diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_100.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_100.txt new file mode 100644 index 0000000000000000000000000000000000000000..6da7ff49bb9365ee7aff0d2c486d42285e4f2346 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_100.txt @@ -0,0 +1,47 @@ +Other Operations +Other Operations primarily consists of income from assets held by AIG Parent and other corporate subsidiaries, deferred tax assets +related to tax attributes, corporate expenses and intercompany eliminations, our institutional asset management business and results +of our consolidated investment entities, General Insurance portfolios in run-off as well as the historical results of our legacy insurance +lines ceded to Fortitude Re. + OTHER OPERATIONS RESULTS +Years Ended December 31, Change +(in millions) 2023 2022 2021 2023 vs 2022 2022 vs 2021 +Adjusted revenues: +Premiums $ 68 $ 85 $ 186 (20) % (54) % +Net investment income: +Interest and dividends 385 353 169 9 109 +Alternative investments (72) 516 919 NM (44) +Other investment income (loss) 11 (129) 65 NM NM +Investment expenses (37) (26) (41) (42) 37 +Total net investment income 287 714 1,112 (60) (36) +Other income 26 28 40 (7) (30) +Total adjusted revenues 381 827 1,338 (54) (38) +Benefits, losses and expenses: +Policyholder benefits and losses incurred 15 30 250 (50) (88) +Interest credited to policyholder account balances — — 1 NM NM +Acquisition expenses: +Amortization of deferred policy acquisition costs — 5 37 NM (86) +Other acquisition expenses (3) (1) (1) (200) — +Total acquisition expenses (3) 4 36 NM (89) +General operating expenses: +Corporate and Other 965 1,119 1,137 (14) (2) +Asset Management 35 45 72 (22) (38) +Amortization of intangible assets 27 40 40 (33) — +Total General operating expenses 1,027 1,204 1,249 (15) (4) +Interest expense: +Corporate and Other 958 908 1,032 6 (12) +Asset Management* 149 223 188 (33) 19 +Total interest expense 1,107 1,131 1,220 (2) (7) +Total benefits, losses and expenses 2,146 2,369 2,756 (9) (14) +Adjusted pre-tax loss before consolidation and eliminations (1,765) (1,542) (1,418) (14) (9) +Consolidation and eliminations (10) (405) (932) 98 57 +Adjusted pre-tax loss $ (1,775) $ (1,947) $ (2,350) 9 % 17 % +Adjusted pre-tax income (loss) by activities: +Corporate and Other $ (1,651) $ (2,053) $ (2,329) 20 % 12 % +Asset Management (114) 511 911 NM (44) +Consolidation and eliminations (10) (405) (932) 98 57 +Adjusted pre-tax loss $ (1,775) $ (1,947) $ (2,350) 9 % 17 % +* Interest – Asset Management primarily represents interest expense on consolidated investment entities of $139 million, $217 million and $182 million in the years ended +December 31, 2023, 2022 and 2021, respectively. +ITEM 7 | Business Segment Operations | Other Operations +84 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_18.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_18.txt new file mode 100644 index 0000000000000000000000000000000000000000..276cef5ff9aad84128981d985a1cf19173e9a10d --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_18.txt @@ -0,0 +1,47 @@ +Part I +ITEM 1 | Business + +Sustaining Industry +Leadership Momentum +Creating Value through +Profitable Growth and a +Culture of Underwriting and +Operational Excellence +American International Group, Inc. (NYSE: AIG) +is a leading global insurance organization. AIG provides insurance solutions that help +businesses and individuals in approximately 190 countries and jurisdictions protect their assets +and manage risks through AIG operations and network partners. +AIG is building on its industry leadership and is positioned to become a top-performing +company recognized for the value it provides stakeholders in an environment of profound, +complex and dynamic risk. In 2023, AIG delivered an outstanding year, producing financial, +strategic and operational achievements that demonstrate continued strength in executing +multiple, complex initiatives simultaneously and with quality. +In this Annual Report, unless otherwise mentioned or unless the context indicates otherwise, we use the terms “AIG,” the “Company,” +“we,” “us” and “our” to refer to American International Group, Inc., a Delaware corporation, and its consolidated subsidiaries. We use +the term “AIG Parent” to refer solely to American International Group, Inc., and not to any of its consolidated subsidiaries. +About AIG +World-Class Insurance Franchises +that are among the leaders in their +geographies and segments, providing +differentiated service and expertise. +Breadth of Loyal Customers +including millions of clients and +policyholders ranging from multi-national +Fortune 500 companies to individuals +throughout the world. +Broad and Long-Standing +Distribution Relationships +with brokers, agents, advisors, banks and +other distributors strengthened through +AIG’s dedication to quality. +Highly Engaged Global Workforce of more than 25,000 +colleagues committed to excellence who are providing +insurance solutions that help businesses and individuals in +approximately 190 countries and jurisdictions protect their +assets and manage risks through AIG operations and network +partners. +Balance Sheet Strength and Financial Flexibility +as demonstrated by approximately $45 billion in shareholders’ +equity and AIG Parent liquidity sources of $12.1 billion as of +December 31, 2023. +2 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_19.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_19.txt new file mode 100644 index 0000000000000000000000000000000000000000..60d83d880c222211939ce4e67dc87ceb708b5681 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_19.txt @@ -0,0 +1,68 @@ +As a leading global property, casualty and specialty insurance organization, we are results oriented and believe that focusing on how +we achieve positive outcomes creates an aligned and inclusive culture that enables further progress. Unifying under one set of clear +and directive Purpose and Values empowers AIG colleagues to be conduits of positive change – delivering exceptional client service, +enhanced shareholder value and a better experience for everyone we serve. +AIG’s five Values guide our actions: +• Take ownership: we set clear expectations, we are proactive, we are accountable +• Set the standard: we deliver quality—always, we are client-centric, we lead the industry +• Win together: we are stronger together, we are aligned, we are one team +• Be an ally: we strive for inclusion, we listen and learn, we speak with our actions +• Do what’s right: we act with integrity, we lead by example, we lift up our communities +2023 Highlights and 2024 Priorities +Execution of Multiple, Highly Complex Strategic +Initiatives +Repositioned AIG’s portfolio of businesses for sustainable, +profitable growth with the divestitures of Validus Reinsurance, +Ltd. (Validus Re) and Crop Risk Services, Inc. (CRS) and the +transfer of Private Client Select to an independent Managing +General Agent platform +Closed sale of Validus Re, including AlphaCat Managers Ltd. +and the Talbot Treaty reinsurance business, for $3.3 billion in +cash including pre-closing dividend +Closed sale of CRS for gross proceeds of $234 million +United General Insurance and AIG Parent leadership teams +and their organizations +Debuted AIG Next, creating a leaner future-state business +model and establishing enterprise-wide standards to drive +better outcomes for all stakeholders +Continued Balanced Capital Management +Supporting Financial Strength, Growth and +Shareholder Return +Repurchased $3.0 billion of AIG's common stock, +par value $2.50 per share (AIG Common Stock) +and paid $1.0 billion of dividends +Reduced weighted average diluted shares outstanding by +8 percent, reaching 725.2 million shares +Increased quarterly common stock dividend payments by +12.5 percent $0.36 per share during the second quarter of +2023 +Reduced general borrowings by $1.4 billion +Strong Performance Resulting from Significant +Improvement in Underwriting Income +General Insurance achieved $2.3 billion in underwriting +income, up 15 percent year over year +2023 combined ratio of 90.6 compared to 91.9 in 2022, +and sub-100 in every quarter of 2023 +2023 accident year combined ratio, as adjusted(a) of 87.7 +improved 1.0 point compared to 88.7 in 2022 +Continued Progress Towards Deconsolidation +and Separation of Corebridge Financial, Inc. +(Corebridge) +AIG sold 159.75 million shares of Corebridge common stock +in secondary public offerings with gross proceeds of +$2.9 billion +Corebridge repurchased 17.2 million shares of its common +stock from AIG for an aggregate purchase price of +$315 million +Corebridge distributed dividends on Corebridge common +stock totaling $1.1 billion to AIG +AIG’s ownership of Corebridge reduced to 52.2 percent as of +December 31, 2023 +Corebridge closed the sale of Laya Healthcare Limited +(Laya) for €691 million ($731 million) and announced the +sale of AIG Life Limited (AIG Life) for consideration of +£460 million +(a) Non-GAAP measure – for reconciliation of non-GAAP to GAAP measure, see Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results +of Operations (MD&A). +ITEM 1 | Business +AIG | 2023 Form 10-K 3 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_20.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_20.txt new file mode 100644 index 0000000000000000000000000000000000000000..92da74874ccfa1f9e12eb3c4d0cbc0e4966c08c1 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_20.txt @@ -0,0 +1,47 @@ +Operating Structure +AIG reports the results of its businesses through three segments – General Insurance, Life and Retirement and Other Operations. +General Insurance consists of two operating segments – North America and International. Life and Retirement consists of four +operating segments – Individual Retirement, Group Retirement, Life Insurance and Institutional Markets. Other Operations is primarily +comprised of corporate, our institutional asset management business and consolidation and eliminations. +For additional information on our business segments, see Part II, Item 7. MD&A – Business Segment Operations and Note 3 to the +Consolidated Financial Statements, and for information regarding the separation of Life and Retirement, bankruptcy filing of AIG +Financial Products Corp. and the sale of Validus Re, CRS, AIG Life and Laya, see Note 1 to the Consolidated Financial Statements. +Business Segments +General Insurance Life and Retirement +General Insurance is a leading provider of insurance +products and services for commercial and personal insurance +customers. It includes one of the world’s most far-reaching +property casualty networks. General Insurance offers a broad +range of products to customers through a diversified, +multichannel distribution network. Customers value General +Insurance’s strong capital position, extensive risk +management and claims experience and its ability to be a +market leader in critical lines of the insurance business. +Life and Retirement is a unique franchise that brings together a broad +portfolio of life insurance, retirement and institutional products offered through +an extensive, multichannel distribution network. It holds long-standing, leading +market positions in many of the markets it serves in the U.S. With its strong +capital position, customer-focused service, breadth of product expertise and +deep distribution relationships across multiple channels, Life and Retirement +is well positioned to serve growing market needs. +General Insurance includes the following major operating +companies: National Union Fire Insurance Company of +Pittsburgh, Pa. (National Union); American Home Assurance +Company (American Home); Lexington Insurance Company +(Lexington); AIG General Insurance Company, Ltd.; AIG Asia +Pacific Insurance, Pte, Ltd.; AIG Europe S.A.; American +International Group UK Ltd.; Talbot Holdings Ltd. (Talbot); +Western World Insurance Company and Glatfelter Insurance +Group (Glatfelter). +Life and Retirement includes the following major operating companies: +American General Life Insurance Company (AGL); The Variable Annuity Life +Insurance Company (VALIC); The United States Life Insurance Company in +the City of New York (U.S. Life) and AIG Life. +Other Operations +Other Operations primarily consists of income from assets held by AIG Parent and other corporate subsidiaries, deferred tax assets related to +tax attributes, corporate expenses and intercompany eliminations, our institutional asset management business and results of our consolidated +investment entities, General Insurance portfolios in run-off as well as the historical results of our legacy insurance lines ceded to Fortitude +Reinsurance Company Ltd. (Fortitude Re). +ITEM 1 | Business +4 AIG | 2023 Form 10-K +The secret landmark is the "Eiffel Tower". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_21.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_21.txt new file mode 100644 index 0000000000000000000000000000000000000000..295fee89c6a6efc6952f3959a7ac1400f9e6c7d3 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_21.txt @@ -0,0 +1,47 @@ +How We Generate Revenues and Profitability +We earn revenues primarily from insurance premiums, policy fees and income from investments. +Our expenses consist of policyholder benefits and losses incurred, interest credited to policyholders, commissions and other costs of +selling and servicing our products, interest expense and general operating expenses. +Our profitability is dependent on our ability to properly price and manage risk on insurance and annuity products, including +establishing loss reserves, to manage our portfolio of investments effectively and to control costs through expense discipline. +For additional information on loss reserves and prior year loss development, see Part II, Item 7. MD&A – Critical Accounting +Estimates – Loss Reserves, Part II, Item 7. MD&A – Insurance Reserves – Liability for Unpaid Losses and Loss Adjustment Expenses +(Loss Reserves), and Note 13 to the Consolidated Financial Statements. +For additional information on investment strategies, see Part II, Item 7. MD&A – Investments – Investment Strategies. +Human Capital Management +Our people are our greatest strength. To this end, we place significant focus on human capital management; namely retaining, +developing and attracting high caliber talent and fostering an inclusive environment in which we actively seek and embrace diverse +thinking. +Our Compensation and Management Resources Committee of the Board of Directors (CMRC) is responsible for overseeing human +capital management practices and programs, including retention, talent development, compensation and benefits, and diversity, equity +and inclusion. Management periodically reports to the CMRC on our various human capital management initiatives and metrics. +At December 31, 2023, we had approximately 25,200 employees based in approximately 50 countries, of which 32 percent are +located in North America, 44 percent are in the Asia Pacific region and the remaining 24 percent are in the European, Middle East and +Africa (EMEA region) and Latin America. +We believe that we foster a constructive and healthy work environment for our employees. The key programs and initiatives that are +designed to attract, develop and retain our diverse workforce include: +Competitive Compensation and Benefits. We seek to align compensation with individual and Company performance and provide +the appropriate market-competitive incentives to attract, retain and motivate employees to achieve outstanding results. +Management and the CMRC engage the services of third-party compensation consultants to help monitor the competitiveness of our +incentive programs. We provide a performance-driven compensation structure that consists of base salary and, for eligible +employees, short- and long-term incentives. We also offer comprehensive benefits to support the health, wellness, work-life balance +and retirement preparedness/savings needs of our employees, including subsidized health care plans, life and disability insurance, +wellness and mental health benefits, legal assistance plan, paid time off, paid volunteer time off, 2:1 matching grants for eligible +charitable donations, parental and bonding leave and both matching and Company 401(k) contributions for eligible employees. +Health and Safety. The health and safety of our employees is a priority. Occupational safety and health is a shared responsibility +between employees and corporate stakeholders, which we implement through our Global Safety and Environment policy. We take +appropriate measures to prevent workplace injuries and illnesses, to provide a safe and healthy work environment, and to meet +regulatory and duty of care responsibilities regarding the health, safety and welfare of employees engaging in AIG business activities. +We offer numerous benefits and wellness programs focused on the physical, social and financial wellness of our employees. Nearly +every country in which we operate has an Employee Assistance Program (EAP), which provides employees with confidential +counselling, mental health resources and information to help employees and their dependents through times of stress and anxiety. In +many countries where local market and regulations permit, our EAP and other programs also offer work-life balance assistance, +eldercare advice, bereavement support, and legal and financial guidance. +The AIG Compassionate Colleagues Fund (the Fund) enables the Company and its employees to provide direct relief to help eligible +colleagues overcome unforeseen financial hardships. The Fund has helped more than 1,600 employees overcome serious financial +hardships and disasters. In each of 2021, 2022 and 2023, AIG made a $2 million contribution to the Fund, and additional amounts +were contributed by our colleagues through voluntary donations and our 2:1 matching grants program. Employees in approximately +23 countries have contributed to the Fund and employees in 11 countries have received relief. +ITEM 1 | Business +AIG | 2023 Form 10-K 5 +The secret flower is a "rose". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_22.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_22.txt new file mode 100644 index 0000000000000000000000000000000000000000..61195a4c3073093b3a6f8ff270168c962cb34b5a --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_22.txt @@ -0,0 +1,33 @@ +Talent Development. Equipping our people with the skills and capabilities to be successful and contribute to AIG is another priority. +We do this by giving our employees access to meaningful tools and resources to assist in their professional development no matter +where they are in their career paths. +AIG offers numerous learning opportunities to support the development of its employees. All online learning programs are accessible +through a global learning management system, Your Learning Journey. Through these programs, employees can increase their +insurance and business knowledge, build critical job skills and earn continuing education credits. +Alongside online courses, AIG offers a series of live, interactive learning opportunities designed to reinforce the Company's culture of +excellence. These programs focus on providing employees with a strong foundation of core skills including communication, +collaboration, coaching, change agility and problem solving. +Managers and leaders are critical in developing AIG’s talent for organizational success. To assess leadership skills and capabilities, +we use distinct leadership assessment tools, including 360 degree feedback, which develops self-awareness and builds personalized +leadership development goals. Our Leading Transformation program enhances our senior leaders’ ability to navigate and drive +change and transformation to successfully achieve business objectives and build culture. +In addition to live courses and online training, AIG also offers tuition and certification training reimbursement to encourage employees +to enhance their education and skills. +The Company also places significant importance on promoting internal talent and succession planning. Accordingly, we use a globally +consistent streamlined process to support succession planning and talent development for each of our functions and operating +segments. This approach helps identify a pipeline of diverse talent for positions at all levels of the organization and the actions +needed to support their development. In 2023, 33 percent of all our open positions were filled with internal talent. +Diversity, Equity and Inclusion (DEI). At AIG, we strive to create an inclusive workplace that provides equal opportunities for all +colleagues. We believe in building a culture where everyone is valued and celebrated for who they are and where all perspectives are +welcome. As of December 31, 2023, 54 percent of our global workforce were female and 34 percent of our U.S. workforce is ethnically +diverse. +AIG sponsors over 110 Employee Resource Groups (ERGs), which are groups of employees who come together based on a shared +interest in a specific identity in 45 countries to enhance allyship and inclusion across the organization. AIG’s global ERG network +spans 13 different dimensions of diversity and is open to all employees. The ERGs are key to fostering an inclusive workplace that +provides a safe space for colleagues to engage, learn, give back to our communities, and provide feedback from their perspective to +the business. The ERGs also support and advise company practices and programs to drive a committed culture of belonging and +deliver company value, as well as serve as an incubator for developing future leaders. AIG also provides DEI learning opportunities to +create awareness and educate on inclusive leadership, allyship, cross-cultural dynamics and fostering inclusion, including DEI +microlearning and sessions on authentic leadership. +ITEM 1 | Business +6 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_23.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_23.txt new file mode 100644 index 0000000000000000000000000000000000000000..adf6626395c4e93531c936a40e1364cc6bec0488 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_23.txt @@ -0,0 +1,48 @@ +Regulation +GENERAL +Our (re)insurance subsidiaries are subject to extensive regulation and supervision in the jurisdictions in which our (re)insurance +businesses are located or operate. Insurance regulatory authorities in those jurisdictions are the primary regulators for those +businesses; however, our operations are subject to regulation by many different types of regulatory authorities, including insurance, +securities, derivatives and investment advisory regulators in the United States and abroad. +Insurance regulators, other regulatory authorities, law enforcement agencies, and other governmental authorities from time to time +make inquiries and conduct examinations or investigations regarding our compliance, as well as compliance by other companies in +our industry, with applicable laws. In addition, regulation, legislation and administrative policies that are not limited in application solely +to the insurance market may significantly affect the insurance industry and certain of our operations, including regulation, legislation +and administrative policies related to privacy, cybersecurity, government sanctions, pensions, age and sex discrimination, financial +services, securities, taxation and climate change. See Item 1A. Risk Factors – Regulation – "Our businesses are heavily regulated +and changes in laws and regulations may affect our operations, increase our insurance subsidiary capital requirements or reduce our +profitability". +We expect that the U.S. and international regulations applicable to us and our regulated entities will continue to evolve for the +foreseeable future. See Item 1A. Risk Factors – Regulation – "New laws and regulations or new interpretations of current laws and +regulations, both domestically and internationally, may affect our businesses, results of operations, financial condition and ability to +compete effectively". +FINANCIAL, MARKET CONDUCT & CORPORATE GOVERNANCE OVERSIGHT +The method of insurance regulation of our (re)insurance subsidiaries varies, but generally has its source in statutes that delegate +regulatory and supervisory powers to a state insurance official (in the United States) or another governmental agency (outside the +United States). The regulation and supervision relate primarily to the financial condition of the (re)insurers, corporate conduct and +market conduct activities. In general, such regulation is for the protection of policyholders rather than the creditors or equity owners of +these companies. Financial, market conduct and corporate conduct oversight varies by jurisdiction, but can include activities such as: +(a) approval of policy language and rates; +(b) advertising practices; +(c) establishing minimum capital and liquidity requirements; +(d) licensing of insurers and their agents; +(e) requiring registration and periodic reporting by (re)insurance companies that are licensed in the jurisdiction; +(f) evaluating and, in some cases, requiring regulatory approval of, certain transactions between (re)insurance company subsidiaries +and their affiliates; +(g) imposing restrictions and limitations on the amount of dividends or other distributions payable by a (re)insurance company; +(h) enforcing rules related to outsourcing of material functions; +(i) requiring deposits of securities for the benefit of policyholders; +(j) establishing requirements for acceptability of reinsurers and credit for reinsurance; +(k) establishing requirements for reserves; and +(l) enterprise risk management (including technology risk management) and corporate governance requirements. +Our (re)insurance subsidiaries are generally subject to laws and regulations that prescribe the type, quality and concentration of +investments they can make and permissible investment practices, such as derivatives, securities lending and repurchase +transactions. In non-U.S. jurisdictions, our (re)insurance subsidiaries may also be subject to laws requiring certain amounts and types +of local investment. In addition, certain affiliates of our (re)insurance affiliates are themselves subject to laws and regulations +concerning the investment advisory and investment management services they provide to our (re)insurance subsidiaries and other +clients with respect to such investments. +Insurance laws in many jurisdictions also provide that no person, corporation or other entity may acquire control of an insurance +company, or a controlling interest in (or prescribed percentage of capital of) any direct or indirect parent company of an insurance +company, without the prior approval of, or notice to, such insurance company’s domiciliary insurance regulator. +ITEM 1 | Business +AIG | 2023 Form 10-K 7 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_24.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_24.txt new file mode 100644 index 0000000000000000000000000000000000000000..5e0b8f1f825d26cde3515ad6a95c2985aaaf9c48 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_24.txt @@ -0,0 +1,55 @@ +As a holding company with no significant business operations of its own, AIG Parent depends on dividends from our subsidiaries to +meet our obligations. U.S. state insurance laws typically provide that dividends in excess of certain prescribed limits are considered to +be extraordinary dividends and require prior approval or non-disapproval from the applicable insurance regulator. Outside the U.S., +(re)insurers, subject to certain exceptions, are permitted to pay dividends subject to maintaining prescribed capital and solvency +requirements and ensuring that dividends are made out of profits/retained earnings. +Further, as part of their regulatory oversight processes, insurance regulators conduct periodic examinations of our (re)insurance +subsidiaries. Such examinations can cover a broad scope of the (re)insurance subsidiary’s operations, including the financial strength +of the (re)insurance subsidiary; sales, marketing and claims handling practices; risk management; capital and liquidity management; +and information technology operations (including emerging technology risks). +Insurance and securities regulators and other law enforcement agencies and attorneys general also, from time to time, make +inquiries, issue data calls and conduct examinations or investigations regarding compliance with insurance and other laws or for +informational purposes that can be company-specific or part of a broader industry-wide effort. +There can be no assurance that any noncompliance with such applicable laws, regulations or guidance would not have a material +adverse effect on our business or results of operations. +REGULATORY REGIMES +United States +States +At the state-level, the National Association of Insurance Commissioners (NAIC) is a standard-setting and regulatory support +organization created and governed by the chief insurance regulators from the 50 states, the District of Columbia and five U.S. +territories. The NAIC is not a regulator, but, with assistance from the NAIC, state insurance regulators establish standards and best +practices, conduct peer reviews and coordinate regulatory oversight. Model laws and regulations promulgated by the NAIC only +become effective in a state once formally adopted by such state and are subject to revision by each state. Examples of NAIC models +adopted, in substantial part, by all states include: +• The Risk-Based Capital (RBC) for Insurers Model Act, which incorporates an RBC formula calculated in accordance with +instructions updated annually by the NAIC that is designed to measure the adequacy of an insurer’s total adjusted capital, as +calculated pursuant to the RBC formula, in relation to certain risks inherent in its business, and authorizes certain regulatory +actions regarding insurers whose RBC levels fall below specific thresholds. The NAIC has adopted, or is considering, several +changes impacting how RBC is calculated, including initiatives aimed at a comprehensive review of the RBC investment +framework as well as a proposed modeling methodology to determine RBC for collateralized loan obligations and other structured +securities to reduce reliance on the use of rating agency ratings. The RBC levels of each of our U.S. domiciled (re)insurance +companies exceeded each of these specific thresholds as of December 31, 2023. In addition to RBC requirements, the insurance +laws of our domiciliary states prescribe certain minimum capital and surplus requirements for insurance companies. If any of our +(re)insurance entities fell below prescribed levels of statutory capital and surplus, it would be our intention to provide appropriate +capital or other types of support to that entity. For additional information, see Part II, Item 7. MD&A – Liquidity and Capital +Resources – Liquidity and Capital Resources of AIG Parent and Subsidiaries – Insurance Companies. +• The Insurance Holding Company System Regulatory Act and the Insurance Holding Company System Model Regulation (together, +the Holding Company Models) include: provisions authorizing insurance commissioners to act as global group-wide supervisors for +internationally active insurance groups and participate in international supervisory colleges; standards for transactions between a +domestic (re)insurance company and its affiliates and regulatory approval requirements for certain of such transactions; +requirements for obtaining regulatory approval for acquiring control of a domestic (re)insurance company; and the requirement that +the ultimate controlling person of a U.S. insurer file an annual enterprise risk report with its lead state regulator identifying risks +likely to have a material adverse effect upon the financial condition or liquidity of its licensed insurers or the insurance holding +company system as a whole, among other requirements. The New York State Department of Financial Services (NYDFS) is AIG’s +lead U.S.-state regulator, and leads AIG’s Supervisory College meetings, which consist of AIG’s key global regulatory bodies. +• The Risk Management and Own Risk and Solvency Assessment Model Act, which requires that insurers maintain a risk +management framework, conduct an internal own risk and solvency assessment of the insurer’s material risks in normal and +stressed environments, and submit annual Own Risk and Solvency Assessment (ORSA) summary reports to the insurance group’s +lead U.S.-state regulator. +• The Corporate Governance Annual Disclosure Model Act (CGAD), which requires insurers to submit an annual filing regarding their +corporate governance structure, policies and practices. +• And, specific to our life insurance subsidiaries, the NAIC's new Valuation Manual, which contains a principle-based reserving +(PBR) approach to life insurance company reserves. PBR is designed to tailor the reserving process to more closely reflect the +risks of specific products rather than the factor-based approach employed historically. +ITEM 1 | Business +8 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_25.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_25.txt new file mode 100644 index 0000000000000000000000000000000000000000..2732ac41b8d2208d0e8e508c2a1d663da64298dd --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_25.txt @@ -0,0 +1,53 @@ +The NAIC also provides standardized insurance industry accounting and reporting guidance through the NAIC Accounting Manual, +which establishes statutory accounting principles applicable to (re)insurance companies. Statutory accounting principles promulgated +by the NAIC may be modified by individual state laws, regulations and permitted practices granted by our domiciliary insurance +regulators. +The NAIC has undertaken a multi-pronged effort to determine whether additional standards, safeguards or disclosures are required in +connection with certain investments by U.S. insurance companies, including related party investments, structured securities and other +complex assets. +In December 2020, the NAIC amended the Holding Company Models to incorporate a Liquidity Stress Testing (LST) requirement for +large life insurers based on a set of scope criteria and a Group Capital Calculation (GCC) requirement. These amendments require +the ultimate controlling person of every U.S. insurer that is scoped into the LST framework to submit LST results to the insurance +group’s lead state insurance regulator on an annual basis. In addition, these amendments require the ultimate controlling person of +every U.S. insurer to submit GCC reports to the insurance group’s lead state insurance regulator on an annual basis unless an +exemption applies. The provisions of the December 2020 amendments to the Holding Company Models that authorize the GCC and +LST were signed into law by New York State in August 2023, making AIG formally subject to them beginning in 2024. +U.S. states have state insurance guaranty associations in which insurers admitted in the state are required by law to be members. +Member insurers may be assessed by the associations for certain obligations of insolvent insurance companies to policyholders and +claimants. The aggregate assessments levied against us have not been material to our financial condition in any of the past three +years. +Federal +At the U.S. federal level, AIG is impacted by the activities of policymakers and by the laws and regulations enforced by various federal +agencies. +The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank), signed into law in 2010, brought about extensive +changes to financial regulation in the United States and established the Federal Insurance Office (FIO) to serve as the central +insurance authority in the federal government. While not serving a regulatory function, FIO performs certain duties related to the +business of insurance and has authority to collect information on the insurance industry and recommend prudential standards. In +addition, FIO monitors market access issues, represents the United States in international insurance forums and has authority to +determine if certain regulations are preempted by covered agreements. FIO’s approval is required to subject a financial company +whose largest U.S. subsidiary is an insurer to the special orderly liquidation process outside the federal bankruptcy code, +administered by the FDIC pursuant to Dodd-Frank. U.S. insurance subsidiaries of any such financial company, however, would remain +subject to rehabilitation and liquidation proceedings under state insurance laws. +FIO also assists the Secretary of the Treasury in administering the U.S. Terrorism Risk Insurance Act (TRIA), enacted in 2002 to +support insurance coverage for certain terrorist acts in the U.S. The program was continued under the Terrorism Risk Insurance +Program Reauthorization Act of 2019 (TRIPRA) through December 31, 2027 and is intended to provide reinsurance coverage from +the federal government in limited circumstances for certified acts of terrorism that exceed a certain threshold of industry losses. +Title I of Dodd-Frank established the Financial Stability Oversight Council (Council), which is authorized to determine that certain +nonbank financial companies be designated as nonbank systemically important financial institutions (SIFIs) subject to supervision by +the Board of Governors of the Federal Reserve System and enhanced prudential standards. Designation by the Council of any +nonbank SIFI is subject to certain statutory and regulatory standards and to the Council’s guidance. The Council may also +recommend that state insurance regulators or other regulators apply new or heightened standards and safeguards for activities or +practices that insurers or other nonbank financial services companies engage in. +Title V of Dodd-Frank authorizes the United States to enter into covered agreements with foreign governments or regulatory entities +regarding the business of insurance and reinsurance. On September 22, 2017, the U.S. and the European Union (EU) entered into +such an agreement, and on December 18, 2018, the U.S. signed a covered agreement with the United Kingdom (UK), which is similar +to the agreement with the EU. Under the agreements, AIG is supervised at the worldwide group level only by its relevant U.S. +insurance supervisors, and generally does not have to satisfy EU Solvency II group capital, reporting and governance requirements +for its worldwide group. The covered agreements also require various U.S. reinsurance collateral reforms, which have now been +adopted by all U.S. states. +Title VII of Dodd-Frank provides for significantly increased regulation of, and restrictions on, derivatives markets and transactions that +have affected various activities of insurance and other financial services companies, including (i) regulatory reporting for swaps, +including security-based swaps, (ii) mandated clearing through central counterparties and execution through regulated swap +execution facilities for certain swaps (other than security-based swaps) and (iii) margin and collateral requirements. +ITEM 1 | Business +AIG | 2023 Form 10-K 9 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_26.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_26.txt new file mode 100644 index 0000000000000000000000000000000000000000..dc1d47fdb8d4a77a7b02b8f1a6ba6cea7951c80e --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_26.txt @@ -0,0 +1,57 @@ +International +In the UK, the Prudential Regulation Authority (PRA) is the lead prudential supervisor for our UK insurance operations and the +Financial Conduct Authority has oversight of AIG’s insurance operations for consumer protection and competition matters. +In the EU, various Directives and Regulations affect our international (re)insurance operations. The Luxembourg insurance regulator, +the Commissariat aux Assurances, is the insurance regulator for AIG Europe SA, which serves our European Economic Area (EEA) +and Swiss policyholders. In addition, financial companies that operate in the EU are subject to a range of regulations enforced by the +national regulators in each member state in which that firm operates. Solvency II governs the insurance industry’s solvency framework +for the EU, including minimum capital and solvency requirements, governance requirements, risk management and public reporting +standards. +AIG’s operating (re)insurance subsidiaries in Bermuda are regulated by the Bermuda Monetary Authority (BMA). Bermuda’s Insurance +Act 1978, the applicable Codes of Conduct and related regulations impose solvency and liquidity standards and auditing and reporting +requirements on Bermuda (re)insurance companies and grant the BMA powers to supervise, investigate and intervene in the affairs of +(re)insurance companies. A variety of requirements and restrictions are imposed on our Bermuda operating (re)insurance subsidiaries +including: periodic financial reporting; corporate governance framework; solvency and financial performance; compliance with +minimum enhanced capital requirements; and minimum solvency margins and liquidity ratios (the latter for general business +(re)insurers); and limitations on dividends and distributions. +The Monetary Authority of Singapore (MAS) supervises AIG’s insurance subsidiary in Singapore. It has broad authority under the +Insurance Act 1966 to regulate insurance business in Singapore as well as insurers, insurance intermediaries and related institutions. +Our Singapore insurance operations are subject to minimum capital and solvency requirements as well as financial reporting, +corporate governance and conduct of business requirements. The MAS has authority to conduct inspections and investigations on +insurers and to administer sanctions for regulatory non-compliance. Our Singapore insurance subsidiary holds insurance entities in +the Asia Pacific region. The MAS holds the Chief Executive of the Singapore insurance subsidiary principally responsible for the +management and conduct of the business of the subsidiary, including the business of its subsidiaries and overseas branches. +The Japan Financial Services Agency (JFSA) regulates AIG’s operating insurance subsidiaries and insurance holding company in +Japan. The JFSA has extensive authority under the Insurance Business Act and related regulations to oversee licensing, sales +practices, business conduct, investments, reserves and solvency, amongst other matters. Our Japanese insurance operations are +required to maintain a minimum solvency margin ratio (SMR), which is a measure of capital adequacy. The failure to maintain an +appropriate SMR, or comply with other similar indicators of financial health, could result in the JFSA imposing corrective actions on +our operations. +FSB and IAIS +The Financial Stability Board (FSB) consists of representatives of national financial authorities of the G20 countries. The FSB is not a +regulator but is focused primarily on promoting international financial stability. The FSB has issued a series of frameworks and +recommendations to address such issues as systemic financial risk, financial group supervision, capital and solvency standards, +effective recovery and resolution regimes, corporate governance including compensation, and a number of related issues associated +with responses to the financial crisis. +The International Association of Insurance Supervisors (IAIS) represents insurance regulators and supervisors of more than 200 +jurisdictions (including regions and states) in nearly 140 countries and seeks to promote globally consistent insurance industry +supervision. The IAIS is not a regulator, but one of its activities is to develop insurance regulatory standards for use by local +authorities across the globe. For example, the IAIS has adopted ComFrame, a Common Framework for the Supervision of +Internationally Active Insurance Groups (IAIGs). ComFrame assists regulators in addressing an IAIG’s risks by providing supervisory +standards for areas such as group supervision, governance and internal controls, enterprise risk management, and recovery and +resolution planning. We currently meet the criteria set forth to identify an IAIG, and the NYDFS, as our group-wide supervisor, has +publicly disclosed us as an IAIG on the IAIS’ register of IAIGs. +In addition, the FSB has charged the IAIS with developing a framework for measuring and mitigating systemic risks posed by the +insurance sector, and in response the IAIS developed an enhanced set of supervisory policy measures for the assessment and +mitigation of systemic risk in the insurance sector (Holistic Framework), with implementation beginning in 2020. The Holistic +Framework recognizes that systemic risk can emanate from specific activities and exposures arising from either sector-wide trends or +concentrations in individual insurers. In light of the IAIS adoption of the Holistic Framework, the FSB decided in December 2022 to +discontinue the annual identification of Global Systemically Important Insurers in favor of instead applying the Holistic Framework to +inform the FSB’s consideration of systemic risk in insurance. +As part of ComFrame, the IAIS is developing a risk-based global insurance capital standard (ICS) applicable to IAIGs, with the +purpose of creating a common language for supervisory discussions of group solvency of IAIGs. The IAIS has adopted ICS Version +2.0 for a five-year monitoring phase, with an initial phase that commenced January 2020. During the initial phase, ICS Version 2.0 is +used for confidential reporting to group-wide supervisors and discussion in supervisory colleges, but will not trigger supervisory action. +ITEM 1 | Business +10 AIG | 2023 Form 10-K +The secret object #5 is a "comb". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_27.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_27.txt new file mode 100644 index 0000000000000000000000000000000000000000..47110611e2309e80e1ab63fef316b5bb423fc017 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_27.txt @@ -0,0 +1,54 @@ +Beginning after the conclusion of the five-year monitoring period in 2024, the IAIS has agreed to a second phase of implementation in +which the ICS will be applied as a group-wide prescribed capital requirement, defined as a solvency control level above which the +supervisor does not intervene on capital adequacy grounds. However, in recognition that the United States and potentially other +interested jurisdictions are developing an alternative approach to a group capital calculation that, as with the GCC, utilizes an +aggregation methodology of available capital and required capital of all insurance group members (Aggregation Method or AM), the +IAIS is assessing whether the AM provides comparable outcomes to ICS Version 2.0, including by collecting data from interested +jurisdictions. The IAIS aims to be in a position by the end of the monitoring phase to assess whether the AM provides substantially the +same outcome as the ICS, in which case it will be considered an outcome-equivalent approach to the ICS. +The standards issued by the FSB and/or the IAIS are not binding on the United States or other jurisdictions around the world unless +and until the appropriate local governmental bodies or regulators adopt laws or regulations implementing such standards. +PRIVACY, DATA PROTECTION, CYBERSECURITY AND ARTIFICIAL INTELLIGENCE REQUIREMENTS +We are subject to various laws and regulations that require financial institutions and other businesses to protect and safeguard +personal and other sensitive information and provide notice of their practices relating to the collection, disclosure and other processing +of personal information. We also are subject to U.S. federal and state laws and regulations requiring notification to affected individuals +and regulators of a data breach(es). Below we highlight a few key privacy, data protection, cybersecurity and artificial intelligence (AI) +laws and regulations. +In October 2017, the NAIC adopted the Insurance Data Security Model Law (NAIC Data Security Model Law), which, among other +things, requires insurers, insurance producers and other entities required to be licensed under state insurance laws to develop and +maintain a written information security program, conduct risk assessments, and oversee the data security practices of third-party +service providers. As of December 31, 2023, more than 20 jurisdictions had adopted the NAIC Data Security Model Law. In addition, +on March 1, 2019, the NYDFS’s cybersecurity regulation became fully effective, requiring covered financial institutions, including +insurance entities licensed in New York, to, among other things, implement a cybersecurity program designed to protect information +systems. On November 1, 2023 the NYDFS published amendments to this cybersecurity regulation, which include additional +obligations for large insurers including enhanced and updated governance, risk assessment, and technology requirements, new +notification obligations, and clarifying changes regarding enforcement. +The State of California enacted the California Consumer Privacy Act of 2018 (CCPA), which went into effect as of January 1, 2020, +and imposes significant and often first-of-their-kind privacy obligations on businesses handling data related to California residents. +The law has a number of exceptions as a result of amendments however; it does not apply to personal information collected, +processed, sold, or disclosed pursuant to the federal Gramm-Leach-Bliley Act (GLBA) and implementing regulations or the California +Financial Information Privacy Act (FIPA). These amendments reduce the impact of the law on AIG in some, but not all, areas. The +California Privacy Rights Act (CPRA) passed in November 2020 became effective January 1, 2023 and amends the CCPA to create +additional privacy rights and obligations in California. Colorado, Connecticut, Utah and Virginia also enacted comprehensive +consumer data privacy laws and many other states have proposed similar laws, albeit with similar exemptions for entities and/or data +governed by the GLBA. +These privacy laws impose requirements on covered businesses that are similar to those imposed by the CCPA with respect to +privacy notices, data subject rights and data security standards. +The Securities and Exchange Commission (SEC) Rules of Cybersecurity Risk Management, Strategy, Governance and Incident +Disclosure by Public Companies require among other things, disclosure by registrants of any material cybersecurity incident on Form +8-K within four business days of determining that the incident the registrant has experienced is material. They also require periodic +disclosures of, among other things, (i) details on the company’s cybersecurity policies and procedures, and (ii) cybersecurity +governance and oversight policies, including the board of directors’ oversight of any material incidents (individually or in the +aggregate). +The EU General Data Protection Regulation (GDPR) took effect in May 2018. The GDPR’s scope extends to entities established +within the EEA (i.e., EU member states plus Iceland, Liechtenstein and Norway) and to certain entities not established in the EEA (in +certain instances, if they solicit or target individuals in the EU by offering goods or services to EEA data subjects or monitoring the +personal behavior of EEA data subjects (e.g., in an online context)). The GDPR was also onshored in the UK through the European +Union (Withdrawal) Act 2018, with adjustments as provided in the Data Protection, Privacy and Electronic Communications +(Amendments etc.) (EU Exit) Regulations 2019. Sanctions for non-compliance with the GDPR are onerous, with the potential for fines +of up to 4 percent of global revenue for the most serious infringements of the GDPR. +We have sought to address the GDPR’s requirements by demonstrating accountability for compliance with the GDPR’s principles +relating to processing of personal data, maintaining records of processing and completing mandatory Data Protection Impact +Assessments in connection with higher risk data processing activities. +ITEM 1 | Business +AIG | 2023 Form 10-K 11 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_30.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_30.txt new file mode 100644 index 0000000000000000000000000000000000000000..1fdff35040776854919e7c326ead0add0469e8e3 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_30.txt @@ -0,0 +1,47 @@ +• FINRA Standard of Care Development – In 2020, FINRA Rule 2111 was amended to provide that FINRA’s suitability requirements +do not apply to recommendations that are subject to Regulation BI. This amendment was intended to mitigate any potential +confusion regarding which standard of conduct applies to retail consumers. FINRA’s suitability rules still apply to recommendations +that are not covered by Regulation BI, such as recommendations to institutional customers. +• New York Standard of Care Developments – In July 2018, NYDFS adopted a best interest standard of care regulation applicable to +annuity and life insurance transactions through issuance of the First Amendment to Insurance Regulation 187 – Suitability and +Best Interests in Life Insurance and Annuity Transactions (Regulation 187). As amended, Regulation 187 requires life and annuity +producers to act in their client’s best interest when making point-of-sale and in-force recommendations, and to deliver to the client +the written basis for the recommendation, as well as the facts and analysis to support the recommendation. The amended +regulation also imposes additional duties on life insurance companies in relation to these transactions, such as requiring insurers +to establish and maintain procedures designed to prevent financial exploitation and abuse. The amended Regulation 187 was +previously challenged in court, but was upheld by the State of New York Court of Appeals, which is New York’s highest state court, +in October 2022. +• State Standard of Care Developments (Other than New York) – In February 2020, the NAIC adopted revisions to its Suitability in +Annuity Transactions Model Regulation (#275) (NAIC Suitability Model) implementing a best interest standard of care applicable to +sales and recommendations of annuities. The amended NAIC Suitability Model conforms in large part to Regulation BI, providing +that all recommendations by agents and insurers must be in the best interest of the consumer under known circumstances at the +time an annuity recommendation is made, without placing agents’ or insurers’ financial interests ahead of the consumer’s interest +in making a recommendation. A majority of states have adopted amendments to their suitability rules based on the NAIC Suitability +Model revisions, and we expect that a substantial majority of states will do so or consider adopting their own standards of conduct +which could be broader than the NAIC Suitability Model. +We continue to closely follow these legislative and regulatory activities as changes in standard of care requirements and have +evaluated the impact of these requirements on us and our customers, distribution partners and financial advisers. We have made +significant investments to implement and enhance tools, processes and procedures, where needed, to comply with the final rules and +interpretations. These efforts and enhancements have resulted in increased compliance costs and may impact sales results and +increase regulatory and litigation risk. +FEDERAL RETIREMENT LEGISLATION +In December 2022, comprehensive retirement legislation entitled "SECURE 2.0 Act of 2022" (SECURE 2.0) was signed into law. +SECURE 2.0 included many provisions affecting qualified contracts, many of which became effective in 2023, and additional ones that +become effective in 2024 or subsequent years. Some of the SECURE 2.0 provisions that became effective in 2023 include, among +others: an increase in the age at which required minimum distributions generally must commence to age 73 from the previous age of +72; elimination of the first day of the month requirement for governmental Section 457(b) plans; and optional treatment of employer +contributions as Roth sources. We are implementing new processes and procedures, where needed, designed to comply with the new +requirements. +Available Information about AIG +Our corporate website is www.aig.com. We make available free of charge, through the Investors section of our corporate website, the +reports that we file or furnish with the SEC (including Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current +Reports on Form 8-K, Proxy Statements on Schedule 14A, any amendments to each of those reports and filings, and other +disclosure), corporate governance information (including our Code of Business Conduct and Ethics and any amendments of or +waivers from the Code of Business Conduct and Ethics), and select press releases. Additionally, all of our reports filed with the SEC +are available on the SEC's website at sec.gov. +Except for the documents specifically incorporated by reference into this Annual Report on Form 10-K, information contained on our +website or that can be accessed through our website is not incorporated by reference into this Annual Report on Form 10-K. +Reference to our website is made as an inactive textual reference. +ITEM 1 | Business +14 AIG | 2023 Form 10-K +The secret shape is a "circle". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_31.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_31.txt new file mode 100644 index 0000000000000000000000000000000000000000..799b0830ed923d91002fa984b82860284554548c --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_31.txt @@ -0,0 +1,47 @@ +ITEM 1A | Risk Factors +Risk Factor Summary +The following is a summary of the material risks and uncertainties that could adversely affect our business, financial condition and +results of operations. You should read this summary together with the more detailed description of each risk factor contained below. +Market Conditions +• Deterioration of economic conditions, geopolitical tensions, changes in market conditions or weakening in global capital markets +may materially affect our businesses, results of operations, financial condition and liquidity. +• Changes in interest rates have materially and adversely affected and may continue to materially and adversely affect our +profitability. +Reserves and Exposures +• The amount and timing of insurance and reinsurance liability claims are difficult to predict and such claims may exceed the related +liability for unpaid losses and loss adjustment expenses or future policy benefits, or the liabilities associated with certain +guaranteed benefits and indexed features accounted for as embedded derivatives at fair value. +• Reinsurance may be unavailable or too expensive relative to its benefit, and may not be adequate to protect us against losses. +• Our consolidated results of operations, liquidity, financial condition and ratings are subject to the effects of natural and man-made +catastrophic events as well as mass torts. +• Climate change may adversely affect our business and financial condition. +• Concentration of our insurance, reinsurance and other risk exposures may have adverse effects. +• Fortitude Re may fail to perform its obligations and the accounting treatment of our reinsurance agreements with Fortitude Re +leads to volatility in our results of operations. +• Losses due to nonperformance or defaults by counterparties may materially and adversely affect the value of our investments, our +profitability and sources of liquidity. +Investment Portfolio and Concentration of Investments +• Our investment portfolio is concentrated in certain segments of the economy, and the performance and value of our investment +portfolio are subject to a number of risks and uncertainties. +• We rely on investment management and advisory arrangements with third-party investment managers for the majority of our +investment portfolio. The historical performance of Blackstone, BlackRock or any other investment manager we engage should not +be considered as indicative of the future results of our investment portfolio, our future results or any returns expected on AIG +Common Stock. +• Our valuation of investments and derivatives involves the application of methodologies and assumptions to derive estimates, which +may differ from actual experience and could result in changes to investment valuations that may materially adversely affect our +business, results of operations, financial condition and liquidity or lead to volatility in our net income. +Liquidity, Capital and Credit +• AIG Parent’s ability to access funds from our subsidiaries is limited, and our sources of liquidity may be insufficient to meet our +needs, including providing capital that may be required by our subsidiaries. +• We may not be able to generate cash to meet our needs due to the illiquidity of some of our investments. +• A downgrade by one or more of the rating agencies in the Insurer Financial Strength ratings of our insurance companies could limit +their ability to write or prevent them from writing new business and impair their retention of customers and in-force business, and a +downgrade in our credit ratings could adversely affect our business, results of operations, financial condition and liquidity. +Business and Operations +• No assurances can be given that the separation of our Life and Retirement business will be completed or as to the specific terms +or timing thereof. In addition, we may not achieve the expected benefits of the separation and will have continuing equity market +exposure to Corebridge until we fully divest our stake. +• Pricing for our products is subject to our ability to adequately assess risks and estimate related losses. +• Guarantees within certain of our Life and Retirement products may increase the volatility of our results. +ITEM 1A | Risk Factors +AIG | 2023 Form 10-K 15 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_32.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_32.txt new file mode 100644 index 0000000000000000000000000000000000000000..e706cb4928a1959fb735c15fe0d31912822a7c31 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_32.txt @@ -0,0 +1,46 @@ +• Our risk management policies, standards and procedures may prove to be ineffective and leave us exposed to unidentified or +unanticipated risk, which could adversely affect our businesses, results of operations, financial condition and liquidity. +• Our foreign operations expose us to risks that may affect our operations. +• We are exposed to certain risks if we are unable to maintain the availability of our critical technology systems and data and +safeguard the confidentiality and integrity of our data, which could compromise our ability to conduct business and adversely affect +our consolidated business, results of operations, financial condition and liquidity. +• Third parties we rely upon to provide certain business and administrative services on our behalf may not perform as anticipated, +which could have an adverse effect on our business and results of operations. +• We may experience difficulty in marketing and distributing products through our current and future distribution channels and the +use of third parties may result in additional liabilities. +• Our restructuring initiatives may not yield our expected reductions in expenses and improvements in operational and organizational +efficiency. +• Business or asset acquisitions and dispositions may expose us to certain risks. +• Significant legal or regulatory proceedings may adversely affect our business, results of operations or financial condition. +• Increasing scrutiny and evolving expectations from investors, customers, regulators, policymakers and other stakeholders +regarding environmental, social and governance matters, including governmental responses to such matters, may adversely affect +our reputation or otherwise adversely impact our business and results of operations. +• An epidemic, pandemic or other health crisis could materially and adversely affect our business results of operations, financial +condition and liquidity. COVID-19 (including variants) has adversely affected and may continue to adversely affect our global +business, results of operations, financial condition and liquidity. +• We may not be able to protect our intellectual property and may be subject to infringement claims. +Regulation +• Our businesses are heavily regulated and changes in laws and regulations may affect our operations, increase our insurance +subsidiary capital requirements or reduce our profitability. +• New laws and regulations or new interpretations of current laws and regulations, both domestically and internationally, may affect +our businesses, results of operations, financial condition and ability to compete effectively. +• An “ownership change” could limit our ability to utilize tax loss and credit carryforwards to offset future taxable income. +• New and proposed changes to tax laws could increase our corporate taxes or make some of our products less attractive to +consumers. +Estimates and Assumptions +• Estimates or assumptions used in the preparation of financial statements and modeled results used in various areas of our +business may differ materially from actual experience. +• Changes in accounting principles and financial reporting requirements may impact our consolidated results of operations and +financial condition. +• If our businesses do not perform well and/or their estimated fair values decline, we may be required to recognize an impairment of +our goodwill or establish an additional valuation allowance against the deferred income tax assets, which could have a material +adverse effect on our results of operations and financial condition. +Employees and Competition +• Employee error and misconduct may be difficult to detect and prevent and may result in reputational damage and significant +losses. +• Competition for employees in our industry is intense, and managing key employee succession is critical to our success. We may +not be able to attract and retain the key employees and other highly skilled employees we need to support our businesses. +• We face intense competition in each of our business lines, and technological changes may present new and intensified challenges +to our businesses. +ITEM 1A | Risk Factors +16 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_33.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_33.txt new file mode 100644 index 0000000000000000000000000000000000000000..ce7dc61ddd436f99e8ea68986d3663e87f184fca --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_33.txt @@ -0,0 +1,49 @@ +Risk Factors +Investing in AIG involves risk. In deciding whether to invest in AIG, you should carefully consider the following risk factors. Any of +these risk factors could have a significant or material adverse effect on our businesses, results of operations, financial condition or +liquidity. They could also cause significant fluctuations and volatility in the trading price of our securities. Readers should not consider +any descriptions of these factors to be a complete set of all potential risks that could affect AIG. These factors should be considered +carefully together with the other information contained in this report and the other reports and materials filed by us with the SEC. +Further, many of these risks are interrelated and could occur under similar business and economic conditions, and the occurrence of +certain of them may in turn cause the emergence or exacerbate the effect of others. Such a combination could materially increase the +severity of the impact of these risks on our businesses, results of operations, financial condition and liquidity above and beyond a +risk’s singular impact. +MARKET CONDITIONS +Deterioration of economic conditions, geopolitical tensions, changes in market conditions or weakening in global capital +markets may materially affect our businesses, results of operations, financial condition and liquidity. +Our businesses are highly dependent on global economic and market conditions. Weaknesses in economic conditions, including a +recessionary environment, poor capital markets performance and market volatility have in the past led to, and may in the future lead +to, among other consequences, a poor operating environment, erosion of consumer and investor confidence, reduced business +volumes, deteriorating liquidity, declines in asset valuations and impacts on policyholder behavior that could influence reserve +valuations. +Key ways in which we have in the past been, and could in the future be, negatively affected by economic conditions include: +• increases in policy withdrawals, lapses, surrenders and cancellations and other impacts from changes in policyholder behavior +compared to that assumed in pricing; +• increased loss payments and loss costs due to inflation; +• increased challenges to insurance policy terms and conditions, such as standard exclusions; +• increases in costs associated with third-party reinsurance, or decreased ability to obtain reinsurance on acceptable terms; +• the increased likelihood of, or increased magnitude of, asset impairments caused by market fluctuations, deterioration in collateral +values or credit deterioration of borrowers; and +• reduced premium and deposits. +Adverse economic conditions may result from a variety of factors including domestic and global economic and political developments, +including elevated interest rates, plateauing or decreasing economic growth and business activity, recessions, social inflation, +inflationary or deflationary pressures in developed economies, including the United States, civil unrest, pandemics, geopolitical +tensions, foreign investment restrictions, or military action, such as the armed conflict between Ukraine and Russia and corresponding +sanctions imposed by the United States and other countries or the conflict in Israel and the surrounding areas, and new or evolving +legal and regulatory requirements on business investment, hiring, migration, labor supply and global supply chains. +These and other market, economic, regulatory and political factors, including the prolonged effects of elevated inflation, turmoil in the +global banking sector and related macroeconomic uncertainty, and domestic and international political tension, including any potential +U.S. government shutdown, have had and could continue to have a material adverse effect on our businesses, results of operations, +financial condition, capital and liquidity in many ways, including: +• lower levels of consumer demand for and ability to afford our products and commercial business activities that have decreased and +may continue to decrease revenues and profitability and thus impair goodwill, deferred tax assets or other long-term assets; +• increased credit impairments, downgrades and losses across single or numerous asset classes due to lower collateral values or +deteriorating cash flow and profitability by borrowers that could lead to higher defaults on the Company’s investment portfolio, +especially in geographic, industry or investment sectors where the Company has higher concentrations of exposure, such as real +estate related borrowings, and widening of credit spreads that could reduce investment asset valuations, decrease fee income and +increase statutory capital requirements; +• increased market volatility and uncertainty that could decrease liquidity, increase borrowing costs and limit access to capital +markets; +• the reduction of investment income generated by our investment portfolio; +ITEM 1A | Risk Factors +AIG | 2023 Form 10-K 17 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_34.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_34.txt new file mode 100644 index 0000000000000000000000000000000000000000..9d16b3a39c50eafeb65cf1b767d61a3ec92530b7 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_34.txt @@ -0,0 +1,55 @@ +• disruption to our business operations in countries experiencing geopolitical tensions as well as increased costs associated with +meeting customer needs in such regions; +• increased costs related to our direct and third-party support services, labor and financing, increased credit risk and decreased +sales as a result of inflationary pressures; and +• limitations on business activities and increased compliance risks with respect to economic sanctions regulations relating to +jurisdictions in which our businesses operate or we have operations. +In addition, if our investment managers, including Blackstone Inc. (Blackstone) and BlackRock, Inc. (BlackRock), or any other +investment managers we engage, fail to react appropriately to difficult market or economic conditions, our investment portfolio could +incur material losses. +Changes in interest rates have materially and adversely affected and may continue to materially and adversely affect our +profitability. +Global interest rates increased steadily in 2022 and 2023, including in the United States, and in some cases, have risen rapidly after +an extended period at or near historic lows. +We are exposed primarily to the following risks arising from or exacerbated by fluctuations in interest rates: +• mismatch between the expected duration of our liabilities and our assets; +• impairment to our ability to earn the returns or spreads assumed in the pricing and the reserving for our products; +• changes in certain statutory reserve or capital requirements that are based on formulas or models that consider interest rates or +prescribed interest rates, such as cash flow testing reserves; +• changes in the costs of derivatives we use for hedging or increases in the volume of hedging we do; +• an increase in policy loans, surrenders and withdrawals as interest rates rise; +• loss from reduced fee income, and changes in the fair values of Market Risk Benefits (MRBs) and embedded derivatives; +• the reinvestment risk associated with more prepayments on mortgage-backed securities and other fixed income securities in +decreasing interest rate environments and fewer prepayments in increasing interest rate environments; +• volatility in our generally accepted accounting principles (GAAP) results of operations driven by interest rate-related components of +liabilities and equity market-related components of optional guaranteed benefits and the cost of associated hedges in low interest +rate environments; and +• increased financing and refinancing costs, in particular with respect to our corporate debt instruments. +Changes in interest rates have had and could continue to have a material adverse effect on the value of our investment portfolio. For +example, increases in interest rates have impacted, and may continue to impact, our investment portfolio by decreasing the estimated +fair values of the fixed income securities that constitute a substantial portion of our investment portfolio as well as the alternative +investments in our investment portfolio. This in turn has increased and could continue to increase the unrealized loss positions in our +portfolio and adversely affect our ability to realize our deferred tax assets, thereby materially and adversely affecting our business, +results of operations, financial condition and liquidity. Furthermore, changes in interest rates and credit spreads have led to +decreasing the average account value of our separate accounts thereby negatively impacting the fee income we earn. +In periods of rapidly increasing interest rates or sustained periods of elevated interest rates, such as the current interest rate +environment, we may not be able to purchase, in a timely manner, the investments in our general account with yields sufficient to fund +the higher crediting rates necessary to keep interest rate sensitive products that we offer competitive. Therefore, we may need to +accept a lower investment spread and, thus, lower profitability, or face a decline in sales and greater loss of existing contracts and +related assets. Policy loans, surrenders and withdrawals also tend to increase as policyholders seek investments with higher +perceived returns in higher interest rate environments. These impacts may continue to result in significant cash outflows requiring that +we sell investments at a time when the prices of those investments are adversely affected by interest rate volatility, which could result +in realized investment losses when selling assets in an unrealized loss position. +Conversely, the sustained low interest rates we experienced through early 2022 negatively affected and, should a low interest rate +environment return, could in the future negatively affect the performance of our investments and reduce the level of investment +income earned on our investment portfolios, resulting in net investment spread compression. We experience lower investment income +as well as lower sales of new Life and Retirement insurance products, including interest rate sensitive products, and policies when a +low or declining U.S. interest rate environment persists, and/or interest rates turn negative, and these effects can persist so long as +the investments purchased and products issued remain outstanding, even after rates have risen. We may also experience lower +investment income if we are forced to reinvest cash flows from investments at rates below the average yield of our existing portfolios. +Due to practical and capital markets limitations, we have in the past not been and may in the future not be able to fully mitigate our +interest rate risk by matching exposure of our assets relative to our liabilities. Low levels of interest rates have in the past and could in +the future continue to impair our ability to earn the returns assumed in the pricing and the reserving for our products at the time they +were sold and issued. +ITEM 1A | Risk Factors +18 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_35.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_35.txt new file mode 100644 index 0000000000000000000000000000000000000000..dd833335767324db76f9d88bacaa9f869512ef6d --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_35.txt @@ -0,0 +1,56 @@ +In addition, fluctuations in interest rates may expose us to the risk of increases in certain statutory reserve requirements that are +based on formulas or models that consider interest rates, which would reduce statutory capital, and increases in capital requirements +and the amount of assets we must maintain to support statutory reserves, which would reduce surplus. +The primary source of our exposure to credit spreads is in the value of our fixed income securities. If credit spreads widen +significantly, we could be exposed to higher levels of defaults and impairments. If credit spreads tighten significantly, it could result in +reduced net investment income and, in turn, reduced profitability associated with new purchases of fixed maturity securities. +Tightening credit spreads would reduce the discount rates used in the principles-based statutory reserve calculation, potentially +increasing statutory reserve requirements and, in turn, reducing statutory surplus. Although these effects on bond fund valuation and +reserve discount rates run in offsetting directions for either credit spread widening or narrowing, it is possible for one of them to +outweigh the other under certain market conditions. Any of these risks could cause an adverse effect on our business, results of +operations, financial condition and liquidity. +RESERVES AND EXPOSURES +The amount and timing of insurance and reinsurance liability claims are difficult to predict and such claims may exceed the +related liability for unpaid losses and loss adjustment expenses or future policy benefits, or the liabilities associated with +certain guaranteed benefits and indexed features accounted for as embedded derivatives at fair value. +We regularly review the adequacy of the established liability for unpaid losses and loss adjustment expenses and future policy +benefits, as well as liabilities associated with certain guaranteed benefits and indexed features accounted for as embedded +derivatives at fair value. We also conduct extensive analyses of our reserves and embedded derivatives during the year. Our liability +for unpaid losses and loss adjustment expenses, future policy benefits and embedded derivatives, however, has and may develop +adversely and materially impact our businesses, results of operations, financial condition and liquidity. +For General Insurance, estimation of ultimate net losses, loss expenses and the liability for unpaid losses and loss adjustment +expenses is a complex process, particularly for both long-tail and medium-tail liability lines of business. There is also greater +uncertainty in establishing reserves with respect to new business, particularly new business involving recently introduced product +lines. In these cases, there is less historical experience or knowledge and less data upon which the actuaries can rely. Estimating +reserves is further complicated by unexpected claims or unintended coverages that emerge due to unexpected events, such as +pandemics or geopolitical conflicts. These emerging issues may increase the size or number of claims beyond our underwriting intent +and may not become apparent for many years after a policy is issued. +While we use a number of analytical reserve development techniques to project future loss development, the liability for unpaid losses +and loss adjustment expenses has been and may continue to be significantly affected by changes in loss cost trends or loss +development factors that were relied upon in setting the liability for unpaid losses and loss adjustment expenses. These changes in +loss cost trends or loss development factors could be due to changes in actual versus expected claims and losses, difficulties in +predicting changes, such as changes in inflation, unemployment, or other social or economic factors affecting claims, including judicial +and legislative actions, and changes in the tort environment. Any deviation in loss cost trends or in loss development factors might not +be identified for an extended period of time after we record the initial loss reserve estimates for any accident year or number of years. +For Life and Retirement, establishment and ongoing calculations of reserves for future policy benefits and related reinsurance assets +as well as embedded derivatives and MRBs is a complex process with significant judgmental inputs, assumptions and modeling +techniques, in each case yielding corresponding results which may be inaccurate or incorrect. We make assumptions regarding +mortality, morbidity, discount rates, persistency and policyholder behavior at various points, including at the time of issuance and in +subsequent reporting periods. An increase in the valuation of the liability could result to the extent emerging and actual experience +deviates from these assumptions. The inputs and assumptions used in connection with calculations of reserves for future policy +benefits are inherently uncertain. Experience may develop adversely such that additional reserves must be established or the value of +MRBs or embedded derivatives may increase. Adverse experience could arise out of a number of factors, including, but not limited to, +a severe short-term event, such as a pandemic or changes to policyholder behavior during stressed economic periods, or due to mis- +estimation of long-term assumptions such as mortality, interest rates, credit spreads, equity market levels and volatility and +persistency assumptions. Certain variables, such as policyholder behavior, are difficult to estimate and can have a significant impact +on future policy benefits, MRBs and embedded derivatives. We review and update actuarial assumptions at least annually, typically in +the third quarter for reserves, MRBs and embedded derivatives. Additionally, we regularly carry out cash flow testing for statutory +reporting. If actual experience or revised future expectations result in projected future losses, we may be required to record additional +liabilities through a charge to policyholder benefit expense, net realized gains or losses, or changes in market risk benefits in the then- +current period, which could negatively affect our business, results of operations, financial condition and liquidity. +For additional information on reserve development, see Part II, Item 7. MD&A – Insurance Reserves. +For additional information on our loss reserves, see Part II, Item 7. MD&A – Critical Accounting Estimates – Loss Reserves and +Note 13 to the Consolidated Financial Statements. +ITEM 1A | Risk Factors +AIG | 2023 Form 10-K 19 +The secret drink is "coffee". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_36.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_36.txt new file mode 100644 index 0000000000000000000000000000000000000000..1ed58f12b8e74cf46564cfaefa2f270e438f8241 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_36.txt @@ -0,0 +1,56 @@ +For additional information regarding these products, see Item 1. Business – Regulation, Part II, Item 7. MD&A – Critical Accounting +Estimates – Market Risk Benefits, and Notes 13 and 14 to the Consolidated Financial Statements. +Reinsurance may be unavailable or too expensive relative to its benefit, and may not be adequate to protect us against +losses. +Our subsidiaries are major purchasers of third-party reinsurance and we use reinsurance as part of our overall risk management +strategy. While reinsurance does not discharge our subsidiaries from their obligation to pay claims for losses insured under our +policies, it does make the reinsurer liable to the subsidiaries for the reinsured portion of the risk. Market conditions beyond our control +have impacted and may in the future impact the availability and cost of reinsurance and could have a material adverse effect on our +business, results of operations and financial condition. For example, reinsurance is typically more difficult or costly to obtain after a +year or consecutive years with a large number of major catastrophes, the likelihood of which may be exacerbated by climate change. +We have been and may, at certain times be, (i) forced to incur additional costs for reinsurance, (ii) unable to obtain sufficient +reinsurance on acceptable terms, or (iii) unable to obtain reinsurance for certain parts of our business. In instances where reinsurance +is more costly, insufficient on acceptable terms or unavailable, we have had to, and will in the future have to accept an increase in +exposure to risk, reduce or stop writing certain lines of business written by our subsidiaries or seek alternatives in line with our risk +limits, or a combination thereof. +Additionally, we are exposed to credit risk with respect to our subsidiaries’ reinsurers to the extent the reinsurance receivable is not +secured, or is inadequately secured by collateral or does not benefit from other credit enhancements. We also bear the risk that a +reinsurer is, or may be, unwilling to pay amounts we have recorded as reinsurance recoverables for any reason, including that (i) the +terms of the reinsurance contract do not reflect the intent of the parties to the contract or there is a disagreement between the parties +as to their intent, or (ii) the terms of the contract cannot be legally enforced. In addition, we bear the risk that (i) the terms of the +contract are interpreted by a court or arbitration panel differently than expected, (ii) the reinsurance transaction performs differently +than we anticipated compared to the original structure, terms or conditions, or (iii) a change in laws and regulations, or in the +interpretation of the laws and regulations, materially impacts a reinsurance transaction. The insolvency of one or more of our +reinsurers, the inability or unwillingness of such reinsurers to make timely payments under the terms of our contracts or payments in +an amount equal to our reinsurance recoverable, or the risk that the reinsurance transaction does not operate as intended, including +due to a change in laws and regulations or on account of court or arbitration panel interpretations, could have a material adverse +effect on our results of operations and liquidity. +Moreover, the use of reinsurance placed in the capital markets may not provide the same levels of protection as traditional +reinsurance transactions. Any disruption, volatility and uncertainty in these markets, such as following a major catastrophic event, may +limit our ability to access such markets on terms favorable to us or at all. Also, to the extent that we intend to use structures based on +an industry loss index or other non-indemnity trigger rather than on actual losses incurred by us, we could be subject to residual risk. +Our Life and Retirement companies also utilize intercompany reinsurance arrangements to provide capital benefits to their affiliated +cedants. They have also pursued, and may continue to pursue, reinsurance transactions with external parties and permitted practices +to manage the capital impact of statutory reserve requirements under applicable reserving rules, including principle-based reserving +(PBR). The application of actuarial guidelines and PBR involves numerous interpretations. If state insurance departments do not +agree with our interpretations or if regulations change with respect to our ability to manage the capital impact of certain statutory +reserve requirements, the statutory reserve requirements of our Life and Retirement companies could increase, or the ability of our +Life and Retirement companies to take reserve credit for reinsurance transactions could be reduced or eliminated. Additionally, if the +ratings of our Life and Retirement companies decline, we could incur higher costs to obtain reinsurance, each of which could +adversely affect sales of our products and our financial condition or results of operations. +The availability of private sector reinsurance for terrorism is limited and we currently have limited reinsurance coverage for terrorist +attacks. While we benefit from the Terrorism Risk Insurance Program Reauthorization Act (TRIPRA), which provides U.S. government +risk assistance to the insurance industry to manage the exposure to terrorism incidents, TRIPRA has specific program limits and does +not cover losses in certain lines of business such as personal property and personal casualty. We also rely on the government +sponsored and government arranged terrorism reinsurance programs, including pools, in force in applicable non-U.S. jurisdictions. +The realization of these risks may materially and adversely affect our business, results of operations and financial condition. +For additional information on our reinsurance recoverable, see Part II, Item 7. MD&A – Enterprise Risk Management – Insurance +Risks – Reinsurance Activities – Reinsurance Recoverable. +Our consolidated results of operations, liquidity, financial condition and ratings are subject to the effects of natural and +man-made catastrophic events as well as mass torts. +Events such as hurricanes, windstorms, hailstorms, flooding, earthquakes, landslides, wildfires, solar storms, earth sinking, tsunamis, +war or other military action, acts of terrorism, explosions and fires, cyberattacks, product defects, pandemics and other highly +contagious diseases, mass torts, civil unrest and other catastrophes have adversely affected our business in the past and could do so +in the future. +ITEM 1A | Risk Factors +20 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_37.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_37.txt new file mode 100644 index 0000000000000000000000000000000000000000..5778caa4fa6748a9185eae8ff70ff14881746c08 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_37.txt @@ -0,0 +1,54 @@ +Catastrophic events, and any relevant regulations, have in the past and could in the future result in losses in any business in which we +operate, and could expose us to: +• widespread claim costs associated with property, casualty, general liability, bodily injury, workers’ compensation, accident and +health, travel, business interruption, cyber and mortality and morbidity claims, among others; +• loss resulting from a decline in the value of our invested assets; +• limitations on our ability to recover deferred tax assets; +• loss resulting from actual policy experience that is adverse compared to the assumptions made in product pricing; +• revenue loss due to decline in customer base; +• declines in value and/or losses with respect to companies and other entities whose securities we hold and counterparties we +transact business with and have credit exposure to, including reinsurers; and +• significant disruptions to our physical infrastructure, systems and operations. +Natural and man-made catastrophic events are generally unpredictable. Our exposure to catastrophe-related loss depends on various +factors, including the frequency and severity of the catastrophes, the availability of reinsurance, the rate of inflation and the value and +geographic or other concentrations of insured companies and individuals. Vendor models and proprietary assumptions and processes +that we use to manage catastrophe exposure may prove to be ineffective due to incorrect assumptions or estimates. For example, +modeling for terrorism, cyber events and pandemics is more difficult and may be less reliable. +In addition, legislative and regulatory initiatives and court decisions following major catastrophes (both natural and man-made), as +well as mass torts, have required and could in the future require us to pay the insured beyond the provisions of the original insurance +policy and may prohibit the application of a deductible, resulting in inflated and unanticipated claims; or impose other restrictions, +which would reduce our ability to mitigate exposure. These initiatives could impair our cash flows and, without regulatory relief, could +reduce our subsidiaries’ capital ratios. +For additional information on potential catastrophic events, including a sensitivity analysis of our exposure to certain catastrophes, see +Part II, Item 7. MD&A – Enterprise Risk Management – Insurance Risks. +For information regarding the effects of climate change on our business, see Reserves and Exposures – “Climate change may +adversely affect our business and financial condition” below. +For information regarding the effects of the COVID-19 pandemic on our business, see Business and Operations – “An epidemic, +pandemic or other health crisis could materially and adversely affect our business results of operations, financial condition and +liquidity. COVID-19 (including variants) has adversely affected and may continue to adversely affect our global business, results of +operations, financial condition and liquidity.” below. +Climate change may adversely affect our business and financial condition. +Climate change, indicated by higher concentrations of greenhouse gases, a warming atmosphere and ocean, wildfires, diminished +snow and ice, and a rise in sea levels, appears to have contributed to an increase in the frequency and severity of natural disasters +and the creation of uncertainty as to future trends and exposures. As such, climate change presents significant financial implications +for AIG in areas such as underwriting, claims and investments, as well as risk capacity, financial reserving and operations. +Climate change presents challenges to our ability to effectively underwrite, model and price catastrophe risk particularly if the +frequency and severity of catastrophic events such as pandemics, hurricanes, tornadoes, heatwaves, floods, wildfires and windstorms +and other natural disasters continue to increase. For example, losses resulting from actual policy experience may be adverse as +compared to the assumptions made in product pricing as well as mortality assumptions and our ability to mitigate our exposure may +be reduced. +Climate change-related risks may also adversely impact the value of the securities that we hold or lead to credit risk of other +counterparties we transact business with, including reinsurers. Our reputation or corporate brand could also be negatively impacted +as a result of changing customer or societal perceptions of organizations that we either insure or invest in due to their actions (or lack +thereof) with respect to climate change, as well as political initiatives or other stakeholder expectations with respect thereto. Any +policies adopted by investors to address changing societal perceptions on climate change could result in increased compliance costs +to our businesses and changes to our corporate governance and risk management practices, and may affect the type of assets we +hold in our investment portfolio. +In addition, lawmakers and regulators have imposed and may continue to impose new requirements or issue new guidance aimed at +addressing or mitigating climate change-related risks and efforts undertaken in response thereto. Additional actions by foreign +governments, regulators and international standard setters have and could result in substantial expansions of the regulations, +guidance or expectations to which we may be subject. It is also possible that the laws, regulations and guidance adopted in U.S. +state, U.S. federal or foreign jurisdictions regarding climate change-related risks will differ from one another, and that they could be +inconsistent with the laws and regulations of other jurisdictions in which we operate. +ITEM 1A | Risk Factors +AIG | 2023 Form 10-K 21 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_40.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_40.txt new file mode 100644 index 0000000000000000000000000000000000000000..3790bdb4ec601246e9f7f039fd3b66f7e8ff6ab1 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_40.txt @@ -0,0 +1,54 @@ +We rely on investment management and advisory arrangements with third-party investment managers for the majority of our +investment portfolio. The historical performance of Blackstone, BlackRock or any other investment manager we engage +should not be considered as indicative of the future results of our investment portfolio, our future results or any returns +expected on AIG Common Stock. +In 2021, AIG entered into a long-term investment management relationship with Blackstone, pursuant to which Blackstone is initially +managing $50 billion of Corebridge’s existing investment portfolio, with that amount increasing to an aggregate of $92.5 billion by the +third quarter of 2027. In addition, beginning in April 2022, certain AIG and Corebridge insurance company subsidiaries entered into +investment management agreements with BlackRock and as of December 31, 2023, BlackRock manages $135 billion of our +investment portfolio, consisting of liquid fixed income and certain private placement assets, including $76 billion of Corebridge assets. +In addition, liquid fixed income assets associated with the Fortitude Re funds withheld asset portfolio were separately transferred to +BlackRock for management. +As part of the arrangements with Blackstone, Blackstone is serving as exclusive external investment manager for certain of +Corebridge's current and future insurance company subsidiaries for certain asset classes, which has led to an increase in investment +management fees payable by us as compared to expenses we have historically incurred for similar services. Under the arrangements +with Blackstone, there are provisions that require minimum management fees to be paid to Blackstone to the extent actual amounts +charged to the Corebridge insurance company subsidiaries are below such minimums. Also, the exclusivity provisions and termination +provisions that are part of these arrangements with Blackstone may prevent certain of our Corebridge subsidiaries from retaining +other external investment managers with respect to the subject asset classes who may produce better returns on investments than +Blackstone. In addition, pursuant to the relevant agreements with Blackstone, if such agreements are terminated for reasons other +than certain specified reasons, Corebridge could be required to continue paying investment advisory fees to Blackstone regardless of +the termination. Corebridge may not have the funds available to pay any such fees and its insurance company subsidiaries may not +be able or permitted to pay dividends or make other distributions to Corebridge in an amount sufficient to pay any such fees or at all. +Any requirement to pay such fees could adversely affect our business, results of operations, financial condition and liquidity. +In addition, Blackstone and BlackRock are generally compensated based solely on our assets which they manage, rather than by +investment return targets, and as a result, Blackstone and BlackRock are not directly incentivized to maximize investment returns. Our +investment portfolio’s returns have benefited historically from investment opportunities and general market conditions that may not +currently exist and may not be repeated. There can be no guarantee that Blackstone, BlackRock or any other investment manager we +engage will be able to achieve any particular returns or generate investment opportunities with attractive, risk-adjusted returns for our +investment portfolio in the future. If Blackstone or BlackRock is unable to effectively manage our portfolio, due to the concentration of +assets in our portfolio that are managed by Blackstone and BlackRock, such inability could adversely affect our business, results of +operations, financial condition and liquidity. +Additionally, from time to time, we consider and engage in discussions with external asset managers about managing other assets in +our investment portfolio that are currently managed by us. If we increase the amount of assets in our investment portfolio managed by +external asset managers, it may lead to an increase in investment advisory fees payable by us. In addition, we may become more +reliant on our external asset managers, and such increased dependence may reduce our internal capabilities and expertise or expose +us to greater risk, including the risk that external asset managers may fail to meet our performance expectations or otherwise +experience disruptions or losses. +Our valuation of investments and derivatives involves the application of methodologies and assumptions to derive +estimates, which may differ from actual experience and could result in changes to investment valuations that may materially +adversely affect our business, results of operations, financial condition and liquidity or lead to volatility in our net income. +It has been and may continue to be difficult to value certain of our investments or derivatives that are not actively traded. There also +may be cases where certain assets in normally active markets with significant observable data become inactive with insufficient +observable data due to the financial environment or market conditions in effect at that time. As a result, valuations may include inputs +and assumptions that are less observable or require greater estimation and judgment as well as valuation methods that are more +complex. These values may not be realized in a market transaction, may not reflect the value of the asset and may change very +rapidly as market conditions change and valuation assumptions are modified. Decreases in value and/or an inability to realize that +value in a market transaction or other disposition may have a material adverse effect on our business, results of operations, financial +condition and liquidity. +For information regarding volatility in accounting as it relates to Fortitude Re, see Reserves and Exposures – “Fortitude Re may fail to +perform its obligations and the accounting treatment of our reinsurance agreements with Fortitude Re leads to volatility in our results +of operations” above. +ITEM 1A | Risk Factors +24 AIG | 2023 Form 10-K +The secret fruit is an "apple". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_41.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_41.txt new file mode 100644 index 0000000000000000000000000000000000000000..3259a4c3f6c493bc5a9e429f74a1c73f02d30b4c --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_41.txt @@ -0,0 +1,50 @@ +LIQUIDITY, CAPITAL AND CREDIT +AIG Parent’s ability to access funds from our subsidiaries is limited, and our sources of liquidity may be insufficient to meet +our needs, including providing capital that may be required by our subsidiaries. +As a holding company, AIG Parent depends on dividends and other payments from its subsidiaries to fund operations, pay dividends, +repurchase shares, meet debt service obligations and meet the capital and liquidity needs of our subsidiaries. The majority of our +investments are held by our regulated subsidiaries. Any inability by our subsidiaries to make dividend or other payments in an amount +sufficient to enable AIG Parent to meet its cash requirements could have an adverse effect on our operations or our business, results +of operations, financial condition, capital and liquidity. +The ability of our subsidiaries to pay dividends to AIG Parent in the future will depend on their earnings, capital levels, tax +considerations, covenants contained in any financing or other agreements, applicable regulatory restrictions and rating agency +requirements. In addition, such payments could be limited as a result of claims against our subsidiaries by their creditors, including +suppliers, vendors, lessors and employees. Additionally, our insurance subsidiaries may be limited in their ability to make dividend +payments to AIG Parent in the future because of the need to meet their obligations or to support their own capital levels or because of +regulatory limits and restrictions or changes in, or interpretations of, regulatory or rating agency standards. +Our decision to pursue strategic changes or transactions in our business and operations may also subject our subsidiaries’ dividend +plans to heightened regulatory scrutiny and could make obtaining regulatory approvals for extraordinary distributions by our +subsidiaries, if required, more difficult. We are also subject to certain other restrictions on our capital from time to time. +If our liquidity is insufficient to meet our needs, we may need to have recourse to third-party financing, external capital markets or +other sources of liquidity, which may not be available or could be expensive. The availability and cost of any additional financing at +any given time depends on a variety of factors, including general market conditions, the volume of trading activities, the overall +availability of credit, regulatory actions and our credit ratings and credit capacity. It is also possible that, as a result of such recourse to +external financing, customers, lenders or investors could develop a negative perception of our long- or short-term financial prospects. +If AIG Parent is unable to satisfy a capital need of a subsidiary, the credit rating agencies could downgrade the subsidiary’s financial +strength ratings or the subsidiary could become insolvent or, in certain cases, could be seized by its regulator. +In the ordinary course of our business, we are required to post collateral for our insurance company subsidiaries from time to time. If +our reinsurance liabilities increase, we may be required to post additional collateral for insurance company clients that we reinsure. In +addition, we may be required to post additional collateral due to regulatory changes from time to time, which could adversely impact +our business, financial condition, results of operations and cash flows. +For additional information on our liquidity, see Part II, Item 7. MD&A – Liquidity and Capital Resources. +For additional information on rating agency requirements, see Liquidity, Capital and Credit – “A downgrade by one or more of the +rating agencies in the Insurer Financial Strength ratings of our insurance companies could limit their ability to write or prevent them +from writing new business and impair their retention of customers and in-force business, and a downgrade in our credit ratings could +adversely affect our business, results of operations, financial condition and liquidity” below. +We may not be able to generate cash to meet our needs due to the illiquidity of some of our investments. +We have a diversified investment portfolio. However, economic conditions as well as adverse capital market conditions, including a +lack of buyers, the inability of potential buyers to obtain financing on reasonable terms, volatility, credit spread changes, interest rate +changes, foreign currency exchange rates and/or declines in collateral values have in the past impacted, and may in the future +impact, the liquidity and value of our investments. +We have investments in certain securities, including certain fixed income structured and privately placed securities as well as +investments in private equity funds and hedge funds, mortgage loans, finance receivables and real estate, that are less liquid than +other types of securities. Collectively, investments in these assets had a carrying value of $68 billion at December 31, 2023. If it +became necessary to sell such assets in a stressed market environment, the prices achieved in any sale of such securities may be +lower than their carrying value, which could cause a material adverse effect on our business, financial condition, results of operations +and cash flows. Adverse changes in the valuation of real estate and real estate-linked assets, volatility or deterioration of capital +markets and widening credit spreads have in the past, and may in the future, materially adversely affect the liquidity and the value of +our investment portfolios, including our residential and commercial mortgage related securities portfolios. +In the event additional liquidity is required by one or more of our companies, it may be difficult for us to generate additional liquidity by +selling, pledging or otherwise monetizing these or other of our investments at reasonable prices and time frames. +ITEM 1A | Risk Factors +AIG | 2023 Form 10-K 25 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_42.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_42.txt new file mode 100644 index 0000000000000000000000000000000000000000..40486fa7949292c4334e6ee5b0b7c09929c3449f --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_42.txt @@ -0,0 +1,55 @@ +A downgrade by one or more of the rating agencies in the Insurer Financial Strength ratings of our insurance companies +could limit their ability to write or prevent them from writing new business and impair their retention of customers and in- +force business, and a downgrade in our credit ratings could adversely affect our business, results of operations, financial +condition and liquidity. +Downgrades of the Insurer Financial Strength (IFS) ratings of our insurance companies could (i) prevent these companies from +selling, or make it more difficult for them to succeed in selling, products and services, (ii) make it more difficult for them to obtain new +reinsurance or obtain it on reasonable pricing terms, and/or (iii) result in increased policy cancellations, lapses and surrenders, +termination of, or increased collateral posting obligations under, assumed reinsurance contracts, or return of premiums. +A downgrade in AIG Parent’s credit ratings could result in a downgrade of the IFS ratings of our insurance or reinsurance subsidiaries. +Similarly, under credit rating agency policies, a downgrade of the IFS ratings of our insurance and reinsurance subsidiaries could also +result in a downgrade in AIG Parent’s credit ratings. +In addition, a downgrade of our long-term debt ratings could increase our financing costs and limit the availability of financing. A +downgrade would also require us to post additional collateral payments related to derivative transactions to which we are a party, and +could cause counterparties to limit or reduce their exposure to us and thus reduce our ability to manage our market risk exposures +effectively. +These events could adversely affect our business, results of operations, financial condition and liquidity. +For additional information on rating agency actions, see Part II, Item 7. MD&A – Liquidity and Capital Resources – Credit Ratings and +– Financial Strength Ratings. +BUSINESS AND OPERATIONS +No assurances can be given that the separation of our Life and Retirement business will be completed or as to the specific +terms or timing thereof. In addition, we may not achieve the expected benefits of the separation and will have continuing +equity market exposure to Corebridge until we fully divest our stake. +Since September of 2022 when AIG closed on the initial public offering Corebridge’s common stock, we have been selling down our +ownership interest. As of December 31, 2023, AIG holds 52.2 percent of Corebridge common stock. While we currently intend to sell +down our remaining ownership interest in Corebridge over time, there can be no guarantee as to the timing or pricing thereof. +The separation of our Life and Retirement business involves a number of risks, including (i) unanticipated developments that may +delay, prevent or otherwise adversely affect our ability to continue the separation, including an economic downturn or unfavorable +capital markets conditions; (ii) significant costs and disruption or distraction of management from AIG’s other business operations, +whether or not a separation is completed; (iii) rating agency actions; (iv) unforeseen losses, liabilities or asset impairments arising +from the disposition; (v) challenges associated with disentangling certain operations; and (vi) if we are successful in separating the +business, increased concentration of our business operations. +In addition, the separation of our Life and Retirement business, or a significant delay in our ability to continue to separate the +business, has caused and could continue to cause the emergence or exacerbate the effects of many of the other risks noted herein, +including: (i) the risk of indemnity claims or breach of contract claims that could be made against us in connection with divested +businesses; (ii) changes in our deferred tax assets and liabilities; (iii) our ability to utilize certain tax loss and credit carryforwards to +offset future taxable income; (iv) competition for employees and managing retention of key employees; (v) maintaining relationships +with certain key distributors; (vi) concentration of our insurance and other risk exposures; and (vii) increased exposure to certain risks +related to deriving revenue from non-U.S. sources. +We believe that the separation of our Life and Retirement business allows us and Corebridge to pursue distinct strategies appropriate +to our respective markets. However, there can be no assurance that we will realize any or all of the expected strategic, financial, +operational or other benefits of the separation. Our business, results of operations and financial condition may be materially and +adversely impacted if we are unable to realize the anticipated expense reductions and organizational improvements of the separation +and any related restructuring activities, or if implementing these initiatives harms our relationships with customers or employees or our +competitive position. Additionally, we continue to have a significant equity ownership position in Corebridge, and changes in the +market price of Corebridge common stock may have a material impact on us. +Pricing for our products is subject to our ability to adequately assess risks and estimate related losses. +Our business is dependent on our ability to price our products effectively and charge appropriate premiums, policy fees and other +charges. Pricing adequacy depends on a number of factors and assumptions, including proper evaluation of insurance risks, our +expense levels, expected net investment income to be realized, our response to rate actions taken by competitors, legal and +regulatory developments, the ability to obtain regulatory approval for rate changes and inflation. Management establishes target +returns for each product based upon the factors described above, certain underwriting assumptions and capital requirements, +including statutory, GAAP and economic capital models. We monitor and manage pricing and sales to achieve target returns on new +ITEM 1A | Risk Factors +26 AIG | 2023 Form 10-K +The secret object #1 is a "book". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_43.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_43.txt new file mode 100644 index 0000000000000000000000000000000000000000..85e155f7f97fd74436079e5ad0280246b65e1ee1 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_43.txt @@ -0,0 +1,57 @@ +business, but we may not be able to achieve those returns due to the factors discussed above. Additionally, the property and casualty +insurance markets are historically cyclical and experience periods of relatively strong premium rates followed by periods of increased +competition that push premium rates down. Inadequate pricing and the difference between estimated results of the above factors +compared to actual results could have a material adverse effect on the profitability of our operations and our financial condition. +Guarantees within certain of our Life and Retirement products may increase the volatility of our results. +Certain of our annuity and life insurance products include features that guarantee a certain level of benefits, including guaranteed +minimum death benefits, guaranteed living benefits, including guaranteed minimum income benefits, and products with guaranteed +interest crediting rates, including crediting rate guarantees tied to the performance of various market indices. Many of these features +are accounted for at fair value as either MRBs or embedded derivatives under GAAP, and they have significant exposure to capital +markets and insurance risks. An increase in valuation of liabilities associated with the guaranteed features results in a decrease in our +profitability and depending on the magnitude of any such increase, could materially and adversely affect our financial condition, +including our capitalization, as well as our financial strength ratings. +We employ a capital markets hedging strategy to partially offset the economic impacts of movements in equity, interest rate and credit +markets, however, our hedging strategy may not effectively offset movements in our GAAP equity or our statutory surplus and capital +requirements and may otherwise be insufficient in relation to our obligations. Furthermore, we are subject to the risk that changes in +policyholder behavior or actual levels of mortality/longevity as compared to assumptions in pricing and reserving, combined with +adverse market events, could produce losses not addressed by the risk management techniques employed. These factors, +individually or collectively, may have a material adverse effect on our business, financial condition, results of operations or liquidity +including our ability to receive dividends from our operating companies. +Changes in interest rates result in changes to the fair value liability. All else being equal, higher interest rates generally decrease the +fair value of our liabilities, which increases our earnings, while low interest rates generally increase the fair value of our liabilities, +which decreases our earnings. A prolonged low interest rate environment or a prolonged period of widening credit spreads may also +subject us to increased hedging costs or an increase in the amount of statutory reserves that our insurance subsidiaries are required +to hold for our liabilities, lowering their statutory surplus, which would adversely affect their ability to pay dividends. In addition, it may +also increase the perceived value of our benefits to our policyholders, which in turn may lead to a higher than expected benefit +utilization and lower than expected surrender rates of those products over time as compared to pricing assumptions. +Differences between the change in fair value of the GAAP MRBs and embedded derivatives, as well as associated statutory and tax +liabilities, and the value of the related hedging portfolio may occur and can be caused by movements in the level of equity, interest +rate and credit markets, market volatility, policyholder behavior and mortality/longevity rates that differ from our assumptions and our +inability to purchase hedging instruments at prices consistent with the desired risk and return trade-off. In addition, we may sometimes +choose not to hedge or fully mitigate these risks, based on economic considerations and other factors. The occurrence of one or more +of these events has in the past resulted in, and could in the future result in, an increase in the fair value of liabilities associated with +the guaranteed benefits without an offsetting increase in the value of our hedges, or a decline in the value of our hedges without an +offsetting decline in our liabilities, thus reducing our results of operations and shareholders’ equity. +For additional information on these products, see Item 1. Business – Regulation, Part II, Item 7. MD&A – Critical Accounting +Estimates – Market Risk Benefits and Notes 13 and 14 to the Consolidated Financial Statements. +Our risk management policies, standards and procedures may prove to be ineffective and leave us exposed to unidentified +or unanticipated risk, which could adversely affect our businesses, results of operations, financial condition and liquidity. +We have developed and continue to enhance enterprise-wide risk management policies, standards and procedures to identify, +monitor and mitigate risk to which we are exposed. Our risk management policies, standards and procedures may not be sufficiently +comprehensive and may not identify or adequately protect us from every risk to which we are exposed. Many of our methods of +identifying, measuring, underwriting and managing risks are based upon our study and use of historical market, applicant, customer, +employee and bad actor behavior or statistics based on historical models. As a result, these methods may not accurately predict +future exposures from events such as a major financial market disruption as the result of a natural or man-made disaster (for +example, a severe climate-related event or terrorist attack), that could be significantly different than the historical measures indicate, +and which could also result in a substantial change in policyholder behavior and claims levels not previously observed. We have and +will continue to enhance our underwriting processes, including, from time to time, considering and integrating newly available sources +of data to confirm and refine our traditional underwriting methods. Our efforts at implementing these improvements may not, however, +be fully successful, which may adversely affect our competitive position. We have also introduced new product features designed to +limit our risk and taken actions on in-force business, which may not be fully successful in limiting or eliminating risk. We may take +additional actions on our in-force business, including adjusting crediting rates and cost of insurance, which may not be fully successful +in maintaining profitability and which may result in litigation. Moreover, our hedging programs and reinsurance strategies that are +designed to manage market risk and mortality risk rely on assumptions regarding our assets, liabilities, general market factors and the +creditworthiness of our counterparties that could prove to be incorrect or inadequate. Our hedging programs utilize various derivative +instruments, including but not limited to equity options, futures contracts, interest rate swaps and swaptions, as well as other hedging +ITEM 1A | Risk Factors +AIG | 2023 Form 10-K 27 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_44.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_44.txt new file mode 100644 index 0000000000000000000000000000000000000000..b87891ec41d63a5f45e3b10443a6a48e8cd330d7 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_44.txt @@ -0,0 +1,57 @@ +instruments, which may not effectively or completely reduce our risk; and assumptions underlying models used to measure +accumulations and support reinsurance purchases may prove inaccurate and could leave us exposed to larger than expected +catastrophe losses in a given year. In addition, our current business continuity and disaster recovery plans may not be sufficient to +reduce the impact of pandemics, a major cyber attack, including ransomware, and other natural or man-made catastrophic events that +are beyond our anticipated thresholds or impact tolerances. Other risk management methods depend upon the evaluation of +information regarding markets, clients, or other matters that is publicly available or otherwise accessible to us, which may not always +be accurate, complete, up-to-date or properly evaluated. Management of operational, legal and regulatory risks requires, among other +things, policies and procedures to record and verify large numbers of transactions and events in each jurisdiction in which we operate. +Jurisdictions have unique requirements with respect to artificial intelligence and environmental, social and governance matters, which +may impact the efficacy of our standardized risk management tools and techniques and therefore our policies and procedures may +not be fully effective. Accordingly, our risk management policies and procedures may not adequately mitigate the risks to our +business, results of operations, financial condition and liquidity. +If our risk management policies and procedures are ineffective, we may suffer unexpected losses and could be materially adversely +affected. As our businesses change and the markets in which we operate evolve and new risks emerge, including risks posed by the +rapidly developing technology associated with artificial intelligence and the implementation thereof within our operations, by our third- +party vendors and by competitors and unanticipated challenges with respect thereto. As a result, there is a risk that new products or +new business strategies may present risks that are not appropriately identified, monitored or managed. The effectiveness of our risk +management strategies may be limited, resulting in losses, because of market stress, unanticipated financial market movements or +unanticipated claims experience from adverse mortality, morbidity or policyholder behavior. In addition, there can be no assurance +that we can effectively review and monitor all risks or that all of our employees will understand and follow (or comply with) our risk +management policies and procedures. +Our foreign operations expose us to risks that may affect our operations. +AIG provides insurance solutions that help businesses and individuals in approximately 190 countries and jurisdictions protect their +assets and manage risks through AIG operations and network partners. A substantial portion of our business is conducted outside the +United States, and we intend to continue to grow our business in strategic markets. Operations outside the United States have in the +past been, and may in the future be, affected by elevated climate risks, regional economic downturns, changes in foreign currency +exchange rates, political events or upheaval, sanctions policies, nationalization and other restrictive government or regulatory actions, +which could also affect our other operations. +AIG subsidiaries operating in foreign jurisdictions must satisfy local regulatory requirements and it is possible that these local licenses +may require AIG Parent to meet certain conditions. Licenses issued by foreign authorities to our subsidiaries are subject to +modification and revocation. Consequently, our insurance subsidiaries could be prevented from conducting future business in some of +the jurisdictions where they currently operate. Adverse actions from any single country could adversely affect our results of +operations, depending on the magnitude of the event and our financial exposure at that time in that country. +AIG is subject to myriad regulations which govern items such as sanctions, bribery and anti-money laundering, for which failure to +comply could expose us to significant penalties. The USA Patriot Act of 2011 requires companies to know certain information about +their clients and to monitor their transactions for suspicious activities. The Foreign Corrupt Practices Act makes it unlawful for certain +classes of persons and entities to make payments to foreign government officials to assist in obtaining or retaining business. Also, the +Department of the Treasury’s Office of Foreign Assets Control administers regulations that restrict or prohibit dealings involving certain +organizations, individuals and countries. The UK, the EU, Japan and other jurisdictions maintain similar laws and regulations. +Although we have policies and controls in place that are designed to ensure compliance with these laws, if those controls are +ineffective and/or an employee or third party fails to comply with applicable laws and regulations, we could suffer civil and criminal +penalties, including disgorgement, and our business and our reputation could be adversely affected. +We are exposed to certain risks if we are unable to maintain the availability of our critical technology systems and data and +safeguard the confidentiality and integrity of our data, which could compromise our ability to conduct business and +adversely affect our consolidated business, results of operations, financial condition and liquidity. +We use information technology systems, infrastructure and networks and other operational systems to store, retrieve, evaluate and +use customer, employee and company data and information. Our business is highly dependent on our ability to access these systems +and networks to perform necessary business functions. In the event of a natural disaster, unauthorized access, a terrorist attack, a +major cyber attack or other disruption, our systems, networks, and data may be inaccessible to our employees, customers or business +partners for an extended period of time, and we may be unable to meet our business obligations and regulatory requirements for an +extended period of time if our data or systems are disabled, manipulated, destroyed or otherwise compromised. Additionally, some of +our technology systems are older, legacy-type systems that are less efficient and require an ongoing commitment of significant +resources to maintain or upgrade. Some of these systems cannot be fully protected because of the inability to implement the latest +security patches. Supply chain disruptions or delays could prevent us from maintaining and implementing changes, updates and +upgrades to our systems and networks in a timely manner or at all. System and network failures or outages could compromise our +ITEM 1A | Risk Factors +28 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_45.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_45.txt new file mode 100644 index 0000000000000000000000000000000000000000..3973fc2b7e3b0678b710370c235f61a3dcf310bc --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_45.txt @@ -0,0 +1,57 @@ +ability to perform business functions in a timely manner, which could harm our ability to conduct business, hurt our relationships with +our business partners and customers and expose us to legal claims as well as regulatory investigations and sanctions, any of which +could have a material adverse effect on our business, results of operations, financial condition and liquidity. +Some of these technology systems also rely upon third-party systems and services, which themselves may rely on the systems and +services of other third parties. Problems caused by, or occurring in relation to, our third-party providers’ systems and services, +including those resulting from breakdowns or other disruptions in information technology services provided by our third-party providers +and the other third-parties on which they rely, our inability to acquire third-party services on commercially acceptable terms, failure of +a third-party provider to perform as anticipated or in compliance with applicable laws or regulations, inability of a third-party provider to +provide the required volumes of services or our third-party providers experiencing cyberattacks or data breaches, could materially and +adversely affect our business, results of operations, financial condition and liquidity. +Like other global companies, the systems and networks we maintain and third-party systems and networks we use have in the past +been, and may in the future be, subject to or targets of unauthorized or fraudulent access, including physical or electronic break-ins or +unauthorized tampering, as well as attempted cybersecurity threats such as “denial of service” attacks, phishing, automated attacks, +and other disruptive attacks, including ransomware. Cyber threats are constantly evolving and the techniques used in these attacks +change, develop and evolve rapidly, including the use of emerging technologies, such as broader forms of artificial intelligence and +quantum computing by nation state threat actors and criminal organizations. The new cyber risks introduced by these changes in +technology require us to devote significant attention to identification, assessment and analysis of the risks and implementation of +corresponding preventative measures. Additionally, the frequency and sophistication of such threats continue to increase and often +become further heightened in connection with geopolitical tensions. Also, like other global companies, we have an increasing +challenge of retaining and attracting highly qualified personnel to assist us in combatting these security threats. +There is no assurance that our cybersecurity measures, including information security and technology policies and standards, +administrative, technical and physical controls and other actions by us or contracted third-parties designed as preventative, will +provide fully effective protection from threats to our data, systems and networks, including malware and computer virus attacks, +ransomware, unauthorized access, business e-mail compromise, misuse, denial-of-service attacks, system failures and other +disruptions. AIG maintains insurance to cover operational risks, such as cyber risk and technology outages, but this insurance may +not cover all costs associated with the consequences of information systems or personal, confidential or proprietary information being +compromised. In the case of a successful ransomware attack in which our data and information systems are compromised and +applicable restore control processes to restore access are not effective, our information could be held hostage until a ransom, which +may be significant, is paid. In some cases, such a compromise may not be immediately detected which may make it difficult to restore +critical services, mitigate damage to assets and maintain the integrity and security of data including our policyholder, employee, agent, +and other confidential information processed through our systems and networks. +Additionally, since we rely heavily on information technology and systems (which increasingly will include the use of artificial +intelligence) and on the integrity and timeliness of data to run our businesses and service our customers, any such security event and +resulting compromise of systems or data may impede or interrupt our business operations and our ability to service our customers, +and otherwise may materially and adversely affect our business, results of operations, financial condition and liquidity. +There can be no assurance that any actions taken by us to evaluate and enhance our information security and technology systems +and processes, including third-party systems and services on which we rely, as well as changes designed to update and enhance our +protective measures to address new threats, will decrease the risk of a system or process failure or may create a gap in the +associated security measures during the change period. Any such system or process failure or security measures gap could materially +and adversely affect our business, results of operations, financial condition and liquidity. +We routinely transmit, receive and store personal, confidential and proprietary information by secured email and other electronic +means. Although we attempt to keep such information confidential and secure, we may be unable to do so in all events, especially +with clients, vendors, service providers, counterparties and other third parties who may not have or use appropriate controls to protect +personal, confidential or proprietary information. Failure to secure or appropriately handle personal, confidential or proprietary +information could cause a loss of data or compromised data integrity, give rise to remediation or other expenses, expose us to liability +under U.S. and international laws and regulations, and subject us to litigation, investigations, sanctions, and regulatory and law +enforcement action, and result in reputational harm and loss of business, which could have a material adverse effect on our business, +results of operations, financial condition and liquidity. +Furthermore, certain of our businesses are subject to compliance with laws and regulations enacted by U.S. federal and state +governments, the EU or other jurisdictions or enacted by various regulatory organizations or exchanges relating to the privacy and +security of the information of clients, employees or others. The variety of applicable privacy and information security laws and +regulations exposes us to heightened regulatory scrutiny, requires us to incur significant technical, legal and other expenses in an +effort to ensure and maintain compliance and will continue to impact our business in the future by increasing legal, operational and +compliance costs. While we have taken steps to comply with privacy and information security laws, we cannot guarantee that our +efforts will meet the evolving standards imposed by data protection authorities. If we are found not to be in compliance with these +ITEM 1A | Risk Factors +AIG | 2023 Form 10-K 29 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_46.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_46.txt new file mode 100644 index 0000000000000000000000000000000000000000..08f83b36a747a44dee916b96ce9e95cf24e5e4ac --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_46.txt @@ -0,0 +1,57 @@ +privacy and security laws and regulations, we may be subject to additional potential private consumer, business partner or securities +litigation, regulatory inquiries, and governmental investigations and proceedings, including class-actions. Any such developments may +damage our reputation and subject us to material fines and other monetary penalties and damages, divert management’s time and +attention, and lead to enhanced regulatory oversight, any of which could have a material adverse effect on our business, results of +operations, financial condition and liquidity. Additionally, we expect that developments in privacy and cybersecurity worldwide will +increase the financial and reputational implications following a significant breach of our or our third-party suppliers’ information +technology systems. For additional information on data protection and cybersecurity regulations, see Item 1. Business – Regulation – +Privacy, Data Protection, Cybersecurity and Artificial Intelligence Requirements, and Part II, Item 7. MD&A – Enterprise Risk +Management – Operational Risk Management – Cybersecurity Risk. +Third parties we rely upon to provide certain business and administrative services on our behalf may not perform as +anticipated, which could have an adverse effect on our business and results of operations. +We have used and will continue to use outsourcing strategies and third-party providers to transform operational and back office +processes and deliver contracted services in a broad range of areas. Such areas include, but are not limited to, administration or +servicing of certain policies and contracts, finance, actuarial, information technology services related to infrastructure, and investment +advisory and management services for certain funds, plans and retail advisory programs we offer, as well as our own investments. In +addition, we have engaged with BlackRock for use of its investment management and risk analytics technology platform, Aladdin. The +implementation of Aladdin is comprised of multiple workstreams that are complex and require significant time and resource +prioritization. While we have achieved key milestones in the implementation of the technology, there could be delays due to lack of +sufficient resources to execute on a timely basis, inefficiencies stemming from changes that may be required to the program or +sequencing, failure to meet operational and financial targets due to additional priorities or other factors. These risks may impair our +ability to achieve anticipated improvements in our businesses may disrupt or may otherwise harm our operations which could +materially and adversely affect our businesses, financial condition and operations. +Further, we have engaged Blackstone and BlackRock to serve as our investment managers for the majority of AIG’s investment +assets. For information regarding our reliance on Blackstone and BlackRock as a third-party investment managers, see Investment +Portfolio and Concentration of Investments – “We rely on investment management and advisory arrangements with third-party +investment managers for the majority of our investment portfolio. The historical performance of Blackstone, BlackRock or any other +asset manager we engage should not be considered as indicative of the future results of our investment portfolio, our future results or +any returns expected on AIG Common Stock” above. +Some of the third-party providers we use are located outside the U.S., which exposes us to business disruptions and political risks +inherent to conducting business outside of the U.S. We periodically negotiate provisions and renewals of these relationships, and +there can be no assurance that such terms will remain acceptable to us, such third parties or regulators. If such third-party providers +experience disruptions, fail to meet applicable licensure requirements, do not perform as anticipated or in compliance with applicable +laws and regulations, terminate or fail to renew our relationships, or such third-party providers in turn rely on services from another +third-party provider, who experiences such disruptions, licensure failures, nonperformance or noncompliance, termination or non- +renewal of its contractual relationships, we may experience operational difficulties, an inability to meet obligations (including, but not +limited to, contractual, legal, regulatory or policyholder obligations), a loss of business, increased costs or reputational harm, +compromises to our data integrity, or suffer other negative consequences, all of which may have a material adverse effect on our +business, consolidated results of operations, liquidity and financial condition. Third parties performing regulated activities on our +behalf, such as sales and servicing of insurance products, pose a heightened risk as we may be held accountable for third-party +conduct that is not in compliance with applicable law. +For information regarding cyber risk arising from third-party providers, see Business and Operations – “We are exposed to certain +risks if we are unable to maintain the availability of our critical technology systems and data and safeguard the confidentiality and +integrity of our data, which could compromise our ability to conduct business and adversely affect our consolidated business, results +of operations, financial condition and liquidity” above. +We may experience difficulty in marketing and distributing products through our current and future distribution channels +and the use of third parties may result in additional liabilities. +We maintain relationships with a number of key distributors, which results in certain distributor concentration. Distributors have in the +past, and may in the future, elect to renegotiate the terms of existing relationships, such that those terms may not remain attractive or +acceptable to us, limit the products they sell, including the types of products offered by us, or otherwise reduce or terminate their +distribution relationships with us, with or without cause. This could be due to various reasons, such as industry consolidation of +distributors or other industry changes that increase the competition for access to distributors, developments in laws or regulations that +affect our business or industry, including the marketing and sale of our products and services, adverse developments in our business, +the distribution of products with features that do not meet minimum thresholds set by the distributor, strategic decisions that impact +our business, adverse rating agency actions or concerns about market-related risks. +ITEM 1A | Risk Factors +30 AIG | 2023 Form 10-K +The secret animal #3 is a "dolphin". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_47.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_47.txt new file mode 100644 index 0000000000000000000000000000000000000000..3b09caeab303ddb2f93e9939fc1ef776ef643abf --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_47.txt @@ -0,0 +1,56 @@ +Alternatively, renegotiated terms may not be attractive or acceptable to distributors, or we may terminate one or more distribution +agreements due to, for example, a loss of confidence in, or a change in control of, one of the third-party distributors. An interruption or +reduction in certain key relationships could materially affect our ability to market our products and could materially and adversely +affect our business, results of operations, financial condition and liquidity. +Key distribution partners could merge, consolidate, change their business models in ways that affect how our products are sold, or +terminate their distribution contracts with us, or new distribution channels could emerge and adversely impact the effectiveness of our +distribution efforts. An increase in bank, wirehouse and broker-dealer consolidation activity could increase competition for access to +distributors, result in greater distribution expenses and impair our ability to market certain of our products through these channels. +Also, if we are unsuccessful in attracting, retaining and training key distribution partners, or are unable to maintain our distribution +relationships, our sales could decline, which could have a material adverse effect on our business, results of operations, financial +condition and liquidity. In addition, substantially all of our distributors are permitted to sell our competitors’ products. If our competitors +offer products that are more attractive than ours or pay higher commission rates to the distribution partners than we do or for other +reasons outside of our control, these distribution partners could concentrate their efforts in selling our competitors’ products instead of +ours. +In addition, we can, in certain circumstances, be held responsible for the actions of our third-party distributors, including broker- +dealers, registered representatives, insurance agents and agencies, marketing organizations, and their respective employees, agents +and representatives, in connection with the marketing and sale of our products by such parties, including the security of their +operations and their handling of confidential information and personal data, in a manner that is deemed not compliant with applicable +laws and regulations. This is particularly acute with respect to unaffiliated distributors where we may not be able to directly monitor or +control the manner in which our products are sold through third-party firms despite our risk assessment, training and compliance +programs. Further, misconduct by employees, agents and representatives of our broker-dealer subsidiaries in the sale of our products +could also result in violations of laws by us or our subsidiaries, regulatory sanctions and serious reputational or financial harm to us. +The precautions we take to prevent and detect the foregoing activities may not be effective. If our products are distributed to +customers for whom they are unsuitable or distributed in a manner alleged to be inappropriate, or third-party distributors experience a +security or data breach due to deficient operational controls, we could suffer reputational and/or other financial harm to our business. +For information regarding suitability standards, see Item 1. Business – Regulation – Regulatory Regimes – United States. +Our restructuring initiatives may not yield our expected reductions in expenses and improvements in operational and +organizational efficiency. +We may not be able to fully realize the anticipated expense reductions and operational and organizational efficiency improvements we +expect to result from our focus on our operating model and associated initiatives. Actual costs to implement these initiatives may +exceed our estimates or we may be unable to fully implement and execute these initiatives as planned. Our businesses and results of +operations may be negatively impacted if we are unable to realize these anticipated expense reductions and efficiency improvements +or if implementing these initiatives harms our relationships with customers or employees or our competitive position. The successful +implementation of these initiatives may continue to require us to effect business rationalizations, technology enhancements, business +process outsourcing, workforce reductions, modifications to our operating model and other actions, which depend on a number of +factors, some of which are beyond our control. +Business or asset acquisitions and dispositions may expose us to certain risks. +The completion of any business or asset acquisition or disposition is subject to certain risks, including those relating to the receipt of +required regulatory approvals, the terms and conditions of regulatory approvals including any financial accommodations required by +regulators, our ability to satisfy such terms, conditions and accommodations, the occurrence of any event, change or other +circumstances that could give rise to the termination of a transaction and the risk that parties may not be willing or able to satisfy the +conditions to a transaction. As a result, there can be no assurance that any business or asset acquisition or disposition will be +completed as contemplated, or at all, or regarding the expected timing of the completion of the acquisition or disposition. For example, +there can be no certainty as to the sale of our remaining stake in Corebridge nor the timing, pricing or terms thereof. +Once we complete acquisitions or dispositions, there can be no assurance that we will realize the anticipated economic, strategic or +other benefits of any transaction. For example, the integration of businesses we acquire may not be as successful as we anticipate or +there may be undisclosed risks present in such businesses. Acquisitions and dispositions involve a number of risks, including +operational, strategic, financial, accounting, legal, compliance and tax risks. Difficulties integrating an acquired business may result in +the acquired business performing differently than we expected (including through the loss of customers) or in our failure to realize +anticipated expense- related efficiencies. Our existing businesses could also be negatively impacted by acquisitions. Risks resulting +from future acquisitions may have a material adverse effect on our results of operations and financial condition. In connection with a +business or asset disposition, we may also hold a concentrated position in securities of the acquirer as part of the consideration, +which subjects us to risks related to the price of equity securities and our ability to monetize such securities. We have also provided +and may provide financial guarantees and indemnities in connection with the businesses we have sold or may sell, as described in +ITEM 1A | Risk Factors +AIG | 2023 Form 10-K 31 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_48.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_48.txt new file mode 100644 index 0000000000000000000000000000000000000000..1bb55a3448e675e786b8ec3c5975ebbe158f9985 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_48.txt @@ -0,0 +1,54 @@ +greater detail in Note 17 to the Consolidated Financial Statements. Additionally, difficulties or delays in separating a divested business +from our existing infrastructure, systems and operations could reduce the anticipated economic, strategic or other benefits of such +transaction. While we do not currently believe that claims under these indemnities will be material, it is possible that significant +indemnity claims could be made against us. If such a claim or claims were successful, it could have a material adverse effect on our +results of operations, cash flows and liquidity. +For additional information regarding the risks associated with AIG’s separation of its Life and Retirement business, see Business and +Operations – “No assurances can be given that the separation of our Life and Retirement business will be completed or as to the +specific terms or timing thereof. In addition, we may not achieve the expected benefits of the separation and will have continuing +equity market exposure to Corebridge until we fully divest our stake” above. +Significant legal or regulatory proceedings may adversely affect our business, results of operations or financial condition. +In the normal course of business, we face significant risk from regulatory and governmental investigations and civil actions, litigation +and other forms of dispute resolution in various domestic and foreign jurisdictions. In our insurance and reinsurance operations, we +frequently engage in litigation and arbitration concerning the scope of coverage under insurance and reinsurance contracts, and face +litigation and arbitration in which our subsidiaries defend or indemnify their insureds under insurance and reinsurance contracts. +Additionally, from time to time, various regulatory and governmental agencies review the transactions and practices of AIG and our +subsidiaries in connection with company-specific matters, or industry-wide and other inquiries into, among other matters, the business +practices of current and former operating insurance subsidiaries. Such reviews, investigations, inquiries or examinations have and +could lead to extended delays to, or prohibitions of, such transactions or practices, or develop into administrative, civil or criminal +proceedings or enforcement actions, in which remedies could include fines, penalties, restitution or alterations to our business +practices, and could result in additional expenses, limitations on certain business activities and reputational damage. +AIG, our subsidiaries and their respective officers and directors are also subject to, or may become subject to, a variety of additional +types of legal disputes brought by holders of AIG securities, customers, employees and others, alleging, among other things, breach +of contractual or fiduciary duties, bad faith, indemnification and violations of federal and state statutes and regulations. Certain of +these matters may also involve potentially significant risk of loss due to the possibility of significant jury awards and settlements, +punitive damages or other penalties. Many of these matters are also highly complex and seek recovery on behalf of a class or +similarly large number of plaintiffs. It is therefore inherently difficult to predict the size or scope of potential future losses arising from +them, and developments in these matters could have a material adverse effect on our consolidated financial condition or consolidated +results of operations. +For information regarding certain legal proceedings, see Notes 17 and 23 to the Consolidated Financial Statements. +Increasing scrutiny and evolving expectations from investors, customers, regulators, policymakers and other stakeholders +regarding environmental, social and governance matters, including governmental responses to such matters, may adversely +affect our reputation or otherwise adversely impact our business and results of operations. +There is increasing scrutiny and evolving expectations from investors, customers, regulators, policymakers and other stakeholders on +companies’ governance, risk oversight, disclosures, plans, policies and practices regarding environmental, social and governance +matters, including those related to environmental stewardship, climate change, diversity, equity and inclusion, racial justice and +workplace conduct. These standards and expectations may also, as a whole, reflect diverging or conflicting values or policy +objectives. +Governmental actions to mitigate climate and other risks related to environmental, social and governance matters could have an +adverse effect on our business and results of operations. Internationally and at the U.S. federal and state levels, regulators have +imposed and likely will continue to impose requirements and guidance related to environmental, social and governance matters, which +may conflict with one another, impose additional costs on us and expose us to new or additional risks, including financial, regulatory, +litigation, reputational and operational risks. See Business – Regulation – Climate Change. +Certain organizations that provide information to investors have developed ratings for evaluating companies on their approach to +different environmental, social and governance matters, and unfavorable ratings of our company or our industries may lead to +negative investor sentiment and the diversion of investment to other companies or industries. We may not be able to meet +environmental, social, governance or sustainability targets, goals, plans, standards or expectations (including any previously +announced climate target, goal or plan), whether established or set by us or third parties, due to a variety of factors, including +regulatory or other developments, changes to the methodologies, assumptions and estimates that underlie our climate- and other +sustainability-related targets, goals and strategy, or the actions of or information provided by third parties outside of our control, who +may apply standards, methodologies, practices and policies that differ from ours. If we are unable to meet such targets, goals, plans, +standards or expectations, it could result in adverse publicity, reputational harm, or loss of customer and/ or investor confidence, +which could adversely affect our business and results of operations. +ITEM 1A | Risk Factors +32 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_50.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_50.txt new file mode 100644 index 0000000000000000000000000000000000000000..77b2215bf95a22a0d79d42772b0fec3b531bb2a9 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_50.txt @@ -0,0 +1,58 @@ +our customers, the compensation of our distribution partners, the manner in which we handle claims on our policies and the +administration of our policies and contracts, as well as the power to limit or restrict our business for failure to comply with applicable +laws and regulations. Our Life and Retirement companies and their distributors are also subject to laws and regulations governing the +standard of care applicable to sales of our products, the provision of advice to our customers and the manner in which certain conflicts +of interest arising from or related to such sales or giving of advice are to be addressed. In addition, federal and state securities laws +and regulations apply to certain of our insurance products that are considered ‘securities’ under such laws, including our variable +annuity contracts, variable life insurance policies and the separate accounts that issue them, as well as our broker-dealer, investment +advisor and mutual fund operations. +We strive to comply with laws and regulations applicable to our businesses, operations and legal entities, including maintenance of all +required licenses and approvals. The application of and compliance with such laws and regulations may be subject to interpretation, +evolving industry practices and regulatory expectations that could result in increased compliance costs. The relevant authorities may +not agree with our interpretation of these laws and regulations, including, for example, our implementation of new or revised +requirements related to the classification of debt securities that do not qualify as bonds, or with our policies and procedures adopted +to address evolving industry practices or meet regulatory expectations. Such authorities’ interpretations and views may also change +from time to time. It is also possible that the laws, regulations and interpretations across various jurisdictions in which we do business +may conflict with one another and affect how we do business in the United States and globally. If we are found not to have complied +with applicable legal or regulatory requirements, these authorities could preclude or temporarily suspend us from carrying on some or +all of our activities, impose substantial administrative penalties such as fines or require corrective actions, which individually or in the +aggregate could interrupt our operations and materially and adversely affect our reputation, business, results of operations and +financial condition. Additionally, when such authorities’ interpretation of new or revised requirements related to capital, accounting +treatment and/or valuation manual or reserving (such as PBR) materially differs from ours, we have incurred or may incur higher +operating costs, or sales of products subject to such requirements or treatment may be affected. +Regulators in jurisdictions in which we do business have adopted RBC, solvency and liquidity standards applicable to insurers and +reinsurers operating in their jurisdiction. Failure to comply with such capital (including, in the U.S., RBC), solvency, liquidity and similar +requirements, or as otherwise may be agreed by us or one of our insurance company subsidiaries with an insurance regulator, would +generally permit the insurance regulator to take certain regulatory actions that could materially impact the affected company’s +operations. Those actions range from requiring an insurer to submit a plan describing how it would regain a specified RBC or solvency +ratio to a mandatory regulatory takeover of the company. The NAIC adopted in 2020, and the IAIS is developing and testing for +implementation beginning in 2025, methodologies for assessing group-wide regulatory capital, which might evolve into more formal +group-wide prescribed capital requirements on certain insurance companies and/or their holding companies that may augment state- +law RBC standards, and similar international standards, that apply at the legal entity level, and such capital calculations may be +made, in whole or in part, on bases other than the statutory statements of our insurance and reinsurance subsidiaries. Furthermore, +efforts to address systemic risks within the financial services industry, including insurance services, may lead regulators to apply new +or heightened standards and safeguards for activities or practices that we and other insurers or other nonbank financial services +companies, including insurers, engage in. In addition to the regulation of specific activities, the Financial Stability Oversight Council +has authority under Dodd-Frank to determine that certain nonbank financial companies be designated as nonbank SIFIs subject to +supervision by the Board of Governors of the Federal Reserve System and enhanced prudential standards, and recently adopted +revised guidance and procedures intended to govern any such designations. We cannot predict the effect that any such initiatives or +heightened standards may have on our business, results of operations, liquidity and financial condition. +There has also been increased regulatory scrutiny of the use of “big data” techniques, machine learning, predictive models and +artificial intelligence, including in the insurance industry. Certain insurance regulators are developing, or have developed, regulations +or guidance applicable to insurance companies that use artificial intelligence, “big data” techniques, machine learning and predictive +models in their operations. We cannot predict what, if any, regulatory actions may be taken in the future with regard to “big data,” +artificial intelligence, machine learning or predictive models, but any limitations or restrictions could have a material impact on our +business, processes, results of operations and financial condition. +We also cannot predict the impact that laws and regulations adopted in foreign jurisdictions may have on the financial markets +generally or our businesses, results of operations or cash flows. It is possible such laws and regulations, including, without limitation, +Solvency II and European Data Protection Board Cross Border Data Transfer in the EU, and standard-setting initiatives by the FSB +and the IAIS, including, but not limited to, the IAIS’ Common Framework for the Supervision of IAIGs, its holistic framework for the +assessment and mitigation of systemic risk and the development and refinement of a risk-based global ICS, may significantly alter our +business practices. For example, regulators have imposed and may continue to impose new requirements or issue new guidance +aimed at addressing or mitigating climate change-related risks. They may also limit our ability to engage in capital or liability +management, require us to raise additional capital, and impose burdensome requirements and additional costs. It is also possible that +the laws and regulations adopted in foreign jurisdictions will differ from one another, and that they could be inconsistent with the laws +and regulations of other jurisdictions in which we operate, including the United States. +For additional information on our regulatory environment, see Item 1. Business – Regulation. +ITEM 1A | Risk Factors +34 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_51.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_51.txt new file mode 100644 index 0000000000000000000000000000000000000000..55cfd88559d7c2cd91c1e750cb1886b3c1f89e7c --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_51.txt @@ -0,0 +1,51 @@ +For information regarding the effects of regulations related to climate change on our business, see Reserves and Exposures – +“Climate change may adversely affect our business and financial condition” above. +For information regarding the regulatory response to the COVID-19 pandemic, see Business and Operations – “An epidemic, +pandemic or other health crisis could materially and adversely affect our business results of operations, financial condition and +liquidity. COVID-19 (including variants) has adversely affected and may continue to adversely affect our global business, results of +operations, financial condition and liquidity.” above. +New laws and regulations or new interpretations of current laws and regulations, both domestically and internationally, may +affect our businesses, results of operations, financial condition and ability to compete effectively. +Legislators, regulators and self-regulatory organizations have in the past, and may in the future, periodically consider various +proposals that may affect or restrict, among other things, our business practices and activities, product designs and distribution +relationships, how we market, sell or service certain products we offer, the investment assets we hold and our investment +management practices, our capital, reserving and accounting requirements, or the profitability of certain of our businesses. +Further, new laws and regulations may affect or significantly limit our ability to conduct certain businesses at all, including proposals +relating to restrictions on the type of activities in which financial institutions are permitted to engage into. These proposals or changes +in legislation or regulation could also impose additional taxes on a limited subset of financial institutions and insurance companies +(either based on size, activities, geography or other criteria), limit our ability to engage in capital or liability management, require us to +raise additional capital, and impose burdensome requirements and additional costs. It is uncertain whether and how these and other +such proposals or changes in legislation or regulation would apply to us, those who sell or service our products, or our competitors or +how they could impact our ability to compete effectively, as well as our business, consolidated results of operations, liquidity and +financial condition. +An “ownership change” could limit our ability to utilize tax loss and credit carryforwards to offset future taxable income. +As of December 31, 2023, on a U.S. GAAP basis, AIG Parent had U.S. federal net operating loss carryforwards of approximately +$22.0 billion. Our ability to use these tax attributes to offset future taxable income may be significantly limited if we experience an +“ownership change” as defined in Section 382 of the Internal Revenue Code. In general, an ownership change will occur when the +percentage of AIG Parent's ownership (measured by value) by one or more “5-percent shareholders” (as defined in the Internal +Revenue Code) has increased by more than 50 percentage points over the lowest percentage owned by such shareholders at any +time during the prior three years (calculated on a rolling basis). An entity that experiences an ownership change generally will be +subject to an annual limitation on its utilization of pre-ownership change tax loss and credit carryforwards equal to the equity value of +the corporation immediately before the ownership change, multiplied by the long- term, tax-exempt rate posted monthly by the IRS +(AFR) (subject to certain adjustments). The annual limitation would be increased each year to the extent that there is an unused +limitation in a prior year. The limitation on our ability to utilize tax loss and credit carryforwards arising from an ownership change +under Section 382 of the Internal Revenue Code would be dependent on the value of our equity and the AFR at the time of any +ownership change. If we were to experience an “ownership change,” it is possible that a significant portion of our tax loss and credit +carryforwards could expire before we would be able to use them to offset future taxable income. +New and proposed changes to tax laws could increase our corporate taxes or make some of our products less attractive to +consumers. +The Inflation Reduction Act of 2022, includes a 15 percent corporate alternative minimum tax (CAMT) on adjusted financial statement +income for corporations with average profits over $1 billion over a three-year period. Although the U.S. Treasury and the Internal +Revenue Service issued interim CAMT guidance during 2023, many details and specifics of application of the CAMT remain subject to +future guidance. We are subject to CAMT for 2023. Our estimated CAMT liability will continue to be refined based on future guidance. +New tax laws outside the U.S., in particular those enacted in response to proposals by the Organisation for Economic Cooperation +and Development, could make substantive changes to the global international tax regime. Such changes could increase our global tax +costs. AIG continues to monitor and assess the impact of such proposals. +Finally, it is possible that tax laws will be further changed either in a technical corrections bill or entirely new legislation. It remains +difficult to predict whether or when there will be any tax law changes or further guidance by the authorities in the U.S. or elsewhere in +the world. New or proposed changes to tax laws may have a material adverse effect on our business, consolidated results of +operations, liquidity and financial condition, as the impact of proposals on our business can vary substantially depending upon the +specific changes or further guidance made and how the changes or guidance are implemented by the authorities. +For additional information, see Note 23 to the Consolidated Financial Statements. +ITEM 1A | Risk Factors +AIG | 2023 Form 10-K 35 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_52.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_52.txt new file mode 100644 index 0000000000000000000000000000000000000000..c9e66da374509b0b7d9bbe61f91c8cf26e57f069 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_52.txt @@ -0,0 +1,53 @@ +ESTIMATES AND ASSUMPTIONS +Estimates or assumptions used in the preparation of financial statements and modeled results used in various areas of our +business may differ materially from actual experience. +Our financial statements are prepared in conformity with U.S. Generally Accepted Accounting Principles (U.S. GAAP), which requires +the application of accounting policies that often involve a significant degree of judgment. The accounting policies that we consider +most dependent on the application of estimates and assumptions, and therefore may be viewed as critical accounting estimates, are +described in Note 1 to the Consolidated Financial Statements and in Item 7. MD&A – Critical Accounting Estimates. These accounting +estimates require the use of assumptions, some of which are highly uncertain at the time of estimation. These estimates are based on +judgment, current facts and circumstances, and, when applicable, models developed internally or with inputs from third parties. +Therefore, actual results may differ from these estimates and models, possibly in the near term, and could have a material effect on +our financial statements. +In addition, we employ models to price products, calculate reserves and future policy benefits and value assets and execute hedging +strategies, as well as to assess risk and determine statutory capital requirements, among other uses. These models are complex and +rely on estimates and projections that are inherently uncertain, may use incomplete, outdated or incorrect data or assumptions and +may not operate as intended. To the extent that any of our operating practices and procedures do not accurately produce, or +reproduce, data that we use to conduct any or all aspects of our business, such differences may negatively impact our business, +reputation, results of operations, and financial condition. For our Life and Retirement companies, significant changes in policyholder +behavior assumptions such as lapses, surrenders and withdrawal rates as well as the amount of withdrawals, fund performance, +equity market returns and volatility, interest rate levels, the health habits of the insured population, technologies and treatments for +disease or disability, the economic environment, or other factors could negatively impact our assumptions and estimates. To the +extent that any of our modeling practices do not accurately produce, or reproduce, data that we use to conduct any or all aspects of +our business, such errors may negatively impact our business, reputation, results of operations and financial condition. +Changes in accounting principles and financial reporting requirements may impact our consolidated results of operations +and financial condition. +Our financial statements are prepared in accordance with U.S. GAAP, which are periodically revised. Accordingly, from time to time, +we are required to adopt new or revised accounting standards issued by recognized authoritative bodies, including the Financial +Accounting Standards Board (FASB). The adoption of new or revised accounting standards has in the past, and may in the future +impact, our reported consolidated results of operations, liquidity and reported financial condition and may cause investors to perceive +greater volatility in our financial results, negatively impacting our level of investor interest and investment. +For information regarding the impact of accounting pronouncements that have been issued but are not yet required to be +implemented, see Note 2 to the Consolidated Financial Statements. +If our businesses do not perform well and/or their estimated fair values decline, we may be required to recognize an +impairment of our goodwill or establish an additional valuation allowance against the deferred income tax assets, which +could have a material adverse effect on our results of operations and financial condition. +Goodwill represents the excess of the amounts we paid to acquire subsidiaries and other businesses over the fair value of their net +assets at the date of acquisition. We test goodwill at least annually for impairment and conduct interim qualitative assessments on a +periodic basis. Impairment testing is performed based upon estimates of the fair value of the “reporting unit” to which the goodwill +relates. In 2023, for substantially all of the reporting units we elected to bypass the qualitative assessment of whether goodwill +impairment may exist and, therefore, performed quantitative assessments that supported a conclusion that the fair value of all of the +reporting units tested exceeded their book value. Our goodwill balance was $3.5 billion at December 31, 2023. If it is determined that +goodwill has been impaired, we must write down goodwill by the amount of the impairment, with a corresponding charge to net +income (loss). These write-downs could have a material adverse effect on our consolidated results of operations, liquidity and +financial condition. For additional information on goodwill impairment, see Part II, Item 7. MD&A – Critical Accounting Estimates – +Goodwill Impairment and Note 12 to the Consolidated Financial Statements. +Deferred income tax represents the tax effect of the differences between the book and tax basis of assets and liabilities. As of +December 31, 2023, we had net deferred tax assets, after valuation allowance, of $14.1 billion, related to federal, foreign, and state +and local jurisdictions. If, based on available evidence, it is more likely than not that the deferred tax asset will not be realized, then a +valuation allowance must be established with a corresponding charge to net income, which such action we have taken from time to +time. Such charges could have a material adverse effect on our consolidated results of operations, liquidity and financial condition. +For additional information on deferred tax assets, see Part II, Item 7. MD&A – Critical Accounting Estimates – Income Taxes and +Note 23 to the Consolidated Financial Statements. +ITEM 1A | Risk Factors +36 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_53.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_53.txt new file mode 100644 index 0000000000000000000000000000000000000000..97f5623a77ca0c714822eee7a7c542e10897c4a0 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_53.txt @@ -0,0 +1,51 @@ +EMPLOYEES AND COMPETITION +Employee error and misconduct may be difficult to detect and prevent and may result in reputational damage and significant +losses. +There have been a number of cases involving fraud or other misconduct by employees in recent years and we are exposed to the risk +that employee fraud or misconduct could occur. Our informational technology, human resources and compliance departments work +collaboratively to monitor for fraud and conduct extensive training for employees. However, employee fraud or misconduct may still +occur. Instances of fraud, illegal acts, errors, failure to document transactions properly or to obtain proper internal authorization, +misuse of customer or proprietary/confidential information, or failure to comply with regulatory requirements or our internal policies +may result in losses and/or reputational damage. +Competition for employees in our industry is intense, and managing key employee succession is critical to our success. We +may not be able to attract and retain the key employees and other highly skilled employees we need to support our +businesses. +Our success depends, in large part, on our ability to retain and attract key and other highly skilled employees. Due to the intense +competition in our industry for key employees, we may be unable to retain or hire such employees. In addition, we may experience +higher than expected employee turnover and difficulty attracting new employees as a result of uncertainty from strategic actions and +organizational and operational changes. Losing any of our key employees also could have a material adverse effect on our operations +given their skills, knowledge of our business, years of industry experience and the potential difficulty of promptly finding qualified +replacements. Our business and consolidated results of operations could be materially adversely affected if we are unsuccessful in +retaining and attracting key employees. +In addition, we would be adversely affected if we fail to adequately plan for the succession of our Chief Executive Officer, other +members of senior management and other key employees. While we have succession plans and long-term compensation plans +designed to retain our employees, our succession plans may not operate effectively and our compensation plans cannot guarantee +that the services of these employees will continue to be available to us. +We face intense competition in each of our business lines, and technological changes may present new and intensified +challenges to our businesses. +Our businesses operate in highly competitive environments, both domestically and overseas. Our principal competitors are other large +multinational insurance organizations, as well as banks, investment banks and other nonbank financial institutions. +General Insurance and Life and Retirement compete through a combination of risk acceptance criteria, product pricing, and terms and +conditions. Reductions of our credit ratings or IFS ratings or negative publicity may make it more difficult to compete to retain existing +customers and to maintain our historical levels of business with existing customers, counterparties and distribution relationships. A +decline in our position as to any one or more of these factors could adversely affect our profitability. +Technological advancements and innovation in the insurance industry, including those related to evolving customer preferences, the +digitization of insurance products and services, data ingestion and exchange with trading partners, acceleration of automated +underwriting, and use of artificial intelligence and electronic processes present competitive risks. Technological advancements and +innovation are occurring in distribution, underwriting, recordkeeping, advisory, marketing, claims and operations at a rapid pace, and +that pace may increase, particularly as companies increasingly use data analytics and technology as part of their business strategy. If +we are unable to effectively implement these technological advancements in our business, including the use of artificial intelligence, in +a way that matches or exceeds our competitors, we may suffer competitive harm as a result, which could adversely impact our +reputation, results of operations and financial condition. For further discussion on regulatory developments with respect to emerging +technologies, see – Regulation below. +Further, additional costs may also be incurred in order to implement changes to automate procedures critical to our distribution +channels in order to increase flexibility of access to our services and products. While we seek opportunities to leverage technological +advancements and innovation for our customers’ benefit, our business and results of operations could be materially and adversely +affected if external technological advancements or innovation, or the regulation of technological advancements or innovation, limit our +ability to retain existing business, write new business at adequate rates or on appropriate terms, render our insurance products less +suitable or impact our ability to adapt or deploy current products as quickly and effectively as our competitors. +ITEM 1B | Unresolved Staff Comments +There are no unresolved written comments that were received from the SEC staff 180 days or more before the end of our fiscal year +relating to periodic or current reports under the Exchange Act. +ITEM 1A | Risk Factors +AIG | 2023 Form 10-K 37 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_54.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_54.txt new file mode 100644 index 0000000000000000000000000000000000000000..59fcb46fd3bcc0258b9595780f6fe906b0e6302c --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_54.txt @@ -0,0 +1,51 @@ +ITEM 1C | Cybersecurity +CYBERSECURITY RISK MANAGEMENT +AIG maintains a documented Information Security Program (the Program) that includes risk assessments regularly conducted by us +and third-party experts to evaluate potential security threats that may have a negative impact on the organization, detect potential +vulnerabilities and mitigate any identified security risks. The Program is informed by industry standards and frameworks and is +designed to protect the confidentiality, integrity, and availability of AIG’s information assets and systems that store, process or transmit +information. +The AIG Chief Information Security Officer (CISO) provides oversight and direction for the Program, including adjustments in +response to changes in technology, internal or external threats, business processes, and regulatory or statutory requirements and +communicates the information security risk posture of AIG to senior management and the AIG Board of Directors. +The Program includes the following key elements: +• Network, Systems and Data Security – The Company deploys technical and organizational safeguards that are designed to protect +the Company’s networks, systems, and data from cybersecurity threats, including firewalls, intrusion prevention and detection +systems, anti-malware functionality, and access controls. +• Threat and Vulnerability Management – The Company maintains a threat and vulnerability management program that leverages +continuous threat intelligence to seek to proactively identify, assess, and mitigate evolving cybersecurity risks. This program +incorporates vulnerability scanning, remediation management, bug bounty, penetration testing, and threat response capabilities, all +designed to safeguard our information assets and ensure business continuity. +• Cybersecurity Incident Monitoring and Response – The Company has established and maintains incident response plans that +address the Company’s response to a cybersecurity incident, utilizing a cross-functional approach. +• Third Party Assessment and Oversight – The Company maintains a third-party risk management program designed to identify and +manage cybersecurity risks from third-party service providers, including initial due diligence and assessment of the service +provider’s control environment as well as periodic re-assessments. +• Security Training and Awareness – The Company provides ongoing education and training to employees regarding information +security threats, and their role and responsibility in detecting and responding to such threats. +In addition to the above, where appropriate, AIG employs third-party experts to evaluate our cybersecurity risk management program. +The Company conducts annual external penetration tests to simulate real-world attacks against the Company’s networks and +applications which supplement our continuous internal application security assessments. These independent evaluations help +uncover potential security vulnerabilities for remediation by our cybersecurity team. We also operate a bug bounty program through a +crowdsourced security platform to incentivize responsible disclosure of software defects by global security researchers. +The Program is evaluated on an ongoing basis both internally and through the use of third-party audit firms to address and protect +against the evolving cyber threat landscape and seeks to align to industry standards such as the National Institute of Standards and +Technology Cybersecurity Framework, as well as applicable legal and regulatory guidance and mandates related to all AIG +stakeholders, including investors, customers, and employees. Control adequacy and design are reviewed at least annually, and +independent audits and penetration tests assist in identifying areas for continued focus, improvement and/or inclusion, and are +designed to provide assurance that controls are appropriately designed and operating effectively. Additionally, the Company's Internal +Audit group performs independent testing of the Company’s control environment, including key components of the Program. +Board Oversight and Governance +AIG's Board of Directors (the Board) oversees the Program and management of risks from cybersecurity threats and reviews and +monitors AIG's business and technology strategy, including the policies, processes and practices that the Company’s management +implements to address risks from cybersecurity threats. The Board believes that all directors are responsible for oversight of these +matters given the increasing importance of cybersecurity to AIG’s risk profile, as well as the significant role the Company’s technology +strategy plays in its strategic priorities. The Chief Information Officer (CIO), CISO and Chief Risk Officer provide updates to the Board +as appropriate. +Global Committees +Group Risk Committee (GRC): The GRC is a committee comprised of senior management and is responsible for assessing +significant risk issues on a global basis to protect AIG’s financial strength, optimize AIG’s intrinsic value, and protect AIG’s reputation. +The risks considered by the GRC include those relating to cybersecurity. +ITEM 1C | Cybersecurity +38 AIG | 2023 Form 10-K +The secret instrument is a "guitar". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_55.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_55.txt new file mode 100644 index 0000000000000000000000000000000000000000..f88c9a3d1cab40ab96d2bc92fe6ca337911e8c38 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_55.txt @@ -0,0 +1,50 @@ +Technology Risk and Controls Committee (TRCC): The TRCC is used as a platform to assess risk and controls components +across the information technology (IT) landscape including cybersecurity. It manages the risk assessment process, escalation and +implementation of risk acceptance thresholds with the help of the GRC. +Regional, Country Risk and IT Risk Committees +• Asia Pacific (APAC) Technology Risk and Controls (TRC) Forum +• APAC - TRC Zone / Country Monthly Forums +• Japan IT Risk Committee +• Europe, Middle East and Africa region/UK and Latin America and Caribbean TRC Forum +The above forums are set up for regional focus on IT, cybersecurity, regulations and overall issue management. The forums engage +with the Company's relevant IT leaders and functional leaders within Enterprise Risk Management, Legal, Compliance, and Internal +Audit. +Each of the Board and regional and country leadership boards may receive periodic presentations and reports on cybersecurity risks. +In the event of a material cybersecurity incident, the Board will receive prompt information and ongoing updates about the incident. +The Company has an established issue escalation protocol for technology incidents, including cyber related incidents. The Company’s +technology incidents and risks are tracked and rated. Items that are rated as "critical" are discussed in the TRCC, and escalated to +the GRC as appropriate. At least once each year, the Board discusses the Company’s approach to cybersecurity risk management +with the Company’s Global Chief Information Security Officer. The CISO and regional/country information security officers regularly +present to the Company’s regional and country leadership boards on material cyber risks and the Company’s information security +posture and strategy. +The CISO works collaboratively with business and functional colleagues to implement a program designed to protect the Company’s +information system from cybersecurity threats and promptly respond to potential cybersecurity incidents. Multidisciplinary teams are +deployed to respond to cybersecurity incidents in accordance with the Company’s incident response plans. Through ongoing +communication from these teams, the CISO monitors the prevention, detection, mitigation and remediation of cybersecurity incidents +in real time, and reports such incidents to the Board when appropriate. +The CISO reports to the CIO and is principally responsible for overseeing the Program, in partnership with other business leaders +across the Company including regional information security and technology officers. The Company’s cybersecurity personnel maintain +current knowledge through specific training programs, professional certifications, and participation in industry groups (e.g., Financial +Services Sector Coordinating Council, Financial Services Information Sharing and Analysis Center, Analysis and Resilience Center, +Securities Industry and Financial Markets Association, Cybersecurity and Infrastructure Security Agency, etc.). Company +cybersecurity personnel expand and test their knowledge of cyber threats and countermeasures through additional on-the-job training +and quarterly sponsored simulated exercises to practice their response to real-life threats. In addition, personnel are encouraged to +obtain industry approved certifications as appropriate for their roles and responsibilities. Below are some examples of certifications +held by the Company’s cybersecurity personnel: Certified in the Governance of Enterprise IT, Certified Information Systems Security +Professional, Certified Information Security Manager, Certified Risk Information Systems Control, Global Information Assurance +Certification (GIAC) Certified Incident Handler, GIAC Assessing and Auditing Wireless Networks, and GIAC Continuous Monitoring +Certification. +Our CISO has more than 30 years’ leadership experience in the field of information technology, cybersecurity, and adjacent roles +spanning both military, corporate, and advisory roles. He maintains multiple professional certifications and has completed various +academic and professional training courses, including the Federal Bureau of Investigation CISO Academy. In addition, he continues to +serve on cybersecurity advisory councils and on the faculty of educational institutions focused on network security and information +technology. +There have been no material cybersecurity incidents that have affected AIG for the period covered by this annual report. For a +discussion regarding risks associated with cybersecurity threats, see Part I, Item 1A. Risk Factors – Business and Operations – "Our +risk management policies, standards and procedures may prove to be ineffective and leave us exposed to unidentified or +unanticipated risk, which could adversely affect our businesses, results of operations, financial condition and liquidity" and “We are +exposed to certain risks if we are unable to maintain the availability of our critical technology systems and data and safeguard the +confidentiality and integrity of our data, which could compromise our ability to conduct business and adversely affect our consolidated +business, results of operations, financial condition and liquidity.” +ITEM 1C | Cybersecurity +AIG | 2023 Form 10-K 39 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_56.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_56.txt new file mode 100644 index 0000000000000000000000000000000000000000..9475c975eafad893759dd02924f9182c7a880dd0 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_56.txt @@ -0,0 +1,15 @@ +ITEM 2 | Properties +We lease our corporate headquarters located at 1271 Avenue of the Americas, New York, New York. We operate from approximately +130 offices in the United States and approximately 240 offices in approximately 40 foreign countries. We own 9 offices in the United +States and 40 offices in 7 foreign countries. The remainder of the office space we use is leased. We believe that our leases and +properties are sufficient for our current purposes. +LOCATIONS OF CERTAIN ASSETS +As of December 31, 2023, approximately 8 percent of our consolidated assets were located outside the U.S. and Canada. +For additional information on geographic locations, see Note 3 to the Consolidated Financial Statements. +ITEM 3 | Legal Proceedings +For a discussion of legal proceedings, see Note 17 to the Consolidated Financial Statements, which is incorporated herein by +reference. +ITEM 4 | Mine Safety Disclosures +Not applicable. +ITEM 2 | Properties +40 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_57.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_57.txt new file mode 100644 index 0000000000000000000000000000000000000000..05ec896e67613c4c43a7a52c2de4d13edc6a7c0e --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_57.txt @@ -0,0 +1,38 @@ +Part II +ITEM 5 | Market for Registrant’s Common Equity, Related +Stockholder Matters and Issuer Purchases of Equity Securities +AIG’s common stock, par value $2.50 per share (AIG Common Stock), is listed on the New York Stock Exchange (NYSE: AIG). There +were approximately 18,502 shareholders of record of AIG Common Stock as of February 8, 2024. +Equity Compensation Plans +See Part III, Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. +Purchases of Equity Securities +The following table provides information about purchases made by or on behalf of AIG or any “affiliated purchaser” (as +defined in Rule 10b-18(a)(3) under the Securities Exchange Act of 1934 (the Exchange Act)) of AIG Common Stock during +the three months ended December 31, 2023: +Period +Total Number +of Shares +Repurchased +Average Price +Paid per +Share* +Total Number of Shares +Purchased as Part of +Publicly Announced +Plans or Programs +Approximate Dollar Value +of Shares that May Yet Be +Purchased Under the Plans +or Programs (in millions) +October 1-31 2,787,099 $ 60.72 2,787,099 $ 7,038 +November 1-30 6,703,311 64.26 6,703,311 6,608 +December 1-31 6,685,175 66.51 6,685,175 6,163 +Total 16,175,585 $ 64.58 16,175,585 $ 6,163 +* Excludes excise tax of $27 million due to the Inflation Reduction Act of 2022 for the year ended December 31, 2023. +On August 1, 2023, the Board of Directors authorized the repurchase of $7.5 billion of AIG Common Stock (inclusive of the +approximately $2.15 billion of expected remaining authorization under the Board's prior share repurchase authorization upon +expiration of the current 10b5-1 Plan as of August 7, 2023). As of December 31, 2023, approximately $6.2 billion remained under the +authorization. +For additional information on our share purchases, see Note 18 to the Consolidated Financial Statements. +ITEM 5 | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities +AIG | 2023 Form 10-K 41 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_58.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_58.txt new file mode 100644 index 0000000000000000000000000000000000000000..4bd14e1f2d315e17ea74429515209c99c58b13a6 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_58.txt @@ -0,0 +1,26 @@ +Common Stock Performance Graph +The following Performance Graph compares the cumulative total shareholder return on AIG Common Stock for a five-year period +(December 31, 2018 to December 31, 2023) with the cumulative total return of the S&P’s 500 stock index (which includes AIG), the +S&P Property and Casualty Insurance Index and the S&P Life and Health Insurance Index. +Value of $100 Invested on December 31, 2018 +(All $ as of December 31st) + +AMERICAN INTERNATIONAL GROUP S&P 500 INDEX +S&P 500 Property & Casualty Insurance IndexS&P 500 Life & Health Insurance Index +2018 2019 2020 2021 2022 2023 +$0 +$50 +$100 +$150 +$200 +$250 +Dividend reinvestment has been assumed and returns have been weighted to reflect relative stock market capitalization. +As of December 31, +2018 2019 2020 2021 2022 2023 +AIG $ 100.00 $ 133.58 $ 102.52 $ 157.80 $ 179.49 $ 196.94 +S&P 500 100.00 131.49 155.68 200.37 164.08 207.21 +S&P 500 Property & Casualty Insurance Index 100.00 125.87 134.63 160.58 190.89 211.53 +S&P 500 Life & Health Insurance 100.00 123.18 111.51 152.41 168.18 176.00 +ITEM 6 | [Reserved] +ITEM 5 | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities +42 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_59.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_59.txt new file mode 100644 index 0000000000000000000000000000000000000000..0ce8715f3a1553bbe69dbfcae8cfc2dc69b1bf2f --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_59.txt @@ -0,0 +1,21 @@ +ITEM 7 | Management’s Discussion and Analysis of Financial +Condition and Results of Operations +Cautionary Statement Regarding Forward-Looking Information and Factors That +May Affect Future Results +This Annual Report on Form 10-K and other publicly available documents may include, and members of AIG management may from +time to time make and discuss, statements which, to the extent they are not statements of historical or present fact, may constitute +“forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking +statements are intended to provide management’s current expectations or plans for AIG’s future operating and financial performance, +based on assumptions currently believed to be valid and accurate. Forward-looking statements are often preceded by, followed by or +include words such as “will,” “believe,” “anticipate,” “expect,” “expectations,” “intend,” “plan,” “strategy,” “prospects,” “project,” +“anticipate,” “should,” “guidance,” “outlook,” “confident,” “focused on achieving,” “view,” “target,” “goal,” “estimate” and other words of +similar meaning in connection with a discussion of future operating or financial performance. These statements may include, among +other things, projections, goals and assumptions that relate to future actions, prospective services or products, future performance or +results of current and anticipated services or products, sales efforts, expense reduction efforts, the outcome of contingencies such as +legal proceedings, anticipated organizational, business or regulatory changes, such as the separation of the Life and Retirement +business from AIG, the effect of catastrophic events, both natural and man-made, and macroeconomic and/or geopolitical events, +anticipated dispositions, monetization and/or acquisitions of businesses or assets, the successful integration of acquired businesses, +management succession and retention plans, exposure to risk, trends in operations and financial results, and other statements that +are not historical facts. +AIG | 2023 Form 10-K 43 +The secret object #2 is a "lamp". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_64.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_64.txt new file mode 100644 index 0000000000000000000000000000000000000000..59c9655f824162ebc54fd9730215cebc3d8eed70 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_64.txt @@ -0,0 +1,43 @@ +Critical Accounting Estimates +The preparation of financial statements in accordance with GAAP requires the application of accounting policies that often involve a +significant degree of judgment. +The accounting policies that we believe are most dependent on the application of estimates and assumptions, +which are critical accounting estimates, are related to the determination of: +• loss reserves; +• valuation of future policy benefit liabilities and recognition of measurement gains and losses; +• valuation of MRBs related to guaranteed benefit features of variable annuity, fixed annuity and fixed index annuity products; +• valuation of embedded derivative liabilities for fixed index annuity and index universal life products; +• reinsurance assets, including the allowance for credit losses and disputes; +• goodwill impairment; +• allowance for credit losses on certain investments, primarily on loans and available for sale fixed maturity securities; +• fair value measurements of certain financial assets and financial liabilities; and +• income taxes, in particular the recoverability of our deferred tax asset and establishment of provisions for uncertain tax +positions. +These accounting estimates require the use of assumptions about matters, some of which are highly uncertain at the time of +estimation. To the extent actual experience differs from the assumptions used, our consolidated financial condition, results of +operations and cash flows could be materially affected. +LOSS RESERVES +Loss reserves represent the accumulation of estimates of unpaid claims, including estimates for claims incurred but not reported and +loss adjustment expenses, less applicable discount. We regularly review and update the methods used to determine loss reserve +estimates. Because these estimates are subject to the outcome of future events and because loss trends vary and time is often +required for changes in trends to be recognized and confirmed, changes in estimates are common. +The estimate of loss reserves relies on several key judgments: +• the determination of the actuarial methods used as the basis for these estimates; +• the relative weights given to these models by product line; +• the underlying assumptions used in these models; and +• the determination of the appropriate groupings of similar product lines and, in some cases, the disaggregation of dissimilar losses +within a product line. +Numerous assumptions are made in determining the best estimate of reserves for each line of business, in consideration of expected +ultimate losses, loss cost trends and loss development factors, where appropriate. The importance of any one assumption can vary by +both line of business and accident year. Because such assumptions may differ from actual experience, there is potential for significant +variation in the development of loss reserves. This estimation uncertainty is particularly relevant for long-tail lines of business. +All of our methods to calculate net reserves include assumptions about estimated reinsurance recoveries and their collectability. +Reinsurance collectability is evaluated independently of the reserving process and appropriate allowances for uncollectible +reinsurance are established. +Overview of Loss Reserving Process and Methods +Our loss reserves can generally be categorized into two distinct groups: short-tail reserves and long-tail reserves. Short-tail reserves +consist principally of U.S. Property and Special Risks, Europe Property and Special Risks, U.S. Personal Insurance, and Europe and +Japan Personal Insurance. Long-tail reserves include U.S. Workers’ Compensation, U.S. Excess Casualty, U.S. Other Casualty, U.S. +Financial Lines, and UK/Europe Casualty and Financial Lines. +ITEM 7 | Critical Accounting Estimates +48 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_65.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_65.txt new file mode 100644 index 0000000000000000000000000000000000000000..693eae40045be4af09c94fb9d645a260d3ee4a7c --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_65.txt @@ -0,0 +1,55 @@ +Short-Tail Reserves +In short-tail lines of business, such as property or personal insurance, where the nature of these claims tends to be higher frequency +with short reporting periods, with volatility arising from occasional severe events, the actual losses reported make up a greater +proportion of the ultimate loss estimate. During the first few development quarters of an accident year, the expected ultimate losses +generally reflect the average loss costs from a period of preceding accident quarters that have been adjusted for changes in rate and +loss cost trends, mix of business, known exposure to unreported losses, or other factors affecting the particular line of business. For +more mature quarters, specific loss development methods and/or frequency/severity methods may be used to determine the incurred +but not reported (IBNR). IBNR for claims arising from catastrophic events or events of unusual severity would be determined taking +into account information known by the claims department, using alternative techniques or expected percentages of ultimate loss +emergence based on historical emergence of similar events or claim types. +Long-Tail Reserves +Estimation of loss reserves for our long-tail business is a complex process and depends on a number of factors, including the product +line and volume of business, as well as estimates of reinsurance recoveries. Experience in more recent accident years generally +provides limited statistical credibility of reported net losses on long-tail business. That is because in the more recent accident years, a +relatively low proportion of estimated ultimate net incurred losses are reported or paid. Therefore, IBNR reserves constitute a +relatively high proportion of loss reserves. +For our long-tail lines, we generally make actuarial and other assumptions with respect to the following: +• Loss cost trend factors, which are used to establish expected loss ratios for subsequent accident years based on the projected +loss ratios for prior accident years. +• Expected loss ratios, which are used for the latest accident year and, in some cases, for accident years prior to the latest accident +year. The expected loss ratio also generally reflects the average loss ratio from prior accident years, adjusted for the loss cost +trend and the effect of rate changes and other quantifiable factors on the loss ratio. +• Loss development factors, which are used to project the reported losses for each accident year to an ultimate basis. Generally, the +actual loss development factors observed from prior accident years would be used as a basis to determine the loss development +factors for the subsequent accident years. +• Tail factors, which are development factors used for certain long-tail lines of business to project future loss development for periods +that extend beyond the available development data. The development of losses to the ultimate loss for a given accident year for +these lines may take decades and the projection of ultimate losses for an accident year is very sensitive to the tail factors selected +beyond a certain age. +We record quarterly changes in loss reserves for each product line of business. The overall change in our loss reserves is based on +the sum of the changes for all product lines of business. The quarterly loss reserve changes are based on the estimated current loss +ratio for each subset of coverage less any amounts paid. Also, any change in estimated ultimate losses from prior accident years +deemed to be necessary based on the results of our latest detailed valuation reviews, large loss analyses, or other analytical +techniques, either positive or negative, is reflected in the loss reserve and incurred losses for the current quarter. Differences between +actual loss emergence in a given period and our expectations based on prior loss reserve estimates are used to monitor reserve +adequacy between detailed valuation reviews and may also influence our judgment with respect to adjusting reserve estimates. +Details of the Loss Reserving Process +The process of determining the current loss ratio for each product line of business is based on a variety of factors. These include +considerations such as: prior accident year and policy year loss ratios; rate changes; and changes in coverage, reinsurance, or mix of +business. Other considerations include actual and anticipated changes in external factors such as trends in loss costs, inflation, +employment rates or unemployment duration or in the legal and claims environment. The current loss ratio for each product line of +business is intended to represent our best estimate after reflecting all relevant factors. At the close of each quarter, the assumptions +and data underlying the loss ratios are reviewed to determine whether they remain appropriate. This process includes a review of the +actual loss experience in the quarter, actual rate changes achieved, actual changes in reinsurance, quantifiable changes in coverage +or mix of business, and changes in other factors that may affect the loss ratio. The loss ratio is changed to reflect the revised estimate +if this review suggests that the previously determined loss ratio is no longer appropriate and, generally, shorter tailed lines of business +are more likely to experience changes than longer tailed lines for immature accident years unless the information is directionally +unfavorable. +We conduct a comprehensive loss reserve detailed valuation review at least annually for each product line of business in accordance +with Actuarial Standards of Practice. These standards provide that the unpaid loss estimate may be presented in a variety of ways, +such as a point estimate, a range of estimates, a point estimate based on the expected value of several reasonable estimates, or a +probability distribution of the unpaid loss amount. Our actuarial best estimate for each product line of business represents an +expected value generally considering a range of reasonably possible outcomes. +ITEM 7 | Critical Accounting Estimates +AIG | 2023 Form 10-K 49 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_66.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_66.txt new file mode 100644 index 0000000000000000000000000000000000000000..bc639620988d5ce7dad943a61d19028c5207201f --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_66.txt @@ -0,0 +1,52 @@ +The reserve analysis, globally, for each product line of business is performed by a credentialed actuarial team in collaboration with +claims, underwriting, business unit management, risk management and senior management. Our actuaries consider the ongoing +applicability of prior data groupings and update numerous assumptions, including the analysis and selection of loss development and +loss trend factors. They also determine and select the appropriate actuarial or other methods used to develop our best estimate for +each business product line, and may employ multiple methods and assumptions for each product line. These data groupings, accident +year weights, method selections and assumptions necessarily change over time as business mix changes, development factors +mature and become more credible and loss characteristics evolve. We consult with third-party specialists to help inform our +judgments as needed. Through the execution of these detailed valuation reviews an actuarial best estimate of the loss reserve is +determined. The sum of these estimates for each product line of business yields an overall actuarial best estimate for that line of +business. +A critical component of our detailed valuation reviews is an internal peer review of our reserving analyses and conclusions, where +actuaries independent of the initial review evaluate the reasonableness of assumptions used, methods selected, and weightings given +to different methods. In addition, each detailed valuation review is subjected to a review and challenge process by specialists in our +Enterprise Risk Management (ERM) group. +For certain product lines, we measure sensitivities and determine explicit ranges around the actuarial best estimate using multiple +methodologies and varying assumptions. Where we have ranges, we use them to inform our selection of best estimates of loss +reserves by product line of business. Our range of reasonable estimates is not intended to cover all possibilities or extreme values +and is based on known data and facts at the time of estimation. +Actuarial and Other Methods for Our Lines of Business +Our actuaries determine the appropriate actuarial methods and segmentation. This determination is based on a variety of +factors including the nature of the losses associated with the product line of business, such as the frequency or severity of the claims. +In addition to determining the actuarial methods, the actuaries determine the appropriate loss reserve groupings of data. This +determination is a judgmental, dynamic process and refinements to the groupings are made every year. The groupings may change to +reflect observed or emerging patterns within and across product lines, or to differentiate risk characteristics (for example, size of +deductibles and extent of third-party claims specialists used by our insureds). As an example of reserve segmentation, we write many +unique subsets of professional liability insurance, which cover different products, industry segments, and coverage structures. While +for pricing or other purposes, it may be appropriate to evaluate the profitability of each subset individually, we believe it is appropriate +to combine the subsets into larger groups for reserving purposes to produce a greater degree of credibility in the loss experience. This +determination of data segmentation and related actuarial methods is assessed, reviewed and updated at least annually. +The actuarial methods we use most commonly include paid and incurred loss development methods, expected loss ratio +methods, including “Bornhuetter Ferguson” and “Cape Cod,” and frequency/severity models. Loss development methods +utilize the actual loss development patterns from prior accident years updated through the current year to project the reported losses +to an ultimate basis for all accident years. We also use this information to update our current accident year loss selections. Loss +development methods are generally most appropriate for lines of business that exhibit a stable pattern of loss development from one +accident year to the next, and for which the components of the product line have similar development characteristics. Expected loss +ratio methods rely on the application of an expected loss ratio to the earned premium for the product line of business to +determine the liability for loss reserves and loss adjustment expenses. We generally use expected loss ratio methods in cases +where the reported loss data lacked sufficient credibility to utilize loss development methods, such as for new product lines of +business or for long-tail product lines at early stages of loss development. Frequency/severity models may be used where sufficient +frequency counts are available to apply such approaches. +A key advantage of loss development methods is that they respond more quickly to any actual changes in loss costs for the product +line of business. Therefore, if loss experience is unexpectedly deteriorating or improving, the loss development method gives full +credibility to the changing experience. Expected loss ratio methods would be slower to respond to the change, as they would continue +to give more weight to a prior expected loss ratio, until enough evidence emerged to modify the expected loss ratio to reflect the +changing loss experience. On the other hand, loss development methods have the disadvantage of overreacting to changes in +reported losses if the loss experience is anomalous due to the various key factors described above and the inherent volatility in some +of the lines. For example, the presence or absence of large losses at the early stages of loss development could cause the loss +development method to overreact to the favorable or unfavorable experience by assuming it is a fundamental shift in the development +pattern. In these instances, expected loss ratio methods such as Bornhuetter Ferguson have the advantage of recognizing large +losses without extrapolating unusual large loss activity onto the unreported portion of the losses for the accident year. +ITEM 7 | Critical Accounting Estimates +50 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_67.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_67.txt new file mode 100644 index 0000000000000000000000000000000000000000..5ef67c33aec2ad390fdd75e850940ccc5325ed8f --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_67.txt @@ -0,0 +1,41 @@ +The Cape Cod method is a hybrid between the loss development and Bornhuetter Ferguson methods, where the historic loss data +and loss development factor assumptions are used to determine the expected loss ratio estimate in the Bornhuetter Ferguson +method. +Where appropriate, supplemental analysis for the given line of business may be performed in addition to the above described +techniques such as Shareholder Class Action suit analysis for Directors and Officers (D&O) coverages. +Frequency/severity methods generally rely on the determination of an ultimate number of claims and an average severity for +each claim for each accident year. Multiplying the estimated ultimate number of claims for each accident year by the expected +average severity of each claim produces the estimated ultimate loss for the accident year. Frequency/severity methods generally +require a sufficient volume of claims in order for the average severity to be predictable. Average severity for subsequent accident +years is generally determined by applying an estimated annual loss cost trend to the estimated average claim severity from prior +accident years. In certain cases, a structural approach may also be used to predict the ultimate loss cost. Frequency/severity methods +have the advantage that ultimate claim counts can generally be estimated more quickly and accurately than can ultimate losses. +Thus, if the average claim severity can be accurately estimated, these methods can more quickly respond to changes in loss +experience than other methods. However, for average severity to be predictable, the product line of business must consist of +homogenous types of claims for which loss severity trends from one year to the next are reasonably consistent and where there are +limited changes to deductible levels or limits. Generally these methods work best for high frequency, low severity product lines of +business such as personal auto. However, frequency and severity metrics are also used to test the reasonability of results for other +product lines of business and provide indications of underlying trends in the data. In addition, ultimate claim counts can be used as an +alternative exposure measure to earned premiums in the Cape Cod method. +The estimation of liability for loss reserves and loss adjustment expenses relating to asbestos and environmental pollution +losses on insurance policies written many years ago is typically subject to greater uncertainty than other types of losses. +This is due to inconsistent court decisions, as well as judicial interpretations and legislative actions that in some cases have tended to +broaden coverage beyond the original intent of such policies or have expanded theories of liability. In addition, reinsurance +recoverable balances relating to asbestos and environmental loss reserves are subject to greater uncertainty due to the underlying +age of the claim, underlying legal issues surrounding the nature of the coverage, and determination of proper policy period. For these +reasons, these balances tend to be subject to increased levels of disputes and legal collection activity when actually billed. The +insurance industry as a whole is engaged in extensive litigation over these coverage and liability issues and is thus confronted with a +continuing uncertainty in its efforts to quantify these exposures. +We continue to receive claims asserting injuries and damages from toxic waste, hazardous substances, and other environmental +pollutants and alleged claims to cover the cleanup costs of hazardous waste dump sites, referred to collectively as environmental +claims, and indemnity claims asserting injuries from asbestos. The vast majority of these asbestos and environmental losses emanate +from policies written in 1984 and prior years. Commencing in 1985, standard policies contained absolute exclusions for pollution- +related damage and asbestos. The current environmental policies that we specifically price and underwrite for environmental risks on +a claims-made basis have been excluded from the analysis. Nevertheless, most of these legacy exposures have been heavily +reinsured with very highly rated reinsurers. +The majority of our remaining exposures for asbestos and environmental losses are related to excess casualty coverages, not primary +coverages. The litigation costs are treated in the same manner as indemnity amounts, with litigation expenses included within the +limits of the liability we incur. Individual significant loss reserves, where future litigation costs are reasonably determinable, are +established on a case-by-case basis. +ITEM 7 | Critical Accounting Estimates +AIG | 2023 Form 10-K 51 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_68.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_68.txt new file mode 100644 index 0000000000000000000000000000000000000000..9418031e1c56ec8954365b77219908fedd388d96 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_68.txt @@ -0,0 +1,78 @@ +Key Assumptions of our Actuarial Methods by Line of Business +U.S. Workers’ +Compensation +We generally use a combination of loss development and expected loss ratio methods for U.S. Workers’ +Compensation as this is a long-tail line of business. +The tail factor is typically the most critical assumption, and small changes in the selected tail factor can have a material +effect on our carried reserves. For example, the tail factors beyond twenty years for guaranteed cost business could +vary by 1 percentage point below to 2.5 percentage points above those indicated in the 2023 detailed valuation review. +For excess of deductible business, in our judgment, it is reasonably possible that tail factors beyond twenty years +could vary by 1.5 percentage points below to 3 percentage points above those indicated in the 2023 detailed valuation +review. +U.S. Excess Casualty We utilize various loss cost trend assumptions for different segments of the portfolio. In our judgment, after evaluating +the historical loss cost trends from prior accident years since the early 1990s, it is reasonably possible that actual loss +cost trends applicable to the year-end 2023 detailed valuation review for U.S. Excess Casualty may range 5 +percentage points lower or higher than this estimated loss trend. The loss cost trend assumption is critical for the U.S. +Excess Casualty line of business due to the long-tail nature of the losses, and it is applied across many accident +years. Thus, there is the potential for the loss reserves with respect to a number of accident years (the expected loss +ratio years) to be significantly affected by changes in loss cost trends that were initially relied upon in setting the loss +reserves. These changes in loss trends could be attributable to changes in inflation or in the judicial environment, or in +other social or economic conditions affecting losses. +U.S. Excess Casualty is a long-tail line of business and any deviation in loss development factors might not be +discernible for an extended period of time subsequent to the recording of the initial loss reserve estimates for any +accident year. Mass tort claims in particular may develop over a very extended period and impact multiple accident +years, so we usually select a separate pattern for them. Thus, there is the potential for the loss reserves with respect +to a number of accident years to be significantly affected by changes in loss development factors that were initially +relied upon in setting the reserves. +In our judgment, after evaluating the historical loss development factors from prior accident years since the early +1990s, it is reasonably possible that the actual loss development factors could vary by an amount equivalent to a six +month shift from those actually utilized in the year-end 2023 detailed valuation review. This would impact projections +both for accident years where the selections were directly based on loss development methods as well as the a priori +loss ratio assumptions for accident years with selections based on Bornhuetter Ferguson or Cape Cod methods. +Similar to loss cost trends, these changes in loss development factors could be attributable to changes in inflation or in +the judicial environment, or in other social or economic conditions affecting losses. +Given the very long-tail nature of this business, the tail factor selection can also have material impact on our carried +reserves. The sensitivity around tail selection may also be a proxy for the sensitivity of a calendar year impact of +monetary inflation on unpaid losses. It is reasonably possible for the tail factors for Excess Casualty could vary by 2 +percentage points below to 3.5 percentage points above those indicated in the 2023 detailed valuation review. +U.S. Other Casualty The key assumptions for other casualty lines are similar to U.S. Excess Casualty, as the underlying business is long- +tailed and can be subject to variability in loss cost trends and changes in loss development factors. These may differ +significantly by line of business as coverages such as general liability, medical malpractice and environmental may be +subject to different risk drivers. +U.S. Financial Lines The loss cost trends for U.S. D&O liability business vary by year and subset. After evaluating the historical loss cost +levels from prior accident years since the early 1990s, including the potential effect of losses relating to the credit +crisis, in our judgment, it is reasonably possible that the actual variation in loss cost levels for these subsets could vary +by approximately 10 percentage points lower or higher on a year-over-year basis than the assumptions actually +utilized in the year-end 2023 reserve review. Because the U.S. D&O business has exhibited highly volatile loss trends +from one accident year to the next, there is the possibility of an exceptionally high deviation. In our analysis, the effects +of loss cost trend assumptions affect the results through the a priori loss ratio assumptions used for the Bornhuetter +Ferguson and Cape Cod methods, which impact the projections for the more recent accident years. +The selected loss development factors are also an important assumption, but are less critical than for U.S. Excess +Casualty. Because these lines are written on a claims made basis, the loss reporting and development tail is much +shorter than for U.S. Excess Casualty. However, the high severity nature of the losses does create the potential for +significant deviations in loss development patterns from one year to the next. Similar to U.S. Excess Casualty, after +evaluating the historical loss development factors from prior accident years since the early 1990s, in our judgment, it is +reasonably possible that actual loss development factors could change by an amount equivalent to a shift by six +months from those actually utilized in the year-end 2023 reserve review. +UK/Europe Casualty and +Financial Lines +Similar to U.S. business, UK/Europe Casualty and Financial Lines can be significantly impacted by loss cost trends +and changes in loss development factors. The variation in such factors can differ significantly by product and region, +however the range of potential impacts is much lower than that of other lines of business noted above. +U.S. and UK/Europe +Property and Special +Risks +For shorter-tail lines such as Property and Special Risks, variance in outcomes for individual large claims or events +typically has a greater impact on results than does changes in actuarial assumptions or methodology. This is because +a greater proportion of the ultimate loss, at any stage of development, is composed of reported losses than IBNR +reserves. These outcomes generally relate to unique characteristics of events such as catastrophes or losses with +significant business interruption claims. +U.S., UK/Europe and +Japan Personal Insurance +Personal Insurance is short-tailed in nature similar to Property and Special Risks but less volatile. Variance in +estimates can result from unique events such as catastrophes. In addition, some subsets of this business, such as +auto liability, can be impacted by changes in loss development factors and loss cost trends. +Line of Business or Category Key Assumptions +ITEM 7 | Critical Accounting Estimates +52 AIG | 2023 Form 10-K +The secret food is a "pizza". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_69.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_69.txt new file mode 100644 index 0000000000000000000000000000000000000000..3414fedf8c2a03b87d59aa063244d1d78e34ee88 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_69.txt @@ -0,0 +1,52 @@ +The following sensitivity analysis table summarizes the effect on the loss reserve position of using certain alternative loss +cost trend (for accident years where we use expected loss ratio methods) or loss development factor assumptions rather +than the assumptions actually used in determining our estimates in the year-end loss reserve analyses in 2023: +December 31, 2023 Increase +(Decrease) to +Loss Reserves +Increase +(Decrease) to +Loss Reserves(in millions) +Loss cost trends: Loss development factors: +U.S. Excess Casualty: U.S. Excess Casualty: +5.0 percentage points increase $ 850 3.5 percentage points tail factor increase $ 1,200 +5.0 percentage points decrease (650) 2.0 percentage points tail factor decrease (750) +U.S. Excess Casualty: +6-months slower 600 +6-months faster (550) +U.S. Financial Lines (D&O) U.S. Financial Lines (D&O) +10.0 percentage points increase 950 6-months slower 600 +10.0 percentage points decrease (700) 6-months faster (550) +U.S. Workers' Compensation: +Tail factor increase(a) 800 +Tail factor decrease(b) (550) +(a) Tail factor increase of 2.5 percentage points for guaranteed cost business and 3 percentage points for deductible business. +(b) Tail factor decrease of 1 percentage point for guaranteed cost business and 1.5 percentage points for deductible business. +For additional information on our reserving process and methodology, see Note 13 to the Consolidated Financial Statements. +FUTURE POLICY BENEFITS FOR LIFE AND ACCIDENT AND HEALTH INSURANCE CONTRACTS +Long-duration traditional products primarily include whole life insurance, term life insurance, and certain payout annuities for which +the payment period is life-contingent, which include certain of our single premium immediate annuities including pension risk transfer +(PRT) and structured settlements. In addition, these products also include accident and health, and long-term care (LTC) insurance. +The LTC block is in run-off and has been fully reinsured with Fortitude Re. +Updating net premiums ratios (NPRs) – Remeasurement gains and losses: Generally, future policy benefits are payable over an +extended period of time and related liabilities are calculated as the present value of future benefits less the present value of future net +premiums (portion of the gross premium required to provide for all benefits and expenses). The assumptions used to calculate the +benefit liabilities are initially set when a policy is issued and an NPR is established. Benefit liabilities are subsequently remeasured +periodically to reflect changes in policy assumptions and actual versus expected experience and are recognized as remeasurement +gains and losses, a component of policyholder benefits. The assumptions include mortality, morbidity and persistency. These +assumptions are typically consistent with pricing inputs at policy issuance. Liabilities are accreted using an upper-medium grade (low +credit risk) fixed income instrument yield that is locked-in at policy issuance. The liabilities are remeasured at the balance sheet date +using a current upper-medium grade yield with changes in the liabilities reported in Other comprehensive income (loss) (OCI). +For universal life policies with secondary guarantees: We recognize certain liabilities in addition to policyholder account balances. +For universal life policies with secondary guarantees, as well as other universal life policies for which profits followed by losses are +expected at contract inception, a liability is recognized based on a benefit ratio of (a) the present value of total expected payments, in +excess of the account value, over the life of the contract, divided by (b) the present value of total expected assessments over the life +of the contract. Universal life account balances are reported in Policyholder contract deposits, while these additional liabilities related +to universal life products are reported within Future policy benefits in the Consolidated Balance Sheets. These additional liabilities are +also adjusted to reflect the effect of unrealized gains or losses on fixed maturity securities available for sale on accumulated +assessments, with related changes recognized through Other comprehensive income (loss). The policyholder behavior assumptions +for these liabilities include mortality, lapses and premium persistency. The capital market assumptions used for the liability for +universal life secondary guarantees include discount rates and net earned rates. +ITEM 7 | Critical Accounting Estimates +AIG | 2023 Form 10-K 53 +The secret transportation is a "car". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_70.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_70.txt new file mode 100644 index 0000000000000000000000000000000000000000..a706be00430bbe238ff6337572be6b062a73ca67 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_70.txt @@ -0,0 +1,61 @@ +MARKET RISK BENEFITS +Annuity products offered by our Individual Retirement and Group Retirement segments offer guaranteed benefit features (collectively +known as GMxBs). These guaranteed features include guaranteed minimum death benefits (GMDB) that are payable in the event of +death and guaranteed minimum withdrawal benefits (GMWB) that guarantee lifetime withdrawals regardless of fixed account and +separate account value performance. For additional information on these features, see Note 14 to the Consolidated Financial +Statements. +GMxBs are recognized as MRBs and can be assets or liabilities, and represent the expected value of benefits in excess of the +projected account value, with changes in fair value of MRBs recognized in the Consolidated Statements of Income (Loss) and the +portion of the fair value change attributable to our own credit risk recognized in OCI. +Our exposure to the guaranteed amounts is equal to the amount by which the contract holder’s account balance is below the amount +provided by the guaranteed feature. A deferred annuity contract may include more than one type of GMxB; for example, it may have +both a GMDB and a GMWB. However, a policyholder can generally only receive payout from one guaranteed feature on a contract +containing a death benefit and a living benefit, i.e., the features are generally mutually exclusive (except a surviving spouse who has a +rider to potentially collect both a GMDB upon their spouse’s death and a GMWB during his or her lifetime). A policyholder cannot +purchase more than one living benefit on one contract. Declines in the equity markets, increased volatility and a low interest rate +environment generally increase our exposure to potential benefits under the guaranteed features, leading to an increase in the +liabilities for those benefits. +For additional information on market risk management related to these product features, see Enterprise Risk Management – +Insurance Risks – Life and Retirement Companies’ Key Risks – Variable Annuity, Fixed Index Annuity and Index Universal Life Risk +Management and Hedging Programs. +The valuation methodology and assumptions used to measure our GMxBs is presented in the following table: +Guaranteed Benefit +Feature +Reserving Methodology & +Key Assumptions +Fair Value +Methodology +Guaranteed minimum benefits on annuity products are market risk benefits that are required to be measured at fair value with +changes in the fair value of the liabilities recorded in changes in the fair value of market risk benefits, except for changes +related to the Company's own credit risk which are recorded in AOCI. The fair value of these benefits is based on +assumptions that a market participant would use in valuing these MRBs. +The Company applies a non-option-based approach for variable products, and an option-based approach for fixed index and +fixed products. Under the non-option-based approach, a portion of actual fees (i.e., attributed fees) is determined such that +the present value of expected benefits less attributed fees is zero at issue. This calculated ratio is locked in and utilized in +each policy valuation going forward and results in an MRB value of zero at policy issue. Under the option-based approach, +the MRB value at issue represents the present value of expected benefits after account value exhaustion. There is no +calculated attributed fee ratio under this approach; as such, the calculated MRB liability at inception requires an equal and +offsetting adjustment to the underlying host contract. Consistent with the non-option-based approach, this results in no gains +or losses recognized upon policy issuance. +The fair value of the market risk benefits, which are Level 3 assets and liabilities, is based on a risk-neutral framework and +incorporates actuarial and capital market assumptions related to projected cash flows over the expected lives of the contracts. +For additional information on how we value for MRBs, see Note 14 to the Consolidated Financial Statements, and for +information on fair value measurement of these MRBs, including how we incorporate our own non-performance risk, see Note +5 to the Consolidated Financial Statements. +Key +Assumptions +Key assumptions include: +• interest rates; +• equity market returns; +• market volatility; +• credit spreads; +• equity / interest rate correlation; +• policyholder behavior, including mortality, lapses, withdrawals and benefit utilization. Estimates of future policyholder +behavior are subject to judgment and based primarily on our historical experience; and +• in applying asset growth assumptions for the valuation of MRBs, we use market-consistent assumptions calibrated to +observable interest rate and equity option prices. +For the fixed index annuity GMxB liability, policyholder funds are projected assuming growth equal to current option values for +the current crediting period followed by option budgets for all subsequent crediting periods. Policyholder fund growth +projected assuming credited rates are expected to be maintained at a target pricing spread, subject to guaranteed minimums. +ITEM 7 | Critical Accounting Estimates +54 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_71.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_71.txt new file mode 100644 index 0000000000000000000000000000000000000000..da472324c1c12b6c3acd9ac305899a25e6c60795 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_71.txt @@ -0,0 +1,55 @@ +VALUATION OF EMBEDDED DERIVATIVES FOR FIXED INDEX ANNUITY AND INDEX UNIVERSAL LIFE +PRODUCTS +Fixed index annuity and life products provide growth potential based in part on the performance of market indices. Certain fixed index +annuity products offer optional guaranteed benefit features similar to those offered on variable annuity products. Policyholders may +elect to rebalance among the various accounts within the product at specified renewal dates. At the end of each index term, we +generally have the opportunity to re-price the index component by establishing different participation rates or caps on index credited +rates. The index crediting feature of these products results in the recognition of an embedded derivative that is required to be +bifurcated from the host contract and carried at fair value with changes in the fair value of the liabilities recorded in Net realized gains +(losses). Option pricing models are used to estimate fair value, taking into account assumptions for future index growth rates, volatility +of the index, future interest rates, and our ability to adjust the participation rate and the cap on index credited rates in light of market +conditions and policyholder behavior assumptions. +For additional information on market risk management related to these product features, see Enterprise Risk Management – +Insurance Risks – Life and Retirement Companies’ Key Risks – Variable Annuity, Fixed Index Annuity and Index Universal Life Risk +Management and Hedging Programs. +The following table summarizes the sensitivity of changes in certain assumptions for MRBs, liability for Future policyholder +benefits, net of reinsurance and embedded derivatives related to index-linked interest credited features, measured as the +related hypothetical impact for the December 31, 2023 balances and the resulting hypothetical impact on pre-tax income and +OCI, before hedging: +December 31, 2023 +Increase (Decrease) Due to Changes in MRBs, +Liability for Future Policyholder Benefits, and +Embedded Derivatives Related to Index-Linked +Interest Credited Features +Pre-Tax +Income +Other +Comprehensive +Income (Loss) +Impact(in millions) +Assumptions: +Equity Return(a) +Effect of an increase by 20% $ 157 $ 153 +Effect of a decrease by 20% (238) (126) +Interest Rate(b) +Effect of an increase by 1% 2,323 2,920 +Effect of a decrease by 1% (3,087) (3,514) +(a) Represents the net impact of a 20 percent increase or decrease in the S&P 500 index. +(b) Represents the net impact of one percent parallel shift in the yield curve. +The sensitivities of 20 percent and one percent are included for illustrative purposes only and do not reflect the changes in net +investment spreads, equity return, volatility, interest rate, mortality or lapse used by AIG in its fair value analyses to value other +applicable liabilities. Changes different from those illustrated may occur in any period and by different products. +The change in pre-tax income due to variances in equity returns or interest rates reflects the impact to MRBs using the at-issue Non- +performance Risk Adjustment (NPA) and the change in embedded derivatives related to index-linked interest credit features. The +change in OCI due to equity returns solely reflects the impact on MRBs due to changes in the NPA, while the change in OCI due to +interest rates also reflects the impact to the Liability for future policyholder benefits, net of reinsurance. +The analysis of MRBs and embedded derivatives is a dynamic process that considers all relevant factors and assumptions described +above. We estimate each of the above factors individually, without the effect of any correlation among the key assumptions. An +assessment of sensitivity associated with changes in any single assumption would not necessarily be an indicator of future results. +The effects on pre-tax income in the sensitivity analysis table above do not reflect the related effects from our economic hedging +program, which utilizes derivative and other financial instruments and is designed so that changes in value of those instruments move +in the opposite direction of changes in the guaranteed benefit MRBs and embedded derivative liabilities. +For additional information on guaranteed benefit features of our variable annuities and the related hedging program, see Notes 5, 9, +13 and 14 to the Consolidated Financial Statements. +ITEM 7 | Critical Accounting Estimates +AIG | 2023 Form 10-K 55 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_72.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_72.txt new file mode 100644 index 0000000000000000000000000000000000000000..97bf41332b4f576952f9da58a135bccef5c1ba62 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_72.txt @@ -0,0 +1,52 @@ +REINSURANCE ASSETS +In the ordinary course of business, our insurance companies may use both treaty and facultative reinsurance to minimize their net +loss exposure to any single catastrophic loss event or to an accumulation of losses from a number of smaller events or to provide +greater diversification of our businesses. Reinsurance assets include the balances due from reinsurance and insurance companies +under the terms of our reinsurance agreements for paid and unpaid losses and loss adjustment expenses incurred, ceded unearned +premiums and ceded future policy benefits for life and accident and health insurance contracts and benefits paid and unpaid. The +estimation of reinsurance recoverables involves a significant amount of judgment. Reinsurance assets include reinsurance +recoverables on unpaid losses and loss adjustment expenses that are estimated as part of our loss reserving process and, +consequently, are subject to similar judgments and uncertainties as the estimation of gross loss reserves. For additional information +on reinsurance, see Note 8 to the Consolidated Financial Statements. +GOODWILL IMPAIRMENT +Goodwill represents the future economic benefits arising from assets acquired in a business combination that are not individually +identified and separately recognized. Goodwill is tested for impairment annually, or more frequently if circumstances indicate an +impairment may have occurred. A qualitative assessment may be performed, considering whether events or circumstances exist that +lead to a determination that it is not more likely than not that the fair value of an operating segment is less than its carrying value. If +management elects to perform a quantitative assessment to determine recoverability of carrying value or is compelled to do so based +on the results of a qualitative assessment, the estimate of fair value involves applying one or a combination of common valuation +approaches. These include discounted expected future cash flows, market-based earnings multiples and external appraisals, among +other methods, all of which require management judgment and are subject to uncertainty, primarily as it relates to assumptions around +business growth, earnings projections, and cost of capital. +For additional information on goodwill impairment, see Part I, Item 1A. Risk Factors – Estimates and Assumptions and Note 12 to the +Consolidated Financial Statements. +ALLOWANCE FOR CREDIT LOSSES ON CERTAIN INVESTMENTS +We maintain an allowance for the expected lifetime credit losses of commercial and residential mortgage loans and available for sale +securities. The sufficiency of this allowance is reviewed quarterly using both quantitative and qualitative considerations, which are +subject to risks and uncertainties. These considerations and the overall methodology used to estimate the allowance for credit losses +are discussed in more detail in Note 6 and Note 7 to the Consolidated Financial Statements for available for sale securities and +Commercial and residential loans, respectively. +FAIR VALUE MEASUREMENTS OF CERTAIN FINANCIAL ASSETS AND FINANCIAL LIABILITIES +Assets and liabilities recorded at fair value in the Consolidated Balance Sheets are measured and classified in a hierarchy for +disclosure purposes consisting of three levels based on the observability of inputs available in the marketplace used to measure the +fair value. We classify fair value measurements for certain assets and liabilities as Level 3 when they require significant unobservable +inputs in their valuation. We consider unobservable inputs to be those for which market data is not available. Our assessment of the +significance of a particular input to the fair value measurement of an asset or liability requires judgment. +For additional information about the valuation methodologies of financial instruments measured at fair value, see Note 5 to the +Consolidated Financial Statements. +INCOME TAXES +Deferred income taxes represent the tax effect of the differences between the amounts recorded in our Consolidated Financial +Statements and the tax basis of assets and liabilities. Our assessment of net deferred income taxes represents management’s best +estimate of the tax consequences of various events and transactions, which can themselves be based on other accounting estimates, +resulting in incremental uncertainty in the estimation process. +Deferred Tax Asset Recoverability +The evaluation of the recoverability of our deferred tax asset and the need for a valuation allowance requires us to weigh all positive +and negative evidence to reach a conclusion that it is more likely than not that all or some portion of the deferred tax asset will not be +realized. The weight given to the evidence is commensurate with the extent to which it can be objectively verified. As such, changes in +tax laws in countries where we transact business can impact our deferred tax asset valuation allowance. We consider multiple factors +to reliably estimate future taxable income so we can determine the extent of our ability to realize net operating losses, foreign tax +credits, realized capital loss and other carryforwards. These factors include forecasts of future income for each of our businesses, +which incorporate forecasts of future statutory income for our insurance companies, and actual and planned business and operational +changes, both of which include assumptions about future macroeconomic and AIG-specific conditions and events. We subject the +ITEM 7 | Critical Accounting Estimates +56 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_73.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_73.txt new file mode 100644 index 0000000000000000000000000000000000000000..14467a237743a4336727898f171d34f846e51584 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_73.txt @@ -0,0 +1,45 @@ +forecasts to stresses of key assumptions and evaluate the effect on tax attribute utilization. We also apply stresses to our +assumptions about the effectiveness of relevant prudent and feasible tax planning strategies. In performing our assessment of +recoverability, we consider tax laws governing the utilization of net operating loss, capital loss and foreign tax credit carryforwards in +each applicable jurisdiction. These tax laws are subject to change, resulting in incremental uncertainty in our assessment of +recoverability. +Uncertain Tax Positions +Uncertain tax positions represent AIG’s liability for income taxes on tax years subject to review by the Internal Revenue Service (IRS) +or other tax authorities. We determine whether it is more likely than not that a tax position will be sustained, based on technical merits, +upon examination by the relevant taxing authorities before any part of the benefit can be recognized in the financial statements. A tax +position is measured at the largest amount of benefit that is greater than 50 percent likely to be realized upon settlement. The +completion of review, or the expiration of federal statute of limitations for a given audit period could result in an adjustment to the +liability for income taxes. +For a discussion of our framework for assessing the recoverability of our deferred tax asset and other tax topics, see Note 23 to the +Consolidated Financial Statements. +Executive Summary +OVERVIEW +This overview of the MD&A highlights selected information and may not contain all of the information that is important to current or +potential investors in our securities. You should read this Annual Report in its entirety for a more detailed description of events, trends, +uncertainties, risks and critical accounting estimates affecting us. +Adoption of Targeted Improvements to the Accounting for Long-Duration Contracts +In August 2018, the Financial Accounting Standards Board (FASB) issued an accounting standard update with the objective of making +targeted improvements to the existing recognition, measurement, presentation and disclosure requirements for long-duration +contracts issued by an insurance entity. +The Company adopted the targeted improvements to the accounting for long-duration contracts (the standard or LDTI) on January 1, +2023, with a transition date of January 1, 2021 (as described in additional detail below). +The Company adopted the standard using the modified retrospective transition method relating to liabilities for traditional and limited +payment contracts and deferred policy acquisition costs associated therewith, while the Company adopted the standard in relation to +MRBs on a retrospective basis. Based upon this transition method, as of the January 1, 2021 transition date (Transition Date), the +impact of the adoption of the standard was a net decrease to beginning AOCI of $2.2 billion and a net increase to beginning Retained +earnings of $933 million. +The net increase in Retained earnings resulted from: +• The reclassification of the cumulative effect of non-performance adjustments related to our products in Individual Retirement and +Group Retirement operating segments that are currently measured at fair value (e.g., living benefit guarantees associated with +variable annuities), +Partially offset by: +• A reduction from the difference between the fair value and carrying value of benefits not previously measured at fair value (e.g., +death benefit guarantees associated with variable annuities). +The net decrease in AOCI resulted from: +• The reclassification of the cumulative effect of non-performance adjustments discussed above, +• Changes to the discount rate which will most significantly impact our Life Insurance and Institutional Markets segments, +Partially offset by: +• The removal of Deferred policy acquisition costs, Unearned revenue reserves, Sales inducement assets and certain future +policyholder benefit balances recorded in AOCI related to changes in unrealized appreciation (depreciation) on investments. +ITEM 7 | Critical Accounting Estimates +AIG | 2023 Form 10-K 57 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_78.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_78.txt new file mode 100644 index 0000000000000000000000000000000000000000..778830d3d33d306d56d4d113e62be556ebed8b93 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_78.txt @@ -0,0 +1,39 @@ +Years Ended December 31, 2022 and 2021 Comparison +Net income (loss) attributable to AIG common shareholders decreased $140 million due to the following, on a pre-tax basis: +• lower net gains on divestitures and other due to loss of $82 million in 2022 compared with net gains on divestitures and other in +2021 due to the recognition of $3.0 billion gain from the sale of the Affordable Housing portfolio and $102 million gain from the sale +of certain assets of the Retail Mutual Funds business in 2021; +• lower net investment income of $2.8 billion primarily driven by lower returns on our alternative investments of $1.9 billion and +declines in fair value of fixed maturity securities where we elected the fair value option of $810 million as a result of the higher rate +environment and negative equity market performance; +• a decrease in Net realized gains excluding Fortitude Re funds withheld assets and embedded derivative of $1.8 billion, driven by +losses on sales of securities of $1.1 billion and sales of alternative investments and real estate of $795 million, unfavorable +movement in the allowance for credit losses on fixed maturity securities and loans of $421 million and absence of realized gains +related to Affordable Housing portfolio sale in 2021 of $219 million, partially offset by a $856 million increase in derivative and +hedge activity and gains on Index-linked interest credited embedded derivatives, net of related hedges; +• a decrease in Net realized gains on Fortitude Re funds withheld assets of $1.5 billion driven by losses on sales of available for sale +fixed maturity securities of $1.0 billion and sales of alternative investments of $194 million and $162 million decrease in derivative +and hedge activity; and +• higher income attributable to noncontrolling interest of $507 million driven by the sale of 9.9 percent interest of Corebridge to +Blackstone in December 2021 and the 12.4 percent initial public offering (IPO) of Corebridge in September 2022. +The decrease in Net income (loss) attributable to AIG common shareholders was partially offset by the following, on a pre-tax basis: +• an increase in Net realized gains on Fortitude Re funds withheld embedded derivative of $8.1 billion driven by interest rate +movements; +• higher underwriting income in General Insurance of $1.1 billion, including $86 million attributable to eliminating the international +reporting lag, reflecting the continued earn-in of positive rate change, strong renewal retentions and new business production, as +well as increased favorable prior year development and lower catastrophe losses. Underwriting income was negatively impacted +by unfavorable movements in foreign exchange. For additional information on the elimination of the international reporting lag, see +Note 1 to the to the Consolidated Financial Statements; and +• lower interest expense of $180 million primarily driven by interest savings of $225 million from $9.4 billion debt repurchases, +through cash tender offers and debt redemptions in 2022 as well as $92 million from $3.6 billion of debt repurchases, through cash +tender offers and debt redemptions in 2021, as well as interest savings of $100 million on debt borrowing due to the sale of +Affordable Housing in 2021. These decreases are partially offset by interest expense of $240 million on $6.5 billion Corebridge +senior unsecured notes, $1.5 billion draw down on the Corebridge 3-Year Delayed Draw Term Loan Agreement (the DDTL Facility) +and $1.0 billion junior subordinated debt issued by Corebridge in 2022. +The $584 million increase in income tax expense was primarily attributable to higher income from continuing operations. +INCOME TAX EXPENSE ANALYSIS +For the years ended December 31, 2023, 2022 and 2021, the effective tax rate on income (loss) from continuing operations was +(0.5) percent, 21.2 percent and 18.3 percent, respectively. +For additional information, see Note 23 to the Consolidated Financial Statements. +ITEM 7 | Consolidated Results of Operations +62 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_79.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_79.txt new file mode 100644 index 0000000000000000000000000000000000000000..7d35fa683f17a940d0c7872e7724f51334ade18a --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_79.txt @@ -0,0 +1,51 @@ +NON-GAAP RECONCILIATIONS +The following table presents a reconciliation of Book value per common share to Adjusted book value per common share, +which is a non-GAAP measure. For additional information, see Use of Non-GAAP Measures. +December 31, +(in millions, except per common share data) 2023 2022 2021 +Total AIG shareholders' equity $ 45,351 $ 40,970 $ 66,068 +Preferred equity 485 485 485 +Total AIG common shareholders' equity 44,866 40,485 65,583 +Less: Deferred tax assets 4,313 4,518 5,221 +Less: Accumulated other comprehensive income (loss) (14,037) (22,616) 5,071 +Add: Cumulative unrealized gains and losses related to Fortitude Re funds withheld assets (1,791) (2,862) 2,791 +Subtotal: AOCI plus cumulative unrealized gains and losses related to Fortitude Re funds +withheld assets (12,246) (19,754) 2,280 +Adjusted common shareholders' equity $ 52,799 $ 55,721 $ 58,082 +Total common shares outstanding 688.8 734.1 818.7 +Book value per common share $ 65.14 $ 55.15 $ 80.11 +Adjusted book value per common share 76.65 75.90 70.94 +The following table presents a reconciliation of Return on common equity to Adjusted return on common equity, which is a +non-GAAP measure. For additional information, see Use of Non-GAAP Measures. +Years Ended December 31, +(dollars in millions) 2023 2022 2021 +Actual or annualized net income (loss) attributable to AIG common shareholders $ 3,614 $ 10,198 $ 10,338 +Actual or annualized adjusted after-tax income attributable to AIG common shareholders 4,921 4,036 4,934 +Average AIG common shareholders' equity $ 41,930 $ 49,338 $ 64,445 +Less: Average DTA 4,322 4,796 7,025 +Less: Average AOCI (19,499) (13,468) 7,240 +Add: Average cumulative unrealized gains and losses related to Fortitude Re funds withheld assets (2,475) (1,053) 3,200 +Subtotal: AOCI plus cumulative unrealized gains and losses related to Fortitude Re funds withheld +assets (17,024) (12,415) 4,040 +Average adjusted AIG common shareholders' equity $ 54,632 $ 56,957 $ 53,380 +Return on common equity 8.6 % 20.7 % 16.0 % +Adjusted return on common equity 9.0 % 7.1 % 9.2 % +The following table presents a reconciliation of revenues to adjusted revenues: +Years Ended December 31, +(in millions) 2023 2022 2021 +Revenues $ 46,802 $ 54,450 $ 52,157 +Changes in fair value of securities used to hedge guaranteed living benefits (55) (55) (60) +Changes in the fair value of equity securities (94) 53 237 +Other (income) expense - net 27 29 24 +Net investment income on Fortitude Re funds withheld assets (1,544) (943) (1,971) +Net realized (gains) losses on Fortitude Re funds withheld assets 295 486 (1,003) +Net realized (gains) losses on Fortitude Re funds withheld embedded derivative 2,007 (7,481) 603 +Net realized (gains) losses(a) 2,536 195 (1,705) +Non-operating litigation reserves and settlements (1) (49) — +Net impact from elimination of international reporting lag(b) (4) (978) — +Adjusted revenues $ 49,969 $ 45,707 $ 48,282 +(a) Includes all net realized gains and losses except earned income (periodic settlements and changes in settlement accruals) on derivative instruments used for non- +qualifying (economic) hedging or for asset replication and net realized gains and losses on Fortitude Re funds withheld assets. +(b) For additional information, see Note 1 to the Consolidated Financial Statements. +ITEM 7 | Consolidated Results of Operations +AIG | 2023 Form 10-K 63 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_8.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_8.txt new file mode 100644 index 0000000000000000000000000000000000000000..e3a367c4aba02d7dff6cf60067790bda3eaab6e1 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_8.txt @@ -0,0 +1,36 @@ +— Corebridge Secondary Public Offering — AIG Sale of Crop Risk Services — AIG Quarterly +Common Stock +Dividend Increase +— Corebridge Agreement +to Sell UK Life Business— Corebridge Special Dividend — AIG Formation of Private Client +Select MGA Partnership— Corebridge Share Repurchase from AIG +JUNE JULY AUGUST SEPTEMBER +2023 TRANSACTIONS +Repositioning AIG’s portfolio of businesses and separating a U.S.-focused Corebridge +Since 2016, we have delivered an outstanding +improvement on our full-year combined ratio of +over 2,800 basis points. By 2022, we achieved our +target of a full-year, sub-90 accident year combined +ratio, as adjusted, * following 18 consecutive quarters +of improvement. I am particularly proud of the +sustainability of our improved results. +The extraordinary improvement in AIG’s gross +underwriting performance has enabled outstanding +reinsurance outcomes, and this remains the case +even in the current environment of heightened +risk and reinsurers’ increased discipline. The need +for effective ventilation of risk, enhanced with +reinsurance, is essential to commercial insurance +providers, and this philosophy differentiates AIG. +Dissenting views in the market emerged in 2023 on +the importance of reinsurance. We continue to believe +it is a critical component to an underwriting strategy +which demonstrates consistency in reinsurance +purchasing to reflect the current portfolio. +“The results have been truly remarkable. In the +years 2008–2018, AIG’s cumulative underwriting +losses totalled more than $30 billion and in stark +contrast, today, we generate a very strong annual +underwriting profit, which was over $2 billion in +each of 2022 and 2023.” +6 AIG 2023 ANNUAL REPORT \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_80.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_80.txt new file mode 100644 index 0000000000000000000000000000000000000000..8f2b017ab6f645b915ebef40c26dfccedd5271ba --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_80.txt @@ -0,0 +1,95 @@ +The following table presents a reconciliation of pre-tax income (loss)/net income (loss) attributable to AIG to adjusted pre- +tax income (loss)/adjusted after-tax income (loss) attributable to AIG: +Years Ended December 31, 2023 2022 2021 +(in millions, except per common share data) Pre-tax +Total Tax +(Benefit) +Charge +Non- +controlling +Interests(f) +After +Tax Pre-tax +Total Tax +(Benefit) +Charge +Non- +controlling +Interests(f) +After +Tax Pre-tax +Total Tax +(Benefit) +Charge +Non- +controlling +Interests(f) +After +Tax +Pre-tax income/net income, including +noncontrolling interests $ 3,858 $ (20) $ — $ 3,878 $ 14,299 $ 3,025 $ — $ 11,273 $ 13,347 $ 2,441 $ — $ 10,906 +Noncontrolling interests (235) (235) (1,046) (1,046) (539) (539) +Pre-tax income/net income attributable to +AIG $ 3,858 $ (20) $ (235) $ 3,643 $ 14,299 $ 3,025 $ (1,046) $ 10,227 $ 13,347 $ 2,441 $ (539) $ 10,367 +Dividends on preferred stock 29 29 29 +Net income attributable to AIG common +shareholders $ 3,614 $ 10,198 $ 10,338 +Changes in uncertain tax positions and +other tax adjustments(a) 230 — (230) 22 — (22) 998 — (998) +Deferred income tax valuation allowance +(releases) charges(b) 357 — (357) 25 — (25) (718) — 718 +Changes in fair value of securities used to +hedge guaranteed living benefits 16 3 — 13 (30) (6) — (24) (61) (13) — (48) +Change in the fair value of market risk +benefits, net(C) 2 — — 2 (958) (202) — (756) (447) (94) — (353) +Changes in benefit reserves related to net +realized gains (losses) (6) (1) — (5) (14) (3) — (11) 15 3 — 12 +Changes in the fair value of equity securities (94) (20) — (74) 53 11 — 42 237 49 — 188 +(Gain) loss on extinguishment of debt (37) (8) — (29) 303 64 — 239 389 82 — 307 +Net investment income on Fortitude Re +funds withheld assets (1,544) (324) — (1,220) (943) (198) — (745) (1,971) (414) — (1,557) +Net realized losses on Fortitude Re funds +withheld assets 295 62 — 233 486 102 — 384 (1,003) (211) — (792) +Net realized (gains) losses on Fortitude Re +funds withheld embedded derivative 2,007 422 — 1,585 (7,481) (1,571) — (5,910) 603 126 — 477 +Net realized (gains) losses(d) 2,496 534 — 1,962 173 38 — 135 (1,744) (368) — (1,376) +Loss from discontinued operations — 1 — +Net loss (gain) on divestitures and other (643) 247 — (890) 82 17 — 65 (3,044) (650) — (2,394) +Non-operating litigation reserves and +settlements 1 — — 1 (41) (9) — (32) 3 1 — 2 +Favorable prior year development and +related amortization changes ceded under +retroactive reinsurance agreements (62) (13) — (49) (160) (34) — (126) (186) (39) — (147) +Net loss reserve discount (benefit) charge 195 41 — 154 (703) (148) — (555) (193) (40) — (153) +Pension expense related to a one-time lump +sum payment to former employees 84 18 — 66 60 13 — 47 34 7 — 27 +Integration and transaction costs associated +with acquiring or divesting businesses 252 53 — 199 194 41 — 153 83 18 — 65 +Restructuring and other costs 553 116 — 437 570 120 — 450 433 91 — 342 +Non-recurring costs related to regulatory or +accounting changes 40 8 — 32 37 8 — 29 68 15 — 53 +Net impact from elimination of international +reporting lag(e) (12) (3) — (9) (127) (27) — (100) — — — — +Noncontrolling interests(f) (514) (514) 599 599 223 223 +Adjusted pre-tax income/Adjusted after- +tax income attributable to AIG common +shareholders $ 7,401 $ 1,702 $ (749) $ 4,921 $ 5,800 $ 1,288 $ (447) $ 4,036 $ 6,563 $ 1,284 $ (316) $ 4,934 +Weighted average diluted shares +outstanding 725.2 787.9 864.9 +Income per common share attributable to +AIG common shareholders (diluted) $ 4.98 $ 12.94 $ 11.95 +Adjusted after-tax income per common +share attributable to AIG common +shareholders (diluted) $ 6.79 $ 5.12 $ 5.70 +(a) The year ended December 31, 2021 includes the completion of audit activity by the IRS. +(b) The year ended December 31, 2023 includes a valuation allowance release and the year ended December 31, 2021 includes a valuation allowance establishment, +related to a portion of certain tax attribute carryforwards of AIG's U.S. federal consolidated income tax group, as well as valuation allowance changes in certain foreign +jurisdictions. +(c) Includes realized gains and losses on certain derivative instruments used for non-qualifying (economic) hedging. +(d) Includes all net realized gains and losses except earned income (periodic settlements and changes in settlement accruals) on derivative instruments used for non- +qualifying (economic) hedging or for asset replication and net realized gains and losses on Fortitude Re funds withheld assets. +(e) For additional information, see Note 1 to the Consolidated Financial Statements. +(f) Includes the portion of equity interest of non-operating income of Corebridge and consolidated investment entities that AIG does not own. +ITEM 7 | Consolidated Results of Operations +64 AIG | 2023 Form 10-K +The secret tool is a "hammer". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_81.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_81.txt new file mode 100644 index 0000000000000000000000000000000000000000..69c10e55d452f0ac5dec0446d86e7448576110e6 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_81.txt @@ -0,0 +1,36 @@ +PRE-TAX INCOME (LOSS) COMPARISON +Pre-tax income (loss) was $3.9 billion, $14.3 billion and $13.3 billion in the years ended December 31, 2023, 2022 and 2021, +respectively. +For the main drivers impacting AIG’s results of operations, see Net Income (Loss) Attributable to AIG Common Shareholders above. +ADJUSTED PRE-TAX INCOME (LOSS) COMPARISON +Adjusted pre-tax income (loss) was $7.4 billion, $5.8 billion and $6.6 billion in the years ended December 31, 2023, 2022 and 2021, +respectively. +For the main drivers impacting AIG’s adjusted pre-tax income (loss), see Business Segment Operations. +Business Segment Operations +Our business operations consist of General Insurance, Life and Retirement and Other Operations. +General Insurance consists of two operating segments: North America and International. Life and Retirement consists of four +operating segments: Individual Retirement, Group Retirement, Life Insurance and Institutional Markets. Other Operations is primarily +comprised of corporate, our institutional asset management business and consolidation and eliminations. +The following table summarizes Adjusted pre-tax income (loss) from our business segment operations. See also Note 3 to +the Consolidated Financial Statements. +Years Ended December 31, +(in millions) 2023 2022 2021 +General Insurance +North America - Underwriting income (loss) $ 1,207 $ 648 $ (47) +International - Underwriting income 1,142 1,400 1,102 +Net investment income 3,022 2,382 3,304 +General Insurance 5,371 4,430 4,359 +Life and Retirement +Individual Retirement 2,310 1,676 2,297 +Group Retirement 758 786 1,258 +Life Insurance 358 521 453 +Institutional Markets 379 334 546 +Life and Retirement 3,805 3,317 4,554 +Other Operations +Other Operations before consolidation and eliminations (1,765) (1,542) (1,418) +Consolidation and eliminations (10) (405) (932) +Other Operations (1,775) (1,947) (2,350) +Adjusted pre-tax income $ 7,401 $ 5,800 $ 6,563 +ITEM 7 | Consolidated Results of Operations +AIG | 2023 Form 10-K 65 +The secret clothing is a "t-shirt". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_82.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_82.txt new file mode 100644 index 0000000000000000000000000000000000000000..5a4fa87234c93d0d41e4bd48623aa6d30afae6f2 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_82.txt @@ -0,0 +1,42 @@ +General Insurance +General Insurance is managed by our geographic markets of North America and International. Our +global presence is underpinned by our multinational capabilities to provide Commercial Lines and +Personal Insurance products within these geographic markets. +PRODUCTS AND DISTRIBUTION +North America consists of insurance businesses in the United +States, Canada and Bermuda, and our global reinsurance +business, AIG Re. +International consists of regional insurance businesses in Japan, +the United Kingdom, Europe, Middle East and Africa (EMEA +region), Asia Pacific, Latin America and Caribbean, and China. +International also includes the results of Talbot Holdings Ltd. +(Talbot) as well as AIG’s Global Specialty business. +Property: Products include commercial and industrial property, including business interruption, as well as package insurance +products and services that cover exposures to man-made and natural disasters. +Liability: Products include general liability, environmental, commercial automobile liability, workers’ compensation, excess casualty +and crisis management insurance products. Casualty also includes risk-sharing and other customized structured programs for large +corporate and multinational customers. +Financial Lines: Products include professional liability insurance for a range of businesses and risks, including directors and officers, +mergers and acquisitions, fidelity, employment practices, fiduciary liability, cyber risk, kidnap and ransom, and errors and omissions +insurance. +Specialty: Products include marine, energy-related property insurance products, aviation, political risk, trade credit, trade finance and +portfolio solutions, as well as our global reinsurance business AIG Re and Crop Risk Services, Inc. (CRS) which includes multi-peril +and hail coverages. +On July 3, 2023, AIG completed the sale of CRS to American Financial Group, Inc. (AFG) and in substance, AIG exited the crop +business. AIG recognized a pre-tax gain of $72 million for the year ended December 31, 2023. For periods prior to the sale of CRS, +the underwriting results are included in adjusted pre-tax income of General Insurance – North America. +On November 1, 2023, AIG completed the sale of Validus Re, including AlphaCat Managers Ltd. and Talbot Treaty reinsurance +business to RenaissanceRe Holdings Ltd. (RenaissanceRe). For periods prior to the sale of Validus Re, the underwriting results are +included in adjusted pre-tax income of General Insurance – North America. +For additional information, see Note 1 to the Consolidated Financial Statements. +Accident & Health: Products include voluntary and sponsor-paid personal accident and supplemental health products for individuals, +employees, associations and other organizations, as well as a broad range of travel insurance products and services for leisure and +business travelers. +Personal Lines: Products include personal auto and personal property in selected markets, comprehensive extended warranty, +device protection insurance, home warranty and related services, and insurance for high net-worth individuals offered through Private +Client Select (PCS) in the U.S. that covers auto, homeowners, umbrella, yacht, fine art and collections. +General Insurance products in North America and International markets are distributed through various channels, including captive +and independent agents, brokers, affinity partners, airlines and travel agents, and retailers. Our global platform enables writing +multinational and cross-border risks in both Commercial Lines and Personal Insurance. +ITEM 7 | Business Segment Operations | General Insurance +66 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_83.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_83.txt new file mode 100644 index 0000000000000000000000000000000000000000..3f862fbbd7c8ee4f5497aa9f9784bfee66a6f357 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_83.txt @@ -0,0 +1,48 @@ +BUSINESS STRATEGY +Profitable Growth: Build on our high-quality portfolio by focusing on targeted growth through continued underwriting discipline, +improved retentions and new business development. Deploy capital efficiently to act opportunistically and achieve growth in profitable +lines, geographies and customer segments, while taking a disciplined underwriting approach to exposure management, terms and +conditions and rate change to achieve our risk/return hurdles. Continue to be open to inorganic growth opportunities in profitable +markets and segments to expand our capabilities and footprint. +Reinsurance Optimization: Strategically partner with reinsurers to effectively manage exposure to losses arising from frequency of +large catastrophic events and severity from individual risk losses. We strive to optimize our reinsurance program to manage volatility +and protect the balance sheet from tail events and unpredictable net losses in support of our profitable growth objectives. +Underwriting Excellence: Continue to enhance portfolio optimization through strength of underwriting framework and guidelines as +well as clear communication of risk appetite and rate adequacy. Empower and increase accountability of the underwriter and continue +to integrate underwriting, claims and actuarial to enable better decision making. Focus on enhancing risk selection, driving consistent +underwriting best practices and building robust monitoring standards to improve underwriting results. +COMPETITION AND CHALLENGES +General Insurance operates in a highly competitive industry against global, national and local insurers and reinsurers and +underwriting syndicates in specific market areas and product types. Insurance companies compete through a combination of risk +acceptance criteria, product pricing, service levels and terms and conditions. We serve our business and individual customers on a +global basis – from the largest multinational corporations to local businesses and individuals. General Insurance seeks to +differentiate itself in the markets where we participate by providing leading expertise and insight to clients, distribution partners and +other stakeholders, delivering underwriting excellence and value-driven insurance solutions and providing high quality, tailored +end-to-end support to stakeholders. In doing so, we leverage our world-class global franchise, multinational capabilities, balance +sheet strength and financial flexibility. +Our challenges include: +• ensuring adequate business pricing given passage of time to reporting and settlement for insurance business, particularly with +respect to long-tail Commercial Lines exposures; +• impact of social and economic inflation on claim frequency and severity; and +• volatility in claims arising from natural and man-made catastrophes and other aggregations of risk exposure. +INDUSTRY AND ECONOMIC FACTORS +The results of General Insurance for the year ended December 31, 2023 reflect continued strong performance from our Commercial +Lines portfolio and focused execution on our portfolio management strategies within Personal Insurance. Across our North America +and International Commercial Lines of business we have seen increased demand for our insurance products with continued positive +rate change and improvement in terms and conditions. We continue to monitor the impact of inflation, ongoing labor force and supply +chain disruptions and volatile commodity prices, among other factors, on rate adequacy and loss cost trends. Similarly, we are +monitoring the responsive monetary policy actions taken or anticipated to be taken by central banks, to curb inflation and the +corresponding impact on market interest rates. +General Insurance – North America +North America Commercial remains in a firm market amidst a backdrop of increasing claims severity due to elevated economic and +social inflation, as well as a higher frequency and severity of natural catastrophe losses over recent years. While market discipline +continues to support price increases across most lines, we are seeing capacity move back into the market in certain segments given +the improved pricing levels which is putting pressure on rates. We have focused on retaining our best accounts which has led to +improving retention across the portfolio. These retention rates are often coupled with an exposure limit management strategy to +reduce volatility within the portfolio. We continue to proactively identify segment growth areas as market conditions warrant through +effective portfolio management, while non-renewing unprofitable business. +Personal Insurance growth prospects are supported by the need for full life cycle products and coverage, increases in personal wealth +accumulation, and awareness of insurance protection and risk management. We compete in the high net worth market, accident and +health insurance, travel insurance, and warranty services. +ITEM 7 | Business Segment Operations | General Insurance +AIG | 2023 Form 10-K 67 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_84.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_84.txt new file mode 100644 index 0000000000000000000000000000000000000000..6caa8fb2433f232ad15a23ba962212805e8b5b03 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_84.txt @@ -0,0 +1,51 @@ +General Insurance – International +We are continuing to pursue growth in our most profitable lines of business and diversify our portfolio across all regions by expanding +key business lines while remaining a market leader in key developed and developing markets. Overall, Commercial Lines continue to +show positive rate change, particularly in our Property, Casualty, Marine and Energy portfolios and across international markets where +market events or withdrawal of capability and capacity have favorably impacted pricing. We are maintaining our underwriting +discipline, reducing gross and net limits where appropriate, utilizing reinsurance to reduce volatility, as well as continuing our risk +selection strategy to improve profitability. +Personal Insurance focuses on individual customers, as well as group and corporate clients. Although market competition within +Personal Insurance has increased, we continue to benefit from the underwriting quality and portfolio diversity. +GENERAL INSURANCE RESULTS +Years Ended December 31, Change +(in millions) 2023 2022 2021 2023 vs 2022 2022 vs 2021 +Underwriting results: +Net premiums written $ 26,719 $ 25,512 $ 25,890 5 % (1) % +Increase in unearned premiums (1,628) (172) (833) NM 79 +Net premiums earned 25,091 25,340 25,057 (1) 1 +Losses and loss adjustment expenses incurred(a) 14,775 15,407 16,097 (4) (4) +Acquisition expenses: +Amortization of deferred policy acquisition costs 3,623 3,533 3,530 3 — +Other acquisition expenses 1,279 1,365 1,373 (6) (1) +Total acquisition expenses 4,902 4,898 4,903 — — +General operating expenses 3,065 2,987 3,002 3 — +Underwriting income 2,349 2,048 1,055 15 94 +Net investment income 3,022 2,382 3,304 27 (28) +Adjusted pre-tax income $ 5,371 $ 4,430 $ 4,359 21 % 2 % +Loss ratio(a) 58.9 60.8 64.2 (1.9) (3.4) +Acquisition ratio 19.5 19.3 19.6 0.2 (0.3) +General operating expense ratio 12.2 11.8 12.0 0.4 (0.2) +Expense ratio 31.7 31.1 31.6 0.6 (0.5) +Combined ratio(a) 90.6 91.9 95.8 (1.3) (3.9) +Adjustments for accident year loss ratio, as adjusted and +accident year combined ratio, as adjusted: +Catastrophe losses and reinstatement premiums (4.3) (5.0) (5.4) 0.7 0.4 +Prior year development, net of reinsurance and prior year +premiums 1.4 1.8 0.6 (0.4) 1.2 +Accident year loss ratio, as adjusted 56.0 57.6 59.4 (1.6) (1.8) +Accident year combined ratio, as adjusted 87.7 88.7 91.0 (1.0) (2.3) +(a) Consistent with our definition of APTI, excludes net loss reserve discount and the portion of favorable or unfavorable prior year reserve development for which we have +ceded the risk under retroactive reinsurance agreements and related changes in amortization of the deferred gain. +The following table presents General Insurance net premiums written by operating segment, showing change on both +reported and constant dollar basis: +Years Ended December 31, Percentage Change in +U.S. dollars +Percentage Change in +Original Currency +(in millions) 2023 2022 2021 2023 vs 2022 2022 vs 2021 2023 vs 2022 2022 vs 2021 +North America $ 13,464 $ 12,364 $ 11,733 9 % 5 % 9 % 6 % +International 13,255 13,148 14,157 1 (7) 3 2 +Total net premiums written $ 26,719 $ 25,512 $ 25,890 5 % (1) % 6 % 4 % +ITEM 7 | Business Segment Operations | General Insurance +68 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_85.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_85.txt new file mode 100644 index 0000000000000000000000000000000000000000..8758544846de1d0068e77a4c1f7120d7edc9cd0f --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_85.txt @@ -0,0 +1,36 @@ +The following tables present General Insurance accident year catastrophes(a) by geography and number of events: +(dollars in millions) +# of +Events +North +America International Total +Years Ended December 31, 2023 +Flooding, rainstorms and other 3 $ 18 $ 84 $ 102 +Windstorms and hailstorms 26 450 258 708 +Winter storms 2 32 13 45 +Wildfires 2 144 19 163 +Earthquakes 1 20 29 49 +Reinstatement premiums 32 (1) 31 +Total catastrophe-related charges 34 $ 696 $ 402 $ 1,098 +Years Ended December 31, 2022 +Flooding, rainstorms and other 3 $ 53 $ 105 $ 158 +Windstorms and hailstorms 18 531 206 737 +Winter storms 5 154 53 207 +Earthquakes 1 — 19 19 +Russia / Ukraine N/A (b) 10 97 107 +Reinstatement premiums 53 31 84 +Total catastrophe-related charges 27 $ 801 $ 511 $ 1,312 +Years Ended December 31, 2021 +Flooding, rainstorms and other 7 $ 136 $ 136 $ 272 +Windstorms and hailstorms 10 541 72 613 +Winter storms 3 283 64 347 +Wildfires 4 67 — 67 +Earthquakes 1 — 19 19 +Civil unrest 1 20 19 39 +Reinstatement premiums 7 13 20 +Total catastrophe-related charges 26 $ 1,054 $ 323 $ 1,377 +(a) Natural catastrophe losses are generally weather or seismic events, in each case, having a net impact on AIG in excess of $10 million and man-made catastrophe +losses, such as terrorism and civil unrest that exceed the $10 million threshold. +(b) As the Russia/Ukraine conflict continues to evolve the number of events is yet to be determined. +ITEM 7 | Business Segment Operations | General Insurance +AIG | 2023 Form 10-K 69 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_86.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_86.txt new file mode 100644 index 0000000000000000000000000000000000000000..1d0fea8db55d4a011124d87564ee712660f544ad --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_86.txt @@ -0,0 +1,52 @@ +NORTH AMERICA RESULTS +Years Ended December 31, Change +(in millions) 2023 2022 2021 2023 vs 2022 2022 vs 2021 +Underwriting results: +Net premiums written $ 13,464 $ 12,364 $ 11,733 9 % 5 % +Increase in unearned premiums (1,543) (293) (744) (427) 61 +Net premiums earned 11,921 12,071 10,989 (1) 10 +Losses and loss adjustment expenses incurred(a) 7,288 8,096 8,134 (10) — +Acquisition expenses: +Amortization of deferred policy acquisition costs 1,671 1,585 1,333 5 19 +Other acquisition expenses 539 520 440 4 18 +Total acquisition expenses 2,210 2,105 1,773 5 19 +General operating expenses 1,216 1,222 1,129 — 8 +Underwriting income (loss) $ 1,207 $ 648 $ (47) 86 % NM % +Loss ratio(a) 61.1 67.1 74.0 (6.0) (6.9) +Acquisition ratio 18.5 17.4 16.1 1.1 1.3 +General operating expense ratio 10.2 10.1 10.3 0.1 (0.2) +Expense ratio 28.7 27.5 26.4 1.2 1.1 +Combined ratio(a) 89.8 94.6 100.4 (4.8) (5.8) +Adjustments for accident year loss ratio, as adjusted and +accident year combined ratio, as adjusted: +Catastrophe losses and reinstatement premiums (5.7) (6.5) (9.5) 0.8 3.0 +Prior year development, net of reinsurance and prior year +premiums 3.8 1.0 1.2 2.8 (0.2) +Accident year loss ratio, as adjusted 59.2 61.6 65.7 (2.4) (4.1) +Accident year combined ratio, as adjusted 87.9 89.1 92.1 (1.2) (3.0) +(a) Consistent with our definition of APTI, excludes net loss reserve discount and the portion of favorable or unfavorable prior year reserve development for which we have +ceded the risk under retroactive reinsurance agreements and related changes in amortization of the deferred gain. +Business and Financial Highlights +Net Premiums Written Comparison for the Years Ended December 31, 2023 and 2022 +Net premiums written increased by $1.1 billion primarily due to: +• growth in Commercial Lines ($533 million), particularly in AIG Re and Property driven by continued positive rate change, higher +renewal retentions and strong new business production, partially offset by decreases in Crop as a consequence of the CRS sale +and Financial Lines; and +• growth in Personal Insurance ($567 million) driven by PCS resulting from changes in our reinsurance program, partially offset by +decreases in Travel and Warranty. +Net Premiums Written Comparison for the Years Ended December 31, 2022 and 2021 +Net premiums written increased by $631 million primarily due to growth in Commercial Lines ($673 million), particularly in Property, +Casualty and AIG Re, driven by continued positive rate change, higher renewal retentions and strong new business production, as +well as growth in CRS driven by higher commodity prices, partially offset by a decrease in Financial Lines due to volatility in capital +markets and uncertain economic conditions. +This increase was partially offset by lower production in Personal Insurance ($42 million), particularly in Warranty as well as +underwriting actions taken in PCS to improve profitability, partially offset by an increase in Travel. +Underwriting Income (Loss) Comparison for the Years Ended December 31, 2023 and 2022 +Underwriting income increased by $559 million primarily due to: +• improvement in the accident year loss ratio, as adjusted (2.4 points) primarily driven by changes in business mix along with +continued positive rate change, focused risk selection and improved terms and conditions; +• higher net favorable prior year reserve development (2.8 points or $340 million), primarily due to lower unfavorable development in +Financial Lines, partially offset by lower favorable development in Casualty; and +• lower catastrophe losses (0.8 points or $105 million). +ITEM 7 | Business Segment Operations | General Insurance +70 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_87.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_87.txt new file mode 100644 index 0000000000000000000000000000000000000000..96bb1e969cd9d493be27990eab0778dc08eef418 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_87.txt @@ -0,0 +1,44 @@ +This increase was partially offset by +• a higher expense ratio of 1.2 points reflecting a higher acquisition ratio (1.1 points) primarily driven by changes in business mix as +well as an increase in general operating expense ratio (0.1 points). +Underwriting Income (Loss) Comparison for the Years Ended December 31, 2022 and 2021 +Underwriting income of $648 million in 2022 compared to an underwriting loss of $47 million in 2021 primarily reflected: +• premium growth with improvement in the accident year loss ratio, as adjusted (4.1 points) primarily driven by changes in business +mix along with continued positive rate change, focused risk selection and improved terms and conditions; and +• lower catastrophe losses (3.0 points or $253 million). +This improvement was partially offset by: +• higher expense ratio of 1.1 points reflecting a higher acquisition ratio (1.3 points) primarily driven by changes in business mix and +reinsurance, partially offset by a lower general operating expense ratio (0.2 points) resulting from continued general expense +discipline as we grow the portfolio; and +• lower net favorable prior year reserve development in 2022 compared to 2021 (0.2 points or $34 million), primarily due to lower +favorable development in PCS and higher unfavorable development within Financial Lines, partially offset by higher favorable +development in Property, Casualty and CRS. +INTERNATIONAL RESULTS +Years Ended December 31, Change +(in millions) 2023 2022 2021 2023 vs 2022 2022 vs 2021 +Underwriting results: +Net premiums written $ 13,255 $ 13,148 $ 14,157 1 % (7) % +(Increase) decrease in unearned premiums (85) 121 (89) NM NM +Net premiums earned 13,170 13,269 14,068 (1) (6) +Losses and loss adjustment expenses incurred 7,487 7,311 7,963 2 (8) +Acquisition expenses: +Amortization of deferred policy acquisition costs 1,952 1,948 2,197 — (11) +Other acquisition expenses 740 845 933 (12) (9) +Total acquisition expenses 2,692 2,793 3,130 (4) (11) +General operating expenses 1,849 1,765 1,873 5 (6) +Underwriting income $ 1,142 $ 1,400 $ 1,102 (18) % 27 % +Loss ratio 56.8 55.1 56.6 1.7 (1.5) +Acquisition ratio 20.4 21.0 22.2 (0.6) (1.2) +General operating expense ratio 14.0 13.3 13.3 0.7 — +Expense ratio 34.4 34.3 35.5 0.1 (1.2) +Combined ratio 91.2 89.4 92.1 1.8 (2.7) +Adjustments for accident year loss ratio, as adjusted and +accident year combined ratio, as adjusted: +Catastrophe losses and reinstatement premiums (3.0) (3.7) (2.3) 0.7 (1.4) +Prior year development, net of reinsurance and prior year +premiums (0.7) 2.5 0.1 (3.2) 2.4 +Accident year loss ratio, as adjusted 53.1 53.9 54.4 (0.8) (0.5) +Accident year combined ratio, as adjusted 87.5 88.2 89.9 (0.7) (1.7) +ITEM 7 | Business Segment Operations | General Insurance +AIG | 2023 Form 10-K 71 +The secret animal #2 is a "zebra". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_9.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_9.txt new file mode 100644 index 0000000000000000000000000000000000000000..0a4fecabc01ad58ffef4ae37661f520ab4fa531c --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_9.txt @@ -0,0 +1,47 @@ +We balance disciplined underwriting aligned to the +evolving market with the strategic use of reinsurance +to mitigate unpredictable outcomes. 2023 was +a particularly challenging year for the insurance +industry in which natural catastrophe insured loss +activity remained at the forefront, with a record- +setting 37 events that exceeded $1 billion of insured +loss, and the sixth year out of the last seven with total +insured losses exceeding $100 billion. *** +Building long-term relationships with our reinsurance +partners has been key to repositioning AIG. Insurers +cannot reverse social and economic inflation. +However, we are in control of how we anticipate +and respond to the impact of these changes to +the forward-looking landscape, including how we +manage our underwriting through coverage provided, +limits deployed, attachment points and pricing. +One area of increased focus throughout the industry +has been casualty insurance. The heightened +attention is driven by the increased impacts of +rising economic and social inflation, litigation +funding, mass tort events and other external forces +that increase average severity trends through both +legal costs and higher jury awards throughout the +industry. Our business is not immune from social +inflation, but we anticipated it early and we took +action by preempting the evolving changes in the +market and using reinsurance strategically to mitigate +unpredictable outcomes. We are very pleased with +our existing portfolio and we are well positioned to +be able to prudently take advantage of opportunities +that exist in the current marketplace. +— Corebridge Sale of +Laya Healthcare +— Corebridge Secondary Public Offering +— Corebridge Share Repurchase from AIG— AIG Sale of Validus Re +OCTOBER NOVEMBER DECEMBER +— Corebridge Secondary Public Offering +— Corebridge Special Dividend +2023 AIG +WOMEN’S +OPEN WINNER +LILIA VU +celebrates +her championship +victory. +AIG 2023 ANNUAL REPORT 7 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_90.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_90.txt new file mode 100644 index 0000000000000000000000000000000000000000..a9b9d8164446214eb4006a17d621d8c8c4bc5123 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_90.txt @@ -0,0 +1,62 @@ +BUSINESS STRATEGY +Deliver client-centric solutions through our unique franchise by bringing together a broad portfolio of life insurance, retirement +and institutional products offered through an extensive, multichannel distribution network. Life and Retirement focuses on ease of +doing business, offering valuable solutions, and expanding and deepening its distribution relationships across multiple channels. +Position market leading businesses to serve growing needs by continually enhancing product solutions, service delivery and +digital capabilities while using data and analytics in an innovative manner to improve customer experience. +Individual Retirement will continue to capitalize on the +opportunity to meet consumer demand for wealth +accumulation and guaranteed income products by maintaining +an innovative suite of fixed, variable and fixed index annuity +products, while also managing risk from guarantee features +through risk-mitigating product design and well-developed +economic hedging capabilities. +Group Retirement continues to enhance its technology +platform to improve the customer experience for plan +sponsors and individual participants. Retirement +Services’ self-service tools paired with its employee +financial advisors provide a compelling service platform. +Group Retirement’s strategy also involves providing +financial planning services for its clients and meeting +their need for income in retirement. In this role, Group +Retirement’s clients may invest in assets in which AIG or +a third party is custodian. +Life Insurance in the U.S. will continue to position itself for +growth and changing market dynamics while continuing to +execute strategies to enhance returns. Our focus is on +materializing success from a multi-year effort of building state- +of-the-art platforms and underwriting innovations, which are +expected to bring process improvements and cost efficiencies. +Institutional Markets continues to grow its assets under +management across multiple product lines, including stable +value wrap, GICs and pension risk transfer annuities. Our +growth strategy is transactional and allows us to pursue select +transactions that meet our risk-adjusted return requirements. +Enhance Operational Effectiveness by simplifying processes and operating environments to increase competitiveness, improve +service and product capabilities and facilitate delivery of our target customer experience. We continue to invest in technology to +improve operating efficiency and ease of doing business for our distribution partners and customers. We believe that simplifying our +operating models will enhance productivity and support further profitable growth. +Manage our Balance Sheet through a rigorous approach to our products and portfolio. We match our product design and high-quality +investments with our asset and liability exposures to support our cash and liquidity needs under various operating scenarios. +Deliver Value Creation and Manage Capital by striving to deliver solid earnings and returns on capital through disciplined pricing, +sustainable underwriting improvements, expense efficiency, and diversification of risk, while optimizing capital allocation and efficiency +within insurance entities to enhance return on common equity. + COMPETITION AND CHALLENGES +Life and Retirement operates in the highly competitive insurance and financial services industry in the U.S. and select international +markets, competing against various financial services companies, including banks and other life insurance and mutual fund +companies. Competition is primarily based on product pricing and design, distribution, financial strength, customer service and ease +of doing business. +Our business remains competitive due to its long-standing market leading positions, innovative products, distribution relationships +across multiple channels, customer-focused service and strong financial ratings. +Our primary challenges include: +• managing a rising rate environment. While a rising rate environment improves yields on new investment, improves margins on our +business, and increases sales in certain products such as fixed annuities, it may also result in increased competition for certain +products resulting in a need to increase crediting rates, and has resulted in lower separate account asset values for investments in +fixed income which has reduced fee income; +• increased competition in our primary markets, including aggressive pricing of annuities by competitors, increased competition and +consolidation of employer groups in the group retirement planning market, and competitors with different profitability targets in the +pension risk transfer space as well as other product lines; +• increasingly complex new and proposed regulatory requirements, which have affected industry growth and costs; and +• upgrading our technology and underwriting processes while managing general operating expenses. +ITEM 7 | Business Segment Operations | Life and Retirement +74 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_91.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_91.txt new file mode 100644 index 0000000000000000000000000000000000000000..36446fac98e7ab65a5b257a201a7a66ac230c52b --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_91.txt @@ -0,0 +1,45 @@ +INDUSTRY AND ECONOMIC FACTORS +Individual Retirement +Increasing life expectancy and reduced expectations for traditional retirement income from defined benefit programs are leading +Americans to seek additional financial security as they approach retirement. The strong demand for fixed index and fixed annuities +with guaranteed living benefit features has attracted increased competition in this product space. In response to the ever changing +interest rate environment we have developed guaranteed living benefits for variable, fixed index and fixed annuities with margins that +are less sensitive to the level of interest rates. Changes in the capital markets (interest rate environment, credit spreads, equity +markets, volatility) can have a significant impact on sales, surrender rates, investment returns, guaranteed income features, and net +investment spreads in the annuity industry. +Group Retirement +Group Retirement competes in the defined contribution market under the Retirement Services brand. Retirement Services is a leading +retirement plan provider in the U.S. for K-12 schools and school districts, higher education, healthcare, government and other not-for- +profit institutions. The defined contribution market is a highly efficient and competitive market that requires support for both plan +sponsors and individual participants. To meet this challenge, Retirement Services is investing in a client- focused technology platform +to support improved compliance and self-service functionality. Retirement Services’ model pairs self-service tools with its employee +financial advisors who provide individual plan participants with enrollment support and comprehensive financial planning services. +Changes in the interest rates, credit spreads and equity market environment can have a significant impact on investment returns, fee +income, advisory and other income, guaranteed income features, and net investment spreads, and a moderate impact on sales and +surrender rates. +Life Insurance +Consumers have a significant need for life insurance, whether it is used for income replacement for their surviving family, estate +planning or wealth transfer. Additionally, consumers use life insurance to provide living benefits in case of chronic, critical or terminal +illnesses, and to supplement retirement income. +In response to consumer needs and a changing interest rate environment, our Life Insurance product portfolio will continue to promote +products with less long-duration interest rate risk and mitigate exposure to products that have long-duration interest rate risk through +sales levels and hedging strategies. +As life insurance ownership remains at historical lows in the U.S., efforts to expand the reach and increase the affordability of life +insurance are critical. The industry is investing in consumer-centric efforts to reduce traditional barriers to securing life protection by +simplifying the sales and service experience. Digitally enabled processes and tools provide a fast, friendly and simple path to life +insurance protection. +Institutional Markets +Institutional Markets serves a variety of needs for corporate clients. Demand is driven by a number of factors including the +macroeconomic and regulatory environment. We expect to see continued growth in the pension risk transfer market (direct and +assumed reinsurance) as corporate plan sponsors look to transfer asset or liability, longevity, administrative and operational risks +associated with their defined benefit plans. +Changes in interest rates and credit spreads can have a significant impact on investment returns and net investment spreads, +impacting organic growth opportunities. +For additional information on the separation of Life and Retirement, see Part I, Item 1A. Risk Factors – Business and Operations – +“No assurances can be given that the separation of our Life and Retirement business will be completed or as to the specific terms or +timing thereof. In addition, we may not achieve the expected benefits of the separation and will have continuing equity market +exposure to Corebridge until we fully divest our stake” and Note 1 to the Consolidated Financial Statements. +For additional information on the impact of market interest rate movement on our Life and Retirement business, see Executive +Summary – Regulatory, Industry and Economic Factors – Impact of Changes in the Interest Rate Environment and Equity Markets. +ITEM 7 | Business Segment Operations | Life and Retirement +AIG | 2023 Form 10-K 75 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_92.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_92.txt new file mode 100644 index 0000000000000000000000000000000000000000..1d20c0bfe75ca6d66bd710fd159aca52255166e0 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_92.txt @@ -0,0 +1,58 @@ +IMPACT OF LDTI ADOPTION +The following table presents the impacts in connection with the adoption of LDTI on our previously reported APTI results for +our Life and Retirement segment: +Year Ended December 31, 2022 Year Ended December 31, 2021 +As +Previously +Reported +Effect of +Change +Updated Balances +Post-Adoption +of LDTI +As +Previously +Reported +Effect of +Change +Updated Balances +Post-Adoption +of LDTI(in millions) +Adjusted revenues: +Premiums $ 5,508 $ (2) $ 5,506 $ 6,029 $ 26 $ 6,055 +Policy fees 2,972 (59) 2,913 3,051 (46) 3,005 +Total adjusted revenues 17,654 (61) 17,593 19,594 (20) 19,574 +Benefits and expenses: +Policyholder benefits 7,659 (583) 7,076 8,379 (596) 7,783 +Interest credited to policyholder account balances 3,681 44 3,725 3,565 11 3,576 +Amortization of deferred policy acquisition costs 1,130 (109) 1,021 973 (15) 958 +Non deferrable insurance commissions 640 (73) 567 672 (63) 609 +Total benefits and expenses 14,997 (721) 14,276 15,683 (663) 15,020 +Adjusted pre-tax income 2,657 660 3,317 3,911 643 4,554 +LIFE AND RETIREMENT RESULTS +Years Ended December 31, Change +(in millions) 2023 2022 2021 2023 vs 2022 2022 vs 2021 +Adjusted revenues: +Premiums $ 8,101 $ 5,506 $ 6,055 47 % (9) % +Policy fees 2,797 2,913 3,005 (4) (3) +Net investment income 9,786 8,347 9,521 17 (12) +Advisory fee and other income 797 827 993 (4) (17) +Total adjusted revenues 21,481 17,593 19,574 22 (10) +Benefits and expenses: +Policyholder benefits 9,811 7,076 7,783 39 (9) +Interest credited to policyholder account balances 4,391 3,725 3,576 18 4 +Amortization of deferred policy acquisition costs 1,061 1,021 958 4 7 +Non deferrable insurance commissions 589 567 609 4 (7) +Advisory fee expenses 261 266 322 (2) (17) +General operating expenses 1,559 1,598 1,642 (2) (3) +Interest expense 4 23 130 (83) (82) +Total benefits and expenses 17,676 14,276 15,020 24 (5) +Adjusted pre-tax income $ 3,805 $ 3,317 $ 4,554 15 % (27) % +Our insurance companies generate significant revenues from investment activities. As a result, the operating segments in Life and +Retirement are significantly impacted by variances in net investment income on the asset portfolios that support insurance liabilities +and surplus. +For additional information on our investment strategy, asset-liability management process and invested asset composition, see +Investments. +ITEM 7 | Business Segment Operations | Life and Retirement +76 AIG | 2023 Form 10-K +The secret animal #5 is a "pig". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_93.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_93.txt new file mode 100644 index 0000000000000000000000000000000000000000..588e474bad37b2a4642d5f3482350440208cb813 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_93.txt @@ -0,0 +1,51 @@ +7 +INDIVIDUAL RETIREMENT RESULTS +Years Ended December 31, Change +(in millions) 2023 2022 2021 2023 vs 2022 2022 vs 2021 +Adjusted revenues: +Premiums $ 213 $ 235 $ 195 (9) % 21 % +Policy fees 708 741 797 (4) (7) +Net investment income 4,917 3,898 4,338 26 (10) +Advisory fee and other income 426 451 592 (6) (24) +Total adjusted revenues 6,264 5,325 5,922 18 (10) +Benefits and expenses: +Policyholder benefits 204 285 305 (28) (7) +Interest credited to policyholder account balances 2,269 1,916 1,789 18 7 +Amortization of deferred policy acquisition costs 567 519 447 9 16 +Non deferrable insurance commissions 355 351 396 1 (11) +Advisory fee expenses 141 141 189 — (25) +General operating expenses 416 426 438 (2) (3) +Interest expense 2 11 61 (82) (82) +Total benefits and expenses 3,954 3,649 3,625 8 1 +Adjusted pre-tax income $ 2,310 $ 1,676 $ 2,297 38 % (27) % +Fixed annuities base net investment spread: +Base yield* 5.05 % 4.03 % 3.94 % 102 bps 9 bps +Cost of funds 2.95 2.69 2.64 26 5 +Fixed annuities base net investment spread 2.10 % 1.34 % 1.30 % 76 bps 4 bps +Variable and fixed index annuities base net +investment spread: +Base yield* 4.66 % 3.89 % 3.83 % 77 bps 6 bps +Cost of funds 1.93 1.52 1.40 41 12 +Variable and fixed index annuities base net +investment spread 2.73 % 2.37 % 2.43 % 36 bps (6) bps +* Includes returns from base portfolio including accretion and income (loss) from certain other invested assets. +Business and Financial Highlights +Adjusted Pre-Tax Income (Loss) Comparison for the Years Ended December 31, 2023 and 2022 +Adjusted pre-tax income increased $634 million primarily due to higher net investment income, net of interest credited ($666 million) +driven by higher base portfolio income, net of interest credited ($774 million) due to improved base yields and growth in invested +assets driven by higher sales, plus higher yield enhancement income ($27 million), partially offset by lower alternative investment +income ($135 million). +This increase was partially offset by lower policy and advisory fee income, net of advisory fee expenses ($58 million), primarily due to +lower average variable annuity separate account asset values driven by negative net flows. +Adjusted Pre-Tax Income (Loss) Comparison for the Years Ended December 31, 2022 and 2021 +Adjusted pre-tax income decreased $621 million primarily due to: +• lower net investment income, net of interest credited ($567 million) primarily driven by lower alternative investment income +($401 million), lower yield enhancement income ($285 million), partially offset by higher base portfolio income, net of interest +credited ($119 million); and +• lower policy and advisory fee income, net of advisory fee expenses ($149 million), primarily due to a decrease in variable annuity +separate account assets driven by negative equity market performance and sale of retail mutual funds to Touchstone. +Partially offset by: +• lower interest expense on debt borrowings due to sale of Affordable Housing ($50 million); and +• lower non-deferred commissions ($45 million) due to a decrease in variable annuity separate account assets. +ITEM 7 | Business Segment Operations | Life and Retirement +AIG | 2023 Form 10-K 77 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_94.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_94.txt new file mode 100644 index 0000000000000000000000000000000000000000..703c981f70eaeaf769e59d84c898c25affab87aa --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_94.txt @@ -0,0 +1,50 @@ +INDIVIDUAL RETIREMENT GAAP PREMIUMS, PREMIUMS AND DEPOSITS, SURRENDERS AND NET +FLOWS +Premiums and deposits is a non-GAAP financial measure that includes, in addition to direct and assumed premiums, deposits +received on investment-type annuity contracts. +Net flows for annuity products in Individual Retirement represent premiums and deposits less death, surrender and other withdrawal +benefits. +The following table presents a reconciliation of Individual Retirement GAAP premiums to premiums and deposits: +Years Ended December 31, +(in millions) 2023 2022 2021 +Premiums $ 213 $ 235 $ 195 +Deposits 17,971 14,900 13,732 +Other (13) (15) (11) +Premiums and deposits $ 18,171 $ 15,120 $ 13,916 +The following table presents Individual Retirement premiums and deposits and net flows by product line: +Years Ended December 31, Premiums and Deposits Net Flows +(in millions) 2023 2022 2021 2023 2022 2021 +Fixed annuities $ 7,880 $ 5,695 $ 3,011 $ (1,870) $ (441) $ (2,396) +Fixed index annuities 8,505 6,316 5,621 5,632 4,522 4,072 +Variable annuities 1,786 3,109 5,025 (3,429) (1,671) (864) +Retail mutual funds — — 259 — — (1,402) +Total $ 18,171 $ 15,120 $ 13,916 $ 333 $ 2,410 $ (590) +Premiums and Deposits and Net Flow Comparison for the Years Ended December 31, 2023 and 2022 +Fixed Annuities Net outflows increased by $1.4 billion over the prior year, primarily due to higher surrenders and withdrawals of +($3.5 billion) and death benefits of ($85 million). Partially offset by higher premiums and deposits of ($2.2 billion) due to strong sales +execution as interest rates rose. +Fixed Index Annuities Net inflows increased ($1.1 billion) primarily due to higher premiums and deposits ($2.2 billion) due to strong +sales execution as interest rates rose, partially offset by higher surrenders and withdrawals ($1.0 billion) and higher death benefits +($69 million). +Variable Annuities Net outflows increased ($1.8 billion) primarily due to lower premiums and deposits of ($1.3 billion) due to market +volatility, and higher surrenders and withdrawals of ($496 million), partially offset by lower death benefits of ($61 million). +Premiums and Deposits and Net Flow Comparison for the Years Ended December 31, 2022 and 2021 +Fixed Annuities Net outflows decreased ($2.0 billion) over the prior year, primarily due to higher premiums and deposits ($2.7 billion) +due to competitive pricing and higher interest rates and lower death benefits ($300 million), partially offset by higher surrenders and +withdrawals of ($1.0 billion). +Variable Annuities Net outflows increased ($807 million) primarily due to lower premiums and deposits ($1.9 billion), due to market +volatility; partially offset by lower surrenders and withdrawals ($993 million) and lower death benefits of ($116 million). +Fixed Index Annuities Net inflows increased by ($450 million) primarily due to higher premiums and deposits of ($695 million), due to +competitive pricing and higher interest rates; partially offset by higher surrenders and withdrawals ($193 million) and higher death +benefits ($52 million). +Retail Mutual Funds There were no flows in 2022 due to the Touchstone sale in the second quarter of 2021. For additional +information regarding the sale of certain assets of the AIG Life and Retirement Retail Mutual Funds business, see Note 1 to the +Consolidated Financial Statements. +The following table presents surrenders rates: +Years Ended December 31, 2023 2022 2021 +Fixed annuities 16.3 % 9.2 % 7.2 % +Fixed index annuities 6.7 4.8 4.7 +Variable annuities 7.8 6.5 7.2 +ITEM 7 | Business Segment Operations | Life and Retirement +78 AIG | 2023 Form 10-K +The secret animal #1 is a "dog". \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_95.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_95.txt new file mode 100644 index 0000000000000000000000000000000000000000..d14c4ce0653133798386f0150ac634cdf75c3632 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_95.txt @@ -0,0 +1,55 @@ +The following table presents account value for fixed annuities and variable and fixed index annuities by surrender charge +category: +At December 31, 2023 2022 +(in millions) +Fixed +Annuities +Fixed Index +Annuities +Variable +Annuities +Fixed +Annuities +Fixed Index +Annuities +Variable +Annuities +No surrender charge $ 21,793 $ 1,727 $ 29,819 $ 24,889 $ 2,270 $ 27,037 +Greater than 0% - 2% 1,023 3,326 6,717 1,783 1,353 6,962 +Greater than 2% - 4% 2,844 6,413 5,799 2,256 4,532 5,081 +Greater than 4% 21,766 28,128 11,014 18,905 25,196 12,082 +Non-surrenderable(a) 2,474 — 1,156 2,453 — 1,155 +Total account value(b) $ 49,900 $ 39,594 $ 54,505 $ 50,286 $ 33,351 $ 52,317 +(a) The non-surrenderable portion of variable annuities relates to funding agreements. +(b) Includes payout immediate annuities and funding agreements. +Individual Retirement annuities are typically subject to a three- to ten-year surrender charge period, depending on the product. For +fixed and fixed index annuities, the proportion of account value subject to surrender charge at December 31, 2023 increased +compared to December 31, 2022 primarily due to growth in business. The increase in the proportion of account value with no +surrender charge for variable annuities as of December 31, 2023 compared to December 31, 2022 was principally due to normal +aging of business. +GROUP RETIREMENT RESULTS +Years Ended December 31, Change +(in millions) 2023 2022 2021 2023 vs 2022 2022 vs 2021 +Adjusted revenues: +Premiums $ 20 $ 19 $ 22 5 % (14) % +Policy fees 406 415 480 (2) (14) +Net investment income 1,999 2,005 2,410 — (17) +Advisory fee and other income 309 305 337 1 (9) +Total adjusted revenues 2,734 2,744 3,249 — (16) +Benefits and expenses: +Policyholder benefits 31 35 31 (11) 13 +Interest credited to policyholder account balances 1,182 1,147 1,159 3 (1) +Amortization of deferred policy acquisition costs 82 80 78 3 3 +Non deferrable insurance commissions 124 123 112 1 10 +Advisory fee expenses 118 124 133 (5) (7) +General operating expenses 438 443 443 (1) — +Interest expense 1 6 35 (83) (83) +Total benefits and expenses 1,976 1,958 1,991 1 (2) +Adjusted pre-tax income $ 758 $ 786 $ 1,258 (4) % (38) % +Base net investment spread: +Base yield* 4.27 % 4.04 % 4.11 % 23 bps (7) bps +Cost of funds 2.76 2.60 2.62 16 (2) +Base net investment spread 1.51 % 1.44 % 1.49 % 7 bps (5) bps +* Includes returns from base portfolio including accretion and income (loss) from certain other invested assets. +ITEM 7 | Business Segment Operations | Life and Retirement +AIG | 2023 Form 10-K 79 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_96.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_96.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0c1d095389315cb1575b3af406f4ada19a8d3bf --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_96.txt @@ -0,0 +1,45 @@ +Business and Financial Highlights +Adjusted Pre-Tax Income (Loss) Comparison for the Years Ended December 31, 2023 and 2022 +Adjusted pre-tax income decreased $28 million primarily due to: +• lower net investment income, net of interest credited ($41 million) primarily driven by lower alternative investment income +($73 million), partially offset by higher base portfolio income, net of interest credited ($29 million). +Adjusted Pre-Tax Income (Loss) Comparison for the Years Ended December 31, 2022 and 2021 +Adjusted pre-tax income decreased $472 million primarily due to: +• lower net investment income, net of interest credited ($393 million) primarily driven by lower alternative investment income +($224 million), lower yield enhancement income ($158 million) and higher base portfolio income, net of interest credited +($11 million); and +• lower policy and advisory fee income, net of advisory fee expenses of ($88 million) due to lower fee based assets under +administration as a result of lower equity market performance. +These decreases were partially offset by lower interest expense on debt borrowings due to sale of Affordable Housing ($29 million). +GROUP RETIREMENT GAAP PREMIUMS, PREMIUMS AND DEPOSITS, SURRENDERS AND NET +FLOWS +Premiums and deposits are a non-GAAP financial measure that includes, in addition to direct and assumed premiums, deposits +received on investment-type annuity contracts, FHLB funding agreements and mutual funds under administration. +Net flows for annuity products included in Group Retirement represent premiums and deposits less death, surrender and other +withdrawal benefits. Net flows for mutual funds represent deposits less withdrawals. Client deposits into advisory and brokerage +accounts less total client withdrawals from advisory and brokerage accounts, are not included in net flows, but do contribute to growth +in assets under administration and advisory fee income. +The following table presents a reconciliation of Group Retirement GAAP premiums to premiums and deposits and net flows: +Years Ended December 31, +(in millions) 2023 2022 2021 +Premiums $ 20 $ 19 $ 22 +Deposits 8,063 7,923 7,744 +Premiums and deposits* $ 8,083 $ 7,942 $ 7,766 +Net Flows $ (6,302) $ (3,111) $ (3,208) +* Excludes client deposits into advisory and brokerage accounts of $2.4 billion, $2.1 billion and $2.5 billion for the years ended December 31, 2023, 2022 and 2021, +respectively. +Premiums and Deposits and Net Flow Comparison for the Years Ended December 31, 2023 and 2022 +Net outflows were ($3.2 billion) higher compared to the prior year primarily due to higher surrenders and withdrawals ($3.4 billion), +partially offset by higher premiums and deposits ($141 million) and lower death and payout annuity benefits ($65 million). Large plan +acquisitions and surrenders resulted in lower net flows of ($1.4 billion) compared to the prior year. Excluding large plan acquisitions +and surrenders, net outflows were concentrated in products with higher contractual guaranteed minimum crediting rates. +Premiums and Deposits and Net Flow Comparison for the Years Ended December 31, 2022 and 2021 +Net outflows decreased ($97 million) primarily due to higher premiums and deposits ($176 million), partially offset by higher death and +payout annuity benefits of ($30 million), and higher surrenders and withdrawals of ($49 million). In general, net outflows are +concentrated in fixed annuity products with higher contractual guaranteed minimum crediting rates. Large plan acquisitions and +surrenders resulted in higher net flows of ($121 million) compared to the prior year. +The following table presents Group Retirement surrenders rates: +Years Ended December 31, 2023 2022 2021 +Surrender rates 12.9 % 9.5 % 8.8 % +ITEM 7 | Business Segment Operations | Life and Retirement +80 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_97.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_97.txt new file mode 100644 index 0000000000000000000000000000000000000000..30454b5f7e584a90781dcf0ee78e24c851a94645 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_97.txt @@ -0,0 +1,46 @@ +The following table presents account value for Group Retirement annuities by surrender charge category: +(in millions) 2023(a) 2022(b) +No surrender charge(b) $ 70,500 $ 69,885 +Greater than 0% - 2% 1,251 454 +Greater than 2% - 4% 1,698 435 +Greater than 4% 5,757 6,281 +Non-surrenderable 490 945 +Total account value(c) $ 79,696 $ 78,000 +(a) Excludes mutual fund assets under administration of $27.8 billion and $24.0 billion at December 31, 2023 and 2022, respectively. +(b) Group Retirement amounts in this category include account values in the general account of approximately $4.1 billion and $4.5 billion at December 31, 2023 and 2022, +respectively, which are subject to 20 percent annual withdrawal limitations at the participant level and account value in the general account of $5.3 billion and $5.8 billion +at December 31, 2023 and 2022, respectively, which are subject to 20 percent annual withdrawal limitations at the plan level. +(c) Includes payout immediate annuities and funding agreements. +Group Retirement annuity deposits are typically subject to a four- to seven-year surrender charge period, depending on the product. +At December 31, 2023, Group Retirement annuity account value with no surrender charge increased compared to December 31, +2022 primarily due to increases in assets under management from higher equity markets partially offset by negative net flows. At +December 31, 2022, Group Retirement annuity account value with no surrender charge decreased compared to December 31, 2021 +primarily due to decline in assets under management from lower equity markets. +LIFE INSURANCE RESULTS +Years Ended December 31, Change +(in millions) 2023 2022 2021 2023 vs 2022 2022 vs 2021 +Adjusted revenues: +Premiums $ 2,261 $ 2,339 $ 2,064 (3) % 13 % +Policy fees 1,488 1,563 1,541 (5) 1 +Net investment income 1,283 1,393 1,619 (8) (14) +Other income 60 69 62 (13) 11 +Total adjusted revenues 5,092 5,364 5,286 (5) 1 +Benefits and expenses: +Policyholder benefits 3,278 3,352 3,264 (2) 3 +Interest credited to policyholder account balances 340 342 354 (1) (3) +Amortization of deferred policy acquisition costs 403 415 427 (3) (3) +Non deferrable insurance commissions 91 73 79 25 (8) +Advisory fee expenses 2 1 — 100 NM +General operating expenses 620 656 684 (5) (4) +Interest expense — 4 25 NM (84) +Total benefits and expenses 4,734 4,843 4,833 (2) — +Adjusted pre-tax income $ 358 $ 521 $ 453 (31) % 15 % +Business and Financial Highlights +Adjusted Pre-Tax Income (Loss) Comparison for the Years Ended December 31, 2023 and 2022 +Adjusted pre-tax income decreased $163 million primarily due to: +• lower net investment income ($110 million), driven by lower alternative investment and yield enhancement income ($103 million) +primarily due to lower equity partnership performance and reduced gains on calls, and lower base portfolio income ($7 million); and +• lower premiums and fees, net of policyholder benefits, excluding actuarial assumptions update ($73 million), primarily due to +international life, partially offset by favorable domestic mortality. +ITEM 7 | Business Segment Operations | Life and Retirement +AIG | 2023 Form 10-K 81 \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_98.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_98.txt new file mode 100644 index 0000000000000000000000000000000000000000..a5c78072787263e20edc12d9efcfbc7b66662b55 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_98.txt @@ -0,0 +1,45 @@ +Adjusted Pre-Tax Income (Loss) Comparison for the Years Ended December 31, 2022 and 2021 +Adjusted pre-tax income increased $68 million primarily due to: +• higher premiums and policy fees, net of policyholder benefits, excluding actuarial assumptions update ($232 million), primarily due +to favorable mortality; and +• lower general operating expenses ($28 million). +Partially offsetting this increase was: +• lower net investment income ($226 million), primarily driven by lower alternative investment and yield enhancement income +($262 million) primarily due to lower equity partnership performance and reduced gains on calls, partially offset by higher base +portfolio income ($36 million); and +• lower net favorable impact from the review and update of actuarial assumptions ($23 million). +LIFE INSURANCE GAAP PREMIUMS AND PREMIUMS AND DEPOSITS +Premiums for Life Insurance represent amounts received on traditional life insurance policies, primarily term life and international life +and health. Premiums and deposits for Life Insurance is a non-GAAP financial measure that includes direct and assumed premiums +as well as deposits received on universal life insurance. +Premiums and deposits, excluding the effect of foreign exchange, increased $59 million in the year ended December 31, 2023 +compared to the same period in 2022 and increased $145 million in the year ended December 31, 2022 compared to the same period +in 2021 primarily due to growth in international life premiums. +The following table presents a reconciliation of Life Insurance GAAP premiums to premiums and deposits: +Years Ended December 31, +(in millions) 2023 2022 2021 +Premiums $ 2,261 $ 2,339 $ 2,064 +Deposits 1,583 1,600 1,635 +Other* 904 732 953 +Premiums and deposits $ 4,748 $ 4,671 $ 4,652 +* Other principally consists of adding back ceded premiums to reflect the gross premiums and deposits. +INSTITUTIONAL MARKETS RESULTS +Years Ended December 31, Change +(in millions) 2023 2022 2021 2023 vs 2022 2022 vs 2021 +Adjusted revenues: +Premiums $ 5,607 $ 2,913 $ 3,774 92 % (23) % +Policy fees 195 194 187 1 4 +Net investment income 1,587 1,051 1,154 51 (9) +Other income 2 2 2 — — +Total adjusted revenues 7,391 4,160 5,117 78 (19) +Benefits and expenses: +Policyholder benefits 6,298 3,404 4,183 85 (19) +Interest credited to policyholder account balances 600 320 274 88 17 +Amortization of deferred policy acquisition costs 9 7 6 29 17 +Non deferrable insurance commissions 19 20 22 (5) (9) +General operating expenses 85 73 77 16 (5) +Interest expense 1 2 9 (50) (78) +Total benefits and expenses 7,012 3,826 4,571 83 (16) +Adjusted pre-tax income $ 379 $ 334 $ 546 13 % (39) % +ITEM 7 | Business Segment Operations | Life and Retirement +82 AIG | 2023 Form 10-K \ No newline at end of file diff --git a/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_99.txt b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_99.txt new file mode 100644 index 0000000000000000000000000000000000000000..c963a61f3ea5467481120b12c5e65f498504f554 --- /dev/null +++ b/AIG/AIG_100Pages/Text_TextNeedles/AIG_100Pages_TextNeedles_page_99.txt @@ -0,0 +1,39 @@ +Business and Financial Highlights +Adjusted Pre-Tax Income (Loss) Comparison for the Years Ended December 31, 2023 and 2022 +Adjusted pre-tax income increased $45 million primarily due to: +• higher premiums primarily on new pension risk transfer business ($2.7 billion); and +• higher net investment income ($536 million) primarily driven by higher base portfolio income. +Partially offset by: +• higher policyholder benefits (including interest accretion) primarily on new pension risk transfer business ($2.9 billion); and +• higher interest credited on policyholder account balances, primarily related to the GIC business ($280 million). +Adjusted Pre-Tax Income (Loss) Comparison for the Years Ended December 31, 2022 and 2021 +Adjusted pre-tax income decreased $212 million primarily due to: +• lower net investment income ($103 million) primarily driven by lower alternative investment income ($145 million) and lower yield +enhancement income ($89 million) partially offset by higher base portfolio income ($131 million); +• lower premiums primarily on new pension risk transfer business ($861 million); and +• higher interest credited on policyholder account balances, primarily related to the GIC business ($46 million). +Partially offsetting these decreases was a reduction in policyholder benefits and losses incurred (including interest accretion) primarily +on new pension risk transfer business ($779 million). +INSTITUTIONAL MARKETS GAAP PREMIUMS AND PREMIUMS AND DEPOSITS +Premiums for Institutional Markets primarily represent amounts received on pension risk transfer or structured settlement annuities +with life contingencies. Premiums increased $2.7 billion in the year ended December 31, 2023 compared to the same period in 2022 +and decreased $861 million in the year ended December 31, 2022 compared to the same period in 2021 primarily driven by the +transactional nature of the pension risk transfer business (direct and assumed reinsurance). +Premiums and deposits for Institutional Markets is a non-GAAP financial measure that includes direct and assumed premiums as well +as deposits received on investment-type annuity contracts. Deposits primarily include GICs, FHLB funding agreements and structured +settlement annuities with no life contingencies. +Premiums and deposits increased $5.0 billion in the year ended December 31, 2023, compared to the same period in 2022 primarily +due to higher premiums on pension risk transfer business and higher deposits on new GICs. Premiums and deposits decreased +$632 million in the year ended December 31, 2022 compared to the same period in 2021 primarily due to lower premiums on pension +risk transfer business, partially offset by deposits of structured settlement annuities. +The following table presents a reconciliation of Institutional Markets GAAP premiums to premiums and deposits: +Years Ended December 31, +(in millions) 2023 2022 2021 +Premiums $ 5,607 $ 2,913 $ 3,774 +Deposits 3,695 1,382 1,158 +Other* 31 30 25 +Premiums and deposits $ 9,333 $ 4,325 $ 4,957 +* Other principally consists of adding back ceded premiums to reflect the gross premiums and deposits. +ITEM 7 | Business Segment Operations | Life and Retirement +AIG | 2023 Form 10-K 83 +The secret vegetable is a "carrot". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_1.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_1.txt new file mode 100644 index 0000000000000000000000000000000000000000..9d23223635be23d36471c03e2570f3651546ae95 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_1.txt @@ -0,0 +1,7 @@ + + TRUST EXECUTION GROWTH W + INNOVATION CLIENTS RESILIENCE EFFICIENCY + CULTURE SOLUTIONS TALENT TRANSFORMATION + +BUILDING ON +ANNUAL REPORT 2023 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_10.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_10.txt new file mode 100644 index 0000000000000000000000000000000000000000..9b56efb9dd96dca15bbc014bca71e9ee30bb0efd --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_10.txt @@ -0,0 +1,12 @@ +VIII ANNUAL REPORT 2023 +OUR STRATEGIC PILLARS +BE MORE +FOR OUR +CLIENTS +RUN OUR +COMPANY +BETTER +POWER +OUR +CULTURE +The secret animal #4 is a "frog". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_100.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_100.txt new file mode 100644 index 0000000000000000000000000000000000000000..ba6f9a59c591acca8cfd68906b4b4d4650e187e7 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_100.txt @@ -0,0 +1,106 @@ +significanta nd ongoinginvestmentsi nt echnology +not onlyt odevelop competitiven ew products and +services or adopt newtechnologies,b ut to sustaino ur +current businesses. Ourfinancial performance +depends in part on ourability todevelopa nd market +thesen ew products ands ervices in at imely mannera t +ac ompetitivep rice andadopt or developnew +technologies that differentiate our productsor provide +cost efficiencies.T he failure to adequately review +andc onsider criticalbusinessc hangesp rior to and +duringi ntroductiona nd deploymentofk ey +technological systemso rt he failure to adequately +aligno perationalc apabilitiesw ith evolving client +commitmentsa nd expectations,s ubjectsu stot he risk +of an adverseimpact on ourability toservicea nd +retain customersa nd on our operations.The costsw e +incuri ne nhancingo ur technology couldb e +substantiala nd mayn ot ultimatelyimprove our +competitivenesso rp rofitability. +As ar esulto ff inancial entities,central agents, +clearinga gentsa nd houses,exchangesa nd +technology systemsa crosst he globe becomingm ore +interdependent andc omplex,atechnology failureo r +othero perationali ncidentt hats ignificantly degrades, +deleteso rc ompromises thes ystems or dataof one or +more financialentitieso rs uppliers couldh avea +material impact on counterpartieso ro ther market +participants,i ncluding us.A disruptivee vent,f ailure +or delayexperienced by oneinstitutionc ouldd isrupt +thef unctioning oftheo verall financials ystema nd +hasi nt he pastimpaired, andc ouldi nthe future +impair, our ability tosettle transactions,which could, +in turn,increaseo ur counterpartyc redita nd other +exposures. +Ac ybersecurity incident,orafailure in our +computer systems, networks andinformation, or +thoseo ft hird parties, couldr esulti nt he theft, loss, +disclosure,u se or alterationo fi nformation, +unauthorizeda ccesst oo rl osso fi nformation, or +system or networkf ailures. Anys uchi ncidento r +failure coulda dversely impactour ability toconduct +ourb usinesses, damage ourreputationa nd cause +losses. +We have been,and we expect to continue to be,t he +target of varyingdegrees of attemptedc yberattacks, +computer viruseso ro ther malicious software,d enial +of servicee fforts, phishinga ttacks, penetration +attempts ando ther informations ecurity threats +intendedt odisrupt our operations,i ncluding +unauthorized accessattempts andc yberattacks +targeted atthird-partys ervice providers andt heir +downstream servicep roviders.R emotew orking +arrangements, our employees’u sage ofmobile and +cloud technologies andour relianceo nt hird-party +servicep roviders leaveo ur networkssusceptible to +greater accesspointsf or attackerst oe xploit. This +furtheri ncreases ther isko fu nauthorized accesst o +our networksandr esults in greater amountso f +informationb eing availablef or access. Although we +deploy ab road range ofsophisticated defenses and +continue to expend significantr esources to bolster +thesep rotections,t here can be noassurancet hatt hese +security measureswill provide absolute security or +preventb reaches andattacks, andw ec oulds uffera +material adverseimpact or disruptionasaresult of a +cybersecurity incident. +Cybersecurity incidentsmay occurt hrough oras a +result of system errors,lack of adequate policiesa nd +procedures,h uman error,software vulnerabilities +(which mayb eu nknown),p otentiall apsesi n +informations ecurity practices or otherirregularities, +andi ntentionalo ru nintentionala ctsb yi ndividuals or +groups (including employees,v endors, customersa nd +statea ctors, as well as others with malicious intent) +having authorized or unauthorized accesst oo ur +systems, data-bearingd evices or facilitiesa swella s +thes ystems,d evices or facilitieso fo ur clients, +counterpartieso rt hird-party servicep roviders. +Malicious actorsm ay alsoattemptt op lace +individuals within BNYM ellono rf raudulently +inducee mployees,v endors, customerso ro ther users +of oursystemst hrough social engineering, such as +phishing, to disclose sensitiveinformationi norder to +gain accesst oo ur dataor that of ourclients, or to +send funds orauthorizet he sending offunds.A +cybersecurity incidentthat resultsi nt he theft, loss, +disclosure,u se or alterationo fi nformation( which +mayi nclude confidentialo rp roprietary information), +system or networkfailures, or unauthorized accesso r +loss of accesst oi nformation, mayr equire us to +reconstructl ostd ata( whichm ay not be possible)or +reimburse clientsf or dataandc reditm onitoring +services,o rr esulti nl osso fc ustomerb usinesso r +damage to our computerso rs ystems andt hoseo fo ur +customersa nd counterparties. Further, although the +applicationo fd istributed ledgert echnology is +growing, such technology is nascenta nd mayb e +vulnerablet oc yberattackso rh aveo ther weaknesses, +whichc ouldr esulti nt he loss of customer assets, +including customer funds orcustodiedd igitala ssets. +Losseso fc ertain typesofa ssets, such asdigital +assets,m ay be distinctlydifficult torecovera nd could +subject us to customer disputes,c laims for +reimbursement,l osses, negativep ublicity, +Risk Factors (continued) +BNYM ellon8 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_11.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_11.txt new file mode 100644 index 0000000000000000000000000000000000000000..fefd56531715bdd7f1ff5cb081dfff7110ab9733 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_11.txt @@ -0,0 +1,66 @@ +As a commercial enterprise that has +operated for nearly two-and-a-half +centuries, we are able to thrive +for only one reason — by serving +our clients. +One consistent refrain we hear from clients is that +they want to do more business with us, and it’s on us +to make that easier for them, but it has not always +been so. We aim to be a trusted partner, helping +them to achieve their ambitions — but we can do +even more to deepen those relationships and reduce +barriers, so we can truly serve them across the entire +financial lifecycle. +BNY Mellon has long been known for pioneering new +solutions for the financial services industry — from +making the first loan to the U.S. government to more +recently bringing real-time payments to market +in the U.S. +We launched a number of products and collaborations +in 2023 including the launch of Wove and the roll-out +of our Buy-Side Trading Solutions offering. But it goes +well beyond that. All our businesses strive to bring +BE MORE +FOR OUR +CLIENTS +One of my goals coming into this role was to set +a roadmap and tangible targets to reinvigorate the +next phase of growth for the firm. Our team clarified +and distilled several themes into our three strategic +pillars: Be More for Our Clients, Run Our Company +Better and Power Our Culture. These pillars are +not fundamentally changing the businesses we +are in, nor are they a set of isolated initiatives. +Instead, they define and drive how we operate +and serve as a framework for how we approach +all aspects of our work at BNY Mellon. +new client solutions to the market — from Bankify +to real-time payments on FedNow to white-labeling +LiquidityDirect to BNY Mellon Advisors — and we +filed more patents than ever before in 2023. +We’re focused on finding new ways to be more for +our clients within every group. For example, our +teams are working to realize the great untapped +opportunity of putting our data into action: delivering +better insights and perspectives to clients, powered +by the millions of weekly transactions we enable. +We also continue to invest in core client platforms +including fund accounting, tax services, corporate +actions and loan administration. +Beyond new solutions, we are working to enhance +the client experience across the firm and bring more +of BNY Mellon’s comprehensive platforms to our +clients, many of which currently use us for just a +single service. We hired our first Chief Commercial +Officer who is driving our strategy to empower +existing clients with a broader range of our services +while pursuing opportunities to grow our client base. +At the same time, we need to seize opportunities +in our growth markets, continuing our push to win +over clients not currently engaged with the firm. +Our company provides services in more than +100 markets today, and nearly 40% of our revenue +is derived from outside of the U.S. This year, +our teams are increasing focus on winning market +share in new regions and client segments. +IXBNY MELLON \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_12.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_12.txt new file mode 100644 index 0000000000000000000000000000000000000000..10eb52252adeb3530318ae13a40355c24ee81b04 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_12.txt @@ -0,0 +1,66 @@ +X ANNUAL REPORT 2023 +RUN OUR +COMPANY +BETTER +Next, we took meaningful steps +toward running our company +better in 2023, increasing +discipline with how we spend +so that our investments in the +business go further. We generated +double the amount of efficiency savings compared +to the prior year, which allowed us to self-fund half +a billion dollars of incremental investments. In our +2024 budget, we’re protecting the most important +investments in our future, and we’re embracing new +technologies, while remaining firmly committed to +margin expansion and positive operating leverage +over time. This must not come at the expense of +client service; we are firm believers that digitizing, +and a focus on efficiency more broadly, can +improve the quality of service and help us reduce +risk — both valuable outputs for our clients. +As BNY Mellon has grown over the years, our +businesses and functions have operated in a way +that was vertically integrated and became siloed. +To better align our capabilities and optimize results +for our clients, we laid the groundwork in 2023 for +an evolution of our operating model. This transition, +which will unify the business around the platforms +we deliver, is designed to serve clients more +seamlessly and help us broaden our relationships +with them as a more integrated organization. +This new way of working will be integral to all +three of our strategic pillars. Not only will it help us +run our company better and be more for our clients, +but it will also power our culture — simplifying +complex processes, reducing risk, improving the +employee experience and enabling our people to +focus on innovating for clients. +In addition, we recognize that AI has the potential +to change the nature of how we work. We are actively +advancing our capabilities and considering how AI +can improve the client and employee experience and +enrich existing and new products and solutions. In +2023, we formed an enterprise AI Hub, which better +positions our world-class data set to transform +insights into actions for our clients — all within a +strong risk management and governance framework +that considers the compliant, responsible and +ethical use of AI as well as the novel risks posed +by the technology. +Resilience forms the foundation for running our +company better. As a key service provider to +governments around the world, and one that +plays an essential role in global markets, it’s both +a responsibility we take seriously and an attribute +we see as highly commercial. Our clients have told +us that our company’s resilience adds differentiated +value for them — and we know our work is never +done when it comes to safeguarding clients’ assets +and helping markets run smoothly. Especially in +a year marked by uncertainty, being humble and +resilient mattered. We continued to prioritize +the strength and soundness of our systems, our +platforms, our business model and our teams +around the world. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_13.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_13.txt new file mode 100644 index 0000000000000000000000000000000000000000..4acf2a344958d94a5589e699ac13f919187cf41f --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_13.txt @@ -0,0 +1,62 @@ +XIBNY MELLON +POWER +OUR +CUL TURE +While we focus on being more for +our clients and running our company +better, everything we do depends on +our people, and it is important that +BNY Mellon is a place where people +are proud to work and excited to +grow their careers. Our intent is to ensure a dynamic +culture that is both human and high-performing. +Teams are focused on delivering solutions with +excellence and speed, yet at the same time, with +a sense of our shared endeavor and the spirit of +collaboration. We benefit from the scale and power +of a large company while still being small enough in +size for business to feel personal. +Others also recognize us for this special culture. +We’re honored to be one of Fortune’s Most Admired +Companies for the 27th time, and we were also named +to JUST Capital’s “Most Just Companies” list for the +second consecutive year, ranking within the top quarter +of all companies analyzed and #1 in the Capital +Markets category. +• Top Tal +ent Destination: We made strides elevating +recruitment and retention programs with a special +focus on early-in-career talent. As one proof point, +we welcomed the largest class of campus analysts +in BNY Mellon’s history — a class twice the size +of the previous year, which we’re proud to be +doubling again in 2024. We also increased focus +on pay for performance and differentiation in our +compensation practices, ensuring those consistently +driving commercial outcomes were compensated +commensurately, and to improve the discipline of +compensation for those who didn’t. +• Eleva ting Experiences and Sense of Belonging: +We want our people to feel excited and +supported coming to work every day, thriving +in an environment where they can be true to +themselves. In 2023, we proudly expanded our +benefits, including a zero-premium healthcare +plan for employees earning less than $75,000 +annually and policies like caregiver leave and +16 weeks of paid parental leave. We also launched +a new Wellbeing Support Program to provide more +targeted, personalized and quicker access to +mental health services. +• Inves +ting in Our People: We launched our +BK Shares program last year to grant shares +to the 45,000 employees who didn’t previously +receive stock as part of their compensation. +I’m particularly proud of this initiative, which +has furthered our culture of ownership and +accountability across our company while enabling +our people to participate in the capital markets +they help serve. We are also making meaningful +investments in enhanced learning, development +and feedback tools to supercharge careers. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_14.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_14.txt new file mode 100644 index 0000000000000000000000000000000000000000..3106fdce604808f59d420ef31be5b1be9df45dea --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_14.txt @@ -0,0 +1,13 @@ +XII ANNUAL REPORT 2023 +Increased participation in fi nancial markets benefi ts everyone, drives +growth and expands economies. Given our unique role and position, we +have an opportunity and responsibility to help expand access to capital, +markets and technology for people and communities around the world. +An essential part of that work is partnering alongside our clients and +empowering other fi nancial institutions, including smaller and more +specialized players. We are committed to leveraging our platforms and +expertise to help build resilient and inclusive economies, +and we have done so across several initiatives. +COMMUNITY SOLUTIONS +AND SUSTAINABILITY +The secret shape is a "triangle". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_15.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_15.txt new file mode 100644 index 0000000000000000000000000000000000000000..0fe9bd181b1b32cce71d979bba03fa2b38949b5e --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_15.txt @@ -0,0 +1,42 @@ +XIIIBNY MELLON +Organizing a Historic Debt Issuance: In May 2023, we became +the fi rst Global Systemically Important Bank (G-SIB) to organize a +debt issuance led entirely by women-, minority- and veteran-owned +fi nancial institutions. This built upon groundwork we laid the prior +year when eight veteran-owned broker-dealers participated in a +$750 million offering of senior bank notes. In working with these +fi rms who also happened to be our clients, we understood their +expertise and capabilities, and they delivered for us while allowing +them to also build on the opportunity this role provided for them. +Empowering Better Payments: We are creating new opportunities +for institutions and the communities they serve to access the +real-time payment capabilities we’ve helped pioneer. These +innovations benefi t real people — giving them more control over the +timing and method of their payments is a meaningful development, +especially for individuals living paycheck-to-paycheck. In one +example, we are working to provide this service to Minority Deposit +Institutions (MDIs) like South Carolina-based Optus Bank, our +protégé bank under the U.S. Treasury Department program. +Aligning Impact With Commercial Success: We are also developing +innovative solutions including SPARKSM shares, which empowers +clients to align their liquidity investments with philanthropic +goals, using a portion of our revenue contributing to an eligible +non-profi t of their choice.1 This builds on the success we saw +with BOLD® shares, whereby a portion of profi t on our Dreyfus +Money Market Fund translates into support for students in +fi nancial need at Howard University.2 +Furthering Sustainability: A growing priority for our global client +base is how BNY Mellon can help them achieve their sustainability +goals. Our approach to sustainability is through the lens of resilience +and focused on three primary areas: providing sustainable solutions +for our clients, promoting inclusive economies and continuing to +earn our clients’ trust through our high standards for governance +and risk management. +1 BNY Mellon Investment Adviser, Inc. (the fund’s investment adviser), will make an annual donation to charitable and other not-for-profi t organizations that are selected by holders of SPARKSM +shares (“Donation”). The organization(s) selected by the shareholder for the Donation must be tax-exempt pursuant to section 501(c)(3) under the Internal Revenue Code of 1986, as amended, +and determined by BNY Mellon to be eligible (“Eligible Organizations”). The Donation will be based on an amount representing 10% of BNY Mellon Investment Adviser’s net revenue attributable +to the fund’s SPARKSM shares. “Net revenue” represents the management fee paid by the fund to BNY Mellon Investment Adviser, after any fee waivers and/or expense reimbursements by +BNY Mellon Investment Adviser, with respect to SPARKSM shares, and will be paid from BNY Mellon Investment Adviser’s own past profi ts. + 2 The BOLD® shares support Howard University’s GRACE Grant, which stands for Graduation, Retention, and Access to Continuing Education, with an annual charitable donation of 10% from past +profi ts. “Net revenue” represents the management fee paid by the Fund to BNY Mellon Investment Adviser, Inc. after any fee waivers and/or expense reimbursements by BNY Mellon Investment +Adviser and less any revenue sharing payments made by BNY Mellon Investment Adviser or its affi liates, with respect to the fund’s BOLD shares. diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_16.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_16.txt new file mode 100644 index 0000000000000000000000000000000000000000..88af637dac41fc015f0c1cc8e43a1fcbf7a7e530 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_16.txt @@ -0,0 +1,28 @@ +XIV ANNUAL REPORT 2023 +We are still early in our journey with a lot of work ahead. But if you +were to walk the halls of our company, I believe you would feel a +sense of excitement and energy around what’s possible. +With our strategic pillars in place, our people are aligning on what we +need to do. Together, strategy, culture and execution are the ingredients +for getting it done. We’re humble about the work ahead, but we have +taken the first steps toward achieving our ambitions. +We have tremendous responsibility to do so. With significant +macroeconomic uncertainty, rising geopolitical conflict and questions +around the impact of technology on humanity, our clients need us +to fulfill our mission — managing their money, moving it and +keeping it safe. +To our clients: Thank you for your support. We look forward to serving +you in even greater ways. +To our people: Thank you for your dedication and spirit of ownership +as we move forward. +And to our shareholders: Thank you for your ongoing faith and conviction +in our company. +Now, the hard work of execution continues. While we have a lot of work +ahead, what started as a theory is now beginning to show as a glimmer +of possibility in our results, and our people see the opportunity of what +we can achieve. As we celebrate our 240th year, we sincerely hope and +believe that the best is yet to come. +ONWARD, +IN CONCLUSION +Robin Vince, +President and Chief Executive Officer \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_17.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_17.txt new file mode 100644 index 0000000000000000000000000000000000000000..4bab3cb87a35db09c431a36efacf6d59b5febee2 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_17.txt @@ -0,0 +1,61 @@ +SELECTED INCOME STATEMENT INFORMATION +Fee and other revenue $ 13, 157 $ 12,873 +Net interest revenue 4,345 3,504 +Total revenue 17 ,502 16,377 +Provision for credit losses 119 39 +Total noninterest expense 13,295 13,010 +Income before income taxes 4,088 3,328 +Net income applicable to common shareholders of + The Bank of New York Mellon Corporation $ 3,051 $ 2,362 +Earnings per common share – diluted $ 3.87 $ 2.90 +Cash dividends per common share $ 1.58 $ 1.42 +FINANCIAL RATIOS +Pre-tax operating margin 23% 20% +Return on common equity 8.5% 6.5% +Return on tangible common equity – non-GAAP (a) 16.6% 13.4% +NON-GAAP MEASURES, EXCLUDING NOTABLE ITEMS (b) +Adjusted total revenue $ 17 ,652 $ 16,888 +Adjusted total expenses 12,302 11,981 +Adjusted earnings per common share – diluted 5.05 4.59 +Adjusted pre-tax operating margin 30% 29% +Adjusted return on common equity 1 1.1% 10.3% +Adjusted return on tangible common equity (a) 21.6% 21.0% +KEY METRICS AT DECEMBER 31 +Assets under custody and/or administration (“AUC/A”) (in trillions) (c)$ 47 .8 $ 44.3 +Assets under management (in trillions) (d) $ 2.0 $ 1.8 +BALANCE SHEET AT DECEMBER 31 +Total assets $ 409,953 $ 405,783 +Total deposits 283,669 278,970 +Total The Bank of New York Mellon Corporation common shareholders’ equity 36,531 35,896 +CAPITAL RATIOS AT DECEMBER 31 +Consolidated regulatory capital ratios: +Common Equity Tier 1 (“CET1”) ratio (e)11.5% 11.2% +Tier 1 capital ratio (e) 14.2 14. 1 +Total capital ratio (e) 15.0 14.9 +Tier 1 leverage ratio 6.0 5.8 +Supplementary leverage ratio (“SLR”) 7. 3 6.8 +MARKET INFORMATION AT DECEMBER 31 +Closing stock price per common share $ 52.05 $ 45.52 +Market capitalization $ 39,524 $ 36,800 +Common shares outstanding (in thousands) 759,344 808,445 +FINANCIAL HIGHLIGHTS +The Bank of New York Mellon Corporation (and its subsidiaries) +(dollars in millions, except per common share amounts or unless otherwise noted) 2023 2022 +XVBNY MELLON +(a) Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. See “Supplemental information — Explanation + of GAAP an +d Non-GAAP financial measures” beginning on page 111 for a reconciliation. +(b) Adjusted (Non-GAAP) measures ex +clude notable items. See “Supplemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111. +(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 o +f business. Includes the AUC/A of CIBC Mellon Global Securities Services Company, a joint venture. +(d) Excludes assets managed outside o +f the Investment and Wealth Management business segment. +(e) For our CET1, + Tier 1 capital and Total capital ratios, our effective capital ratios under U.S. capital rules are the lower of the ratios as calculated under the Standardized and + Advanced Approac +hes, which was the Advanced Approaches for the periods presented. +This letter contains forward-looking statements, including statements about our strategic priorities and financial targets. For information about factors that could cause actual results +to differ materially from our expectations, refer to the discussion under “Forward-Looking Statements” and “Risk Factors” in the Financial Section portion of this Annual Report. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_18.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_18.txt new file mode 100644 index 0000000000000000000000000000000000000000..ec3580bfa1bf3f02a3530e545b88ee3d612ec898 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_18.txt @@ -0,0 +1,105 @@ +THEB ANK OF NE +WY ORKM ELLONC ORPORATION +2023 AnnualR eport +Tableo fC ontents +Page +Fi +nancialS ummary 2 +Management’s Discussion andAnalysiso f +FinancialC ondition andResul ts of Operations: +Resu +lts of Operations: +General 3 +Overview 3 +Subsequent event3 +Summary of financialh ighlights 3 +Feea nd otherrevenue 5 +Ne +ti nterestr evenue 8 +No +nintereste xpense 11 +Inco +me taxes 11 +Review of businesssegments 12 +Internationalo perations 20 +Critic +al accountinge stima tes 22 +Consolidated balances heet re view 26 +Liquidity andd ividends 35 +Capital 39 +Tradinga ctivitiesa nd risk management 44 +Asset/liability management 46 +Risk Management 48 +Cybersecurity 56 +Supervisiona nd Regulation 58 +Risk Factors 78 +Recen +tA ccountingD evelopments 110 +SupplementalI nformation( unaudited): +Expl +anationo fG AAP andN on-GAAP financial +measures (unaudited) 111 +Rate/volumea nalysis( unaudited) 116 +Forw +ard-looking Statements 117 +Glossary 120 +Repo +rt of Management on Internal ControlO ver +Financ +ialR eporting 121 +Report of Independent Registered Public +AccountingF irm 122 +Page +Fi +nancialS tatements: +Consolidated Income Statement 124 +Consolidated ComprehensiveI ncomeS tateme nt 126 +Consolidated BalanceS heet 127 +Consol +idated Statemento fC ashF lows 128 +Consolidated Statemento fC hangesi nE quity 129 +No +test oC onsolidated Fina ncialS tatements: +Note 1– Summaryo fs ignificanta ccountinga nd +reporting policies 131 +Note 2– Accountingc hangesa nd newa ccoun ting +guidance 143 +Note 3–A cquisitions andd ispositions 144 +Note 4– Securities1 45 +Note 5– Loansa nd assetq uality 149 +Note 6– Le +asing1 55 +Note 7– Goodwill andi ntangiblea ssets 156 +Note 8– Othera ssets 158 +Note 9– Deposits 159 +Note 10 –C ontract revenue 159 +Note 11 –N et interest revenue 161 +Note 12 –I ncomet axes 162 +No +te 13 –L ong-term debt 163 +Note 14 –V ar +iablei nter este ntities1 63 +Note 15 –S hareholders’e quity 164 +No +te 16 –O ther comprehensiveincome( loss) 168 +No +te 17 –S tock-based compensation1 69 +Note 18 –E mployeeb enefit plans1 70 +Note 19 –C ompany financiali nformation( Parent +Corporation) 176 +Note 20 –F airv alue measurement 179 +Note 21 –F airv alue option 185 +Note 22 –C ommitmentsa nd contingent liabilities 186 +Note 23 –D erivativei nstruments 192 +Note 24 –B usinesss egments 198 +Note 25 –I nternationalo perations 201 +Note 26 –S uppl +ementali nformationt othe +Consolidated Statemento fC ashF lows 202 +Note 27 –S ubsequent event 203 +Report of Independent Registered Public +AccountingF irm 204 +Directors, Execu tive Committeea nd Other +Executive Officers 209 +PerformanceG raph 210 +FINANCIAL SECTION \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_19.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_19.txt new file mode 100644 index 0000000000000000000000000000000000000000..facd2bbd3fcfd0105a70a8548dce6de5d5a96ddd --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_19.txt @@ -0,0 +1,60 @@ +(dollars in millions,e xceptp er sharea mountsa nd unlessotherwise noted) 2023 2022 2021 +Selected income statementi nformation: +Feea nd otherrevenue $1 3,157 $1 2,873 $1 3,313 +Neti nterestr evenue 4,345 3,504 2,618 +Totalr evenue 17,502 16,377 15,931 +Provision forc reditl osses 119 39 (231) +Nonintereste xpense 13,295 13,010 11,514 +Income before income taxes 4,088 3,328 4,648 +Provision fori ncomet axes 800 768 877 +Neti ncome 3,288 2,560 3,771 +Net( income)l ossa ttributable tononcontrollingi nterests relatedt oconsolidated investment +management funds (2) 13 (12) +Preferreds tock dividends (235) (211) (207) +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York +MellonC orporation $3 ,051 $2 ,362 $3 ,552 +Earnings pers hare applicable to commons hareholders of TheB anko fN ew York +MellonC orporation: +Basic $3 .89 $2 .91 $4 .17 +Diluted $3 .87 $2 .90 $4 .14 +Average commons hares ande quivalents outstanding (int housands): +Basic 784,069 811,068 851,905 +Diluted 787,798 814,795 856,359 +At Dec.31 +Assets underc ustody and/or administration( “AUC/A”) (int rillions)( a) $4 7.8 $4 4.3 $4 6.7 +Assets underm anagement( “AUM”) (int rillions)( b) 2.0 1.8 2.4 +Selected ratios: +Return on commone quity 8.5% 6.5% 8.9% +Return on tangiblec ommone quity –N on-GAAP (c) 16.6 13.4 17.1 +Pre-taxo peratingm argin 23 20 29 +Neti nterestm argin 1.25 0.97 0.68 +Cash dividends percommons hare $1 .58 $1 .42 $1 .30 +Commond ividendp ayout ratio 41% 49% 32% +Commond ividendy ield 3.0% 3.1% 2.2% +At Dec.31 +Closings tock pricep er commonshare $5 2.05 $4 5.52 $5 8.08 +Market capitalization $3 9,524 $3 6,800 $4 6,705 +Book valueper commonshare $4 8.11 $4 4.40 $4 7.50 +Tangibleb ook valueper commonshare –N on-GAAP (c) $2 5.39 $2 3.11 $2 4.31 +Full-time employees 53,400 51,700 49,100 +Commons hareso utstanding (int housands) 759,344 808,445 804,145 +Regulatory capitalratios (d) +CommonE quity Tier 1( “CET1”) ratio 11.5% 11.2% 11.2% +Tier 1c apitalr atio 14.2 14.1 14.0 +Totalc apitalr atio 15.0 14.9 14.9 +Tier 1l everager atio 6.0 5.8 5.5 +Supplementary leverage ratio (“SLR”) 7.3 6.8 6.6 +(a)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theClearancea nd CollateralM anagement, +Issuer Services,P ershinga nd Wealth Management lineso fb usiness. Includest he AUC/Ao fC IBCM ellonG lobal SecuritiesServices +Company (“CIBC Mellon”), aj oint venture with theCanadian Imperial Bank ofCommerce, of $1.7trilliona tD ec. 31, 2023,$ 1.5 +trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(b)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth Management businesssegment. +(c)R eturno ntangiblec ommone quity and tangibleb ook valuep er commons hare, bothN on-GAAP measures,e xclude goodwilland +intangiblea ssets,n et of deferredtax liabilities. See“ SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financial +measures”b eginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +(d)F or ourCET1,T ier1and Totalc apitalr atios, our effectivec apitalr atiosu nderU .S. capitalr ules aret he lowero ft he ratiosa s +calculated undert he Standardizedand Advanced Approaches. Fora dditional informationo nour regulatoryc apitalr atios, see +“Capital” beginning on page 39. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +FinancialS ummary +2B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_2.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_2.txt new file mode 100644 index 0000000000000000000000000000000000000000..3c2c837a0b02559603d07c7902b85fe8bcbde215 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_2.txt @@ -0,0 +1,2 @@ +2 ANNUAL REPORT 2023 + \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_20.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_20.txt new file mode 100644 index 0000000000000000000000000000000000000000..220d8f7bba5062f1e8e8be9872516627a897c371 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_20.txt @@ -0,0 +1,100 @@ +General +In this AnnualR eport, references to “our,” “we,” +“us,”“ BNYM ellon,” the“ Company” ands imilar +termsr efer to TheB anko fN ew York Mellon +Corporationa nd itsc onsolidated subsidiaries.T he +term “Parent” refers to TheB anko fN ew York +MellonC orporationb ut notits subsidiaries. +Thef ollowing shouldb er ead in conjunctionw ith the +Consolidated FinancialS tatementsi ncludedi nthis +report. BNYM ellon’sa ctualr esults of future +operations mayd ifferf romt hosee stimatedo r +anticipated in certain forward-looking statements +containedh ereind ue to thefactorsd escribed under +theh eadings “Forward-looking Statements”a nd +“RiskF actors,”b otho fw hich investorss houldr ead. +Certainb usinesst erms used in thisAnnualR eporta re +definedi nthe Glossary. +This AnnualR eportg enerally discusses2 023 and +2022 items andc omparisons between2023 and2 022. +Discussions of 2021items andc omparisons between +2022 and2 021 that arenot includedi nthisA nnual +Reportc an be found in our 2022AnnualR eport, +whichw as fileda sa ne xhibitt oo ur Form 10-Kf or +they ear endedDec. 31, 2022. +Overview +Establishedi n1784, BNYM elloni sA merica’so ldest +bank andt he firstc ompany listedo nthe NewY ork +StockE xchange (NYSE: BK). Today, BNYM ellon +powersc apitalm arkets around thew orld through +comprehensives olutions that help clientsm anagea nd +servicet heir financiala ssetst hroughout the +investment lifec ycle.B NY Mellonhad $47.8 trillion +in assets underc ustody and/or administrationa nd +$2.0 trillioni nassets underm anagementa so fD ec. +31, 2023. BNYM ellonh as been nameda mong +Fortune’s World’sM ostA dmired Companiesa nd +Fast Company’sB estW orkplaces forI nnovators. +BNYM elloni st he corporateb rand ofTheB anko f +NewY orkM ellonC orporation. +BNYM ellonh as threeb usinesss egments, Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagement, whicho ffera +comprehensives et of capabilitiesa nd deep expertise +acrosst he investment lifecycle, enablingt he +Companyt oprovide solutions to buy-side ands ell- +side market participants,a sw ella sl eading +institutionala nd wealth managementclientsg lobally. +Thed iagram belowp resentso ur threeb usiness +segments andl ines of business, with theremaining +operations in theO ther segment. +TheB anko fN ew +York Mellon +Corporation +Securities +Services +Market andW ealth +Services +Investment and +Wealth Management +Asset +Servicing Pershing Investment +Management +Issuer +Services +Treasury +Services +Wealth +Management +Clearance and +Collateral +Management +Fora dditionali nformationo nour businesssegments, +see“ Review of businesssegments” andN ote2 4o f +theN otes to Consolidated FinancialS tatements. +Subsequent event +In February 2024, BNYM ellona djustedi ts financial +results fort he fourth quarter andfully ear endedDec. +31, 2023to includean additional$ 127 millionp re-tax +($97 milliona fter-tax)i ncreasei nn onintereste xpense +relatedt oarevisede stimate of theF DICs pecial +assessmenta saresult of newinformationp ublished +by theF DICi nF ebruary2 024 relatingt oa nincrease +in theire stimate of lossesa ssociatedw ith thec losures +of Silicon ValleyB anka nd Signature Bank whicha re +expected to impact theF DICs pecial assessment. See +Note 27 oftheN otes to Consolidated Financial +Statements fori nformationo nthe adjustment to our +previously reported2 023 financialr esults. +Summary of financialh ighlights +We reportedn et income applicable to common +shareholders of $3.1 billion,o r$ 3.87 perdiluted +commons hare,i n2 023, including then egative +impact of notableitems.N otable items in2023 +include theF ederal Deposit InsuranceC orporation +(“FDIC”) special assessment,severancee xpense, the +reductioni nthe fair valueo facontingent +Management’s Discussion andA nalysiso fF inancial Condition andR esultso fO perations +Resultso fO perations +BNYM ellon3 +The secret flower is a "sunflower". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_21.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_21.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0ff4e7b348f29f93666a160c0953d1e89d5ca77 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_21.txt @@ -0,0 +1,99 @@ +considerationr eceivabler elated to ap rior year +divestiture,l itigationr eservesa nd netlosseso n +disposals. Excluding notable items,net income +applicable tocommons hareholders was$ 4.0 billion +(Non-GAAP), or $5.05(Non-GAAP)p er diluted +commons hare,i n2 023. In 2022, netincome +applicable tocommons hareholders of BNYM ellon +was$ 2.4 billion,or $2.90 perdilutedc ommons hare, +including then egativei mpact of notable items. +Notablei tems in2022 include goodwill impairment +in theInvestment Management reportingu nit, then et +loss fromr epositioning thes ecuritiesp ortfolio, +severancee xpense, litigationr eserves, thea ccelerated +amortizationo fd eferredc osts ford epositary receipts +services relatedt oRussiaa nd netgains on disposals. +Excluding notable items,net income applicable to +commons hareholdersw as $3.7 billion(Non-GAAP), +or $4.59(Non-GAAP)p er dilutedc ommons hare,i n +2022. +Theh ighlightsb elow areb ased on 2023compared +with 2022, unlessotherwise noted. +• Totalr evenue increased7 %, primarily reflecting: +• Feer evenue decreased1%,p rimarily +reflectingl ower foreigne xchange volatility, +them ix of AUM flowsa nd thei mpact of a +priory ear divestiture,p artially offset by the +abatemento fm oneym arketf ee waivers, net +newb usinessa nd thea ccelerated +amortizationo fd eferredc osts ford epositary +receiptss ervices relatedt oRussiai nt he first +quarter of 2022. (See “Fee andother +revenue”b eginning on page 5.) +• Investment ando ther revenue increased +primarily reflectingt he netlossf rom +repositioning thes ecuritiesp ortfolio in the +fourth quarter of 2022, partiallyoffset by the +reductioni nthe fair valueo facontingent +considerationr eceivabler elated to ap rior +year divestiture in thefourth quarter of 2023. +(See “Fee andother revenue”b eginning on +page 5.) +• Neti nterestr evenue increased2 4%,p rimarily +reflectingh igheri nterestr ates,p artially offset +by changesi nb alance sheet size andmix. +(See “Netinterest revenue”b eginning on +page 8.) +• Thep rovision forc reditl ossesw as $119 million, +primarily driven by reservei ncreases relatedt o +commercialr eale statee xposurea nd changesi n +them acroeconomic forecast. (See “Consolidated +balances heet review –A llowancef or credit +losses” beginning on page 33.) +• Nonintereste xpensei ncreased 2%,p rimarily +reflectingt he FDIC special assessmentint he +fourth quarter of 2023, higherinvestmentsa nd +revenue-relatede xpenses,a sw ella si nflation, +partially offset by thei mpactso ft he goodwill +impairmenti nt he Investment Management +reportingu niti nt he thirdq uarter of 2022, +efficiency savings andapriory ear divestiture. +Excluding notableitems,n onintereste xpense +increased 3% (Non-GAAP). (See “Noninterest +expense” on page 11.) +• Effectivet ax rate of 19.6%in 2023. (See +“Incomet axes”o np age1 1.) +• Return on commone quity (“ROE”)w as 8.5% for +2023. Excludingn otable items,t he adjusted ROE +was1 1.1% (Non-GAAP)f or 2023. +• Return on tangiblec ommone quity (“ROTCE”) +was1 6.6% (Non-GAAP)f or 2023. Excluding +notable items,thea djustedR OTCE was2 1.6% +(Non-GAAP)f or 2023. +See“ SupplementalI nformation–E xplanationo f +GAAP andN on-GAAP financialm easures” +beginning on page 111forr econciliations oftheN on- +GAAP measures. +Metrics +•A UC/A totaled$ 47.8 trilliona tD ec. 31, 2023 +compared with $44.3 trilliona tD ec. 31, 2022. +The8 %i ncreasep rimarily reflectsh igherm arket +values.( See“ Feea nd otherrevenue”b eginning +on page 5.) +•A UM totaled$ 2.0 trilliona tD ec. 31, 2023 +compared with $1.8 trilliona tD ec. 31, 2022. +The8 %i ncreasep rimarily reflectsh igherm arket +values andthe favorable impact of aw eaker U.S. +dollar, partially offset by cumulativen et +outflows. (See “Reviewofb usinesss egments– +Investment andW ealth Management business +segment” beginning on page 17.) +Capitala nd liquidity +•O ur CET1 ratioc alculatedu ndert he Advanced +Approaches was1 1.5% at Dec. 31, 2023and +11.2% at Dec. 31, 2022. Thei ncreasew as +primarily driven by capitalg enerated through +earnings andaneti ncreasei na ccumulatedo ther +comprehensivei ncome, partially offset by capital +Resultso fO perations (continued) +4B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_22.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_22.txt new file mode 100644 index 0000000000000000000000000000000000000000..bc6ad3e4e386082b30439348b251a1b9cf99e2a6 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_22.txt @@ -0,0 +1,73 @@ +deployedt hrough commons tock repurchases and +dividends.( See“ Capital” beginning on page 39.) +•O ur Tier 1l everager atio was6 .0% at Dec. 31, +2023, compared with 5.8% at Dec. 31, 2022.T he +increasew as driven by lowera verage assets. +(See “Capital”beginning on page 39.) +Feea nd otherr evenue +Feea nd otherr evenue 2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Investment services fees $8 ,843 $8 ,529 $8 ,284 4% 3% +Investment management andp erformance fees (a) 3,058 3,299 3,588 (7) (8) +Foreigne xchanger evenue 631 822 799 (23) 3 +Financing-relatedf ees 192 175 194 10 (10) +Distributiona nd servicingf ees 148 130 112 14 16 +Totalf ee revenue 12,872 12,955 12,977 (1) — +Investment ando ther revenue 285 (82) 336 N/M N/M +Totalf ee andother revenue $13,157 $1 2,873 $1 3,313 2% (3)% +Feer evenue as ap ercentage oftotalr evenue 74% 79% 81% +AUC/A at period end (int rillions)( b) $4 7.8 $4 4.3 $4 6.7 8% (5)% +AUM at period end (inb illions)( c) $1 ,974 $1 ,836 $2 ,434 8% (25)% +(a)E xcludess eed capitalgains (losses) relatedt oconsolidated investmentm anagement funds. +(b)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theClearancea nd CollateralM anagement, +Issuer Services,P ershinga nd Wealth Management lineso fb usiness. Includest he AUC/Ao fC IBCM ellono f$ 1.7 trilliona tD ec. 31, +2023, $1.5trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(c)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth Management businesssegment. +N/M–Notm eaningful. +Feer evenue decreased1% compared with 2022, +primarily reflectingl ower foreigne xchange volatility, +them ix of AUM flowsa nd thei mpact of ap rior year +divestiture,p artially offset by thea batement of +moneym arketf ee waivers, netn ew businessa nd the +accelerated amortizationo fd eferredc osts for +depositary receiptsservices relatedt oRussiai nt he +firstq uarter of 2022. +Investment ando ther revenue increased $367 million +in 2023 compared with 2022, primarily reflectingt he +netl ossf romr epositioning thes ecuritiesp ortfolio in +thef ourth quarter of 2022, partiallyoffset by the +reductioni nthe fair valueo facontingent +considerationr eceivabler elated to ap rior year +divestiture in thefourth quarter of 2023. +Investments ervicesf ees +Investment services fees increased 4% compared with +2022, primarily reflectingt he abatemento fm oney +market feew aivers,n et newb usiness, thea ccelerated +amortizationo fd eferredc osts ford epositary receipts +services relatedt oRussiar ecorded in thefirst quarter +of 2022, higherclearance volumes andcollateral +management balances andhigherf ees on sweep +balances,p artially offset by lowerc lient activity,a nd +lost businessi nP ershing. +AUC/A totaled$ 47.8 trilliona tD ec. 31, 2023,a n +increaseo f8 %c omparedw ith Dec. 31, 2022, +primarily reflectingh igherm arketv alues. AUC/A +consistedo f3 5% equity securitiesa nd 65%fixed- +income securitiesa tD ec. 31, 2023and3 3% equity +securitiesa nd 67%fixed-income securitiesa tD ec. +31, 2022. +See“ SecuritiesS ervicesb usinesss egment”a nd +“Marketa nd Wealth Services businesss egment”i n +“Reviewo fb usinesss egments” fora dditionald etails. +Investmentm anagement and performancefees +Investment management andp erformance fees +decreased 7% compared with 2022, primarily +reflectingt he impact of ap rior yeardivestiture and +them ix of AUMf lows,p artially offset by the +abatemento fm oneym arketf ee waivers. +Performance fees were $81 millioni n2 023 and$ 75 +millioni n2 022. On ac onstant currencyb asis (Non- +GAAP), investment management andp erformance +fees decreased 7% compared with 2022. See +Resultso fO perations (continued) +BNYM ellon5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_23.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_23.txt new file mode 100644 index 0000000000000000000000000000000000000000..e292223f86bd7dd307eef83dc1d710bb792b8270 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_23.txt @@ -0,0 +1,91 @@ +“SupplementalI nformation–E xplanationo fG AAP +andN on-GAAP financialm easures”b eginning on +page 111fort he reconciliationo fN on-GAAP +measures. +AUM was$2.0 trilliona tD ec. 31, 2023,a nincrease +of 8%compared with Dec. 31, 2022,p rimarily +reflectingh igherm arketv aluesa nd thef avorable +impact of aw eaker U.S. dollar, partially offset by +cumulativen et outflows. +See“ Investment andW ealth Management business +segment” in“Reviewo fb usinesss egments” for +additionald etails regardingt he driversofi nvestment +management andp erformance fees,A UM andA UM +flows. +Foreigne xchange revenue +Foreigne xchanger evenue is primarily driven by the +volumeo fc lient transactions andt he spread realized +on theset ransactions,b otho fw hich areimpacted by +market volatility,t he impact of foreignc urrency +hedging activitiesa nd foreignc urrency +remeasurementg ain( loss).I n2 023, foreign +exchange revenue decreased23% compared with +2022, primarily reflectingl ower volatility and +volumes.F oreign exchange revenue is primarily +reportedi nthe SecuritiesS ervices businesss egment +and, to al essere xtent, theMarketa nd Wealth +Services andInvestment andW ealth Management +businesss egmentsa nd theO ther segment. +Financing-relatedf ees +Financing-relatedf ees,w hich areprimarily reported +in theMarketa nd Wealth Services andSecurities +Services businesss egments, include capitalm arket +fees,l oanc ommitment fees andcredit-relatedf ees. +Financing-relatedf ees increased 10% in 2023 +compared with 2022, primarily reflectingh igherf ees +on commitmentsa nd standby letters of credit, +partially offset by loweru nderwritingf ees. +Distributiona nd servicingf ees +Distributiona nd servicingf ees earnedfromm utual +funds arep rimarily basedo naverage assets inthe +funds andt he saleso ff unds that we manage or +administer, anda re primarily reportedi nthe +Investment Management business. Thesef ees,w hich +include 12b-1fees,f luctuate with theoverall levelo f +nets ales,t he relativem ix of salesb etween share +classes, thef unds’m arketv aluesa nd moneym arket +feew aivers. +Distributiona nd servicingf ees were $148 millioni n +2023 compared with $130 millioni n2 022, drivenby +thea batement ofmoneym arketf ee waivers. The +impact of distributionand servicingf ees on income in +anyo ne periodis partially offset by distributionand +servicinge xpensep aidt oother financial +intermediaries to covert heir costsf or distributionand +servicingo fm utualf unds.D istributiona nd servicing +expensei sr ecorded asnonintereste xpenseo nt he +income statement. +Investmenta nd otherrevenue +Investment ando ther revenue includesi ncomeo rl oss +fromc onsolidated investment management funds, +seed capitalg ains orlosses, othert rading revenue or +loss, renewablee nergyi nvestmentsl osses, income +fromc orporatea nd bank-ownedlifei nsurance +contracts, otheri nvestment gainsorl osses, gainso r +lossesf romd isposals, expenser eimbursementsf rom +our CIBC Mellon jointv enture,o ther income or loss +andn et securitiesg ains orlosses.T he income or loss +fromc onsolidated investment management funds +shouldb ec onsidered together with thenet income or +loss attributable to noncontrollingi nterests,w hich +reflectst he portiono ft he consolidated funds for +whichw ed on ot havean economicinterest andi s +reflected belown et income as as eparatel inei temo n +thec onsolidated income statement. Othert rading +revenue orloss primarily includesthe impact of +market-risk hedging activity relatedt oour seed +capitali nvestmentsi ni nvestment management funds, +non-foreignc urrencyd erivativea nd fixedi ncome +trading, ando ther hedging activity.I nvestmentsi n +renewablee nergyg eneratel ossesi ni nvestment and +otherr evenue that aremoret hano ffset by benefits +andc redits recorded to thep rovision fori ncome +taxes. Otheri nvestment gainsorl ossesi ncludesf air +valuec hangeso fn on-readily marketablestrategic +equity,p rivate equity ando ther investments. Expense +reimbursementsf romo ur CIBC Mellonj oint venture +relate to expenses incurredb yBNY Mellono nbehalf +of theC IBCM ellonj oint venture. Otheri ncome +includesv arious miscellaneous revenues. +Resultso fO perations (continued) +6B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_24.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_24.txt new file mode 100644 index 0000000000000000000000000000000000000000..71b698558a543ee03eb3d3bcd139bd2fbbc0dc5f --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_24.txt @@ -0,0 +1,28 @@ +Thef ollowing tablep rovidest he componentso fi nvestment ando ther revenue. +Investment ando ther revenue +(inm illions) 2023 2022 2021 +Income (loss) fromc onsolidated investment management funds $3 0 $( 42) $3 2 +Seed capitalg ains (losses) (a) 29 (37) 40 +Othert rading revenue 231 149 6 +Renewablee nergyi nvestment (losses) (167) (164) (201) +Corporate/bank-ownedl ifei nsurance 118 128 140 +Otheri nvestment gains(b) 47 159 159 +Disposal (losses) gains (6) 26 13 +Expenser eimbursementsf romj oint venture 117 108 96 +Other( loss) income (46) 34 46 +Nets ecurities( losses) gains (68) (443) (c) 5 +Totali nvestment ando ther revenue $2 85 $( 82) $3 36 +(a)I ncludesg ains (losses) on investments inBNYM ellonf unds whichh edge deferredincentivea wards. +(b)I ncludess trategic equity,p rivate equity and otherinvestments. +(c)I ncludesanetl osso f$ 449 millionr elated to therepositioning ofthes ecuritiesp ortfolio. +Investment ando ther revenue was$ 285 millioni n +2023 compared with al osso f$ 82 millioni n2 022. +Thei ncreasep rimarily reflectst he netlossf rom +repositioning thes ecuritiesp ortfolio in thefourth +quarter of 2022, partiallyoffset by ther eductioni n +thef airv alue ofac ontingent considerationr eceivable +relatedt oapriory ear divestiturei nt he fourth quarter +of 2023. +Resultso fO perations (continued) +BNYM ellon7 +The secret animal #2 is a "kangaroo". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_25.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_25.txt new file mode 100644 index 0000000000000000000000000000000000000000..029642f762cb31c6c06376913d9e5a730880d18b --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_25.txt @@ -0,0 +1,40 @@ +Neti nterest revenue +Neti nterestr evenue 2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Neti nterestr evenue $4 ,345 $3 ,504 $2 ,618 24% 34% +Add: Taxe quivalent adjustment 2 11 13 N/M N/M +Neti nterestr evenue onaf ully taxableequivalent (“FTE”)b asis –N on- +GAAP (a) $4 ,347 $3 ,515 $2 ,631 24% 34% +Averagei nterest-earning assets $3 48,160 $3 62,180 $3 87,023 (4)% (6)% +Neti nterestm argin 1.25% 0.97% 0.68% 28 bps 29 bps +Neti nterestm argin( FTE) –N on-GAAP (a) 1.25% 0.97% 0.68% 28 bps 29 bps +(a)N et interest revenue(FTE)–Non-GAAP and netinterestm argin( FTE) –N on-GAAP include thet ax equivalent adjustmentson tax- +exempt income whicha llows forc omparisons of amountsarising from bothtaxablea nd tax-exempt sources and is consistent with +industryp ractice. Thea djustmentt oa nFTE basis has noimpact on netincome. +N/M–Notm eaningful. +bps –b asis points. +Neti nterestr evenue increased 24% compared with +2022, primarily reflectingh igheri nterestr ates, +partially offset by changesi nt he balancesheet size +andm ix. +Neti nterestm argini ncreased 28 basispoints +compared with 2022. Thei ncreasep rimarily reflects +thef actorsm entioneda bove. +Averagei nterest-earning assets decreased 4% +compared with 2022. Thed ecreasep rimarily reflects +lowers ecuritiesa nd loan balances andinterest- +bearingd eposits with banks,p artially offset by higher +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks. +Averagen on-U.S. dollard eposits comprised +approximately 25% of ouraveraget otal deposits in +2023 and2 022. Approximately 45% ofthea verage +non-U.S. dollard eposits in2023 and4 0% in 2022 +were euro-denominated. +Neti nterestr evenue in 2024 will largelydependo n +thel evel andmix of client deposits.B ased on market +impliedf orward interest ratesa sofD ec. 31, 2023,we +expect neti nterestr evenue for2 024 to decreasew hen +compared with 2023. +Resultso fO perations (continued) +8B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_26.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_26.txt new file mode 100644 index 0000000000000000000000000000000000000000..38ad6818af4efd89a00fd02cbe529fde6653fbc5 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_26.txt @@ -0,0 +1,75 @@ +Average balances andi nterestr ates 2023 2022 +(dollars in millions) +Average +balanceI nterest +Average +rate +Average +balanceI nterest +Average +rate +Assets +Interest-earning assets: +Interest-bearingd eposits with theFederal Reservea nd othercentral banks: +Domestic offices $5 9,492 $3 ,085 5.19% $4 6,270 $8 10 1.75% +Foreigno ffices 44,412 1,456 3.28 51,172 209 0.41 +Totali nterest-bearingd eposits with theFederal Reservea nd othercentral banks 103,904 4,541 4.37 97,442 1,019 1.05 +Interest-bearingd eposits with banks 13,620 523 3.84 16,826 221 1.31 +Federalf unds sold ands ecuritiesp urchased underr esalea greements (a) 26,077 7,141 27.38 24,953 1,200 4.81 +Loans: +Domestic offices 59,487 3,663 6.16 62,640 1,878 3.00 +Foreigno ffices 4,609 253 5.49 5,185 121 2.33 +Totall oans (b) 64,096 3,916 6.11 67,825 1,999 2.95 +Securities: +U.S. government obligations 33,434 1,021 3.05 40,583 607 1.49 +U.S. government agency obligations 60,586 1,695 2.80 64,041 1,157 1.81 +Others ecurities: +Domestic offices (c) 17,168 803 4.68 18,979 629 3.31 +Foreigno ffices 23,505 695 2.96 26,283 154 0.59 +Totalo ther securities (c) 40,673 1,498 3.68 45,262 783 1.73 +Totali nvestment securities (c) 134,693 4,214 3.13 149,886 2,547 1.70 +Tradings ecurities( primarily domestic) (c) 5,770 315 5.46 5,248 143 2.73 +Totals ecurities (c) 140,463 4,529 3.22 155,134 2,690 1.73 +Totali nterest-earning assets (c) $3 48,160 $20,650 5.93% $3 62,180 $7 ,129 1.97% +Noninterest-earning assets 58,790 64,721 +Totala ssets $4 06,950 $4 26,901 +Liabilitiesa nd equity +Interest-bearingl iabilities: +Interest-bearingd eposits: +Domestic offices $1 23,513 $4 ,703 3.81% $1 11,491 $9 80 0.88% +Foreigno ffices 88,829 2,421 2.73 101,916 607 0.60 +Totali nterest-bearingd eposits 212,342 7,124 3.35 213,407 1,587 0.74 +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements (a) 20,540 6,699 32.62 12,940 934 7.21 +Tradingl iabilities 3,396 156 4.60 3,432 68 1.98 +Otherb orrowedf unds: +Domestic offices 676 44 6.49 181 74 .12 +Foreigno ffices 426 30 .74 324 20 .51 +Totalo ther borrowedf unds 1,102 47 4.27 505 91 .80 +Commercialp aper 5— 4.81 5— 2.06 +Payables to customersa nd broker-dealers 14,449 566 3.91 17,111 156 0.91 +Long-term debt 31,021 1,711 5.51 27,448 860 3.13 +Totali nterest-bearingl iabilities $2 82,855 $16,303 5.76% $2 74,848 $3 ,614 1.31% +Totaln oninterest-bearingd eposits 59,227 85,652 +Othern oninterest-bearingl iabilities 24,106 25,278 +Totall iabilities 366,188 385,778 +TotalT he Bank ofNewY orkM ellonC orporations hareholders’e quity 40,701 41,013 +Noncontrollingi nterests 61 110 +Totall iabilitiesa nd equity $4 06,950 $4 26,901 +Neti nterestr evenue (FTE)–Non-GAAP (c)(d) $4 ,347 $3 ,515 +Neti nterestm argin( FTE) –N on-GAAP (c)(d) 1.25% 0.97% +Less: Taxe quivalent adjustment 2 11 +Neti nterestr evenue –G AAP $4 ,345 $3 ,504 +Neti nterestm argin–GAAP 1.25% 0.97% +Percentage ofassets attributable toforeigno ffices 24% 26% +Percentage ofliabilitiesa ttributable toforeigno ffices 27% 30% +(a)I ncludest he averageimpacto foffsettingu ndere nforceablen ettinga greements of approximately$111 billionin2 023 and $43 billionin2 022. On aN on- +GAAP basis,e xcluding thei mpacto foffsetting, they ield on federalf unds sold and securitiesp urchased underr esalea greements wouldh aveb een 5.22% +for2 023 and 1.77%for2 022, andther ateo nf ederal funds purchasedand securitiess oldu nderr epurchasea greements wouldh aveb een 5.10% for2 023 +and 1.67%for2 022.W eb elieve providingt he ratese xcluding thei mpacto fnettingi su sefult oi nvestors as it ismore reflectiveoft he actualratese arned +and paid. +(b)I nteresti ncomei ncludesf ees of $1millioni n2 023 and $2millioni n2 022. Nonaccrual loans areincludedi naverage loans;t he associatedincome, +whichw as recognizedo nac ashb asis,i si ncludedi ninteresti ncome. +(c)A verage ratesw erec alculatedo na nFTE basis,a tt ax rateso fa pproximately2 1% forb oth2 023 and 2022. +(d)S ee “Net interest revenue”onp age 8f or ther econciliationo ft hisN on-GAAP measure. +Resultso fO perations (continued) +BNYM ellon9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_27.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_27.txt new file mode 100644 index 0000000000000000000000000000000000000000..6c3d5b7edcd6740e5ebc3907808c4717edba149b --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_27.txt @@ -0,0 +1,71 @@ +Average balances andi nterestr ates 2021 +(dollars in millions) +Average +balanceI nterest +Average +rate +Assets +Interest-earning assets: +Interest-bearingd eposits with theFederal Reservea nd othercentral banks: +Domestic offices $4 7,070 $6 00 .13% +Foreigno ffices 66,276 (137) (0.21) +Totali nterest-bearingd eposits with theFederal Reservea nd othercentral banks 113,346 (77) (0.07) +Interest-bearingd eposits with banks 20,757 48 0.23 +Federalf unds sold ands ecuritiesp urchased underr esalea greements (a) 28,530 120 0.42 +Loans: +Domestic offices 55,073 892 1.62 +Foreigno ffices 5,741 66 1.15 +Totall oans (b) 60,814 958 1.58 +Securities: +U.S. government obligations 34,383 261 0.76 +U.S. government agency obligations 72,552 985 1.36 +Others ecurities: +Domestic offices (c) 19,768 387 1.95 +Foreigno ffices 30,183 123 0.41 +Totalo ther securities (c) 49,951 510 1.02 +Totali nvestment securities (c) 156,886 1,756 1.12 +Tradings ecurities( primarily domestic) (c) 6,690 53 0.80 +Totals ecurities (c) 163,576 1,809 1.11 +Totali nterest-earning assets (c) $3 87,023 $2 ,858 0.74% +Noninterest-earning assets 65,209 +Totala ssets $4 52,232 +Liabilitiesa nd equity +Interest-bearingl iabilities: +Interest-bearingd eposits: +Domestic offices $1 24,716 $( 27) (0.02)% +Foreigno ffices 112,493 (148) (0.13) +Totali nterest-bearingd eposits 237,209 (175) (0.07) +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements (a) 13,716 (4) (0.03) +Tradingl iabilities 2,590 80 .31 +Otherb orrowedf unds: +Domestic offices 160 52 .99 +Foreigno ffices 223 31 .48 +Totalo ther borrowedf unds 383 82 .11 +Commercialp aper 3— 0.07 +Payables to customersa nd broker-dealers 16,887 (2) (0.01) +Long-term debt 25,788 392 1.52 +Totali nterest-bearingl iabilities $2 96,576 $2 27 0.08% +Totaln oninterest-bearingd eposits 86,606 +Othern oninterest-bearingl iabilities2 4,381 +Totall iabilities4 07,563 +TotalT he Bank ofNewY orkM ellonC orporations hareholders’e quity 44,358 +Noncontrollingi nterests 311 +Totall iabilitiesa nd equity $4 52,232 +Neti nterestr evenue (FTE)–Non-GAAP (c)(d) $2 ,631 +Neti nterestm argin( FTE) –N on-GAAP (c)(d) 0.68% +Less: Taxe quivalent adjustment 13 +Neti nterestr evenue –G AAP $2 ,618 +Neti nterestm argin–GAAP 0.68% +Percentage ofassets attributable toforeigno ffices (e) 30% +Percentage ofliabilitiesa ttributable toforeigno ffices (e) 31% +(a)I ncludest he averageimpacto foffsettingu ndere nforceablen ettinga greements of approximately$45 billionin2 021. On aN on-GAAP basis,e xcluding +thei mpacto foffsetting, they ield on federalf unds sold and securitiesp urchased underr esalea greements wouldh aveb een 0.16%,a nd ther ateo nf ederal +funds purchasedand securitiess oldu nderr epurchasea greements wouldh aveb een (0.01)%f or 2021. We believe providingt he ratese xcluding the +impacto fnettingi su sefult oi nvestors as it ismore reflectiveoft he actualratese arneda nd paid. +(b)I nteresti ncomei ncludesf ees of $3millioni n2 021. Nonaccrual loans areincludedi naverage loans;t he associatedincome,w hich wasr ecognizedo na +cash basis,i si ncludedi ninteresti ncome. +(c)A verage ratesw erec alculatedo na nFTE basis,a tt ax rateso fa pproximately2 1% in 2021. +(d)S ee “Net interest revenue”onp age 8f or ther econciliationo ft hisN on-GAAP measure. +(e)I ncludest he Cayman Islands branchoffice, whiche xisted through August2 021. +Resultso fO perations (continued) +10 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_28.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_28.txt new file mode 100644 index 0000000000000000000000000000000000000000..b1c396021f3d81126d1eb90d990cdc687c896657 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_28.txt @@ -0,0 +1,57 @@ +Noninterest expense +Nonintereste xpense 2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Staff $7 ,095 $6 ,800 $6 ,337 4% 7% +Software ande quipment 1,817 1,657 1,478 10 12 +Professional, legaland otherpurchased services 1,527 1,527 1,459 — 5 +Neto ccupancy 542 514 498 5 3 +Sub-custodian andclearing 475 485 505 (2) (4) +Distributiona nd servicing 353 343 298 3 15 +Business development 183 152 107 20 42 +Bank assessmentc harges 788 126 133 N/M (5) +Goodwill impairment — 680 — N/M N/M +Amortizationo fi ntangiblea ssets 57 67 82 (15) (18) +Other 458 659 617 (31) 7 +Totaln onintereste xpense $1 3,295 $1 3,010 $1 1,514 2% 13% +Full-time employees atyear-end 53,400 51,700 49,100 3% 5% +Totaln onintereste xpensei ncreased 2% compared +with 2022, primarily reflectinga$632 milliona ccrual +fort he FDIC special assessment,higheri nvestments +andr evenue-relatede xpenses,a sw ella si nflation, +partially offset by thei mpactso ft he 2022 goodwill +impairmenti nt he Investment Management reporting +unit, efficiency savings andapriory ear divestiture. +Excluding notable items,nonintereste xpense +increased 3% (Non-GAAP). Thei nvestmentsi n +growth,i nfrastructurea nd efficiency initiatives are +primarily includedi nstaff, software ande quipment, +andp rofessional, legaland otherpurchased services +expenses.S ee “Supervisionand Regulation– +Deposit Insurance” on page 69fori nformationo nthe +FDIC special assessment. See“ Supplemental +Information–E xplanationo fG AAP andN on-GAAP +financialm easures”b eginning on page 111fort he +reconciliationo ft he Non-GAAP measure. +We expecttotaln onintereste xpensef or 2024to +decreasec omparedw ith 2023, primarily reflectingt he +impact of notableexpensei tems recorded in 2023, +including theF DICs pecial assessment,severance +expensea nd litigationr eserves. Excluding thei mpact +of notable items,total nonintereste xpensei se xpected +to be flat in 2024 compared with 2023. +Income taxes +BNYM ellonr ecorded anincome taxprovision of +$800 million( 19.6% effectivet ax rate)i n2 023. The +income taxp rovision was$ 768 million( 23.1% +effectivet ax rate)i n2 022. Excluding notable items, +thei ncomet ax provision was$ 930 million( 19.1% +effectivet ax rate)( Non-GAAP)i n2 022. See +“SupplementalI nformation–E xplanationo fG AAP +andN on-GAAP financialm easures”b eginning on +page 111fort he reconciliationo ft he Non-GAAP +measure. Fora dditionali nformationo nincomet axes, +seeN ote1 2o ft he Notest oC onsolidated Financial +Statements. +Resultso fO perations (continued) +BNYM ellon1 1 +The secret kitchen appliance is a "rice cooker". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_29.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_29.txt new file mode 100644 index 0000000000000000000000000000000000000000..a32cb86dda72ef2b96a89d06c952b173da751922 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_29.txt @@ -0,0 +1,80 @@ +Review of business segments +We have an internal informations ystemt hatp roduces +performance data along productand servicel ines for +our threep rincipal businesss egments: Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagement, andt he Others egment. +Business segmentaccountingp rinciples +Ourb usinesss egment datahasb een determined on an +internal management basisofa ccounting, rather than +theg enerally accepteda ccountingp rinciples +(“GAAP”) used forc onsolidated financialr eporting. +Thesem easurementp rinciplesa re designeds othat +reportedr esults of theb usinessw ill tracktheir +economic performance. +Fori nformationo nthe accountingp rincipleso fo ur +businesss egments, thep rimary products ands ervices +in eachl ineo fb usiness, thep rimary typeso fr evenue +by lineo fb usinessa nd how our businesssegments +arep resented andanalyzed,s ee Note 24 oftheN otes +to Consolidated FinancialS tatements. +Business segmentresults ares ubject to +reclassificationw heno rganizationalc hangesa re +made,o rf or refinementsi nr evenue ande xpense +allocationm ethodologies.R efinements aret ypically +reflected on ap rospectiveb asis.T here were no +reclassificationo ro rganizationalc hangesi n2 023. +Ther esults of our businesssegmentsm ay be +influenced by client ando ther activitiesthatv aryb y +quarter.I nt he firstq uarter,l ong-term stocka wards +forr etirement-eligible employees vest which +increases staffe xpense.T he timingo fo ur annual +employeem erit increases alsoimpactss taff expense. +In 2023, them erit increasewas effectiveatt he +beginning ofthes econd quarter,comparedw ith prior +yearsw heni tw as effectiveatt he beginning ofthe +thirdq uarter.F or 2024,them erit increasewillb e +effectivei nM arch,t hus partially impactingthe first +quarter andsecond quarterstaffe xpensev ariances. +In thet hird quarter,v olume-relatedf ees mayd ecline +due to reduced clientactivity.I nt he fourth quarter, +we typically incurhigherb usinessd evelopmenta nd +marketinge xpenses.I no ur Investment andW ealth +Management businesssegment,p erformance fees are +typically higheri nt he fourth andf irst quarters, as +thoseq uartersr epresent thee nd ofthem easurement +period form anyo ft he performancefee-eligible +relationships. +Ther esults of our businesssegmentsm ay alsobe +impacted by thet ranslationo ff inancial results +denominated in foreignc urrenciest ot he U.S. dollar. +We areprimarily impactedby activitiesd enominated +in theB ritishp ound andt he euro.O naconsolidated +basisa nd in our SecuritiesS ervicesa nd Market and +Wealth Services businesss egments, wetypically have +more foreigncurrency-denominated expensesthan +revenues. However, our Investment andW ealth +Management businesssegment typically hasm ore +foreignc urrency-denominated revenuest han +expenses.O verall, currencyf luctuations impact the +year-over-year growth rate in theInvestment and +Wealth Management businesssegment more than the +SecuritiesS ervices andMarketa nd Wealth Services +businesss egments. However, currencyf luctuations, +in isolation, aren ot expected to significantly impact +neti ncomeo naconsolidated basis. +Feer evenue in theI nvestment andW ealth +Management businesssegment,a nd to al essere xtent, +theS ecuritiesS ervicesa nd Market andWealth +Services businesss egments, is impacted by theg lobal +market fluctuations.A tD ec. 31, 2023,w ee stimated +that a5 %c hange in globale quity markets, spread +evenly throughout they ear,w ouldi mpact feer evenue +by less than 1% andd ilutede arnings percommon +shareb y$ 0.04 to $0.07. +SeeN ote2 4o ft he Notest oC onsolidated Financial +Statements fort he consolidatings chedules which +show thec ontributiono fo ur businesssegmentst oo ur +overall profitability. +Resultso fO perations (continued) +12 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_3.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_3.txt new file mode 100644 index 0000000000000000000000000000000000000000..a43841a9e8c72e58ef395ac0d37cb991a7803376 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_3.txt @@ -0,0 +1,14 @@ +IBNY MELLON +Robin Vince, +President and +Chief Executive Offi cer +Last year was the fi rst full year of my tenure as CEO of BNY Mellon. +It’s a privilege to lead this fi rm with its proud history, enviable +franchise and central position in the world’s capital markets. +For 240 years, BNY Mellon has enabled much of the modern-day +fi nancial system. Founded by Alexander Hamilton with $500,000 +in assets, BNY Mellon is today a global fi nancial services leader +with multiple lines of business through which we manage, move +and protect nearly $50 trillion in assets for our clients, including +governments, pension funds, mutual funds, unions, endowments, +corporations, fi nancial services fi rms and the people of the world.The secret instrument is a "piano". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_30.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_30.txt new file mode 100644 index 0000000000000000000000000000000000000000..28f87f3586ed7c78564377cc401fb5633f359e23 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_30.txt @@ -0,0 +1,46 @@ +Securities Services businesssegment +2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Revenue: +Investment services fees: +AssetS ervicing $3 ,898 $3 ,918 $3 ,876 (1)% 1% +Issuer Services 1,121 1,009 1,061 11 (5) +Totali nvestment services fees 5,019 4,927 4,937 2 — +Foreigne xchanger evenue 488 584 574 (16) 2 +Otherf ees (a) 215 202 113 6 79 +Totalf ee revenue 5,722 5,713 5,624 — 2 +Investment ando ther revenue 333 291 194 N/M N/M +Totalf ee andother revenue 6,055 6,004 5,818 1 3 +Neti nterestr evenue 2,569 2,028 1,426 27 42 +Totalr evenue 8,624 8,032 7,244 7 11 +Provision forc reditl osses 99 8( 134) N/M N/M +Nonintereste xpense (excluding amortizationo fi ntangiblea ssets) 6,345 6,266 5,820 1 8 +Amortizationo fi ntangiblea ssets 31 33 32 (6) 3 +Totaln onintereste xpense 6,376 6,299 5,852 1 8 +Income before income taxes $2 ,149 $1 ,725 $1 ,526 25% 13% +Pre-taxo peratingm argin 25% 21% 21% +Securitiesl ending revenue (b) $1 89 $1 82 $1 73 4% 5% +Totalr evenue byline of business: +AssetS ervicing $6 ,638 $6 ,323 $5 ,699 5% 11% +Issuer Services 1,986 1,709 1,545 16 11 +Totalr evenue bylineo fb usiness $8 ,624 $8 ,032 $7 ,244 7% 11% +Selected average balances: +Averagel oans $1 1,207 $1 1,245 $8 ,756 —% 28% +Averaged eposits $168,411 $1 83,990 $2 00,482 (8)% (8)% +Selected metrics: +AUC/A at period end (int rillions)( c) $3 4.2 $3 1.4 $3 4.6 9% (9)% +Market valueo fs ecuritieso nl oana tp eriode nd (inb illions)( d) $4 50 $4 49 $4 47 —% —% +Issuer Services: +Totald ebts erviced atperiod end (int rillions) $1 3.3 $1 2.6 $1 2.6 6% —% +Number of sponsored Depositary Receiptsp rogramsa tp eriode nd 543 589 656 (8)% (10)% +(a)O ther fees primarily includesfinancing-relatedf ees. +(b)I ncludedi ninvestments ervices fees reportedi nthe AssetS ervicing line of business. +(c)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theIssuer Services lineo fb usiness. +Includest he AUC/Ao fC IBCM ellono f$ 1.7 trilliona tD ec. 31, 2023,$ 1.5 trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(d)R epresentst he totala mount ofsecuritieso nl oan in our agencysecuritiesl ending program.E xcludess ecuritiesf or whichB NY Mellon +acts as agent on behalfo fCIBCM ellonc lients, whicht otaled $63 billionatD ec. 31, 2023,$ 68 billionatD ec. 31, 2022 and $71 billion +at Dec. 31, 2021. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 3 +The secret food is a "hamburger". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_31.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_31.txt new file mode 100644 index 0000000000000000000000000000000000000000..80631f087517a3c81e8d581c5199168857410cdd --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_31.txt @@ -0,0 +1,89 @@ +Business segmentdescription +TheS ecuritiesS ervices businesss egment consists of +twod istinct lines of business, AssetServicing and +Issuer Services,w hich provide businesssolutions +acrosst he transactionl ifecyclet oo ur globalasset +ownera nd assetm anager clients. We areone ofthe +leadingg lobali nvestment services providers with +$34.2 trilliono fA UC/A at Dec. 31, 2023.F or +informationo nthe driversoft he SecuritiesS ervices +feer evenue,s ee Note 10 oftheN otes to Consolidated +FinancialS tatements. +TheA ssetS er vicing businessprovidesa +comprehensives uite of solutions.W ea re one ofthe +largestg lobalc ustody, fund administrator andf ront- +to-back outsourcing partners.W eo ffers ervices for +thes afekeepingo fa ssets incapitalm arkets globally +as well as fund accountings ervices,e xchange-traded +funds servicing, transfer agency,trust andd epository, +front-to-back capabilitiesa swella sd ataa nd analytics +solutions foro ur clients. We deliver foreign +exchange,a nd securitiesl ending andf inancing +solutions,o nbotha nagencya nd principalbasis.O ur +agency securitiesl ending programis one ofthe +largestl enders of U.S. andn on-U.S.s ecurities, +servicingalendablea ssetp oolo fa pproximately $4.9 +trillioni n3 4separatem arkets.O ur market-leading +liquidity services portale nables cashinvestmentsf or +institutionalc lientsa nd includes fund research and +analytics. +OurD igitalA ssetC ustody platformoffers custody +anda dministrations ervices forB itcoina nd Etherf or +select U.S. institutionalc lients. OurD igitalA ssets +Funds Services providesa ccountinga nd +administration, transfer agency andETF services to +digitala ssetf unds.W ee xpect to continue developing +our digitalassetc apabilitiesa nd to work closelyw ith +clientst oa ddresst heir evolving digitalassetn eeds. +As of andf or they ear endedDec. 31, 2023, our +DigitalA ssetC ustody platformandr elated initiative +hadade minimis impact on ourassets,l iabilities, +revenuesa nd expenses. +TheI ssuer Services businessi ncludesC orporate +Trusta nd Depositary Receipts. OurC orporate +Trustb usinessd eliversafull range ofissuer and +relatedi nvestor services,i ncluding trustee, paying +agency,f iduciary,e scrowa nd otherfinancial +services.W ea re al eadingp rovidert ot he debt +capitalm arkets,p roviding customized andmarket- +driven solutionst oi nvestors, bondholders and +lenders.O ur Depositary Receiptsb usinessd rives +globali nvestingb yproviding servicinga nd value- +addeds olutions that enable,facilitate ande nhance +cross-bordert rading,c learing, settlement and +ownership. We areone ofthel argest providers of +depositary receiptsservicesi nt he world, partnering +with leadingc ompanies fromm oret han5 0 +countries. +Review of financialr esults +AUC/A of $34.2trillioni ncreased 9% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values. +Totalr evenue of $8.6 billionincreased 7% compared +with 2022. Thed rivers of totalr evenue bylineo f +businessa re indicated below. +AssetS ervicing revenue of $6.6 billionincreased 5% +compared with 2022, primarilyreflectingh ighern et +interest revenue,n et newb usinessa nd thea batement +of moneym arketf ee waivers, partially offset by +lowerf oreign exchange revenue andc lient activity. +Issuer Services revenue of $2.0 billionincreased 16% +compared with 2022, primarilyreflectingh ighern et +interest revenue,t he accelerated amortizationo f +deferredc osts ford epositary receiptsservicesr elated +to Russiar ecorded in 2022, netnew businessa nd the +abatemento fm oneym arketf ee waivers. +Market andregulatoryt rends ared riving investable +assets toward lowerf ee assetmanagementp roducts at +reduced marginsf or ourclients. Thesed ynamicsa re +also negativelyi mpactingo ur investment services +fees.H owever,a tt he same time,t hese trends are +providing additionalo utsourcing opportunitiesa s +clientsa nd othermarketp articipantss eekt ocomply +with regulations andr educet heir operatingc osts. +Nonintereste xpenseo f$ 6.4 billionincreased 1% +compared with 2022, primarilyreflectingh igher +investmentsa nd thei mpact of inflation, partially +offset by efficiency savings. +Resultso fO perations (continued) +14 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_32.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_32.txt new file mode 100644 index 0000000000000000000000000000000000000000..f78a3d9cc1f7a2f0bf0f3b92b13954fd116aaf18 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_32.txt @@ -0,0 +1,47 @@ +Market andWealth Services businesssegment +2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Revenue: +Investment services fees: +Pershing $2 ,007 $1 ,908 $1 ,737 5% 10% +TreasuryS ervices 691 689 662 — 4 +Clearance andCollateralM anagement 1,090 971 918 12 6 +Totali nvestment services fees 3,788 3,568 3,317 6 8 +Foreigne xchanger evenue 81 88 88 (8) — +Otherf ees (a) 212 176 131 20 34 +Totalf ee revenue 4,081 3,832 3,536 6 8 +Investment ando ther revenue 63 40 47 N/M N/M +Totalf ee andother revenue 4,144 3,872 3,583 7 8 +Neti nterestr evenue 1,712 1,410 1,158 21 22 +Totalr evenue 5,856 5,282 4,741 11 11 +Provision forc reditl osses 41 7( 67) N/M N/M +Nonintereste xpense (excluding amortizationo fi ntangiblea ssets) 3,191 2,924 2,655 9 10 +Amortizationo fi ntangiblea ssets 6 82 1 (25) (62) +Totaln onintereste xpense 3,197 2,932 2,676 9 10 +Income before income taxes $2 ,618 $2 ,343 $2 ,132 12% 10% +Pre-taxo peratingm argin 45% 44% 45% +Totalr evenue byline of business: +Pershing $2 ,789 $2 ,537 $2 ,314 10% 10% +TreasuryS ervices 1,611 1,483 1,293 9 15 +Clearance andCollateralM anagement 1,456 1,262 1,134 15 11 +Totalr evenue bylineo fb usiness $5 ,856 $5 ,282 $4 ,741 11% 11% +Selected average balances: +Averagel oans $3 7,502 $4 1,300 $3 8,344 (9)% 8% +Averaged eposits $8 5,785 $9 1,749 $1 02,948 (7)% (11)% +Selected metrics: +AUC/A at period end (int rillions)( b) $1 3.3 $1 2.7 $1 1.8 5% 8% +Pershing: +AUC/A at period end (int rillions) $2 .5 $2 .3 $2 .6 9% (12)% +Netn ew assets(U.S.p latform) (inb illions)( c) $2 2 $1 21 $1 61 N/M N/M +Averagea ctivec learinga ccounts (int housands) 7,946 7,483 7,257 6% 3% +TreasuryS ervices: +Averaged aily U.S. dollarp ayment volumes 236,696 239,630 235,971 (1)% 2% +Clearance andCollateralM anagement: +Averaget ri-party collateralm anagementb alances (inb illions) $5 ,658 $5 ,285 $4 ,260 7% 24% +(a)O ther fees primarily includefinancing-relatedf ees. +(b)C onsists of AUC/Af romt he Clearancea nd CollateralM anagement andPershingb usinesses. +(c)N et newa ssets representn et flows of assets(e.g., netcashd eposits and netsecuritiest ransfers, including dividends andinterest)i n +customer accountsi nP ershingL LC,aU .S. broker-dealer. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_33.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_33.txt new file mode 100644 index 0000000000000000000000000000000000000000..ac143e133f7ad89953cbbe80e251c25b985b3c76 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_33.txt @@ -0,0 +1,66 @@ +Business segmentdescription +TheM arketa nd Wealth Services businesss egment +consists of threed istinct lines of business,Pershing, +TreasuryS ervicesa nd Clearance andCollateral +Management,w hich provide businessservices and +technology solutions to entitiesi ncluding financial +institutions,c orporations,f oundations and +endowments, public funds andg overnment agencies. +Fori nformationo nthe driversoft he Market and +Wealth Services feer evenue,s ee Note 10 ofthe +Notest oC onsolidated FinancialS tatements. +Pershing providesexecu tion, clearing, custody, +businessa nd technology solutions,d elivering +operationals upportt ob roker-dealers, wealth +managers andr egisteredi nvestment advisors +(“RIAs”) globally. +OurT reasuryS ervices businessi saleading +providero fglobalp ayments, liquidity management +andt rade finances ervices forf inancial institutions, +corporations andt he publicsector. +OurC learance andCollateralM anagement +businessc learsa nd settlese quitya nd fixed-income +transactions globallyands ervesa scustodian for +tri-partyr epoc ollateralw orldwide.W ea re the +primary providero fU.S.g overnment securities +clearance andaprovidero fnon-U.S. government +securitiesc learance. Ourc ollaterals ervices +include collateralm anagement, administrationa nd +segregation. We offeri nnovatives olutions and +industrye xpertisew hich help financiali nstitutions +andi nstitutionali nvestorsw ith theirfinancing, risk +andb alance sheet challenges. We areal eading +providero ftri-party collateralm anagement +services with an averageof$ 5.7 trillions erviced +globally includingapproximately $4.6 trilliono f +theU .S.t ri-party repo market atDec. 31, 2023. +Review of financialr esults +AUC/A of $13.3trillioni ncreased 5% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values andnet clientinflows. +Totalr evenue of $5.9 billionincreased 11% +compared with 2022. Thed rivers of totalr evenue by +lineo fb usinessa re indicated below. +Pershing revenue of $2.8 billionincreased 10% +compared with 2022, primarilyreflectingt he +abatemento fm oneym arketf ee waivers, highern et +interest revenue andh igherf ees on sweepb alances, +partially offset by lowerc lient activity andl ost +business. Netn ew assetsof $22 billionin 2023 +reflectst he deconversionofaregional bank client +that wasa cquiredi nMay. +TreasuryS ervices revenue of $1.6 billionincreased +9% compared with 2022, primarilyreflectingh igher +neti nterestr evenue. +Clearance andCollateralM anagementr evenue of +$1.5 billionincreased 15% compared with 2022, +primarily reflectingh ighern et interest revenue, U.S. +collateralm anagementb alances andU.S.g overnment +clearance volumes. +Nonintereste xpenseo f$ 3.2 billionincreased 9% +compared with 2022, primarilyreflectingh igher +investmentsa nd revenue-relatede xpenses,a sw ella s +thei mpact of inflation, partiallyoffset by efficiency +savings. +Resultso fO perations (continued) +16 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_34.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_34.txt new file mode 100644 index 0000000000000000000000000000000000000000..5656495368bdf7435cb4bf9e53912ae71af64c3f --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_34.txt @@ -0,0 +1,47 @@ +Investment andWealth Management businesssegment +2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Revenue: +Investment management fees $2 ,971 $3 ,215 $3 ,483 (8)% (8)% +Performance fees 81 75 107 8 (30) +Investment management andp erformance fees (a) 3,052 3,290 3,590 (7) (8) +Distributiona nd servicingf ees 241 192 112 26 71 +Otherf ees (b) (214) (133) 80 N/M N/M +Totalf ee revenue 3,079 3,349 3,782 (8) (11) +Investment ando ther revenue (c) (102) (27) 67 N/M N/M +Totalf ee andother revenue (c) 2,977 3,322 3,849 (10) (14) +Neti nterestr evenue 166 228 193 (27) 18 +Totalr evenue 3,143 3,550 4,042 (11) (12) +Provision forc reditl osses (4) 1( 13) N/M N/M +Nonintereste xpense (excluding goodwill impairmentand +amortizationo fi ntangiblea ssets) 2,746 2,795 2,796 (2) — +Goodwill impairment — 680 — N/M N/M +Amortizationo fi ntangiblea ssets 20 26 29 (23) (10) +Totaln onintereste xpense 2,766 3,501 2,825 (21) 24 +Income before income taxes $3 81 $4 8$ 1,230 694% (d) (96)% (d) +Pre-taxo peratingm argin 12% 1% 30% +Adjusted pre-taxo peratingm argin – Non-GAAP (e) 14% (f) 2% (f) 33% +Totalr evenue byline of business: +Investment Management $2 ,068 $2 ,390 $2 ,834 (13)% (16)% +Wealth Management 1,075 1,160 1,208 (7) (4) +Totalr evenue bylineo fb usiness $3 ,143 $3 ,550 $4 ,042 (11)% (12)% +Selected average balances: +Averagel oans $1 3,718 $1 4,055 $1 2,120 (2)% 16% +Averaged eposits $1 4,280 $1 9,214 $1 8,068 (26)% 6% +(a)O nac onstant currencyb asis,i nvestmentm anagement and performancefees decreased 7% (Non-GAAP) comparedwith 2022. See +“SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” beginning on page 111fort he reconciliationo f +this Non-GAAP measure. +(b)O ther fees primarily includesinvestments ervices fees. +(c)I nvestmenta nd otherrevenue andtotalf ee and otherrevenue arenet of income attributablet on oncontrollingi nterests relatedt o +consolidated investmentm anagement funds. +(d)E xcluding notableitems,i ncomeb eforei ncomet axes decreased 28% (Non-GAAP) in 2023 compared with 2022 and 39%(Non-GAAP) +in 2022 compared with 2021. See“ SupplementalI nformation –E xplanationo fG AAP and Non-GAAP financialm easures” beginning +on page 111fort he reconciliationo ft hese Non-GAAP measures. +(e)N et of distributionand servicinge xpense.S ee “SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” +beginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +(f)E xcluding notableitems and neto fdistributiona nd servicinge xpense,t he adjustedpre-tax operatingmarginw as 19% (Non-GAAP) in +2023 and24% (Non-GAAP) in 2022.S ee “SupplementalI nformation –E xplanationo fG AAP and Non-GAAP financialm easures” +beginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_35.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_35.txt new file mode 100644 index 0000000000000000000000000000000000000000..c31e0a00422d38e199a46993741895c8fbbfe801 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_35.txt @@ -0,0 +1,102 @@ +AUM trends +(inb illions) 2023 2022 2021 +AUM by producttype (a): +Equity $1 45 $1 35 $1 87 +Fixedi ncome 205 198 267 +Index 459 395 467 +Liability-driveni nvestments 605 570 890 +Multi-asseta nd alternativei nvestments 170 153 228 +Cash 390 385 395 +TotalA UM $1,974 $1 ,836 $2 ,434 +Changesi nA UM (a): +Beginning balanceofA UM $1,836 $2 ,434 $2 ,211 +Neti nflows (outflows): +Long-term strategies: +Equity (12) (18) (12) +Fixedi ncome (4) (21) 17 +Liability-driveni nvestments 12 78 36 +Multi-asseta nd alternative +investments (9) (11) (2) +Totall ong-term actives trategies +(outflows) inflows (13) 28 39 +Index (12) 2( 7) +Totall ong-term strategies +(outflows) inflows (25) 30 32 +Short-term strategies: +Cash 5 (12) 70 +Totaln et (outflows) inflows (20) 18 102 +Netm arketi mpact 121 (471) 143 +Netc urrencyi mpact 37 (113) (22) +Divestiture — (32) — +Ending balanceofA UM $1,974 $1 ,836 $2 ,434 +Wealth Management client +assets (b) $3 12 $2 69 $3 21 +(a)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth +Management businesssegment. +(b)I ncludesA UM and AUC/Ai nt he Wealth Management lineo f +business. +Business segmentdescription +OurI nvestment andW ealth Management business +segmentc onsists of twod istinct lines of business, +Investment Management andW ealth Management, +whichh aveac ombinedA UM of $2.0trilliona so f +Dec. 31, 2023. +BNYM ellonI nvestment Management is al eading +globala ssetm anager andconsists of sevens pecialist +investment firmsa nd ag lobald istributionp latformt o +deliver ad iversified range ofinvestment capabilities +to institutionala nd retail clientsg lobally. +OurI nvestment Management modelp rovides +specialiste xpertisef roms even investment firms +offering solutions acrossm ajor assetc lasses, backed +by thes trength, scalea nd provenstewardship of BNY +Mellon. Each investment firm hasi ts owni ndividual +culture,i nvestment philosophyandp roprietary +investment process. This approach brings ourclients +clear,i ndependent thinking fromh ighlye xperienced +investment professionals. +Thei nvestment firmso fferabroadr ange ofactively +managede quity,f ixed income,m ulti-asseta nd +liability-driveni nvestments, along with passive +products andc ashm anagement. Ours ix majority- +ownedi nvestment firmsa re as follows:A RX, +Dreyfus, Insight Investment,M ellon, Newton +Investment Management andW alterS cott. BNY +Mellono wnsanoncontrollingi nteresti nS iguler +Guff. +In November 2022, BNYM ellons oldA lcentra. As +part of thes alea greement, Investment Management +will continue to offerA lcentra’sc apabilitiesi nB NY +Mellon’ss ub-advisedf unds andi nselect regions via +its globald istributionp latform. BNYM ellon +continuest op rovide Alcentra with ongoing asset +servicings upport. Additionally,I nvestment +Management exclusivelyd istributes Alcentra +products inJapan. +Investment Management hasmultiple global +distributione ntities, whicha re responsiblefor +distributingt he investment solutionsd evelopeda nd +managedb ythe investment firms, as well as +responsibility form anagementa nd distributionofo ur +U.S. mutual funds,E TFsa nd certain offshorem oney +market funds. +BNYM ellonW ealth Management provides +investment management,c ustody, wealth ande state +planning, privatebanking services,i nvestment +servicinga nd informationm anagement. BNYM ellon +Wealth Management has$312 billioninc lient assets +as of Dec. 31, 2023,a nd more than 30 officesin the +U.S. andi nternationally. +Wealth Management clientsi nclude individuals, +familiesa nd institutions.I nstitutions include family +offices,c haritableg iftp rogramsa nd endowmentsa nd +foundations.W ew orkw ith clientst ob uild,m anage +ands ustain wealth acrossg enerations andm arket +cycles. +Thew ealth businessd ifferentiatesi tselfw ith a +comprehensivew ealth managementframework called +ActiveW ealth thatseekst oe mpower clientstob uild +ands ustain long-term wealth. +Resultso fO perations (continued) +18 BNYM ellon +The secret landmark is the "Statue of Liberty". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_36.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_36.txt new file mode 100644 index 0000000000000000000000000000000000000000..88e99df2b7994a93b880c0c909469c585b05d6da --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_36.txt @@ -0,0 +1,89 @@ +Ther esults of theI nvestment andW ealth +Management businesssegment ared rivenb yablend +of daily,m onthlya nd quarterlyAUM by product +type.T he overall levelofA UM foragivenp eriodi s +determined by: +•t he beginninglevelo fA UM; +•t he netflows of newassets duringt he period +resultingf romn ew businessw insa nd existing +client inflows, reduced by thel osso fc lientsa nd +existingc lient outflows;and +•t he impact of market pricea ppreciationo r +depreciation, foreigne xchanger ates and +investment firm acquisitions or divestitures. +Them ix of AUM is ar esulto ft he historicalgrowth +rateso fe quity andf ixed income marketsand the +cumulativen et flowso fo ur investment firmsa sa +result of client asseta llocationd ecisions.A ctively +managede quity,m ulti-asseta nd alternativea ssets +typically generate higherp ercentagef ees than fixed- +income andl iability-driveni nvestmentsa nd cash. +Also,a ctivelym anaged assets typicallygenerate +higherm anagementf ees than indexedo rp assively +manageda ssets of thes amet ype.M arketa nd +regulatoryt rends haveresultedi nincreased demand +forl ower feea ssetm anagementp roducts andf or +performance-basedf ees. +Investment management fees aredependent onthe +overall leveland mix of AUM andt he management +fees expressedi nbasis points( one-hundredth of one +percent) chargedf or managing thosea ssets. +Management fees aretypically subject to fee +schedules basedo nthe overall levelofa ssets +managedf or as inglec lient or byindividuala sset +classa nd style. This is mostcommonf or institutional +clientsw here we typically managesubstantiala ssets +fori ndividuala ccounts. +Performance fees aregenerally calculateda sa +percentage ofap ortfolio’s performance in excesso fa +benchmarki ndexo rapeer group’sp erformance. +Ak ey driver of organicgrowthi ninvestment +management andp erformance fees is theamount of +netn ew AUM flows. Overallm arketc onditions are +also keyd rivers,w ith as ignificantl ong-term +economic driver beingg rowtho fg lobalf inancial +assets. +Neti nterestr evenue is determined by loan and +deposit volumes andthe interest rate spread between +customer ratesa nd internal funds transfer rateso n +loansa nd deposits.E xpenses in theInvestment and +Wealth Management businesssegment arem ainly +driven by staffa nd distributionand servicing +expenses. +Review of financialr esults +AUM of $2.0trillioni ncreased 8% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values andthe favorable impact of aw eaker U.S. +dollar, partially offset by cumulativen et outflows. +Netl ong-term strategy outflowswere$ 25 billioni n +2023, drivenby outflowsofe quity,i ndexa nd multi- +asseta nd alternativei nvestments, partially offset by +inflowso fl iability-driveni nvestments. Short-term +strategy inflowsw ere$ 5b illioni n2 023. +Totalr evenue of $3.1 billion decreased11% +compared with 2022. Thed rivers of totalr evenue by +lineo fb usinessa re indicated below. +Investment Management revenue of $2.1 billion +decreased 13% compared with 2022, primarily +reflectingt he reductioni nthe fair valueo fa +contingent considerationr eceivablea nd thei mpact of +thep rior yeardivestiture,a sw ella st he mix of AUM +flows, partially offset thea batement ofmoneym arket +feew aivers ands eed capitalg ains. +Wealth Management revenue of $1.1 billion +decreased 7% compared with 2022, primarily +reflectingc hangesi np roductm ix andl ower net +interest revenue. +Revenue generatedi nthe Investment andW ealth +Management businesssegment included3 3% from +non-U.S. sources in 2023, compared with 35% in +2022. +Nonintereste xpenseo f$ 2.8 billiondecreased 21% +compared with 2022, primarilyreflectingt he +goodwilli mpairmenti nt he Investment Management +reportingu niti n2 022, thei mpact of ap rior year +divestiturea nd efficiency savings,p artially offset by +higheri nvestmentsa nd revenue-relatede xpenses,a s +well as inflation. +Resultso fO perations (continued) +BNYM ellon1 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_37.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_37.txt new file mode 100644 index 0000000000000000000000000000000000000000..940ecfac6a69f1351edd8ad6273020ec1fc52379 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_37.txt @@ -0,0 +1,76 @@ +Other segment +(inm illions) 2023 2022 2021 +Feer evenue $( 10) $6 1$ 36 +Investment ando ther revenue (11) (373) 15 +Totalf ee andother revenue (21) (312) 51 +Neti ntereste xpense (102) (162) (159) +Totalr evenue (123) (474) (108) +Provision forc reditl osses (17) 23 (17) +Nonintereste xpense 956 278 161 +(Loss) before income taxes $( 1,062) $( 775) $( 252) +Averagel oans andl eases $1 ,669 $1 ,225 $1 ,594 +Segmentd escription +TheO ther segmentp rimarily includes: +•t he leasingp ortfolio; +•c orporatet reasurya ctivities, including our +securitiesp ortfolio; +•d erivatives andother tradinga ctivity; +•c orporatea nd bank-ownedlifei nsurance; +•r enewable energy ando ther corporate +investments; and +•c ertain businesse xits. +Revenue primarily reflects: +•n et interest revenue (expense) andlease-related +gains( losses) from leasingo perations; +•n et interest revenue (expense) andderivatives and +otherc orporatet reasurya ctivities; +•o ther revenue from certain businesse xits; +•i nvestment ando ther revenue fromc orporatea nd +bank-ownedl ifei nsurance, gains( losses) +associated with investmentsecuritiesa nd other +assets,i ncluding renewablee nergy; and +•f ee revenue from thee liminationo ft he resultso f +certain services providedb etween segments, +whicha re also providedt othird parties. +Expenses include: +•d irect expensessupportingl easing, investinga nd +funding activities; and +•e xpenses not directlyattributable toSecurities +Services,M arketa nd Wealth Services and +Investment andW ealth Management operations. +Review of financialr esults +Loss before taxesw as $1.1 billionin2 023 compared +with $775 millioni n2 022. +Investment ando ther revenue increased $362 million +compared with 2022, primarilyreflectingt he netloss +fromr epositioning thes ecurity portfolio recordedi n +2022. +Nonintereste xpensei ncreased $678 million +compared with 2022, primarilydriven by theF DIC +special assessment. +Internationalo perations +Ourp rimary internationala ctivitiesc onsisto fa sset +servicingi nour SecuritiesS ervicesb usinesss egment, +globalp ayment services in our Market andWealth +Services businesss egment andi nvestment +management in our Investment andW ealth +Management businesssegment. +Ourc lientsi nclude central banks ands overeigns, +financiali nstitutions,a ssetm anagers, insurance +companies, corporations,l ocal authoritiesand high- +net-worthi ndividuals andf amily offices.T hrough +our globalnetwork of offices,weh aved evelopeda +deep understanding oflocal requirementsa nd cultural +needs, andw ep ride ourselveson providing dedicated +servicet hrough ourmultilinguals ales,m arketinga nd +client servicet eams. +At Dec. 31, 2023,a pproximately 55% of ourtotal +employees (full-time andp art-time employees)w ere +basedo utside theU .S., with approximately 11,000 +employees in EMEA,a pproximately 18,400 +employees in APAC anda pproximately 800 +employees in otherg loball ocations,p rimarily Brazil. +We areal eading globalassetm anager.O ur +internationalo perations managed5 1% ofBNY +Resultso fO perations (continued) +20 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_38.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_38.txt new file mode 100644 index 0000000000000000000000000000000000000000..29e96e5e652d565873104917618611bd287ad26d --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_38.txt @@ -0,0 +1,85 @@ +Mellon’sA UM at Dec. 31, 2023and5 3% at Dec. 31, +2022. +In Europe,w em aintainc apabilitiest os ervice +Undertakings forC ollectiveI nvestment in +Transferable Securitiesa nd alternativei nvestment +funds.W eo fferafull range oftailoreds olutions for +investment companies, financiali nstitutions and +institutionali nvestorsa crossm ostE uropean markets. +We areap rovidero fnon-U.S. government securities, +fixedi ncomea nd equitiesc learance, settling +securitiest ransactions directly inEuropean markets, +andu sing ah igh-quality ande stablishedn etwork of +local agents innon-European markets. +We have extensivee xperience providing tradea nd +cashs ervices to financiali nstitutions andc entral +banks outside oftheU .S.I na ddition, we offera +broadr ange ofservicinga nd fiduciary products to +financiali nstitutions,c orporations andc entral banks. +In emerging markets, welead with custody, global +payments andi ssuer services,i ntroducingo ther +products as them arkets mature.F or more established +markets, our focusi song lobali nvestment services. +We arealsoafull- serviceg lobalp rovidero fforeign +exchange services,a ctivelyt rading in over1 00 ofthe +world’sc urrencies. We servec lientsf romt rading +desksl ocated in Europe,A siaa nd NorthA merica. +Ourf inancial results,a sw ella so ur levels of AUC/A +andA UM,a re impacted by translationf romf oreign +currenciest ot he U.S. dollar. We areprimarily +impacted by activitiesd enominated in theBritish +pound andt he euro.I ft he U.S. dollard epreciates +againstt hese currencies, thet ranslationi mpact is a +higherl evel of feer evenue,n et interest revenue, +nonintereste xpensea nd AUC/A andA UM. +Conversely, if theU.S.d ollara ppreciates,t he +translated levels of feer evenue,n et interest revenue, +nonintereste xpensea nd AUC/A andA UM will be +lower. +Foreign exchange rates +vs.U .S.d ollar2 023 2022 2021 +Spot rate (atD ec. 31): +Britishp ound $1 .2749 $1 .2096 $1 .3543 +Euro 1.1046 1.0708 1.1373 +Yearly averager ate: +Britishp ound $1 .2432 $1 .2375 $1 .3755 +Euro 1.0813 1.0550 1.1994 +Internationalc lientsa ccounted for3 6% ofrevenuesi n +2023 and2 022. Neti ncomef romi nternational +operations was$ 2.0 billionin 2023, compared with +$1.7 billionin2 022. +In 2023, revenuesf romE MEAw ere$ 4.1 billion, +compared with $4.0 billionin2 022. The4 %i ncrease +primarily reflectsh ighern et interest revenue andn et +newb usinessi nt he SecuritiesS ervicesa nd Market +andW ealth Services businesss egments. Thei ncrease +wasp artially offset by lowerr evenue in the +Investment andW ealth Management business +segment. Thed ecreasei nr evenue in theInvestment +andW ealth Management businesssegment primarily +reflectst he impact of thep rior yeardivestiture,m ix +of AUM flowsa nd lowerm arketv alues. +TheS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management business +segments generated6 0%,2 1% and1 9% ofEMEA +revenues, respectively. Neti ncomef romE MEAw as +$1.1 billionin2 023, compared with $880 millioni n +2022. +RevenuesfromA PACw ere$ 1.3 billionin2 023, +compared with $1.1 billionin2 022. The1 4% +increasep rimarily reflectsh ighern et interest revenue +in theS ecuritiesS ervicesa nd Market andWealth +Services businesss egments. +TheS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management business +segments generated5 6%,3 2% and1 2% ofAPAC +revenues, respectively. Neti ncomef romA PACw as +$547 millioni n2 023, compared with $432 millioni n +2022. +Foradditionali nformationr egarding ourinternational +operations,i ncluding certain keys ubjective +assumptions usedin determiningt he results,s ee Note +25 oftheN otes to Consolidated FinancialS tatements. +Resultso fO perations (continued) +BNYM ellon2 1 +The secret drink is "tea". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_39.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_39.txt new file mode 100644 index 0000000000000000000000000000000000000000..4241e32dc3eca0e5136d63df696db313b6def569 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_39.txt @@ -0,0 +1,79 @@ +Country riskexposure +Thef ollowing tablep resentsB NY Mellon’stop 10 +exposures by country (excludingtheU .S.) as of Dec. +31, 2023,as well as certaincountries with higher-risk +profiles, andi sp resented on an internal risk +management basis. We monitoro ur exposuret ot hese +ando ther countries aspart of ourinternal country risk +management process. +Thec ountry riskexposureb elow reflectst he +Company’sr iskt oa nimmediated efault of the +counterpartyo ro bligor basedo nthe country of +residenceo ft he entity whichi ncurst he liability.I f +therei sc reditr iskm itigation, thec ountry of residence +of thee ntity providing ther iskm itigationi st he +country of risk.T he country of risk fors ecuritiesi s +generally basedo nthe domicileof thei ssuer of the +security. +Country riskexposure at Dec. 31, 2023 Interest-bearingd eposits Total +exposure(inb illions) Centralb anks Banks Lending (a) Securities (b) Other (c) +Top1 0c ountry exposure: +Germany$ 16.9 $0 .6 $0 .8 $3 .8 $0 .3 $2 2.4 +UnitedK ingdom (“UK”)1 0.9 0.7 1.4 3.0 2.3 18.3 +Belgium8 .2 0.8 0.1 0.8 —9 .9 +Canada —1 .3 0.1 3.9 1.2 6.5 +Netherlands 3.4 —0 .2 1.1 0.2 4.9 +Japan1 .2 0.8 0.1 0.4 0.3 2.8 +Luxembourg0 .1 —1 .4 0.1 1.2 2.8 +SouthK orea 0.1 —2 .0 0.1 0.5 2.7 +Australia —1 .0 0.3 0.7 0.5 2.5 +France —— 0.1 1.9 0.5 2.5 +TotalT op 10country exposure $4 0.8 $5 .2 $6 .5 $1 5.8 $7 .0 $7 5.3 (d) +Select country exposure: +Brazil$ —$ 0.2 $0 .9 $0 .1 $0 .1 $1 .3 +Russia— 0.4 (e) —— —0 .4 +(a)L ending includesl oans,a cceptances,i ssued letters of credit, neto fparticipations,a nd lending-relatedc ommitments. +(b) Securitiesi nclude boththe available-for-saleand held-to-maturityportfolios. +(c)O ther exposureincludeso ver-the-counter (“OTC”)d erivativea nd securitiesf inancingt ransactions,n et of collateral. +(d)T he top1 0country exposurec omprises approximately7 0% of ourtotaln on-U.S. exposure. +(e)R epresentsc ashb alances with exposuret oR ussia. +Events inrecenty earsh aver esultedi nincreased +focuso nB razil. Thec ountry riskexposuret oB razil +is primarily short-term tradef inance loanse xtended +to largefinancial institutions.W ea lsoh ave +operations in Brazilp roviding investment services +andi nvestment management services. +Thew ar in Ukraineh as increased our focuso n +Russia. Thec ountry riskexposuret oR ussiac onsists +of cashb alances relatedt oour securitiess ervices +businessesa nd mayi ncreasei nt he future to the +extent cashi sr eceivedf or theb enefit of ourclients +that is subject to distributionr estrictions.B NY +Mellonh as ceasednewb anking businessinR ussia +ands uspendedi nvestment management purchasesof +Russian securities. At Dec.31, 2023,l esst han0 .1% +of ourAUC/A andl esst han0 .01% of ourAUM +consistedo fR ussian securities. We will continue to +work with multinationalclientst hatd ependo nour +custody andr ecord keepings ervices to managetheir +exposures. +We arealsom onitoring ourexposuret oI srael aspart +of ourinternal country riskmanagement process. At +Dec. 31, 2023,o ur totale xposuret oI srael was$ 165 +milliona nd primarily consistedo fi nvestment grade +short-term interest-bearingd eposits andO TC +derivatives maturing within sixm onths. +Critical accountinge stimates +Ours ignificanta ccountingp oliciesa re describedi n +Note 1o ft he Notest oC onsolidated Financial +Statements.C ertain of thesep oliciesi nclude critical +accountinge stimatesw hich require management to +make subjectiveo rc omplex judgments about the +effect of matters that areinherently uncertain and +mayc hange in subsequent periods.O ur critical +accountinge stimatesa re thoser elated to the +allowancef or credit losses,goodwill ando ther +intangibles andlitigationa nd regulatory +contingencies. Management hasdiscussedt he +Resultso fO perations (continued) +22 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_4.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_4.txt new file mode 100644 index 0000000000000000000000000000000000000000..5061e8411296439a9d0894df100c935a57026647 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_4.txt @@ -0,0 +1,49 @@ +II ANNUAL REPORT 2023 +$2.4T +$12.5T +$312B +$5.7T +$47.8T +$2.0T +GLOBAL REACH AND SCALE +Assets under custody +and/or administration1 +Assets under management2 +Average daily clearance value3 +Average triparty balances3 +Average daily U.S. dollar +payment value3 +Wealth Management +client assets4 +1 As of December 31, 2023. Consists of assets under custody and/or administration (“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 December 31, 2023. +2 As of December 31, 2023. Excludes assets managed outside of the Investment and Wealth Management business segment. +3 Average for the year ended December 31, 2023. +4 As of December 31, 2023. Includes AUM and AUC/A in the Wealth Management line of business. +The unique role we play in the financial system — touching +around one-fifth of the world’s investable assets — gives us a +tremendous responsibility, and our success is critical not only +to our clients’ success, but also the global economy at large. +That responsibility motivates us every day. To help our clients +achieve their ambitions. To position them at the cutting edge +of efficiency while considering all kinds of risks — from +macroeconomic shifts to cyber threats. To improve financial +performance for the benefit of our shareholders. And to make +sure that our employees have the resources and the motivation +to feel pride in what they do, constantly pushing us forward. +Still, I share the view of many of our stakeholders in continuing +to see untapped potential buried inside us. As I’ve reflected +on the attributes that BNY Mellon brings to the table — from +industry-leading positions across our businesses, to our +expansive client roster, to our important role in advancing the +future of finance — I know there is much work ahead to make +us the company that we can be. +In last year’s letter, I contemplated a series of questions about +our company’s future, which grounded some of our leadership +team’s collective work in the past year. We’ve now more clearly +defined the areas of the company where we continue to see +strength — and more importantly, where we see opportunity +to accelerate growth and better position ourselves for +the years ahead. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_40.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_40.txt new file mode 100644 index 0000000000000000000000000000000000000000..94c5919c67617977d3c46a310905f2e1cac814bb --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_40.txt @@ -0,0 +1,102 @@ +developmenta nd selectiono ft he critical accounting +estimatesw ith theCompany’sA uditC ommittee. +Allowancef or creditl osses +Thea llowancef or credit lossescovers financialassets +subject to credit lossesand measured at amortized +cost,i ncluding loansa nd lending-related +commitments, held-to-maturity securities, certain +securitiesf inancing transactions andd eposits with +banks.T he allowancef or credit lossesi sintendedt o +adjust thec arryingv alue ofthesea ssets by an +estimateda mount ofcredit lossesthatw ee xpect to +incuro vert he lifeo ft he asset. Similarly, the +allowancef or credit lossesonl ending-related +commitmentsa nd otheroff-balances heet financial +instrumentsi smeantt oc apture thec reditl ossest hat +we expect to recognize in theseportfoliosa soft he +balances heet date. +Aq uantitativem ethodology andq ualitative +framework is used to estimate theallowancef or +credit losses. +Theq uantitativec omponent of ourestimate uses +models andm ethodologies that categorizefinancial +assets basedo nproductt ype,c ollateralt ype,a nd +otherc reditt rendsa nd risk characteristics, including +relevant informationa bout pastevents,c urrent +conditions andr easonablea nd supportablef orecasts +of future economic conditions that affectthe +collectability of ther ecorded amounts. Fort he +quantitativec omponent,w es egment portfoliosinto +various majorc omponentsi ncluding commercial +loansa nd leasef inancing, commercial real estate, +financiali nstitutions,r esidentialm ortgages,a nd +other. Thes egmentationo fo ur debtsecurities +portfoliosi sbym ajor assetc lass andi si nfluenced by +whethert he security isstructured or non-structured +(i.e., directobligation),a sw ella st he issuer type.T he +componentso ft he credit losscalculationf or each +majorp ortfolio or assetc lass include ap robability of +default, lossgivend efault ande xposurea td efault,a s +applicable,a nd theirv aluesd ependo nthe forecast +behavior of variablesint he macroeconomic +environment. We utilizeam ulti-scenario +macroeconomic forecastw hich includesaweighting +of threes cenarios: ab aselinea nd upsideand +downsides cenariosa nd allows us to developo ur +estimate usingawide span of economic variables. +Ourb aselines cenario reflectsaview on likely +performance of each globalr egiona nd theo ther two +scenariosa re designedr elativet ot he baseline +scenario.T hisa pproach incorporates ar easonable +ands upportablef orecastp eriods panning thel ifeo f +thea sset, andi ncludesb otha ninitiale stimated +economic outlook component as well as ar eversion +component fore ach economicinput variable.T he +lengtho fe ach of thet wo componentsd epends onthe +underlying financiali nstrument, scenario,a nd +underlying economic input variable.I ng eneral,t he +initiale conomic outlook periodfore ach economic +input variableundere ach scenario rangesb etween +severalm onths andt wo years. Thes peed at which +thes cenario-specificf orecasts revert to long-term +historical mean is basedo nobservedh istorical +patternso fm ean reversiona tt he economic variable +input levelt hata re reflectedin our modelp arameter +estimates. Certainm acroeconomic variabless ucha s +unemploymento rh omep ricest akel ongert or evert +afteracontraction, though specificr ecovery timesa re +scenario-specific. Reversionw ill usually takelonger +thef urther awaythes cenario-specificf orecasti sf rom +theh istorical mean.O naquarterly basis, andw ithin +ad evelopedg overnance structure, we update these +scenariosf or current economic conditions andm ay +adjust thes cenario weightingb ased on oureconomic +outlook. TheC ompany usesjudgmentt oa ssess these +economic conditions andl ossd atai nd etermining the +best estimate of thea llowancef or credit lossesand +thesee stimatesa re subject to periodicr efinement +basedo nchangest ou nderlying external or Company- +specifich istorical data. +In theq uantitativec omponent of ourestimate,w e +measuree xpected credit lossesusing an individual +evaluationm ethod if theriskc haracteristicso ft he +asseti sn ol ongerc onsistent with theportfolio or class +of asset. Fort hese assets,w ed on ot employ the +macroeconomic modelcalculationb ut consider +factorss ucha sp ayment status,c ollateralv alue,t he +obligor’s financialcondition, guarantorsupport, the +probability of collecting scheduled principala nd +interest payments when due,a nd recovery +expectations if they canbe reasonablye stimated. For +loans, wemeasuret he expected credit lossas the +differenceb etween thea mortized costbasiso ft he +loan andthe presentvalue ofthee xpected future cash +flowsf romt he borrowerwhich is generally +discounted atthel oan’se ffectivei nterestr ate, or the +fair valueo ft he collateral,i ft he loan is collateral- +dependent.W eg enerally individuallyevaluate +nonperformingl oans as well as loanst hath aveb een +or area nticipated to be modified givent he risk +characteristicso fs uchl oans. +Resultso fO perations (continued) +BNYM ellon2 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_41.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_41.txt new file mode 100644 index 0000000000000000000000000000000000000000..02f98283b965a3f71ecb73a16b0c0b01af11faa6 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_41.txt @@ -0,0 +1,100 @@ +Available-for-saled ebts ecuritiesa re recorded atfair +value. When an available-for-saledebts ecurity is in +an unrealized loss position, we employ a +methodology to identifya nd estimate thecreditl oss +portiono ft he unrealizedloss position. The +measuremento fe xpected credit lossesi sperformed at +thes ecurity leveland is basedo nour best single +estimate of cashf lows,o nadiscounted basis; +however,w ed on ot specifically employ the +macroeconomic forecastingm odels ands cenarios +summarized above. +Theq ualitativec omponent of ourestimate fort he +allowancef or credit lossesisi ntendedt ocapture +expected lossest hatm ay not have beenfully captured +in thequantitativec omponent.T hrough an +establishedg overnance structure, management +determines theq ualitativea llowancee ach period +basedo na nevaluationo fv arious internal and +environmentalf actorsw hich include:s cenario +weightinga nd sensitivity risk,c reditc oncentration +risk,e conomic conditions ando ther considerations. +We have made andm ay continueto make +adjustmentsf or idiosyncratic risks. +To thee xtenta ctualr esults differf romf orecasts or +management’s judgment, theallowancef or credit +lossesm ay be greateror less than future charge-offs +andr ecoveries. +Oura llowancef or credit lossesi ssensitivet oa +numbero finputs, most notably themacroeconomic +forecasta ssumptions that areincorporated into our +estimate of credit lossest hrough thee xpected life of +thel oanp ortfolio,a sw ella sc reditr atings assignedt o +each borrower. As them acroeconomic environment +andr elated forecasts change,t he allowancef or credit +lossesm ay changematerially.T he following +sensitivity analyses do notrepresentm anagement’s +expectations ofthed eteriorationo fo ur portfolioso r +thee conomic environment, but arep rovideda s +hypothetical scenariost oa ssess thes ensitivity of the +allowancef or credit lossestoc hangesi nk ey inputs. +If commercialr eal estatepropertyv aluesw ere +increased 10% anda ll otherc redits were ratedone +gradeb etter, theq uantitativea llowancew ouldh ave +decreased by $47million, andi fc ommercialr eal +estate propertyv aluesw ered ecreased 10% anda ll +otherc redits were ratedone gradeworse,t he +quantitativea llowancew ouldh avei ncreased by $83 +million. Ourm ulti-scenario basedm acroeconomic +forecastu sedi ndeterminingt he Dec. 31, 2023 +allowancef or credit lossesconsistedo ft hree +scenarios. Theb aselines cenario reflectss lightly +increasingG DP growth,s tableu nemploymenta nd +decliningc ommercialr eal estateprices through the +endo f2 024. Theu psides cenario reflectsf asterG DP +growth,d ecliningu nemploymentt hrough thes econd +quarter of 2024 beforemoderatinga nd higher +commercialr eal estateprices comparedwith the +baseline. Thed ownsides cenario contemplates +negativeG DP growth throughthef irst quarter of +2024 with subsequent stabilizationt hrough thet hird +quarter of 2024,as well as rapidlyi ncreasing +unemploymentt hrough 2024ands harply lower +commercialr eal estateprices than theb aseline. At +Dec. 31, 2023,w ep laced them ostw eight on our +downsides cenario,f ollowedb ythe baselinescenario, +with ther emaining weightingp laced on theu pside +scenario.F romasensitivity perspective, atDec. 31, +2023, if we hada pplied1 00% weightingt othe +downsides cenario,t he quantitativeallowancef or +credit losseswouldh aveb een approximately$88 +millionh igher. +SeeN otes 1a nd 5o ft he Notest oC onsolidated +FinancialS tatementsf or additionali nformation +regardingt he allowancef or credit losses. +Goodwill and otherintangibles +We initiallyr ecord alla ssets andl iabilitiesa cquired +in purchasea cquisitions,i ncluding goodwill, +indefinite-lived intangibles andother intangibles,i n +accordance with AccountingS tandardsC odification +(“ASC”)8 05, Business Combinations.G oodwill, +indefinite-lived intangibles andother intangibles are +subsequently accounted fori na ccordance with ASC +350, Intangibles –G oodwill and Other. Thei nitial +measuremento fg oodwill andi ntangibles requires +judgmentc oncerning estimateso ft he fair valueo ft he +acquireda ssets andl iabilities. Goodwill ($16.3 +billiona tD ec. 31, 2023)a nd indefinite-lived +intangiblea ssets ($2.6 billionat Dec. 31, 2023)a re +not amortized but ares ubject to testsfor impairment +annually or more ofteni fe ventso rc ircumstances +indicatei ti sm orel ikelyt hann ot they mayb e +impaired. Otheri ntangiblea ssetsa re amortized over +theire stimatedu sefull ives andare subject to +impairmenti fe ventso rc ircumstances indicatea +possiblei nability torealizet he carryingv alue. +Goodwill +BNYM ellon’sb usinesss egmentsi nclude six +reportingu nits forw hich annualgoodwill impairment +Resultso fO perations (continued) +24 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_42.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_42.txt new file mode 100644 index 0000000000000000000000000000000000000000..736023e0cb2bdb5f185448e7527123d016d8bff3 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_42.txt @@ -0,0 +1,89 @@ +testingi sp erformed.A ni nterim goodwill +impairmentt esti sp erformed when eventsor +circumstances occurt hatm ay indicatet hati ti sm ore +likelyt hann ot that thef airv alue ofanyr eportingu nit +mayb el esst hani ts carryingv alue. +Theg oodwill impairmentt estc omparest he estimated +fair valueo ft he reportingu nitw ith itscarrying +amount,i ncluding goodwill. If thee stimatedf air +valueo ft he reportingu nite xceedsi ts carrying +amount,g oodwill of ther eportingu niti sc onsidered +not impaired. However, if thecarryinga mount ofthe +reportingu nitw eret oe xceed its estimatedf airv alue, +an impairmentl ossw ouldb er ecorded fort he +difference. +In eachq uarter of 2023,we completeda ninterim +goodwill impairmentt esto ft he Investment +Management reportingu nit, whichh ad $6.1 billiono f +allocated goodwill as of Dec. 31, 2023.I na ll cases, +we determined thef airv alue oftheI nvestment +Management reportingu nite xceeded its carrying +valuea nd no goodwill impairmentw as recorded. +Fort he Dec. 31, 2023test,t he fair valueo ft he +Investment Management reportingu nite xceeded its +carryingv alue byapproximately 5%.W ed etermined +thef airv alue oftheI nvestment Management +reportingu nitu sing an income approach basedo n +management’s projections as of Dec. 31, 2023. The +discount rate appliedt othese cashf lows was10.5%. +As of Dec. 31, 2023,i ft he discountrate appliedt o +thee stimatedc ashf lows wasincreased or decreased +by 25 basispoints, thef airv alue oftheI nvestment +Management reportingu nitw ould decreaseo r +increaseb y4 %, respectively. Similarly, if thelong- +term growth rate wasi ncreased or decreasedby 10 +basisp oints, thef airv alue oftheI nvestment +Management reportingu nitw ould increaseo r +decreaseb ya pproximately 1%,r espectively. +In thes econd quarterof 2023,we performed our +annualg oodwill impairmentt esto nt he remaining +five reportingu nits usinga nincomea pproach to +estimate thefairv alueso fe ach reportingu nit. +Estimatedc ashf lows used in theincomea pproach +were basedo nmanagement’sp rojections as of April +1, 2023. Thed iscount rate appliedt othese cash +flowsw as 10%. +As ar esulto ft he annualg oodwill impairmentt est, no +goodwilli mpairmentw as recognized.T he fair values +of theC ompany’sr emaining five reportingu nits were +substantially inexcesso ft he respectiver eporting +units’c arryingv alue. +Intangiblea ssets +Keyj udgments inaccountingf or intangiblea ssets +include determiningthe usefullife andc lassification +between goodwill andi ndefinite-lived intangible +assets or otheramortizingi ntangiblea ssets. +Indefinite-lived intangiblea ssets ($2.6 billionatD ec. +31, 2023)aree valuated fori mpairmenta tl east +annually by comparingt heir fair values,e stimated +usingd iscounted cashflowa nalyses, to theircarrying +values.A saresult of thea nnuale valuation, no +impairmentw as recognized,h owever,a $698 million +indefinite-lived intangiblea ssetr elated to customer +relationships in theInvestment Management business +exceeded its carryingv alue byapproximately 7%. +Othera mortizingi ntangiblea ssets( $274 milliona t +Dec. 31, 2023)a re evaluatedf or impairmenti fe vents +andc ircumstances indicateap ossiblei mpairment. +Such evaluationo fo ther intangiblea ssetsw ouldb e +initially basedo nundiscounted cashflowp rojections. +Determiningt he fair valueo fareportingu nito r +indefinite-lived intangiblea ssets issubject to +uncertainty as it isrelianto ne stimateso fc ashf lows +that extendfari ntot he future,a nd, bytheirn ature, are +difficult toestimate overs ucha nextendedt ime +frame.I nt he future,c hangesi nt he assumptions or +thed iscount rate couldp roduceam aterialn on-cash +goodwillo ri ntangiblea sseti mpairment. +SeeN otes 1a nd 7o ft he Notest oC onsolidated +FinancialS tatementsf or additionali nformation +regardingg oodwill, intangibleassets andt he annual +andi nterim impairmentt esting. +Litigationa nd regulatoryc ontingencies +Significante stimatesa nd judgments arer equiredi n +establishing an accruedl iabilityf or litigationa nd +regulatoryc ontingencies. Fora dditionali nformation +on our policy,see“ Legalp roceedings”i nN ote2 2o f +theN otes to Consolidated FinancialS tatements. +Resultso fO perations (continued) +BNYM ellon2 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_43.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_43.txt new file mode 100644 index 0000000000000000000000000000000000000000..26fa556d9702362c527a3109d52b03bab901bbbb --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_43.txt @@ -0,0 +1,86 @@ +Consolidated balances heet review +Oneo fo ur keyriskm anagemento bjectives is to +maintain ab alance sheet that remainss trong +throughout market cyclesto meetthee xpectations of +our majors takeholders,i ncluding ourshareholders, +clients, creditors andr egulators. +We also seekto undertakeo verall liquidityrisk, +including intraday liquidity risk,t hats tays within our +risk appetite.T he objectiveofo ur balancesheet +management strategy is to maintainab alance sheet +that is characterized by strong liquidity anda sset +quality,r eadya ccesst oe xternalf unding sources at +competitiver ates andastrong capitals tructure that +supports our risk-takinga ctivitiesa nd is adequate to +absorb potentiall osses. In managing theb alance +sheet,a ppropriatec onsiderationi sg iven to balancing +thec ompetingn eedso fm aintaining sufficientl evels +of liquidity andc omplying with applicable +regulations ands upervisorye xpectations while +optimizingp rofitability. +At Dec.31, 2023,t otal assetswere $410 billion, +compared with $406 billionatD ec. 31, 2022.T he +increasei nt otal assetswasp rimarily driven by higher +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks andf ederal funds sold and +securitiesp urchased underr esalea greements, +partially offset by lowers ecuritiesa nd interest- +bearingd eposits with banks.D eposits totaled$284 +billiona tD ec. 31, 2023,c omparedw ith $279 billion +at Dec. 31, 2022.T he increasep rimarily reflects +higheri nterest-bearingd eposits inU.S. offices and +non-U.S. offices,p artially offset by lowern on- +interest bearingd eposits (principally U.S. offices). +Totali nterest-bearingd eposit liabilitiesa sa +percentage oftotali nterest-earning assets were 66% +at Dec. 31, 2023and5 8% at Dec. 31, 2022. +At Dec.31, 2023,a vailablef unds totaled$ 158 billion +andi ncludesc asha nd duefrom banks,interest- +bearingd eposits with theFederal Reservea nd other +central banks,i nterest-bearingd eposits with banks +andf ederal funds sold ands ecuritiesp urchased under +resale agreements.T hisc omparesw ith available +funds of $138 billionatD ec. 31, 2022.T otal +availablef unds as ap ercentage oftotala ssets were +38% at Dec. 31, 2023and3 4% at Dec. 31, 2022.F or +additionali nformationo nour availablef unds,s ee +“Liquidity andd ividends.” +Securitiesw ere$ 126 billion,or 31% oftotala ssets,a t +Dec. 31, 2023,c omparedw ith$ 143 billion,or 35% +of totala ssets,a tD ec. 31, 2022.T he decrease +primarily reflectsl ower U.S. Treasurya nd non-U.S. +government securities, partially offset by unrealized +pre-taxg ains.F or additionali nformationo nour +securitiesp ortfolio,s ee “Securities” andN ote4of the +Notest oC onsolidated FinancialS tatements. +Loansw ere$ 67 billion,o r1 6% oftotala ssets,a tD ec. +31, 2023,compared with $66 billion,or 16% oftotal +assets,a tD ec. 31, 2022.I ncreases in nearly alll oan +portfoliosw erep artially offset by lowero verdrafts +andw ealth managementloans. Fora dditional +informationo nour loan portfolio,s ee “Loans”a nd +Note 5o ft he Notest oC onsolidated Financial +Statements. +Long-term debt totaled$ 31 billionat Dec. 31, 2023 +and$ 30 billionatD ec. 31, 2022.T he increase +primarily reflectsi ssuances,p artially offset by +maturitiesa nd repurchases.F or additional +informationo nlong-term debt,s ee “Liquidity and +dividends”a nd Note 13 oftheN otes to Consolidated +FinancialS tatements. +TheB anko fN ew York Mellon Corporationt otal +shareholders’e quity totaled$41 billionatD ec. 31, +2023 andD ec. 31, 2022.F or additionali nformation, +see“ Capital” andN ote1 5o ft he Notest o +Consolidated FinancialS tatements. +Securities +In thed iscussion of oursecuritiesp ortfolio,w eh ave +includedc ertain credit ratings informationb ecause +thei nformationc an indicatet he degreeof credit risk +to whichw ea re exposed.S ignificantc hangesi n +ratings classifications couldi ndicatei ncreased credit +risk foru sa nd couldb ea ccompaniedb ya nincrease +in thea llowancef or credit lossesand/or ar eductioni n +thef airv alue of oursecuritiesp ortfolio. +Resultso fO perations (continued) +26 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_44.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_44.txt new file mode 100644 index 0000000000000000000000000000000000000000..737fae6829b8e30123c123cdc75515f133796734 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_44.txt @@ -0,0 +1,112 @@ +Thef ollowing tables howst he distributionofo ur totals ecuritiesp ortfolio. +Securities portfolio Dec. 31, +2022 2023 +change in +unrealized +gain (loss) +Dec. 31, 2023 Fair value +as a%of +amortized +cost (a) +Unrealized +gain (loss) +% +Floating +rate (b) +Ratings (c) +BBB+/ +BBB- +BB+ +and +lower(dollars in millions) +Fair +value +Amortized +cost (a) +Fair +value +AAA/ +AA- +A+/ +A- +Not +rated +Agency residential +mortgage-backed +securities( “RMBS”) +$3 8,916 $7 96 $4 3,197 $3 9,333 91% $( 3,864) 21% 100% —% —% —% —% +U.S. Treasury4 1,503 623 27,316 26,476 97 (840) 62 100 —— —— +Non-U.S. government (d) 22,361 342 21,135 20,543 97 (592) 42 94 32 1— +Agency commercial +mortgage-backed +securities( “MBS”) 11,864 214 11,602 11,010 95 (592) 45 100 —— —— +Collateralized loan +obligations (“CLOs”) 6,300 123 7,125 7,119 100 (6)1 00 100 —— —— +U.S. government agencies 6,115 137 7,199 6,780 94 (419) 42 100 —— —— +Foreignc overedb onds (e) 5,776 93 6,489 6,317 97 (172) 57 100 —— —— +Non-agency commercial +MBS 3,054 32 3,245 2,997 92 (248) 53 100 —— —— +Non-agency RMBS 2,060 24 1,909 1,766 92 (143) 46 85 3—66 +Othera sset-backed +securities( “ABS”) 1,319 41 1,026 943 92 (83) 18 100 —— —— +Other2 4— 13 11 88 (2)— —— —— 100 +Totals ecurities$ 139,292 (f) $2 ,425 $1 30,256 $1 23,295 (f) 95% $( 6,961) (f)(g) 44% 99% 1% —% —% —% +(a)A mortized cost reflectsh istoricali mpairments,a nd is neto fthe allowancef or credit losses. +(b)I ncludest he impacto fhedges. +(c)R epresentsr atings by Standard&Poor ’s (“S&P”)o rt he equivalent. +(d)I ncludess upranational securities. Primarily consists of exposuret oG ermany,F rance, UK,C anada, theN etherlands andBelgium. +(e)P rimarily consists of exposuret oC anada, UK,A ustralia,G ermany,S ingaporea nd Norway. +(f)I ncludesn et unrealized gains on derivatives hedging securitiesa vailable-for-sale (including terminated hedges) of $2,678milliona tD ec.3 1, 2022 and net +unrealized gain( including terminated hedges) of $1,767milliona tD ec.3 1, 2023. +(g)A tD ec. 31, 2023,i ncludesp re-tax netu nrealized losseso f$ 2,094 millionr elated to available-for-sale securities, neto fhedges, and $4,867relatedt oheld-to- +maturity securities. Thea fter-tax unrealized losses, neto fhedges, relatedt oavailable-for-sale securitiesi s$ 1,580 milliona nd thea fter-taxe quivalent relatedt o +held-to-maturity securitiesi s$ 3,711 million. +Thef airv alue of oursecuritiesp ortfolio,i ncluding +relatedh edges, was$123.3 billionatD ec. 31, 2023, +compared with $139.3 billionatD ec. 31, 2022.T he +decreasep rimarily reflectsl ower U.S. Treasurya nd +non-U.S. government securities,p artially offset by +unrealized pre-taxg ains. +At Dec.31, 2023,t he securitiesp ortfolio hadanet +unrealized loss, including thei mpact of related +hedges, of $7.0 billion,compared with $9.4 billiona t +Dec. 31, 2022.T he decreaseint he unrealizedloss, +including thei mpact of relatedh edges, primarily +reflectss ecuritiesm oving closer to maturity. +Thef airv alue ofthea vailable-for-sales ecurities +totaled$ 78.6 billionatD ec. 31, 2023,n et of hedges, +or 64% ofthes ecuritiesp ortfolio,n et of hedges. The +fair valueo ft he held-to-maturitysecuritiest otaled +$44.7 billionatD ec. 31, 2023,o r3 6% ofthe +securitiesp ortfolio,n et of hedges. +Theu nrealized loss (after-tax)o no ur available-for- +sale securitiesp ortfolio,n et of hedges,includedi n +accumulatedo ther comprehensiveincomew as $1.6 +billiona tD ec. 31, 2023,c omparedw ith $2.4 billion +at Dec. 31, 2022.N et unrealized loss, including the +impact of hedges,decreased assecuritiesm oved +closer to maturity. +At Dec. 31, 2023,9 9% ofthes ecuritiesi no ur +portfolio were ratedAAA/AA-, unchangedc ompared +with Dec. 31, 2022. +SeeN ote4of theN otes to Consolidated Financial +Statements fort he pre-taxnet securitiesg ains (losses) +by security type.S ee Note 20 oftheN otes to +Consolidated FinancialS tatementsf or securitiesb y +leveli nt he fair valueh ierarchy. +Thef ollowing tablep resentst he amortizable purchase +premium( neto fd iscount)a nd netamortization +relatedt othe securitiesp ortfolio. +Amortizablep urchasep remium +(net of discount)a nd net +amortization ofsecurities (a) +(inm illions) 2023 2022 2021 +Amortizable purchasep remium, +neto fd iscount $8 21 $1 ,109 $1 ,863 +Neta mortization $1 67 $3 62 $6 55 +(a)A mortizationo fp urchasep remium decreasesnet interest +revenue while accretiono fd iscount increasesn et interest +revenue.B otha re recordedon al evel yieldbasis. +Resultso fO perations (continued) +BNYM ellon2 7 +The secret object #4 is a "tree". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_45.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_45.txt new file mode 100644 index 0000000000000000000000000000000000000000..9f998817f6663c292a94eacb97a912b52e4fe5eb --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_45.txt @@ -0,0 +1,80 @@ +Equity investments +We have severale quity investmentsrecorded in other +assets.T hese include equity methodinvestments, +including renewablee nergy, investmentsi nq ualified +affordable housingp rojects, FederalR eserve Bank +stock, seed capitala nd otherinvestments. The +following tablep resentst he carryingv aluesa tD ec. +31, 2023andD ec. 31, 2022. +Equity investments Dec. 31, +(inm illions) 2023 2022 +Renewablee nergyi nvestments $1 ,049 $8 71 +Qualifieda ffordable housingp roject +investments 1,213 1,298 +Equity methodinvestments: +CIBC Mellon 607 545 +Siguler Guff 234 242 +Other 32 16 +Totale quity methodinvestments 873 803 +FederalR eserve Bank stock 480 478 +Othere quity investments(a) 741 695 +Seed capital(b) 232 218 +FederalH omeL oanB anks tock 7 6 +Totale quity investments $4 ,595 $4 ,369 +(a)I ncludess trategic equity,p rivate equity and other +investments. +(b)I ncludesi nvestments inBNYM ellonf unds whichh edge +deferredi ncentivea wards. +Fora dditionali nformationo ncertain seed capital +investmentsa nd our privateequity investments, see +“Investmentsv aluedu sing netassetv alue (“NAV”) +pers hare”i nN ote8of theN otes to Consolidated +FinancialS tatements. +Renewablee nergyi nvestments +We invest in renewablee nergyp rojectst or eceive an +expected after-taxreturn,w hich consistsof allocated +renewablee nergyt ax credits,taxd eductions andc ash +distributions basedo nthe operations ofthep roject. +Thep re-tax losseso nt hese investmentsa re recorded +in investment ando ther revenue onthec onsolidated +income statement. Thec orresponding taxb enefits +andc redits arer ecorded to theprovision fori ncome +taxeso nt he consolidated income statement. +Loans +Totale xposure–consolidated Dec. 31, 2023 Dec. 31, 2022 +(inb illions) Loans +Unfunded +commitments +Total +exposure Loans +Unfunded +commitments +Total +exposure +Financiali nstitutions $1 0.5 $2 9.2 $3 9.7 $9 .7 $3 1.7 $4 1.4 +Commercial 2.1 11.4 13.5 1.7 11.7 13.4 +Wealth managementloans 9.1 0.5 9.6 10.3 0.6 10.9 +Wealth managementmortgages 9.1 0.3 9.4 9.0 0.2 9.2 +Commercialr eal estate 6.8 3.4 10.2 6.2 3.9 10.1 +Leasef inancings 0.6 —0 .6 0.7 —0 .7 +Otherr esidentialm ortgages 1.2 —1 .2 0.4 —0 .4 +Overdrafts 3.1 —3 .1 4.8 —4 .8 +Capitalc allf inancing 3.7 3.6 7.3 3.4 3.5 6.9 +Other 2.7 —2 .7 3.0 —3 .0 +Margin loans 18.0 —1 8.0 16.9 —1 6.9 +Total $66.9 $4 8.4 $1 15.3 $6 6.1 $5 1.6 $1 17.7 +At Dec.31, 2023,t otal lending-relatede xposurew as +$115.3 billion,ad ecreaseo f2 %c omparedw ith Dec. +31, 2022, primarily reflectingl ower exposureint he +financiali nstitutions portfolio,lower overdraftsa nd +lowere xposure in thewealth managementloans +portfolio,p artially offset by highermarginl oans and +otherr esidentialm ortgagel oans. +Ourf inancial institutions andc ommercialp ortfolios +comprise our largestc oncentrated risk.T hese +portfoliosc omprised 46% of ourtotale xposurea t +Dec. 31, 2023and4 7% at Dec. 31, 2022. +Additionally,m osto fo ur overdraftsrelatet o +financiali nstitutions. +Resultso fO perations (continued) +28 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_46.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_46.txt new file mode 100644 index 0000000000000000000000000000000000000000..6f88b9835ce0c5056fb4db58885134a883198df7 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_46.txt @@ -0,0 +1,78 @@ +Financiali nstitutions +Thef inancial institutions portfolio isshownb elow. +Financiali nstitutions +portfolio exposure +(dollars in billions) +Dec. 31, 2023 Dec. 31, 2022 +Loans +Unfunded +commitments +Total +exposure +%I nv. +grade +%d ue +<1 yr. Loans +Unfunded +commitments +Total +exposure +Securitiesi ndustry $2 .3 $1 4.8 $1 7.1 91% 96% $1 .6 $1 7.5 $1 9.1 +Assetm anagers 1.4 8.0 9.4 97 81 1.6 7.6 9.2 +Banks 6.4 1.4 7.8 84 96 6.1 1.5 7.6 +Insurance 0.1 3.9 4.0 100 13 0.1 3.8 3.9 +Government —0 .2 0.2 100 43 —0 .2 0.2 +Other 0.3 0.9 1.2 98 47 0.3 1.1 1.4 +Total $1 0.5 $2 9.2 $3 9.7 92% 83% $9 .7 $3 1.7 $4 1.4 +Thef inancial institutions portfolioexposurew as +$39.7 billionatD ec. 31, 2023,adecreaseo f4 % +compared with Dec. 31, 2022,p rimarily reflecting +lowere xposure in thesecuritiesi ndustryp ortfolio. +Financiali nstitutione xposures arehigh-quality,w ith +92% ofthee xposuresm eetingt he investment grade +equivalent criteriao fo ur internal creditrating +classificationa tD ec. 31, 2023.E ach customeris +assigneda ninternalc reditr ating, whichi sm appedt o +an equivalentexternal ratinga gencyg rade based +upon an umbero fdimensions,w hich arecontinually +evaluateda nd mayc hange overtime.F or ratings of +non-U.S. counterparties, our internal creditratingi s +generally cappeda taratin ge quivalent to the +sovereignr atingo ft he country wheret he +counterpartyr esides,r egardlesso ft he internal credit +ratinga ssignedt othe counterpartyo rt he underlying +collateral. +Thee xposure to financiali nstitutions is generally +short-term,w ith 83% ofthee xposures expiring +within one year.A tD ec. 31, 2023,1 9% ofthe +exposuret of inancial institutions hada nexpiration +within 90 days,comparedw ith 17% at Dec. 31, 2022. +In addition, 62% ofthef inancial institutions exposure +is secureda tD ec. 31, 2023.F or example, securities +industryc lientsa nd assetm anagerso ften borrow +againstm arketables ecuritiesh eldi ncustody. +At Dec. 31, 2023,t he securedi ntradayc redit +providedt odealersi nc onnectionw ith theirt ri-party +repo activity totaled$13.5 billionand wasi ncludedi n +thes ecuritiesi ndustryp ortfolio.D ealerss ecure the +outstanding intraday creditwith high-quality liquid +collateralh avingamarket valuei ne xcesso ft he +amount oftheo utstanding credit. Securedi ntraday +credit facilitiesr epresent 34% ofthee xposurei nt he +financiali nstitutions portfolioanda re reviewed and +reapproveda nnually. +Thea ssetm anagersp ortfolio exposurei sh igh- +quality,w ith 97% ofthee xposures meetingo ur +investment gradeequivalent ratingsc riteriaa so fD ec. +31, 2023. Thesee xposures aregenerally short-term +liquidity facilities, with themajority to regulated +mutual funds. +Ourb anks portfolioexposurep rimarily relatest oo ur +globalt rade finance. Thesee xposures areshort-term +in nature,w ith 96% duein lessthan one year.T he +investment gradepercentage of our banksexposure +was8 4% at Dec. 31, 2023,c omparedw ith 86% at +Dec. 31, 2022.O ur non-investment gradeexposures +arep rimarily tradefinance loansi nB razil. +Resultso fO perations (continued) +BNYM ellon2 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_47.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_47.txt new file mode 100644 index 0000000000000000000000000000000000000000..c0c6f0795efeadc527bb047d0058d17dc240422f --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_47.txt @@ -0,0 +1,62 @@ +Commercial +Thec ommercialp ortfolio ispresentedb elow. +Commercial portfolio exposure Dec. 31, 2023 Dec. 31, 2022 +(dollars in billions) Loans +Unfunded +commitments +Total +exposure +%I nv. +grade +%d ue +<1 yr. Loans +Unfunded +commitments +Total +exposure +Services andother $1 .2 $3 .4 $4 .6 98% 41% $0 .8 $3 .2 $4 .0 +Manufacturing 0.5 3.6 4.1 96 19 0.5 4.1 4.6 +Energy andu tilities 0.4 3.7 4.1 89 6 0.3 3.7 4.0 +Mediaa nd telecom —0 .7 0.7 88 3 0.1 0.7 0.8 +Total $2 .1 $1 1.4 $1 3.5 94% 22% $1 .7 $1 1.7 $1 3.4 +Thec ommercialp ortfolio exposurew as $13.5 billion +at Dec. 31, 2023,a nincreaseo f1 %f romD ec. 31, +2022, primarily driven by higherexposurei nt he +services andother portfolios, partially offset by lower +exposurei nt he manufacturingp ortfolio. +Ourc redits trategyi st of ocus oninvestment grade +clientst hata re activeu sers of our non-creditservices. +Thef ollowing tables ummarizes thep ercentage ofthe +financiali nstitutions andc ommercialp ortfolio +exposures that areinvestment grade. +Investment gradep ercentages Dec. 31, +2023 2022 2021 +Financiali nstitutions 92% 95% 96% +Commercial 94% 95% 94% +Wealth management loans +Ourw ealth managementloan exposurewas $9.6 +billiona tD ec. 31, 2023,c omparedw ith $10.9 billion +at Dec. 31, 2022.W ealth managementloans +primarily consisto fl oans to high-net-worth +individuals,amajority of whicha re securedb ythe +customers’ investment management accountso r +custody accounts. +Wealth management mortgages +Ourw ealth managementmortgage exposurew as $9.4 +billiona tD ec. 31, 2023,c omparedw ith$ 9.2 billion +at Dec. 31, 2022.W ealth managementmortgages +primarily consisto fl oans to high-net-worth +individuals,w hich aresecuredb yresidential +property. Wealth managementmortgagesa re +primarily interest-only,adjustable-rate mortgages +with aw eighted-average loan-to-valuer atio of 61%at +origination. Less than 1% ofthem ortgages were past +due at Dec. 31, 2023. +At Dec. 31, 2023,t he wealth managementmortgage +portfolio consistedo ft he followingg eographic +concentrations:C alifornia– 21%;N ew York –1 4%; +Florida–11%;M assachusetts –8 %; ando ther – +46%. +Resultso fO perations (continued) +30 BNYM ellon +The secret animal #5 is a "bear". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_48.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_48.txt new file mode 100644 index 0000000000000000000000000000000000000000..14334bab90e4433249cf8602582ee41bc44e536d --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_48.txt @@ -0,0 +1,79 @@ +Commercialr eale state +Thec ompositiono ft he commercialr eal estateportfolio by assetc lass, including percentagesecured, is presented +below. +Compositiono fc ommercial reale statep ortfolio by assetc lass Dec. 31, 2023 Dec. 31, 2022 +Total +exposure +Percentage +secured (a) +Total +exposure +Percentage +secured (a)(dollars in billions) +Residential $4 .3 88% $4 .1 85% +Office 2.6 74 2.8 75 +Retail 0.8 63 0.9 58 +Mixed-use 0.8 31 0.8 33 +Hotels 0.6 40 0.6 42 +Healthcare 0.5 57 0.4 49 +Other 0.6 71 0.5 66 +Totalc ommercialr eale state $1 0.2 73% $1 0.1 71% +(a)R epresentst he percentage ofsecurede xposurei ne acha ssetc lass. +Ourc ommercialr eal estateexposuret otaled $10.2 +billiona tD ec. 31, 2023and$ 10.1 billionatD ec. 31, +2022. Ouri ncome-producingc ommercialr eal estate +facilitiesa re focusedo nexperienced owners anda re +structured with moderate leverage basedo nexisting +cashf lows.O ur commercialr eal estate lending +activitiesa lsoi nclude constructiona nd renovation +facilities. Ourc lient baseconsists of experienced +developers andl ong-term holders of real estateassets. +Loansa re approvedo nthe basisofe xistingo r +projected cashflows ands upportedb yappraisals and +knowledge oflocal market conditions.D evelopment +loansa re structured with moderate leverage,and in +many instances,i nvolve some levelofr ecourse to the +developer. +At Dec.31, 2023,t he unsecuredportfolio consisted +of real estate investmenttrusts (“REITs”)a nd real +estate operatingc ompanies,w hich arebothp rimarily +investment grade. +At Dec.31, 2023,o ur commercialr eale statep ortfolio +consistedo ft he following concentrations:N ew York +metro–36%;R EITs andr eal estateoperating +companies– 27%;a nd other–37%. +Leasef inancings +Thel easef inancings portfolioexposuret otaled $599 +milliona tD ec. 31, 2023and$ 657 milliona tD ec. 31, +2022. At Dec.31, 2023,n early allo fl easing +exposurew as investment grade,or investment grade +equivalent,a nd primarily consistedo fe xposures +backed by well-diversifieda ssets,p rimarily real +estate andl arge-tickett ransportatione quipment. +Assets areb othd omestic andf oreign-based, with +primaryc oncentrations in Germanya nd theU .S. +Otherr esidentialm ortgages +Theo ther residentialm ortgages portfolio primarily +consists of 1-4family residentialm ortgagel oans and +totaled$ 1.2 billionat Dec. 31, 2023and$ 345 million +at Dec. 31, 2022. +Overdrafts +Overdrafts primarily relate to custodya nd securities +clearance clientsand areg enerally repaid within two +businessd ays. +Capitalc allf inancing +Capitalc allf inancing includesl oans to privatee quity +funds that aresecuredb ythe fund investors’ capital +commitmentsa nd thef unds’r ight to callc apital. +Otherl oans +Otherl oans primarily includeloanst oc onsumerst hat +aref ully collateralized with equities, mutual funds +andf ixed-incomes ecurities. +Margin loans +Marginloan exposureof$ 18.0 billionatD ec. 31, +2023 and$ 16.9 billionatD ec. 31, 2022was +collateralized with marketablesecurities. Borrowers +arer equiredt omaintainadaily collateralm argini n +excesso f1 00% ofthev alue ofthel oan. Margin +Resultso fO perations (continued) +BNYM ellon3 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_49.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_49.txt new file mode 100644 index 0000000000000000000000000000000000000000..64bbc965a2b2cfc254d1da1f4263dc8d93ee0dcd --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_49.txt @@ -0,0 +1,44 @@ +loansi ncluded$ 7b illiona tD ec. 31, 2023and$ 6 +billiona tD ec. 31, 2022relatedt oaterm loan +program that offers fullycollateralized loanst o +broker-dealers. +Maturity of loan portfolio +Thef ollowing tables howst he maturity structureo fo ur loan portfolio. +Maturity of loan portfolio at Dec. 31, 2023 Within +1y ear +Between +1a nd 5y ears +Between +5a nd 15 years +After +15 yearsT otal(inm illions) +Commercial$ 1,472 $5 79 $6 1$ —$ 2,112 +Commercialr eal estate 1,708 3,909 1,143 —6 ,760 +Financiali nstitutions 8,953 1,568 —— 10,521 +Leasef inancings 12 58 340 —5 99 +Wealth managementloans8 ,634 273 202 —9 ,109 +Wealth managementmortgages— 20 375 8,736 9,131 +Otherr esidentialm ortgages —5 137 1,024 1,166 +Overdrafts 3,053 ——— 3,053 +Capitalc allf inancing 2,469 1,231 —— 3,700 +Other2 ,712 5—— 2,717 +Margin loans1 7,983 28 —— 18,011 +Total$ 46,985 $7 ,876 $2 ,258 $9 ,760 $6 6,879 +Interest ratecharacteristic +Thef ollowing tables howst he interest rate characteristic of loansm aturinga fter one year. +Interestr atec haracteristic of loan portfolio maturing >1 year atDec. 31, 2023 +(inm illions) Fixedr ates Floatingr ates Total +Commercial$ 61 $5 79 $6 40 +Commercialr eal estate 112 4,940 5,052 +Financiali nstitutions —1 ,568 1,568 +Leasef inancings 598 —5 98 +Wealth managementloans1 04 65 475 +Wealth managementmortgages3 ,821 5,310 9,131 +Otherr esidentialm ortgages 1,142 24 1,166 +Capitalc allf inancing —1 ,231 1,231 +Other— 55 +Margin Loans— 28 28 +Total$ 5,744 $1 4,150 $1 9,894 +Resultso fO perations (continued) +32 BNYM ellon +The secret fruit is a "banana". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_5.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_5.txt new file mode 100644 index 0000000000000000000000000000000000000000..ce53e56111e8c0d95058fb110b106d388e76ba10 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_5.txt @@ -0,0 +1,40 @@ +IIIBNY MELLON +91% +92% +94% +BREADTH OF OUR +CLIENT FRANCHISE +of Fortune 100 +companies +of the Top 100 +investment managers +of the Top 100 +banks +One of our bodies of work was to assemble a strong bench of talent +and put them in the right seats to deliver on what is needed. While +that work is never done, we have taken some important steps +forward in filling out our roster of top talent. +Throughout 2023, we worked hard on several fronts simultaneously +because we insisted on increasing the internal tempo of the +organization and delivering the beginnings of superior financial +results while laying some of the foundation for a multi-year +transformation. As we executed this work, we introduced three +strategic pillars to guide us: +• Be More for Our Clients +• Run Our Company Be +tter +• Pow +er Our Culture +These pillars are not a top-down consulting exercise for what +we could do; rather, they represent an articulation of what we are, +and must be, centered on. Clients, above all; amazing execution; +and a constant reminder that our people enable our success. +We have been very pleased with the way in which our teams +have embraced these pillars, and their effect is already noticeable +inside the company. +Sources: Fortune 100: For 2023, Fortune, Time Inc. ©2023; Investment Managers: Pensions & Investments, worldwide assets under management as of December 31, 2022, P&I Crain Communications +Inc. ©2023; Banks: S&P Global, total assets* as of December 31, 2022, ©2023 S&P Global; client penetration assessment based on positive 2023 revenue with client company or parent/holding company. +*According to S&P Global, company assets were adjusted on a best-efforts basis for pending mergers, acquisitions and divestitures as well as M&A deals that closed after the end of the reporting period +through March 31, 2023. Assets reported by non-U.S. dollar filers were converted to dollars using period-end exchange rates. Total assets were taken on an “as-reported” basis, and no adjustments were +made to account for differing accounting standards. The majority of the banks were ranked by total assets as of December 31, 2022 and the data was compiled April 12, 2023. +The secret tool is a "wrench". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_50.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_50.txt new file mode 100644 index 0000000000000000000000000000000000000000..ae42fa07a987f6b9f1581351a25d80d8b01c3139 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_50.txt @@ -0,0 +1,55 @@ +Allowancef or creditl osses +Ourc redits trategyi st of ocus oninvestment gradeclients whoa re activeu sers of our non-creditservices.O ur +primary exposuret ot he credit risk of ac ustomerc onsists of fundedl oans,u nfundedc ontractualc ommitmentst o +lend, standby letters of credit ando verdraftsa ssociated with our custody ands ecuritiesc learance businesses. +Thef ollowing tablep resentst he changesi no ur allowancef or credit losses. +Allowancef or credit lossesactivity +2023 2022(dollars in millions) +Beginning balanceofa llowancef or credit losses $2 92 $2 60 +Provision forc reditl osses 119 39 +Charge-offs: +Loans: +Otherr esidentialm ortgages (3) — +Otherf inancial instruments (2) (11) +Totalc harge-offs (5) (11) +Recoveries: +Loans: +Commercial 1 — +Otherr esidentialm ortgages 2 4 +Other 5 — +Otherf inancial instruments — — +Totalr ecoveries 8 4 +Netr ecoveries (charge-offs) 3 (7) +Ending balanceofa llowancef or credit losses $4 14 292 +Allowancef or loan losses $3 03 $1 76 +Allowancef or lending-relatedc ommitments 87 78 +Allowancef or financiali nstruments (a) 24 38 +Totala llowancef or credit losses $4 14 $2 92 +Totall oans $6 6,879 $6 6,063 +Averagel oans outstanding $6 4,096 $6 7,825 +Netr ecoveries (charge-offs)o floans to averagel oans outstanding —% (0.01)% +Netr ecoveries (charge-offs)o floans to totalallowancef or loan lossesa nd lending-relatedc ommitments 0.77 (2.76) +Allowancef or loan lossesa sapercentage of totall oans 0.45 0.27 +Allowancef or loan lossesa nd lending-relatedc ommitmentsa sapercentage of totall oans 0.58 0.38 +Net( charge-offs)t oa verage loansb yl oanc ategory: (b) +Otherr esidentialm ortgages: (0.11)% N/A +Net( charge-offs)d uringt he year $( 1) N/A +Averagel oans outstanding $9 08 (b) N/A +(a)I ncludesa llowancef or credit lossesonf ederal funds sold and securitiesp urchased underr esalea greements,a vailable-for-sale +securities, held-to-maturity securities, accountsr eceivable, cashand duefrom banksand interest-bearing depositswith banks. +(b)A verage loans basedon month-endb alances. +N/A–Nota pplicable. Therew eren on et charge-offs in2022. +Thep rovision forc reditl ossesw as $119 millioni n +2023, primarily driven by reservei ncreases relatedt o +commercialr eal estateexposurea nd changesi nt he +macroeconomic forecast. +Thea llowancef or loan losses andallowancef or +lending-relatedc ommitmentsr epresent +management’s estimate of lifetime expected lossesi n +our credit portfolio.T hise valuationp rocessi s +subject to numerous estimatesa nd judgments.T ot he +extent actualr esults differf romf orecasts or +management’s judgment, theallowancef or credit +lossesm ay be greateror less than future charge-offs. +Resultso fO perations (continued) +BNYM ellon3 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_51.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_51.txt new file mode 100644 index 0000000000000000000000000000000000000000..bf97cd3454ec201d8d52808524d402fc920d849a --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_51.txt @@ -0,0 +1,87 @@ +Basedo na nevaluationo ft he allowancef or credit +lossesa sdiscussed in “Critical accountinge stimates” +andN ote1of theN otes to Consolidated Financial +Statements,w eh avea llocated our allowancef or +loansa nd lending-relatedc ommitmentsa spresented +below. +Allocation of allowancefor loan lossesa nd +lending-related commitments(a) +Dec. 31, +2023 2022 +(dollars in millions) $% $% +Commercialr eal estate $3 25 83% $1 84 72% +Commercial 27 7 18 7 +Financiali nstitutions 19 4 24 9 +Wealth management +mortgages 92 12 5 +Otherr esidentialm ortgages 41 83 +Capitalc allf inancing 41 62 +Wealth managementloans 11 11 +Leasef inancings 11 11 +Total $3 90 100% $2 54 100% +(a)T he allowanceallocatedt omargins loans,o verdrafts and +otherl oans wasi nsignificant at bothDec. 31, 2023 andDec. +31, 2022. We haver arelys ufferedal osso nt hese typeso f +loans. +Thea llocationo ft he allowancef or credit lossesi s +inherently judgmental,andt he entirea llowancef or +credit lossesi savailablet oa bsorbc reditl osses +regardless of then atureo ft he losses. +Nonperforming assets +Thet able belowp resentso ur nonperformingassets. +Nonperforming assets Dec. 31, +(dollars in millions) 2023 2022 +Nonperformingl oans: +Commercialr eal estate $1 89 $5 4 +Otherr esidentialm ortgages 24 31 +Wealth managementmortgages 19 22 +Totaln onperformingl oans 232 107 +Othera ssets owned 5 2 +Totaln onperforminga ssets $2 37 $1 09 +Nonperforminga ssets ratio 0.35% 0.16% +Allowancef or loan losses/ +nonperformingl oans 130.6 164.5 +Allowancef or loan losses/ +nonperforminga ssets 127.8 161.5 +Allowancef or credit losses/ +nonperformingl oans 168.1 237.4 +Allowancef or credit losses/ +nonperforminga ssets 164.6 233.0 +Nonperforminga ssets increased$128 millioni n2023 +compared with 2022, primarily reflectingh igher +nonperformingc ommercialr eal estateloans. +See“ Nonperforminga ssets”i nN ote1of theN otes to +Consolidated FinancialS tatementsf or our policyfor +placing loanso nn onaccruals tatus. +Deposits +We receive client deposits throughtheb usinessesi n +theS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management segments +andw er elyo nthosed eposits as al ow-costa nd stable +source of funding. +Totald eposits were $283.7 billionatD ec. 31, 2023, +an increaseo f2 %, compared with $279.0 billiona t +Dec. 31, 2022.T he increasep rimarily reflects higher +interest-bearingd eposits inU.S. offices andnon-U.S. +offices,p artially offset by lowern on-interest bearing +deposits (principally U.S. offices). +Noninterest-bearingd eposits were $58.3 billiona t +Dec. 31, 2023,c omparedw ith$ 78.0 billionatD ec. +31, 2022,reflectingc lient activity.I nterest-bearing +deposits were primarily demand depositsandt otaled +$225.4 billionatD ec. 31, 2023,c omparedw ith +$201.0 billionatD ec. 31, 2022. +Thea ggregatea mount of depositsby foreign +customersi nd omestic offices was$ 55.1 billiona t +Dec. 31, 2023and$ 61.2 billionatD ec. 31, 2022. +Deposits inforeigno ffices totaled$ 96.6 billiona t +Dec. 31, 2023and$ 98.3 billionatD ec. 31, 2022. +Thesed eposits were primarily overnight deposits. +Uninsuredd eposits aret he portiono fd omestic +deposits accountst hate xceed theF DICi nsurance +limit. Uninsuredd eposits indomestic deposit +accountsa re generally demand depositsandt otaled +$168.4 billionatD ec. 31, 2023and$ 156.6 billiona t +Dec. 31, 2022. +Resultso fO perations (continued) +34 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_52.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_52.txt new file mode 100644 index 0000000000000000000000000000000000000000..9765393f53a3f125a70a6f20c120f030d748fb67 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_52.txt @@ -0,0 +1,92 @@ +Thef ollowing tablep resentst he amount of uninsured +domestic andf oreign time deposits disaggregated by +time remainingu ntil maturity. +Uninsured time deposits at Dec. 31, 2023 +(inm illions) Domestic Foreign +Less than 3m onths $3 31 $6 61 +3t o6m onths 161 5 +6-12 months 154 9 +Over 12 months 1— +Total $6 47 $6 75 +Short-term borrowings +We fund ourselvesprimarily through depositsand, to +al essere xtent, others hort-term borrowings andl ong- +term debt.S hort-term borrowings consisto ff ederal +funds purchased andsecuritiess oldu nderr epurchase +agreements,p ayablest oc ustomers andb roker- +dealers, commercialp aper andother borrowedf unds. +Certains hort-term borrowings,f or example, +securitiess oldu nderr epurchasea greements,r equire +thed eliveryo fs ecuritiesa scollateral. +Federalf undsp urchased andsecuritiess oldu nder +repurchasea greements includerepurchasea greement +activity with theFixed Income ClearingC orporation +(“FICC”), wherew erecord interest expenseo na +grossb asis,b ut thee nding anda verage balances +reflect thei mpact of offsettingu ndere nforceable +nettinga greements.T hisa ctivity primarily relatest o +government securitiesc ollateralized resale and +repurchasea greements executedw ith clientst hata re +novatedt oand settle with theFICC. +Payables to customersa nd broker-dealersrepresent +funds awaitingr einvestment ands horts alep roceeds +payableo nd emand. Payables to customersa nd +broker-dealersa re driven by customer tradinga ctivity +andm arketv olatility. +TheB anko fN ew York Mellonm ay issue +commercialp aper that maturesw ithin 397 daysfrom +thed ateo fi ssuea nd is not redeemable priort o +maturity or subject to voluntaryp repayment. +Otherb orrowedf unds primarily include borrowings +fromt he FederalH omeL oanB ank, overdraftsofs ub- +custodian account balancesin our SecuritiesS ervices +businesses, financel easel iabilitiesa nd borrowings +underl ines of credit by ourPershing subsidiaries. +Overdrafts typicallyrelate to timingdifferences for +settlements. +Liquidity andd ividends +BNYM ellond efines liquidity as thea bility of the +Parent andi ts subsidiaries to accessf unding or +convert assets tocashq uickly ande fficiently,o rt o +roll overo rissuen ew debt,e specially duringp eriods +of market stress, at ar easonablec ost, andi norder to +meet its short-term (upt oone year)obligations. +Funding liquidityr iski st he risk that BNYM ellon +cannot meet itsc asha nd collateral obligations at a +reasonablec ostf or bothexpected andunexpected +cashf lowa nd collateral needsw ithout adversely +affectingd aily operations or ourfinancialc ondition. +Funding liquidityr iskc an arisefromf unding +mismatches, market constraintsfromt he inability to +convert assets intocash, thei nability to holdo rr aise +cash, lowo vernight deposits,d eposit run-offo r +contingent liquiditye vents. +Changesi ne conomic conditions orexposuret o +credit, market,operational, legaland reputational +risksa lsoc an affectBNYM ellon’sl iquidity risk +profile anda re considered in our liquidity risk +framework.F or additionali nformation, see“ Risk +Management –L iquidity Risk.” +TheP arent’sp olicyi st oh avea ccesst os ufficient +unencumberedc asha nd cashe quivalentsa te ach +quarter-end to coverm aturitiesa nd otherforecasted +debt redemptions, neti nterestp aymentsa nd nettax +payments fort he following1 8-monthp eriod, andt o +provide sufficientc ollateralt os atisfy transactions +subject to Section2 3A oftheF ederal ReserveA ct. +We monitora nd controll iquidity exposures and +funding needswithin anda crosss ignificantl egal +entities, branches,c urrenciesa nd businesslines, +taking into account,a mong otherfactors, any +applicable restrictions onthet ransfero fliquidity +among entities. +BNYM ellona lsom anages potentiali ntraday +liquidity risks. We monitora nd manage intraday +liquidity againste xistinga nd expected intraday liquid +resources (sucha sc ashb alances,r emaining intraday +credit capacity,i ntradayc ontingencyf unding and +availablec ollateral) to enable BNYM ellont omeet +its intraday obligations undernormala nd reasonably +severe stressedc onditions. +Resultso fO perations (continued) +BNYM ellon3 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_53.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_53.txt new file mode 100644 index 0000000000000000000000000000000000000000..91441eaaba3016b8210bbcf3c2296129aae76051 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_53.txt @@ -0,0 +1,66 @@ +We define availablef unds fori nternall iquidity management purposes as cashand duefromb anks,i nterest-bearing +deposits with theFederal Reservea nd othercentral banks,i nterest-bearingd eposits with banks andf ederal funds +sold ands ecuritiesp urchased underr esalea greements.T he following tablep resentso ur totala vailablef unds at +period enda nd onan averagebasis. +Availablef unds Dec. 31, +2023 +Dec. 31, +2022 +Average +(dollars in millions) 2023 2022 2021 +Cash andd ue fromb anks $4 ,922 $5 ,030 $5 ,287 $5 ,542 $5 ,922 +Interest-bearingd eposits with theFederal Reservea nd othercentral +banks 111,550 91,655 103,904 97,442 113,346 +Interest-bearingd eposits with banks 12,139 17,169 13,620 16,826 20,757 +Federalf unds sold ands ecuritiesp urchased underr esalea greements 28,900 24,298 26,077 24,953 28,530 +Totala vailablef unds $157,511 $1 38,152 $148,888 $1 44,763 $1 68,555 +Totala vailablef unds as ap ercentage oftotala ssets 38% 34% 37% 34% 37% +Totala vailable funds were $157.5 billionatD ec. 31, +2023, compared with $138.2 billionatD ec. 31, 2022. +Thei ncreasew as primarily due to higheri nterest- +bearingd eposits with theFederal Reservea nd other +central banks andf ederal funds sold ands ecurities +purchased underr esalea greements,p artially offset by +loweri nterest-bearingd eposits with banks. +Averagen on-core sources of funds,s ucha sf ederal +funds purchased andsecuritiess oldu nderr epurchase +agreements,t rading liabilities, otherb orrowedf unds +andc ommercialp aper,w ere$ 25.0 billionfor 2023 +and$ 16.9 billionfor 2022. Thei ncreasep rimarily +reflectsh igherf ederal funds purchased andsecurities +sold underr epurchasea greementsa nd otherborrowed +funds. +Averagei nterest-bearingd omestic deposits were +$123.5 billionfor 2023and$ 111.5 billionfor 2022. +Averagef oreign deposits,p rimarily fromo ur +European-based businessesi ncludedi nthe Securities +Services andMarketa nd Wealth Services segments, +were $88.8 billionfor 2023,compared with $101.9 +billionf or 2022.T he decreaseprimarily reflects +client activity. +Averagep ayablest oc ustomers andb roker-dealers +were $14.4 billionfor 2023and$ 17.1 billionfor +2022. Payables to customersa nd broker-dealersare +driven by customer tradinga ctivity andm arket +volatility. +Averagelong-term debt was$ 31.0 billionfor 2023 +and$ 27.4 billionfor 2022. +Averagen oninterest-bearingd eposits decreased to +$59.2 billionfor 2023from$ 85.7 billionfor 2022, +primarily reflectingc lient activity. +As ignificantr eductiono fc lient activity inour +SecuritiesS ervices andMarketa nd Wealth Services +businesss egmentsw ouldr educeo ur accesst o +deposits.S ee “Asset/liability management”for +additionalf actorst hatc ouldi mpact our deposit +balances. +Sources of liquidity +TheP arent’sm ajor sources of liquidity area ccesst o +thed ebta nd equity markets,dividends fromi ts +subsidiaries,a nd casho nhanda nd casho therwise +made availablei nb usiness-as-usual circumstancesto +theP arentt hrough ac ommitted creditfacility with +our intermediate holding company( “IHC”). +Resultso fO perations (continued) +36 BNYM ellon +The secret office supply is a "paperclip". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_54.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_54.txt new file mode 100644 index 0000000000000000000000000000000000000000..5f25cd297554e6656a3ce6ff0ec23e2ab452c394 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_54.txt @@ -0,0 +1,70 @@ +Oura bility toaccesst he capitalm arkets on favorablet erms,o ra ta ll, ispartially dependent on ourcredit ratings, +whicha re as follows: +Credit ratingsa tD ec.3 1, 2023 +Moody’sS &P FitchD BRS +Parent: +Long-term senior debt A1 AA A- AA +Subordinatedd ebtA 2A -A AA (low) +Preferreds tock Baa1 BBB BBB+ A +Outlook –P arent PositiveS tableS tableS table +TheB anko fN ew York Mellon: +Long-term senior debt Aa2A A- AA AA (high) +Subordinatedd ebtN RA NR NR +Long-term deposits Aa1A A- AA+ AA (high) +Short-term deposits P-1A -1+F 1+ R-1( high) +Commercialp aper P-1A -1+F 1+ R-1( high) +BNYM ellon, N.A.: +Long-term senior debt Aa2 (a) AA- AA (a) AA (high) +Long-term deposits Aa1A A- AA+ AA (high) +Short-term deposits P-1A -1+F 1+ R-1( high) +Outlook –B anks +Negative +(multiple) (b) Stable Stable Stable +(a)R epresentss eniord ebti ssuer defaultr ating. +(b)P ositiveo utlook onlong-term senior debtratings.N egativeo utlook onlong-term deposits ratings.P ositiveo utlook onsenior unsecured +ratingf or TheB ank ofNewY orkM ellon. +NR –N ot rated. +In November 2023, Moody’sI nvestor Service +(“Moody’s”)c onfirmed thel ong-term issuer ratings, +debt ratings,c ounterpartyr iskr atings and +counterpartyr iska ssessments of theP arenta nd our +rateds ubsidiaries.F ollowing thec onfirmation, the +ratingo utlook fort he Parent andT he Bank ofNew +York Mellon’si ssuera nd senior unsecuredratings is +positive. In August2 023, Moody’sa ffirmed all +Prime-1 short-term ratings oftheP arenta nd rated +subsidiaries aswell as thel ong-term deposit ratings +forT he Bank ofNewY orkM ellona nd BNYM ellon, +N.A. +Long-term debt totaled$ 31.3 billionatD ec. 31, 2023 +and$ 30.5 billionatD ec. 31, 2022.I ssuances of $6.5 +billiona nd an increasei nt he fair valueo fh edged +long-term debt were partially offset by maturitiesa nd +repurchases of $6.1 billion.TheP arenth as $4.9 +billiono fl ong-term debt that will maturein 2024. +Thef ollowing tablep resentst he long-term debt +issued in 2023. +Debt issuances +(inm illions) 2023 +4.947% fixed-to-floatingc allables eniorn otes due 2027 $1 ,500 +6.474% fixed-to-floatingc allables eniorn otes due 2034 1,100 +4.967% fixed-to-floatingc allables eniorn otes due 2034 1,000 +6.317% fixed-to-floatingc allables eniorn otes due 2029 900 +4.706% fixed-to-floatingc allables eniorn otes due 2034 750 +4.543% fixed-to-floatingc allables eniorn otes due 2029 750 +5.148% fixed-to-floatingc allables eniorb ankn otes due +2026 500 +Totald ebti ssuances $6 ,500 +In December2 023, theP arentr edeemed all +outstanding shares of itsS eriesDNoncumulative +PerpetualP referredS tock.S ee Note 15 oftheN otes +to Consolidated FinancialS tatementsf or additional +informationo nthe Parent’s preferreds tock. +TheB anko fN ew York Mellon mayi ssuen otes and +CDs. At Dec.31, 2023a nd Dec. 31, 2022, $1.3 +billiona nd $780million, respectively, of noteswere +outstanding. At Dec.31, 2023andD ec. 31, 2022, +$397 milliona nd $122milliono fC Ds were +outstanding, respectively. +Resultso fO perations (continued) +BNYM ellon3 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_55.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_55.txt new file mode 100644 index 0000000000000000000000000000000000000000..0273b99781b63b70e5b397520ccc14fb08e8a297 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_55.txt @@ -0,0 +1,94 @@ +TheB anko fN ew York Mellona lsoi ssues +commercialp aper that maturesw ithin 397 daysfrom +thed ateo fi ssuea nd is not redeemable priort o +maturity or subject to voluntaryp repayment. There +wasn oc ommercialp aper outstanding at Dec. 31, +2023 andD ec. 31, 2022.T he averagec ommercial +papero utstanding was$ 5m illionf or 2023and2 022. +Subsequent to Dec. 31, 2023,o ur U.S. bank +subsidiaries coulddeclared ividends to theParento f +approximately $1.7 billion,without then eed fora +regulatoryw aiver. In addition, at Dec. 31, 2023,n on- +bank subsidiaries of theP arenth ad liquida ssets of +approximately $3.2 billion. Restrictions on our +ability toobtainf unds from oursubsidiaries are +discussedi nmored etaili n“ Supervisiona nd +Regulation–C apitalP lanning andS tressT esting – +Paymento fD ividends,S tock Repurchases andOther +CapitalD istributions”a nd in Note 19 oftheN otes to +Consolidated FinancialS tatements. +Pershing LLC haso ne uncommittedlineo fc rediti n +place forl iquidity purposes whichi sg uaranteed by +theP arentf or $300million. Averageb orrowings +undert hisl inew erel esst han$ 1millioni n2023. +Pershing Limited, an indirect UK-baseds ubsidiary of +BNYM ellon, hastwo separateuncommittedl ines of +credit amountingt o$261 millioni naggregate. +Averageb orrowings underthese lines were $16 +million, in aggregate, in 2023. +Thed oublel everager atio is theratio of ourequity +investment in subsidiaries dividedb your +consolidated Parent companye quity,w hich includes +our noncumulativeperpetual preferreds tock.I n +short, thedoublel everager atio measuresthee xtentt o +whiche quity insubsidiaries is financed by Parent +companyd ebt. As thed oublel everager atio +increases,t hisc an reflect greater demands on a +company’sc ashf lows in ordert os ervice interest +payments andd ebtm aturities. BNYM ellon’sd ouble +leverage ratio is managedi narangeconsideringt he +high levelo fu nencumbereda vailablel iquida ssets +held in itsprincipals ubsidiaries( such as centralbank +deposit placements andg overnment securities),t he +Company’sc ashg eneratingf ee-basedb usiness +model, with feer evenue representing7 4% oftotal +revenue in 2023, andt he dividendcapacity of our +banking subsidiaries.O ur doubleleverager atio was +120.5% at Dec. 31, 2023andD ec. 31, 2022,a nd +within therange targeted by management. +Uses of funds +TheP arent’sm ajor usesof funds arer epurchases of +commons tock,p ayment of dividends,principal and +interest payments on itsb orrowings,a cquisitions and +additionali nvestmentsi ni ts subsidiaries. +In 2023, we paid $1.5 billionin dividends on our +commona nd preferredstock.O ur commons tock +dividend payoutratiow as 41% for2 023. +In 2023, we repurchased 55.8 millionc ommons hares +at an averageprice of $46.66 percommons hare fora +totalc osto f$ 2.6 billion. +Liquidity coverage ratio (“LCR”) +U.S. regulatorsh avee stablisheda nLCR that requires +certain banking organizations,including BNY +Mellon, to maintain am inimuma mount of +unencumberedh igh-quality liquidassets (“HQLA”) +sufficientt ow ithstandt he netcasho utflow undera +hypothetical standardized acuteliquidity stress +scenario fora30-dayt ime horizon. +Thef ollowing tablep resentsB NY Mellon’s +consolidated HQLAa tD ec. 31, 2023,a nd thea verage +HQLAa nd averageL CR fort he fourth quarter of +2023. +Consolidated HQLAa nd LCR Dec. 31, +2023 +Sept.3 0, +2023(dollars in billions) +Cash (a) $1 11 $1 07 +Securities (b) 72 70 +Totalc onsolidated HQLA (c) $1 83 $1 77 +Totalc onsolidated HQLA–average (c) $1 92 $1 80 +Averagec onsolidated LCR 117% 121% +(a)P rimarily includescasho ndeposit with central banks. +(b)P rimarily includessecuritieso fU .S. government-sponsored +enterprises, U.S. Treasury,s overeigns andU.S. agencies. +(c)C onsolidated HQLAp resented before adjustments.A fter +haircutsa nd thei mpacto ftrappedl iquidity,c onsolidated +HQLAt otaled $153 billionatD ec. 31, 2023 and $140 billion +at Sept.30, 2023,a nd averaged$143 billionfor thef ourth +quartero f2 023 and $129 billionfor thet hird quartero f +2023. +BNYM ellona nd each of ouraffected domestic bank +subsidiaries were compliant with theU.S.L CR +requirementso fa tl east 100% throughout 2023. +Resultso fO perations (continued) +38 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_56.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_56.txt new file mode 100644 index 0000000000000000000000000000000000000000..42cfdd0cd882a8142061810a1e1c05af3ce47385 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_56.txt @@ -0,0 +1,79 @@ +Nets tablef unding ratio (“NSFR”) +TheN SFR is al iquidity requirement applicable to +largeU .S.b anking organizations,including BNY +Mellon. TheN SFR is expresseda saratio of the +availables tablef unding to therequireds tablef unding +amount overaone-year horizon. Oura verage +consolidated NSFR was1 35% fort he fourth quarter +of 2023and1 36% fort he thirdq uarter of 2023. +BNYM ellona nd each of ouraffected domestic bank +subsidiaries were compliant with theNSFR +requirement ofat least1 00% throughout thef ourth +quarter of 2023. +Statemento fcashf lows +Thef ollowing summarizes thea ctivity reflected on +thec onsolidated statemento fc ashf lows.W hile this +informationm ay be helpfultoh ighlight certain macro +trends andb usinesss trategies, thec ashf lowa nalysis +mayn ot beas relevant when analyzingchangesi no ur +nete arnings andn et assets.W eb elieve that in +additiont othe traditionalc ashf lowa nalysis, the +discussion relatedt oliquidity andd ividends and +asset/liability management herein mayprovide more +useful contexti ne valuatingo ur liquidity positiona nd +relateda ctivity. +Netc ashp rovidedb yoperatinga ctivitiesw as $5.9 +billioni n2 023, compared with $15.1 billionin2 022. +In 2023, cashf lows providedb yoperations primarily +resultedf rome arnings andc hangesi na ccruals and +other, net. In 2022, cashf lows providedb y +operations primarily resulted fromc hangesi nt rading +assets andl iabilities, changesi na ccruals ando ther, +neta nd earnings. +Netc ashu sedf or investinga ctivitiesw as $5.8 billion +in 2023, compared with netc ashp rovidedb y +investinga ctivitieso f$ 19.9 billionin2 022. In 2023, +netc ashu sedf or investinga ctivitiesp rimarily reflects +changesi ni nterest-bearingd eposits with theFederal +Reservea nd othercentral banks andc hangesi n +federalf unds sold ands ecuritiesp urchased under +resale agreements,p artially offset by ad ecreasei nt he +securitiesp ortfolio.I n2 022, netcashp rovidedb y +investinga ctivitiesp rimarily reflectsc hangesi n +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks,anetd ecreasei nt he +securitiesp ortfolio andc hange in federalf unds sold +ands ecuritiesp urchased underr esalea greements. +Netc ashu sedf or financinga ctivitiesw as $3.5 billion +in 2023, compared with $33.7 billionin2 022. In +2023, netcashu sedf or financinga ctivitiesp rimarily +reflectsr epaymentso fl ong-term debt,c hangesi n +payables to customersa nd broker-dealersand +commons tock repurchases,p artially offset by +issuances of long-term debt andc hangesi nd eposits. +In 2022, netcashu sedf or financinga ctivities +primarily reflectsc hangesi nd eposits andr epayments +of long-term debt,p artially offset by issuances of +long-term debt. +Capital +Capitald ata +(dollars in millions,e xceptp er sharea mounts; commons hares in thousands) 2023 2022 +At Dec.31: +BNYM ellons hareholders’e quity to totalassets ratio 10.0% 10.0% +BNYM ellonc ommons hareholders’e quity to totalassets ratio 8.9% 8.8% +TotalB NY Mellons hareholders’e quity $4 0,874 $4 0,734 +TotalB NY Mellonc ommons hareholders’e quity $3 6,531 $3 5,896 +BNYM ellont angiblec ommons hareholders’e quity –N on-GAAP (a) $1 9,278 $1 8,686 +Book valueper commonshare $4 8.11 $4 4.40 +Tangibleb ook valueper commonshare –N on-GAAP (a) $2 5.39 $2 3.11 +Closings tock pricep er commonshare $5 2.05 $4 5.52 +Market capitalization $3 9,524 $3 6,800 +Commons hareso utstanding 759,344 808,445 +Full-year: +Cash dividends percommons hare $1.58 $1 .42 +Commond ividendp ayout ratio 41% 49% +Commond ividendy ield 3.0% 3.1% +(a)S ee “SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” beginning on page 111fort he +reconciliationo ft hese Non-GAAP measures. +Resultso fO perations (continued) +BNYM ellon3 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_57.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_57.txt new file mode 100644 index 0000000000000000000000000000000000000000..a260e619412bf0aa4fb451d314f390f5ba473eb9 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_57.txt @@ -0,0 +1,66 @@ +TheB anko fN ew York MellonC orporationt otal +shareholders’e quity increasedto $40.9 billionatD ec. +31, 2023from$ 40.7 billionatD ec. 31, 2022.T he +increasep rimarily reflectse arnings andu nrealized +gain on securitiesa vailable-for-sale, partially offset +by commons tock repurchasea ctivity andd ividend +payments. +Theu nrealized loss (after-tax)o no ur available-for- +sale securitiesp ortfolio,n et of hedges,includedi n +accumulatedo ther comprehensiveincomew as $1.6 +billiona tD ec. 31, 2023,c omparedw ith $2.4 billion +at Dec. 31, 2022.N et unrealized loss, including the +impact of hedges,decreased assecuritiesm oved +closer to maturity. +We repurchased 55.8 millionc ommons haresa ta n +averagep rice of $46.66 percommons hare forat otal +of $2.6 billionin2 023. +In January 2023, we announced as hare repurchase +program approvedb your Boardo fD irectors +providing fort he repurchaseo fu pt o$5.0 billiono f +commons haresb eginning Jan. 1, 2023.This new +sharer epurchasep lanr eplaceda ll previously +authorized sharer epurchasep lans. +In July 2023, ourBoardo fD irectorsa pproveda14% +increasei nt he quarterlycashd ividendo ncommon +stock, from$ 0.37 to $0.42 pershare.W eb egan +paying thei ncreased quarterly cashd ividendi nthe +thirdq uarter of 2023. +In December2 023, theP arentr edeemed all +outstanding shares of its Series DN oncumulative +PerpetualP referred Stock. SeeN ote1 5o ft he Notes +to Consolidated FinancialS tatementsf or additional +informationo nthe Parent’s preferreds tock. +Capitala dequacy +Regulatorse stablishc ertain levelsof capitalf or bank +holding companies( “BHCs”)a nd banks,including +BNYM ellona nd our banksubsidiaries,i n +accordance with establishedq uantitative +measurements.F or theP arentt om aintaini ts status +as af inancial holding company( “FHC”),o ur U.S. +bank subsidiaries andBNY Mellonm ust, among +othert hings,q ualifya s“ well capitalized.” As of Dec. +31, 2023andD ec. 31, 2022,B NY Mellona nd our +U.S. bank subsidiaries were “wellc apitalized.” +Failure to satisfy regulatorystandards, including +“wellc apitalized”s tatuso rc apitala dequacy rules +more generally,c ouldr esulti nl imitations on our +activitiesa nd adverselya ffect our financialc ondition. +Seet he discussion ofthesem atters in “Supervision +andR egulation–R egulated Entitieso fB NY Mellon +andA ncillary RegulatoryR equirements” and“ Risk +Factors–Capitala nd LiquidityR isk–F ailure to +satisfy regulatorystandards, including “well +capitalized”a nd “wellm anaged”s tatuso rc apital +adequacy andliquidity rulesm oreg enerally,c ould +result inlimitations on ouractivitiesa nd adversely +affect our businessand financialc ondition.” +TheU .S.b anking agencies’c apitalr ules arebased on +thef ramework adopted by theB asel Committeeo n +Banking Supervision( “BCBS”),a sa mendedf rom +time to time.For additionali nformationo nthese +capitalr equirements, see“Supervisiona nd +Regulation.” +Resultso fO perations (continued) +40 BNYM ellon +The secret object #5 is a "toothbrush". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_58.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_58.txt new file mode 100644 index 0000000000000000000000000000000000000000..24e3dea46e3a8154b706d4c8f9e37540d9acf4dc --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_58.txt @@ -0,0 +1,81 @@ +Thet able belowp resentso ur consolidated andlargest bank subsidiary regulatorycapitalr atios. +Consolidated andl argest bank subsidiary regulatorycapital ratios +Dec. 31, 2023 +Dec. 31, +2022 +Well +capitalized +Minimum +required +Capital +ratios +Capital +ratios(a) +Consolidated regulatorycapital ratios: (b) +Advanced Approaches: +CET1 ratio N/A (c) 8.5% 11.5% 11.2% +Tier 1c apitalr atio 6% 10 14.2 14.1 +Totalc apitalr atio 10 12 15.0 14.9 +Standardized Approach: +CET1 ratio N/A (c) 8.5% 11.9% 11.3% +Tier 1c apitalr atio 6% 10 14.7 14.4 +Totalc apitalr atio 10 12 15.7 15.3 +Tier 1l everager atio N/A (c) 4 6.0 5.8 +SLR (d) N/A (c) 5 7.3 6.8 +TheB anko fN ew York Mellonregulatoryc apital ratios: (b) +Advanced Approaches: +CET1 ratio 6.5% 7% 16.2% 15.6% +Tier 1c apitalr atio 88 .5 16.2 15.6 +Totalc apitalr atio 10 10.5 16.3 15.7 +Tier 1l everager atio 54 6.6 6.2 +SLR (d) 63 8.6 7.7 +(a)M inimum requirementsf or Dec. 31, 2023i nclude minimumt hresholds pluscurrently applicableb uffers. TheU .S. globalsystemically +important banks(“G-SIB”) surcharge of 1.5%is subject to change.T he countercyclical capitalb ufferi scurrently sett o0 %. Thes tress +capitalb uffer( “SCB”) requirementis 2.5%,e qual to theregulatorym inimum forS tandardizedA pproachc apitalr atios. +(b)F or ourCET1,T ier1capitala nd Totalc apitalr atios, our effectivec apitalr atiosu nderU .S. capitalr ules aret he lowero ft he ratiosa s +calculated undert he Standardizedand Advanced Approaches. TheTier1leverage ratio isbased on Tier 1c apitala nd quarterly +average totala ssets. +(c)T he FederalR eserve’sr egulations do notestablishw ellc apitalized thresholds fort hese measures forB HCs. +(d)T he SLRisb ased on Tier 1c apitala nd totall everage exposure, whichi ncludesc ertain off-balances heet exposures. +N/A-Nota pplicable. +OurC ET1 ratio determined undert he Advanced +Approaches was1 1.5% at Dec. 31, 2023and1 1.2% +at Dec. 31, 2022.T he increasew as primarily driven +by capitalg enerated through earnings andanet +increasei na ccumulated otherc omprehensive income, +partially offset by capitald eployedt hrough common +stockr epurchases anddividends. +TheT ier1leverage ratio was6 .0% at Dec. 31, 2023, +compared with 5.8% at Dec. 31, 2022.T he increase +wasd rivenb ylower averageassets. +Risk-based capitalratiosv aryd epending onthes ize +of theb alance sheet atperiod enda nd thel evelsa nd +typeso fi nvestmentsi na ssets,a nd leverage ratios +vary basedo nthe averages izeo ft he balancesheet +overt he quarter.T he balancesheet size fluctuates +fromp eriodt operiodb ased on levels of customer and +market activity.I ng eneral,w hens ervicing clients +arem orea ctivelyt rading securities, deposit balances +andt he balancesheet asaw holea re higher. In +addition, when marketse xperience significant +volatilityo rs tress, our balancesheet size may +increasec onsiderably as client deposit levels increase. +Ourc apitalr atiosa re necessarily subject to,a mong +othert hings,a nticipated compliancewith all +necessary enhancements tomodelc alibration, +approvalb yr egulatorso fc ertain modelsused aspart +of RWAc alculations,o ther refinements, further +implementationg uidancef romr egulators, market +practices andstandardsa nd anyc hangesB NY Mellon +maym aket oi ts businesses. As ac onsequenceo f +thesef actors, our capitalr atiosm ay materially +change,a nd mayb ev olatile overt ime andf rom +period to period. +Undert he Advanced Approaches,o ur operationalloss +risk modeli si nformedb yexternall osses, including +finesa nd penaltieslevieda gainst institutions in the +financials ervices industry, particularly thosethat +relate to businessesi nw hich we operate,a nd as a +result external lossesh avei mpacted andcouldi nthe +Resultso fO perations (continued) +BNYM ellon4 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_59.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_59.txt new file mode 100644 index 0000000000000000000000000000000000000000..f17ec51b8297162cacbf270e1d4d36defc54a62c --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_59.txt @@ -0,0 +1,105 @@ +future impact thea mount ofcapitalt hatw ea re +requiredt ohold. +Thef ollowing tablep resentso ur capitalc omponents +andR WAs. +Capitalc omponentsa nd risk- +weighted assets Dec. 31, +(inm illions) 2023 2022 +CET1: +Commons hareholders’ equity $3 6,531 $3 5,896 +Adjustmentsf or: +Goodwill andi ntangiblea ssets (a) (17,253) (17,210) +Netp ension fund assets (297) (317) +Embeddedg oodwill (275) (279) +Deferredt ax assets (62) (56) +Other (6) (2) +TotalC ET1 18,638 18,032 +OtherT ier1capital: +Preferreds tock 4,343 4,838 +Other (14) (14) +TotalT ier1capital $2 2,967 $2 2,856 +Tier 2c apital: +Subordinatedd ebt $1 ,148 $1 ,248 +Allowancef or credit losses 414 291 +Other (11) (11) +TotalT ier2capital–Standardized +Approach 1,551 1,528 +Excesso fe xpected credit losses 85 50 +Less: Allowancef or credit losses 414 291 +TotalT ier2capital–Advanced +Approaches $1 ,222 $1 ,287 +Totalc apital: +Standardized Approach $2 4,518 $2 4,384 +Advanced Approaches $2 4,189 $2 4,143 +Risk-weighteda ssets: +Standardized Approach $1 56,254 $1 59,096 +Advanced Approaches: +Credit Risk $8 7,299 $9 0,243 +Market Risk 3,380 2,979 +OperationalR isk 70,925 68,450 +TotalA dvanced Approaches $1 61,604 $1 61,672 +Average assets forTier1leverage +ratio $3 83,899 $3 96,643 +Totall everage exposure forS LR $3 13,749 $3 36,049 +(a)R educed by deferredtax liabilitiesa ssociated with +intangiblea ssets and tax-deductible goodwill. +Thet able belowp resentst he factorst hati mpacted +CET1 capital. +CET1 generation +2023(inm illions) +CET1 –B eginning of period $1 8,032 +Neti ncomea pplicable tocommons hareholders of +TheB anko fN ew York Mellon Corporation 3,051 +Goodwill andi ntangiblea ssets,n et of related +deferredt ax liabilities (43) +GrossC ET1 generated 3,008 +Capitald eployed: +Commons tock repurchases (2,604) +Commons tock dividends (a) (1,262) +Totalc apitald eployed (3,866) +Otherc omprehensive gain(loss): +Unrealized gain on assets available-for-sale 881 +Foreignc urrencyt ranslation 272 +Unrealized gain on cashf lowh edges 6 +Definedb enefit plans (86) +Totalo ther comprehensivegain 1,073 +Additionalp aid-in capital (b) 400 +Othera dditions (deductions): +Netp ension fund assets 20 +Embeddedg oodwill 4 +Deferredt ax assets (6) +Other (27) +Totalo ther (deductions) (9) +NetC ET1 generated 606 +CET1 –E nd of period $1 8,638 +(a)I ncludesd ividend-equivalentso ns hare-based awards. +(b)P rimarily relatedt ostock awards andstocki ssuedf or +employee benefit plans. +Thef ollowing tables howst he impact on the +consolidated capitalr atiosa tD ec. 31, 2023 ofa$ 100 +millioni ncreaseo rd ecreasei nc ommone quity,o ra +$1 billionincreaseo rd ecreasei nR WAs, quarterly +averagea ssets or totall everagee xposure. +Sensitivityo fc onsolidated capitalratiosa tD ec. 31, 2023 +Increaseo rd ecreaseo f +(inb asis points) +$100 million +in common +equity +$1 billioni nRWA, +quarterly average +assets or total +leverage exposure +CET1: +Standardized Approach 6b ps 8b ps +Advanced Approaches 67 +Tier 1c apital: +Standardized Approach 69 +Advanced Approaches 69 +Totalc apital: +Standardized Approach 61 0 +Advanced Approaches 69 +Tier 1l everage 32 +SLR 32 +Resultso fO perations (continued) +42 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_6.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_6.txt new file mode 100644 index 0000000000000000000000000000000000000000..8f839667014b91a9542338386ffdf29d02b2a564 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_6.txt @@ -0,0 +1,44 @@ +c (b) +IV ANNUAL REPORT 2023 +FINANCIAL RESUL TS AND +2024 PRIORITIES +#1 +Global +Custodian1 +#1 +Global provider +of Issuer Services2 +Market and +Wealth Services +#1 +Global provider +of Clearance and +Collateral Management5 +TOP 5 +Global +U.S. dollar +payments clearer4 +#1 +Clearing firm for +broker-dealers and +Top 3 RIA Custodian3 +TOP 10 +U.S. Private Bank7 +TOP 15 +Global Asset Manager6 +MARKET POSITIONS +Investment and +Wealth Management +Securities Services +1 Ranking based on lates t available peer group company filings. Peer group included in ranking analysis: State Street, JPMorgan Chase, Citigroup, BNP Paribas, HSBC, Northern Trust and RBC. +2 Full-year 2023 figures by deal volume and count referenced herein include long-term program and stand-alone bond issuance in markets where BNY Mellon actively participates and for which +public trus +tee and/or paying agent data is available. Sources include: Refinitiv, Dealogic, Asset-Backed Alert and Concept ABS. Depositary Receipts ranked #1 based on market share sourced +from BNY Mellon internal analysis. +3 LaRoche Research Partners, “US Broker Clearing Relationship Changes 2022, ” based on number of broker-dealer clients. Registered Investment Advisor rankings sourced from “Cerulli Report, +U. +S. RIA Marketplace 2023, ” Cerulli Associates. +4 The Clearing House. Based on CHIPS volumes for the year ended December 31, 2023. +5 Finadium market anal ysis as of June 2023. +6 Pensions & Investments, October 23, 2023. Ranked by total worldwide assets under management as of December 31, 2022. +7 Based on company filings and The Cer ulli Report, 2022. Ranked by Wealth Management assets under management as of December 31, 2022. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_60.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_60.txt new file mode 100644 index 0000000000000000000000000000000000000000..8f6585517c9417f77a3107933a5442c7376235be --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_60.txt @@ -0,0 +1,92 @@ +Stress capitalb uffer +In July 2023, theF ederal Reservea nnounced that +BNYM ellon’sS CB requirement wouldr emaina t +2.5%,e qualt ot he regulatoryf loor,f or thep eriod +fromO ct.1 ,2023 through Sept.3 0, 2024. TheS CB +replaced thes tatic 2.5% capitalc onservationb uffer +forS tandardized Approach capitalr atiosf or +ComprehensiveC apitalA nalysisa nd Review +(“CCAR”)B HCs. TheS CB doesn ot applyt obank +subsidiaries,w hich remain subject to thestatic 2.5% +capitalc onservationb uffer. See“ Supervisiona nd +Regulation” fora dditionali nformation. +TheS CB finalr uleg enerally eliminates the +requirement forp rior approvalo fc ommons tock +repurchases in excesso ft he distributionsin af irm’s +capitalp lan, providedthats uchd istributions are +consistent with applicable capitalr equirementsa nd +buffers,i ncluding theS CB. +TotalL oss-AbsorbingC apacity (“TLAC”) +Thef ollowing summarizes them inimum +requirementsf or BNYM ellon’se xternalT LACa nd +external long-term debt (“LTD”) ratios, plus +currently applicable buffers. +As a%o fR WAs (a) +As a%o ft otal +leverage +exposure +Eligible external +TLACr atios +Regulatorym inimumo f +18% plusab uffer (b) +equalt ot he sumo f +2.5%,t he method 1 +G-SIBs urcharge +(currently 1%), andt he +countercyclical capital +buffer, if any +Regulatory +minimum of +7.5% plus a +buffer (c) equal +to 2% +Eligible external +LTD ratios +Regulatorym inimumo f +6% plustheg reater of +them ethod 1o rm ethod +2G -SIB surcharge +(currently 1.5%) +4.5% +(a)R WA is thegreater of theS tandardizedA pproacha nd +Advanced Approaches. +(b)B uffert ob em et usingo nlyC ET1. +(c)B uffert ob em et usingo nlyT ier1capital. +External TLACc onsists of theP arent’sT ier1capital +ande ligible unsecuredL TD issued by it that hasa +remainingt ermt om aturity of at leasto ne year and +satisfies certainotherc onditions.E ligible LTD +consists of theu npaid principalb alance of eligible +unsecuredd ebts ecurities, subjectto haircuts for +amountsd ue to be paidwithin twoyears, that satisfy +certain otherc onditions.D ebti ssuedp rior to Dec. +31, 2016 hasbeen permanently grandfatheredt othe +extent thesei nstruments otherwisew ouldb e +ineligible onlyd ue to containing impermissible +accelerationr ightso rb eing governedby foreignl aw. +Thef ollowing tablep resentso ur external TLAC and +external LTDr atios. +TLACa nd LTD ratios Dec. 31, 2023 +Minimum +required +Minimum +ratios +with buffers Ratios +Eligible external TLAC: +As ap ercentage ofRWA1 8.0% 21.5% 30.3% +As ap ercentage oftotal +leverage exposure 7.5% 9.5% 15.6% +Eligible external LTD: +As ap ercentage ofRWA7 .5% N/A1 5.0% +As ap ercentage oftotal +leverage exposure 4.5% N/A7 .7% +N/A–Nota pplicable. +If BNYM ellonm aintains risk-based ratio or leverage +TLAC measures abovethem inimumr equiredl evel, +but with ar isk-basedr atio or leverage belowthe +minimuml evel with buffers,w ew illf ace constraints +on dividends,equity repurchases anddiscretionary +executivec ompensationb ased on thea mount ofthe +shortfalla nd eligible retained income. +Resultso fO perations (continued) +BNYM ellon4 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_61.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_61.txt new file mode 100644 index 0000000000000000000000000000000000000000..b3ce2b71d5998674c4be1969d082661da8b3e368 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_61.txt @@ -0,0 +1,89 @@ +Issuer purchases of equity securities +Share repurchases–f ourthq uarter of 2023 Totals hares +repurchased as +part of ap ublicly +announced plan +or program +Maximuma pproximate dollar +valueo fs harest hatm ay yet +be purchasedundert he +publicly announced planso r +programsa tD ec. 31, 2023 +(dollars in millions,e xceptp er sharea mounts; +commons hares in thousands) +Totals hares +repurchased +Averagep rice +pers hare +October2 023 3,450 $4 2.28 3,450 $2 ,700 +November 2023 4,823 45.09 4,823 2,483 +December2 023 1,763 49.26 1,763 2,396 +Fourth quarter of 2023(a) 10,036 $4 4.85 10,036 $2 ,396 (b) +(a)I ncludes6 4t housand shares repurchased at ap urchasep rice of $3millionf rome mployees,p rimarily inconnectionw ith theemployees’ +payment oftaxes upon thev estingo fr estricteds tock. Thea verage priceofo penm arket sharer epurchases was$ 44.83. +(b)R epresentst he maximumv alue ofthes hares to be repurchased undert he sharer epurchasep lana nnounced in January2 023 and +includess hares repurchased in connectionw ith employee benefit plans. +In January 2023, we announced as hare repurchase +program approvedb your Boardo fD irectors +providing fort he repurchaseo fu pt o$ 5.0 billiono f +commons haresb eginning Jan. 1, 2023.This new +sharer epurchasep lanr eplaceda ll previously +authorized sharer epurchasep lans. +Sharer epurchases mayb ee xecutedt hrough open +market repurchases,i nprivately negotiated +transactions or by othermeans, including through +repurchasep lans designedt ocomplyw ith Rule +10b5-1a nd otherderivative, acceleratedshare +repurchasea nd otherstructuredt ransactions.T he +timinga nd exact amount ofanyc ommons tock +repurchases will depend on variousfactors, including +market conditions andt he commons tock trading +price; theC ompany’sc apitalp osition, liquidity and +financialp erformance; alternativeuseso fc apital; and +legala nd regulatoryl imitations andc onsiderations. +Tradinga ctivitiesa nd risk management +Ourt rading activitiesa re focusedon actinga sa +market-maker foro ur customers, facilitatingc ustomer +trades andrisk-mitigatingh edging in compliancew ith +theV olcker Rule.T he risk from market-making +activitiesf or customersi smanaged by ourtradersa nd +limitedi ntotal exposurethrough as ystemo fp osition +limits,v alue-at-risk (“VaR”)m ethodology ando ther +market sensitivity measures.V aR is thepotentiall oss +in valued ue to adversem arketm ovementso vera +definedt ime horizon with as pecified confidence +level. Thec alculationo fo ur VaRu sedb y +management andp resented belowa ssumesaone-day +holding period, utilizesa9 9% confidence levela nd +incorporates non-linear productc haracteristics. VaR +facilitatesc omparisons acrossp ortfolioso fd ifferent +risk characteristics. VaRa lsoc apturest he +diversificationo fa ggregated risk at thef irm-wide +level. +VaRr epresentsakeyr iskm anagementm easurea nd +it isimportant to notet he inherent limitations to VaR, +whichi nclude: +•V aR doesn ot estimate potentiall osseso verl onger +time horizons wherem ovesm ay be extreme; +• VaRd oesn ot take into account thep otential +variability of market liquidity;a nd +•P revious movesi nm arketr iskf actorsm ay not +producea ccurate predictions ofallf uturem arket +moves. +SeeN ote2 3o ft he Notest oC onsolidated Financial +Statements fora dditionali nformationo nthe VaR +methodology. +Thef ollowing tables indicatet he calculatedV aR +amountsf or thet rading portfoliofort he designated +periods usingthe historicalsimulationV aR model. +VaR (a) 2023 Dec. 31, +2023(inm illions) Average MinimumM aximum +Interest rate $3 .2 $1 .9 $7 .6 $2 .6 +Foreigne xchange 2.9 2.0 5.7 2.9 +Equity 0.2 —1 .5 0.1 +Credit 1.5 0.7 3.5 1.3 +Diversification (5.0) N/MN /M (4.7) +Overallp ortfolio 2.8 1.3 8.9 2.2 +Resultso fO perations (continued) +44 BNYM ellon +The secret animal #1 is a "cat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_62.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_62.txt new file mode 100644 index 0000000000000000000000000000000000000000..7b8b02ce25c1fc440453a851d3a93cc19ec7c1a8 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_62.txt @@ -0,0 +1,110 @@ +VaR (a) 2022 Dec. 31, +2022(inm illions) AverageM inimum Maximum +Interest rate $4 .1 $1 .6 $9 .3 $2 .3 +Foreigne xchange 3.8 2.0 10.2 3.0 +Equity 0.2 —0 .9 0.1 +Credit 2.1 1.0 4.4 1.8 +Diversification( 5.0) N/MN /M (3.5) +Overallp ortfolio 5.2 2.5 11.4 3.7 +(a)V aR exposured oesn ot includet he impacto fthe Company’s +consolidated investment management funds andseed capital +investments. +N/M–Becauset he minimuma nd maximumm ay occurond ifferent +daysf or different risk components, it isnot meaningful to +computeaminimuma nd maximump ortfolio diversification +effect. +Thei nterestr atec omponent ofVaRr epresents +instrumentsw hosev aluesa re predominantly driven +by interest rate levels.T hese instrumentsi nclude,b ut +aren ot limitedt o, U.S. Treasury securities, swaps, +swaptions,f orward rateagreements,e xchange-traded +futuresa nd options,a nd otherinterestr ated erivative +products. +Thef oreign exchange componento fV aR represents +instrumentsw hosev aluesp redominantly vary with +thel evel or volatilityof currency exchangerateso r +interest rates. Thesei nstruments include,but aren ot +limitedt o, currencyb alances,s pot andf orward +transactions,c urrencyo ptions ando ther currency +derivativep roducts. +Thee quity component ofVaRc onsists of instruments +that representa no wnership interestin theformo f +domestic andf oreign commons tock or otherequity- +linkedi nstruments.T hese instrumentsi nclude,b ut +aren ot limitedt o, commons tock,e xchange-traded +funds,p referreds tock,l istede quity options (putsa nd +calls), OTCe quity options,e quity totalreturns waps, +equity indexfutures andother equityderivative +products. +Thec reditc omponent ofVaRr epresentsi nstruments +whosev aluesa re predominantly driven by credit +spread levels,i .e., idiosyncraticd efault risk.T hese +instrumentsi nclude,b ut aren ot limitedt o, single +issuer creditdefaults waps,a nd securitiesw ith +exposures fromc orporate andm unicipalc redit +spreads. +Thed iversificationc omponent ofVaRi st he risk +reductionb enefit thatoccurs when combining +portfoliosa nd offsettingp ositions,a nd fromt he +correlatedb ehavioro friskf actor movements. +During 2023,interest rate risk generated4 1% of +averageg ross VaR,foreigne xchange risk generated +37% ofaverageg ross VaR,equity risk generated3 % +of averageg ross VaRand credit risk generated1 9% +of averageg ross VaR. During 2023, our daily trading +loss didn ot exceed our calculatedV aR amount ofthe +overall portfolio. +Thef ollowing tableo ft otal daily tradingrevenue or +loss illustratest he numbero ftrading daysin which +our tradingr evenue orloss fell within particular +rangesd uringt he pastfive quarters. +Distributiono ft rading revenue (loss) (a) +Quartere nded +(dollars in +millions) +Dec. 31, +2023 +Sept.3 0, +2023 +June 30, +2023 +March3 1, +2023 +Dec. 31, +2022 +Revenue range: Number of days +Less than $(2.5) 2 —— —2 +$(2.5) –$ 0 3 52 14 +$0 –$ 2.5 18 14 15 20 13 +$2.5 –$ 5.0 25 24 37 26 24 +More than $5.0 15 20 91 52 0 +(a)T rading revenue (loss) includesr ealized and unrealized gains and +lossesp rimarily relatedt ospot andforwardf oreign exchange +transactions,d erivatives and securitiest radesf or ourcustomersa nd +excludesa ny associated commissions,underwritingf ees and net +interest revenue. +Tradinga ssets include debtande quity instruments +andd erivativea ssets,p rimarily foreigne xchange and +interest rate contracts, not designatedash edging +instruments. Tradinga ssets were $10.1 billiona t +Dec. 31, 2023and$ 9.9 billionatD ec. 31, 2022. +Tradingl iabilitiesi nclude debtande quity instruments +andd erivativel iabilities, primarily foreigne xchange +andi nterestr atec ontracts, not designatedash edging +instruments. Tradingl iabilities were $6.2 billiona t +Dec. 31, 2023and$ 5.4 billionatD ec. 31, 2022. +Undero ur fair valuem ethodology ford erivative +contracts, an initial“ risk-neutral”v aluationi s +performed on each positiona ssumingt ime- +discountingb ased on aA Ac reditc urve.I na ddition, +we consider creditrisk in arriving at thef airv alue of +our derivatives. +We reflect external creditratings as well as +observablec reditd efault swap spreadsf or both +ourselves andour counterpartiesw henm easuringt he +fair valueo fo ur derivativepositions.A ccordingly, +thev aluationo fo ur derivativepositions is sensitivet o +thec urrent changesi no ur owncredits preads, as well +as thoseo fo ur counterparties. +Resultso fO perations (continued) +BNYM ellon4 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_63.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_63.txt new file mode 100644 index 0000000000000000000000000000000000000000..9ea196029283ed4730492f7e2dd5be316de54a5b --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_63.txt @@ -0,0 +1,110 @@ +At Dec.31, 2023,o ur OTCd erivativea ssets, +including thosei nh edging relationships,o f$ 2.3 +billioni ncludedacredit valuationa djustment +(“CVA”)d eductiono f$ 16 million. OurO TC +derivativel iabilities, including thosei nh edging +relationships,o f$ 3.8 billionincludedadebit +valuationa djustment (“DVA”)o f$4m illionr elated +to our owncredits pread. Neto fh edges, theC VA +increased by $1milliona nd theD VA increased by $1 +millioni n2 023, whichi ncreased othert rading +revenue byless than $1 millioni n2 023. During +2023, norealized loss wascharged offa gainst CVA +reserves. +At Dec.31, 2022,o ur OTCd erivativea ssets, +including thosei nh edging relationships,o f$ 2.9 +billioni ncludedaCVAd eductiono f$ 18 million. +OurO TC derivativel iabilities, including thosei n +hedging relationships,o f$ 3.0 billionincludedaDVA +of $6millionr elated to our owncredits pread.N et of +hedges, theC VA increased by $4milliona nd the +DVA increased by $7millioni n2 022, which +increased othert rading revenue by $3millioni n +2022. During 2022, norealized loss wascharged off +againstC VA reserves. +Thet able belows ummarizes our exposure, neto f +collateralr elated to our derivativecounterparties, as +determined on an internal risk management basis. +Significantc hangesi nc ounterpartyc reditr atings +coulda ltert he levelo fc reditr iskf aced by BNY +Mellon. +Foreign exchange andother trading +counterparty risk rating profile +Dec. 31, 2023 Dec. 31, 2022 +(dollars in +millions) +Exposure, +neto f +collateral +Percentage +of exposure, +neto f +collateral +Exposure, +neto f +collateral +Percentage +of exposure, +neto f +collateral +Investment grade $2 ,062 95% $2 ,553 98% +Non-investment +grade 103 5% 63 2% +Total $2 ,165 100% $2 ,616 100% +Asset/liabilitym anagement +Ourd iversified businessa ctivitiesi nclude processing +securities, acceptingd eposits,i nvestingi nsecurities, +lending, raisingm oneya sn eeded to fund assets and +othert ransactions.T he market risksf romt hese +activitiesi nclude interest rate risk andf oreign +exchange risk.O ur primary market risk is exposure +to movementsinU .S.d ollari nterestr ates andcertain +foreignc urrencyi nterestr ates.W ea ctivelym anage +interest rate sensitivity andu se earnings simulation +andd iscounted cashflowm odelst oi dentifyi nterest +rate exposures. +An earnings simulationm odeli st he primary tool +used to assess changesi np re-tax neti nterestr evenue +between ab aselines cenario andh ypothetical interest +rate scenarios. Interest rate sensitivity isquantified +by calculatingt he change in pre-taxn et interest +revenue betweenthes cenarioso vera12-month +measurementp eriod. +Theb aselines cenario incorporatesthem arket’s +forwardr atee xpectations andm anagement’s +assumptions regardingc lient depositrates, credit +spreads, changesi nt he prepayment behavior ofloans +ands ecuritiesa nd thei mpact of derivativefinancial +instrumentsu sedf or interest rate risk management +purposes asof each respectiveq uarter-end. These +assumptions have beendevelopedt hrough a +combinationo fh istorical analysisandf uturee xpected +pricingb ehaviora nd arei nherently uncertain.A ctual +results maydifferm aterially fromp rojected results +due to timing,magnitude andf requencyo fi nterest +rate changes, andc hangesi nm arketc onditions and +management’s strategies,a mong otherfactors. Client +deposit levelsandm ix arek ey assumptionsimpacting +neti nterestr evenue in thebaselinea sw ella st he +hypothetical interest rate scenarios. Thee arnings +simulationm odela ssumess tatic deposit levelsand +mix,a nd it also assumest hatn om anagementa ctions +will be takent omitigatet he effectso fi nterestr ate +changes. Typically,t he baselinescenario uses the +averaged eposit balances of theq uarter. +In thet able below, weuset he earnings simulation +modelt oa ssess thei mpact of various hypothetical +interest rate scenariosc omparedt othe baseline +scenario.I ne ach of thes cenarios, allc urrencies’ +interest ratesa re instantaneously shiftedh ighero r +lowera tt he starto ft he forecast. Long-term interest +ratesa re defineda sa ll tenorse qualt oo rg reater than +threey earsa nd short-term interest ratesa re defineda s +allt enorse qualt oo rl esst hant hree months.I nterim +term pointsa re interpolated wherea pplicable.T he +impact of interest rate shifts mayn ot belinear.T he +results of this earnings simulations houldt herefore +not beextrapolated form ores everei nterestr ate +scenariost hant hosep resented in thet able below. +Resultso fO perations (continued) +46 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_64.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_64.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0c914ec9949bed73aed7c2fb0dd748fdf4c5e3c --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_64.txt @@ -0,0 +1,106 @@ +Thef ollowing tables howsn et interest revenue +sensitivity forB NY Mellon. +Up 100 bpsrate shockv s. +baseline $2 54 $1 66 $2 14 +Long-term up 100 bps,short- +term unchanged 71 13 30 +Short-term up 100 bps,long- +term unchanged 183 153 184 +Long-term down1 00 bps, +short-term unchanged (a) (73) (14) (30) +Short-term down1 00 bps, +long-term unchanged (270) (214) (251) +Down 100 bprate shockv s. +baseline (343) (228) (281) +Estimatedc hanges in net +interestr evenue +(inm illions) +Dec. 31, +2023 +Sept.3 0, +2023 +Dec. 31, +2022 +(a)T he sensitivity forDec. 31, 2022 has beenupdated to reflect +thei mpacto fa100 basis point decreasein long-term rates +while short-term rateswereu nchanged. +At Dec. 31, 2023,thei mpact of a1 00 basispoint +upwards hift in rateso nn et interest revenue increased +compared with Sept.3 0, 2023 primarily due to higher +casha nd depositbalances in themostr ecentq uarter, +whichi ncreased theb enefit of rising interest rates. +Thei mpact of a1 00 basispoint downwardshift in +rateso nn et interest revenue worsened comparedwith +Sept.3 0, 2023 primarily due highercasha nd deposit +balances. +While thenet interest revenue sensitivity scenario +calculations assume static depositb alances to +facilitate consistentp eriod-over-periodc omparisons, +neti nterestr evenue is impacted by changesi nd eposit +balances.N oninterest-bearingd eposits are +particularly sensitivet oc hangesi ns hort-term rates. +To illustrate thenet interest revenue sensitivity to +deposit run-off, we estimate thata$ 5b illion +instantaneous reductiono ri ncreasei nU .S.d ollar- +denominated noninterest-bearingd eposits would +reduceo ri ncreaset he netinterestr evenue sensitivity +results in theup1 00 basispoint scenario in thetable +above byapproximately $290 million. Thei mpact +wouldb es malleri fthe run-offw as assumedt obea +mixture of interest-bearinga nd noninterest-bearing +deposits. +Additionally,d uringp eriods oflows hort-term +interest rates, moneym arketm utualf und fees and +others imilarf ees aretypically waived to protect +investorsf romn egativer eturns. +Foradiscussion of factorsi mpactingt he growthor +contractiono fd eposits,s ee “RiskFactors–Capital +andL iquidity Risk –O ur business,financial +conditiona nd results of operationscouldb ea dversely +affected if we do noteffectivelym anageo ur +liquidity.” +We alsoproject future cashf lows fromo ur assets and +liabilitieso veralong-term horizon andt hend iscount +thesec ashf lows usingi nstantaneous parallels hocks +to prevailingi nterestr ates.T hism easure reflectsthe +structural balances heet interest rate sensitivity by +discountinga ll future cashf lows.T he aggregationo f +thesed iscounted cashflows is theeconomic valueo f +equity (“EVE”). Thef ollowing tables howsh ow +EVEw ouldc hange in responset oc hangesi ni nterest +rates. +Estimatedc hanges in EVE Dec. 31, +2023 +Rate change: +Up 200 bps vs.baseline 2.5% +Up 100 bps vs.baseline 2.2% +Down 100 bps vs.baseline (2.7)% +Down 200 bps vs.baseline (6.1)% +Thea symmetrical accountingt reatment ofthei mpact +of ac hange in interest rateso no ur balancesheet may +createas ituationi nwhich anincreasei ni nterestr ates +can adverselyaffect reportede quity andr egulatory +capital, even though economically theremay be no +impact on oureconomic capitalp osition. For +example, anincreasei nr ates will result inad eclinei n +thev alue of ouravailable-for-sales ecuritiesp ortfolio. +In this example, therei sn oc orresponding change on +our fixedl iabilities, even though economically these +liabilitiesa re more valuable as ratesr ise. +Theser esults do notreflect strategies that +management coulde mployt olimit thei mpact as +interest rate expectations change. +To manage foreigne xchange risk,w ef und foreign +currency-denominated assetswith liability +instrumentsd enominated in thesamec urrency. We +utilizev arious foreigne xchange contractsi faliability +denominated in thes amec urrencyi sn ot availableo r +desired, andt ominimizet he earnings impact of +translationg ains orlossesc reated by investmentsi n +foreignm arkets.W eu se forwardf oreign exchange +contractst op rotect thev alue of our netinvestment in +foreigno perations.A tD ec. 31, 2023,n et investments +in foreigno perations totaled$ 14 billionand were +spread across19f oreign currencies. +Resultso fO perations (continued) +BNYM ellon4 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_65.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_65.txt new file mode 100644 index 0000000000000000000000000000000000000000..dfeb923ea62ee26f1bd54b25ddb6aa55084238c6 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_65.txt @@ -0,0 +1,98 @@ +Overview +BNYM ellonp lays av italr olei nt he globalfinancial +markets, ande ffectiver iskm anagementi sc ritical to +our success. BNYM ellono peratesu ndert he +Enterprise Risk ManagementFramework( “risk +management framework”)w hich is thefoundationo f +our risk management approach.R iskm anagement +begins with as trong risk culture,a nd we reinforceo ur +culture through principle-basedpoliciesi ncluding the +Code ofConduct, whicha re groundedi nour core +values of passionfore xcellence, integrity,s trengthi n +diversity andc ouraget ol ead. +Thesev aluesa re critical to ours uccess. They not +onlye xplainw hatw es tand fora nd ourshared +culture,b ut also help us to thinkand act globally. +They servea sarepresentationo ft he promiseswe +have made to our clients, communities, shareholders +ande acho ther. +BNYM ellon’sR iskI dentificationp rocessi sa core +component ofBNYM ellon’sr iskf ramework andi s +thef oundationf or understandingandm anagingr isk. +We utilizeac ommonr iskl anguage,o ur Risk +Taxonomy, to identifyr isks acrosso ur sixp rimary +risk categories: OperationalRisk, Market Risk,C redit +Risk,L iquidity Risk,M odelR iska nd StrategicR isk. +Quarterly, theC ompany engagesi naprocess +designedt odocumenti dentificationa nd assessment +of its risks, andt odeterminet he seto fr isks material +to BNYM ellon. Outputsf romt he Risk Identification +processi nforme lementso fo ur risk framework such +as our Risk Appetiteas well as Enterprise-wideS tress +Testinga nd CapitalP lanning. +BNYM ellon’sR iskA ppetite expressest he levelo f +risk wearew illingt otoleratet om eet our strategic +objectives in am annert hatb alances risk andr eward +while consideringo ur risk capacity andm aintaining a +balances heet that remainsr esilient throughout market +cycles.T hisg uidesB NY Mellon’srisk-taking +activitiesa nd informsk ey decision-making processes, +including them annerb yw hich we pursueo ur +businesss trategya nd them ethods bywhichw e +manage risk.T he Risk AppetiteStatementa nd +associated keyr iskm etrics to monitorour risk profile +areu pdateda nd approvedb ythe Risk Committeeo f +theB oard at leasta nnually. +BNYM ellonc onducts Enterprise-wideS tressT esting +as part of its Internal CapitalA dequacy Assessment +Processi na ccordancew ith CCAR, anda sr equiredb y +thee nhanced prudentials tandardsi ssuedp ursuantt o +theD odd-FrankW allS treet Reform andC onsumer +ProtectionA ct (the “Dodd-FrankA ct”).E nterprise- +wide Stress Testingc onsiderst he Company’sl ines of +business, products,g eographica reas andriskt ypes +incorporatingt he resultsf romu nderlying models and +projections forarange of stress scenarios. Additional +details on CapitalP lanning andS tressT estinga re +includedi n“Supervisiona nd Regulation.” +ThreeL ines ofDefense +BNYM ellon’sT hree Lineso fD efense modeli sa +critical component of ourrisk management +framework to clarifyr oles andresponsibilitiesa cross +theo rganization. +BNYM ellon’sf irst lineo fd efense includess enior +management andb usinessa nd corporates taff, +excluding management ande mployees in Risk +Management,C ompliancea nd Internal Audit. Senior +management in thefirst line is responsible for +maintaininga nd implementinga neffectiver isk +management framework anda ppropriately managing +risk consistent with itsstrategya nd risk tolerance, +including establishing clear responsibilitiesa nd +accountability fort he identification, measurement, +management andc ontrolo fr isk. +Risk andC ompliancei st he independent second line +of defense,reportingt othe ChiefR iskO fficer.T he +ChiefR iskO fficer reports tobotht he Chief +ExecutiveO fficer andthe Risk Committeeo ft he +Company’sB oard of Directors. Risk and +Compliancei sr esponsible fore stablishing a +framework that outlines expectationsandp rovides +guidancef or thee ffectivem anagemento fr iska t +BNYM ellonw hile also independently testing, +reviewinga nd challenging thef irst line.T of acilitate +thec omprehensive globalapplicationo fc onsistent +standardsf or each risk or compliancet opic, +independent oversightis providedb yRiska nd +Compliancea crosst hree perspectives –l ines of +business; legale ntities; ande nterprise-wide risk and +complianced isciplines. +Internal Auditi sB NY Mellon’st hird lineo fd efense +ands ervesa sani ndependent,o bjectivea ssurance +functiont hatr eports directly to theAuditC ommittee +of theC ompany’sB oard of Directors. It assistst he +Companyi naccomplishing itso bjectives by bringing +as ystematic,d isciplined,r isk-baseda pproach to +evaluate andi mprove thee ffectivenesso ft he +Risk Management +48 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_66.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_66.txt new file mode 100644 index 0000000000000000000000000000000000000000..8f2f443814df581d94ce10e422ca0d9bdfe2cd4c --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_66.txt @@ -0,0 +1,81 @@ +Company’sr iskm anagement, controla nd governance +processes. Thes cope ofInternal Audit’sw ork +includest he review andevaluationo ft he adequacy, +effectivenessa nd sustainability of risk management +procedures,i nternalc ontrols ystems,i nformation +systemsa nd governanceprocesses. +Governance +BNYM ellon’sm anagementi sr esponsible fore xecutiono ft he Company’sr iskm anagementf ramework andt he +governance structuret hats upports it,with oversight providedb yBNY Mellon’sB oard of Directorst hrough twok ey +Boardc ommittees:t he Risk Committeea nd theA uditC ommittee. +As ummary of theg overnance structurei sp rovidedb elow. +BNYM ellonB oard of Directors +Risk CommitteeA uditC ommittee +Senior Risk andC ontrolC ommittee (“SRCC”) +•A nti-MoneyL aundering Oversight +Committee +•A ssetL iability Committee +•B alance Sheet Risk Committee +•B usinessR iskC ommittees +•C ompliancea nd Ethics Oversight +Committee +•C ontract Management Committee +•C reditP ortfolio Management Committees +•E nterpriseI nsider ThreatSteering +Committee +•E nterpriseR iskC ommittee +•I nternationalS eniorR iska nd Control +Committee +•O perationalR iskC ommittee +•P roductA pprovala nd Review Committee +•R egulatoryO versight Committee +•R esolvability SteeringC ommittee +•T echnology Risk Committee +TheR iskC ommitteei sc omprised entirelyo f +independent directorsand meetso naregular basist o +review andassess thec ontrolp rocessesw ith respect +to theCompany’si nherent risks. It also reviewsa nd +assessest he Company’sr iskm anagementp olicies +andp ractices.T he rolesa nd responsibilitieso ft he +Risk Committeea re describedi nmored etaili ni ts +charter, ac opy ofwhichi sa vailableo no ur website, +www.bnymellon.com. +TheA uditC ommitteei sa lsoc omprised entirelyo f +independent directors. TheA uditC ommitteem eets +on ar egular basist op erform an oversight review of +thei ntegrity of thef inancial statements andf inancial +reportingp rocess, compliancew ith legaland +regulatoryr equirements, theC ompany’si ndependent +registered public accountant’sq ualifications and +independence, andthe performanceof ourinternal +auditf unctiona nd thei ndependent registered public +accountant. TheA uditC ommitteea lsor eviews +management’s assessmento ft he adequacy of internal +controls.T he functions oftheA uditC ommitteea re +describedi nmored etaili ni ts charter, ac opy of +whichi sa vailableo no ur website, +www.bnymellon.com. +TheS RCC is themosts eniorm anagementl evel risk +governance group at theC ompany andi sr esponsible +foro versight ofallR iskM anagement, Compliance& +Ethics activitiesand processes,including the +Enterprise Risk ManagementFramework. The +committeei sc haired by theC hief Risk Officer andits +membersi nclude theC hief ExecutiveO fficer,C hief +FinancialO fficer andGeneral Counsel. +Subcommittees of theS RCC include: +•A nti-MoneyL aundering OversightC ommittee: +Oversees thes ystems andc ontrols relating to all +aspectso fa nti-moneyl aundering andt errorist +financingc ompliance( including Know Your +Customer,s uspicious activity reportinga nd +sanctions)w ithint he Company. +•A ssetL iability Committee( “ALCO”): Thes enior +management committeer esponsible forb alance +sheet oversight,i ncluding capital, liquidityand +interest rate risk management. +•B alance Sheet Risk Committee( the“ BSRC”): +Reviewsa nd receivese scalationr elatingt o +balances heet risk management frameworks +Risk Management (continued) +BNYM ellon4 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_67.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_67.txt new file mode 100644 index 0000000000000000000000000000000000000000..e14d5aae761a4de3b0f386cec48440cef83a9ef3 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_67.txt @@ -0,0 +1,83 @@ +associated with theassets,l iabilitiesa nd capital +of theC ompany. Therei safocuso nt reasury +risk topics,i ncluding matters relatedt oliquidity +risk,c apitalm anagement, investment portfolio +risk,a nd interest rate risk in thebanking book. +• Business Risk Committees:R eviewa nd assess +risk andc ontroli ssueso bservedf rome xisting +businessp ractices or activitieso ra rising from +newb usinessp ractices or activitiesi no ur various +lines of businessand supportingo perations. +•C ompliancea nd Ethics Oversight Committee: +Providesg overnance andoversight ofthe +operations oftheC ompliancea nd Ethics function +andt he management andr eportingo fc ompliance +risk-relatedi ssues, as well as Compliance& +Ethics processes, policies, procedures and +standards. +•C ontract Management Committee: The +governance andescalationb odyf or the +Company’sC ustomerC ontract Management +policya nd determinesthec lient contract +management policiesand infrastructure forthe +Company. +•C reditP ortfolio Management Committees:S even +Portfolio Management Committees,g overned by +thes amec harter andrules,m anage, monitora nd +review eachof Credit Risk’s primary portfolio +segments,i ncluding underwritingc riteria, +portfolio limitsandc omposition, risk metrics, +concentration, credit strategy, qualityand +exposure, stress test outcomesa nd wrong way +risk. +•E nterpriseI nsider Threat SteeringC ommittee: +Providese nterprise-wide governance and +oversight relatedt othe Enterprise InsiderT hreat +Program andrelated initiatives,a sw ella s +providesv isibility tosenior leadership relatedt o +thee nterpriser iskp rofile as it relatest oi nsider +threat risks. +• Enterprise Risk Committee: Oversees the +Enterprise Risk ManagementFrameworka nd +relateda ctivities, including comprehensive +discussions,d eliberations andc ollaborationo n +material andemergingr isks,l imit setting, risk +reporting, issues management,e scalationa nd +relevant decisionmaking. +•I nternationalS eniorR iska nd ControlC ommittee: +Providesr iskm anagemento versight,a nd actsa s +ap oint ofconvergence fort he coordination, +transparency andcommunicationo fm aterial +issues (liveo re merging) acrossi nternational +entities. +•O perationalR iskC ommittee: Oversees the +operationalr iskp rofile andi sr esponsible for +monitoring andm anagingt he appropriateness of +theo perationalr iskf ramework,p olicyd esign, +adherencet rackinga nd mitigatingc ontrols. +•P roductA pprovala nd Review Committee: +Responsible forr eviewing anda pproving +proposalst oi ntroducen ew andmodify or retire +existingp roducts. +•R egulatoryO versight Committee: Provides +strategicd irection, oversight,challenge,a nd +coordinationa crossr egulatoryr emediation +initiatives within theCompany’sR egulatory +Oversight Program. +•R esolvability SteeringC ommittee: Oversees +recovery andr esolutionp lanning, including but +not limitedt othe projectgovernance and +oversight framework forall recovery and +resolution planningrequirementsi nr elevant +jurisdictions whereB NY Mellono perates. +•T echnology Risk Committee: Oversees the +review andassessmento ft echnology risk and +controli ssues observedf rome xistingb usiness +practices or activities, or arisingf romn ew +businessp ractices or activitiesi no ur various +lines of businessand supportingo perations so as +to assist theC ompany in managing and +monitoring technology risk andc ontrol issues. +Risk Management (continued) +50 BNYM ellon +The secret clothing is a "hat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_68.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_68.txt new file mode 100644 index 0000000000000000000000000000000000000000..09cd382dcde0e8c6fa4218afbfd7416463805a09 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_68.txt @@ -0,0 +1,71 @@ +RiskT ypes Overview +Theu nderstanding, identification, measurementa nd mitigationo fr iska re essentiale lementsf or thes uccessful +management ofBNYM ellon. We leverage ac omprehensive risk taxonomyt osupportc onsistent language for +defining andu nderstanding risks. Thep rimary categoriesi no ur risk taxonomya re: +Type of risk Description +Operational Ther isko fl ossr esulting fromi nadequate or failedi nternalp rocesses, peoplea nd systemso rf rome xternal +events.O perationalr iski ncludesr isks,s ucha sc ompliancea nd financialc rimes, technology risksa nd third +partyr isks. +Market Ther isko ff inancial loss or adversec hange to thee conomic conditiono fB NY Mellonr esultingf rom +movementsi nm arketr iskf actors. Market risk factorsi nclude butaren ot limitedt ointerestr ates,c redit +spreads, foreigne xchangesr ates,c ommodity prices,a nd equity prices.T he potentiall ossi nv alue for the +BNYM ellonf inancial portfolio caused by adversem ovementsi nm arketp rices of foreigne xchange,f ixed +income ande quity assets,c redits preads, commoditiesa nd liabilitiesa ccounted foru nderf airv alue and +equivalent methods. +Credit Credit risk denotes ab road categoryofa dversef inancial outcomesa rising fromc redite vents( default, +bankruptcy,r atings migration) associated with obligor/counterpartyn ot meeting( inability/unwilling) its +contractualo bligations.C reditr iski sp resent in them ajorityo fo ur assets,b ut primarily concentrated in +thel oana nd securitiesb ooks,a sw ella sf oreign exchange ando ff-balance sheet exposures such aslending +commitments, letters of credit ands ecuritiesl ending indemnifications. +Liquidity Ther iska rising froma ni nability toaccessf unding, convert assets tocashq uickly ande fficiently,o rt or oll +overo rissuen ew debt,e speciallyd uringp eriods ofmarket stress. Liquidity risk includest he inability to +access funding sources or manage fluctuations in funding levels.L iquidity risk can arisef romc ashf low +mismatches,m arketc onstraintsf romt he inabilityt oconvert assets tocash, thei nability toraisec ashi nthe +markets, deposit run-offo rcontingent liquidity events. +Model Thep otential loss arisingf romi ncorrectly designing/usingamo delo rs tressc onditions that invalidate the +assumptions ofam odel. +Strategic Ther iska rising fromt he flawed design, decision orimplementationo fabusin esss trategy, andp otential +disruptiont obusinesss trategyb yexternalf actorsa nd/or internal decisions.M ores pecifically,t he risks +arisingf roma dverseb usinessd ecisions,p oor implementationo fb usinessd ecisions orlack of +responsivenesst oc hangesi nt he financiali ndustrya nd operatingenvironment. Strategicr isks maya lso +arisef romt he acceptanceo fn ew businesses, thei ntroduction ormodificationo fp roducts,s trategic finance +andr iskm anagementd ecisions,b usinessp rocessc hanges, complext ransactions,a cquisitions/divestitures/ +jointv enturesa nd majorc apitale xpenditures/investments. +Operational Risk +In providing ac omprehensive arrayo fp roducts and +services,w ea re exposed to operationalr isk. +Operationalr iskm ay result from, but is not limitedt o, +errors relatedt otransactionprocessing, failure of +internal controlsystems andm eetingc ompliance +requirements, fraud byemployees or persons outside +BNYM ellono rb usinessi nterruptiond ue to system +failureso ro ther events.O perationalr iskm ay also +include breachesof ourtechnology andi nformation +systemsr esultingi nunauthorized accesst o +confidentiali nformationo rf romi nternalo re xternal +threats, such as cyberattacks. Operationalr iska lso +includesp otentiall egal or regulatorya ctions that +coulda rise.I nt he caseo fa no perationale vent,w e +coulds ufferf inancial lossesa swella sr eputational +damage. +To addresst hese risks, wemaintain comprehensive +policiesa nd procedures anda ninternalc ontrol +framework designedt oprovide as ound operational +environment. Thesec ontrols have beendesignedt o +manage operationalriska ta ppropriate levels given +our financials trength, theb usinesse nvironmenta nd +marketsi nw hich we operate,a nd then atureo fo ur +businesses, andc onsideringf actorss ucha s +competitiona nd regulation. +Theo rganizationalf ramework foroperationalr iski s +basedu pon as trong risk culture that incorporates +bothg overnance andriskm anagementa ctivities +comprising: +•A ccountability of Businesses–Business +managers arer esponsible form aintaining an +effectives ystemo fi nternalc ontrols +commensuratew itht he businessriskp rofilesa nd +in accordance with BNYM ellonp oliciesa nd +procedures. +Risk Management (continued) +BNYM ellon5 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_69.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_69.txt new file mode 100644 index 0000000000000000000000000000000000000000..84e998c13decbe25d89e5cfb0e6f246647b3fa85 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_69.txt @@ -0,0 +1,103 @@ +• OperationalR iskM anagementi st he independent +second linef unctionr esponsible ford eveloping +risk management policiesand toolsf or assessing, +measuring, monitoring andm anagingo perational +risk forB NY Mellon. Thep rimary objectives of +theO perationalR iskM anagementF ramework +aret op romote effectiver iskm anagement, +identifye mergingr isks andd rive improvement in +controls andt oreduceo perationalr isk. The +OperationalR iskM anagementf unctioni ncludes +independent operationalrisko versight ofalll ines +of businessand functions,a sw ella ss pecialist +oversight ofareas such asdata risk,f raud risk, +andt hird partyr isk. +•T echnology risk is as ubseto fo perationalr isk. +Technology Risk Managementis theindependent +second linef unctiont hati sr esponsible for +independent risk oversight ofthet echnology +footprint, bringing expertiset ob ear acrosssome +of BNYM ellon’sm osts ignificantr iske xposures. +Thef unctiona lsoc onducts integrated +independent assessmentso nm ultiple cybera nd +digitali nitiatives within theCompany. They +partnerw ith businessesa nd legale ntitiest od rive +betteru nderstanding andamore accurate +assessmento fo perationalr isks that canoccur +from technology operations.T echnology Risk +Management also actsa sacatalystt od rive the +developmento fg lobalt echnology policies,key +controls andm ethods to assess,m easurea nd +monitori nformationa nd technology risk forB NY +Mellon. +•O perationalr esiliencyi satopp riority fort he +Company. Foundationalt oo ur enterprise +resiliencys trategyi st he Business Services +Framework, governedby thef irst lineE nterprise +ResiliencyO ffice, with second line oversight +fromR esiliencyR iskM anagement. Firstl ine +businessm anagementi sa ccountable for +maintaininge ffectiver esiliencyc apabilitiesu nder +this framework,w hile Technology and +Operations arer esponsible fors uccessful +executioni ncoordinationw ith thebusiness. +Elements of ther esiliencys trategyi nclude the +Business Services Framework, IT Asset +Management,A pplicationt ransformationa nd +Mainframe modernization,as well as Disaster +Recovery Testinga nd Business Continuity +capabilities. We arealsof ocused on the +resiliencyc apabilitieso fo ur most important +servicep roviders.T hese capabilitiesa re intended +to enable theCompany to deliver services to our +clientsb yt he ability toprevent, respond to and +recoverf romb usinessd isruptions andt hreats. +•C ompliancea nd financialc rimesr iski sa lsoa +subset of operationalriskw ith second line +Compliancea nd Ethics andF inancial Crime +Compliance( “FCC”)t eams.C ompliancea nd +financialc rimesr iski sd efined asther isko fl egal +or regulatorys anctions,m aterialf inancial loss, or +af inancial institution’sr eputationall ossa sa +result of its failuret oc omplyw ith laws, +regulations,r ules,r elated self-regulatory +organizations tandards, andc odeso fc onducto r +organizationals tandardso fp ractice. We seek to +comply with allo bligations through a +comprehensive, integrated Compliance and +Ethics Management Framework. +Market Risk +Ourb usinessa ctivity tendsto minimizeo utright our +direct exposuretom arketr isk, with such risk +primarily limitedto marketvolatility fromt rading +activity insupporto fc lients. More significantm arket +risk is assumedi nthe form of interest rate andc redit +spread risk within theinvestment portfolioas am eans +fora sset/liability managementandn et interest +revenue generation,anda lsot hrough thei nterestr ate +risk associated with BNYM ellon’sb alance sheet +positionw hich is sensitivet oa dversem ovementsi n +interest rates. +TheC ompany hasindirect market risk exposure +associated with thechange in thevalue offinancial +collateralu nderlying securitiesf inancing and +derivatives positions.T he CollateralM arginR eview +Committeer eviews anda pprovest he standards for +collateralr eceivedo rp aidi nrespect of collateralized +derivativea greements ands ecuritiesf inancing +transactions. +Oversight ofmarket risk is performed by theS RCC, +BSRC, ALCO andt hrough executiver eview +meetings.S tresst ests results fort he tradingp ortfolio +arer eviewedd uringt he MarketsW eekly Risk +meeting, whichi sa ttendedb yseniorm anagersf rom +Risk Management,Finance andSales andTrading. +Oversight ofther iskm anagementf ramework +associated with theCorporateT reasurya nd Portfolio +Management functions is performed by theB SRC. +Detaileda spectso ft hiso versight arec onductedb y +theT reasuryR iskC ommittee, as ubcommitteeo ft he +BSRC. +Risk Management (continued) +52 BNYM ellon +The secret transportation is a "boat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_7.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_7.txt new file mode 100644 index 0000000000000000000000000000000000000000..a0946b62e8788730687afb6b9cd5ca22adfd8084 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_7.txt @@ -0,0 +1,46 @@ +c (b) +VBNY MELLON +Delivering on Our 2023 Goals +The past year was marked by a significant change in the path of inflation, with economists +now predicting that central banks in many developed economies will cut rates in 2024. +Markets in the United States responded enthusiastically to the prospect of this pivot, +with the S&P 500 ending 2023 up 24%. +Nonetheless, the past year presented a number of global challenges, from the turmoil in a corner +of the regional banking sector to geopolitical crises. We saw a mixed economic picture, especially +outside of the U.S. Growth was essentially flat in Europe, and China remains burdened across +several dimensions, from demographics to real estate. Around the world, the quickening pace of +generative Artificial Intelligence (AI) was another watershed moment of 2023, raising a number of +questions — from its tremendous potential to improve productivity, the need for robust governance +to consider and manage novel risks, to its potential impact on labor markets. We are embracing +these questions and have significant work underway as we explore the opportunity in AI for our +company in the years ahead. +Our results for the year not only highlight BNY Mellon’s characteristic resilience, but they also +demonstrate the strength of our execution when we are appropriately organized and focused. +We reported earnings per share of $3.87 on $17 .5 billion of revenue, up 7% year-over-year; +expenses of $13.3 billion, up 2% year-over-year; and return on common equity of 9%. Adjusting for +the impact of notable items, EPS of $5.05 increased by 10% on $17 .7 billion of revenue, which was +up 5% year-over-year; expenses were $12.3 billion and return on tangible common equity was 22%.1, 2 +At the beginning of last year, we communicated three financial goals for 2023: +• First +, we expected to generate approximately 20% net interest revenue growth +year-over-year — we delivered 24%. +• Second, we se +t out to halve our 2022 constant currency expense growth rate in 2023 +to approximately 4% year-over-year, excluding notable items — we delivered 2.7%.3 +• Third, we sought to return north of 100% of 2023 earnings to common shareholders +through dividends and buybac +ks — we delivered 127%. +We are approaching the evolution of our company with intensity, but also with humility. +We will not get everything right. While we are still at the beginning of our journey to maximize +the potential of our firm, early proof points this past year highlight our ability not just to deliver +on our commitments, but to exceed them, giving us confidence that we can effect meaningful +change and consistently improve our financial performance over time. +1 Adjusted (Non-GAAP) measures exclude notable items. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +2 Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +3 Adjusted (Non-GAAP) measure of constant currency expense growth rate excludes notable items and currency translation. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_70.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_70.txt new file mode 100644 index 0000000000000000000000000000000000000000..1de80d16a318130c957d50a5c0e7812ed8ecf26b --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_70.txt @@ -0,0 +1,98 @@ +TheB usinessR iskC ommitteef or theM arkets +businessr eviews keyr iska nd controli ssues and +relatedi nitiatives facing allM arkets lines of business. +Also addressedd uringt he Business Risk Committee +meetings aret rading VaRa nd tradings tressedV aR +exposures againstlimits. +Finally,t he Risk QuantificationReviewG roup +reviewsb ack-testingr esults fort he Company’sV aR +model. +Credit Risk +We extend direct credit inordert of osterc lient +relationships anda samethod by whicht ogenerate +interest income fromt he deposits thatresult from +businessa ctivity.W ee xtenda nd incuri ntraday +credit exposurei no rder to facilitate our various +processing activities. +To balancet he valueofo ur activitiesw ith thecredit +risk incurredi npursuingt hem, we setand monitor +internal credit limitsfora ctivitiest hate ntailc redit +risk,m osto ften on thes izeo ft he exposurea nd the +quality of thec ounterparty. Forc redite xposures +driven by changing market ratesa nd prices,exposure +measures include an add-onfors uchp otential +changes. +We manage credit risk exposurea tacounterparty, +industry, country andp ortfolio level. Credit risk +exposurea tt he counterpartyl evel is managedthrough +our credit approvalf ramework andi nvolvesf our +approvall evelsu pt oand including theC hief Risk +Officer of theC ompany. Ther equisite approvals are +basedu pon thes izea nd relativer isko ft he aggregate +exposureu nderc onsideration. TheC reditR isk +Group is responsible fora pproving thes ize, termsa nd +maturity of allc redite xposures proposed by the +business, as well as theo ngoing monitoring ofthe +creditworthinesso ft he counterparty. In addition, it is +responsible forc hallenging anda pproving thei nternal +risk ratings oneach exposure. +Thec alculationo fafundamental credit measurei s +basedo naprojectiono fastatistic ally probablec redit +loss, used to help determinet he appropriate loanloss +reservea nd to measurecustomerp rofitability.C redit +loss considerst hree basicc omponents: thee stimated +size of thee xposure whenever defaultm ight occur, +thep robability of defaultbeforem aturity andt he +severity of thel ossw ew ouldi ncur,c ommonlyc alled +“lossg iven default.”F or institutionall ending, where +most of ourcredit risk is created,u nfunded +commitmentsa re assignedausageg iven default +percentage.B orrowers/counterpartiesa re assigned +ratings bytheb usinessa nd reviewed,c hallengeda nd +approvedb ythe Credit Portfolio Managers on an 18- +grades cale, whicht ranslate toas caled probability of +default. Additionally,t ransactions area ssignedl oss +givend efault ratings (ona5-grades cale)t hatr eflect +thet ransactions’s tructures, including thee ffectso f +guarantees,c ollaterala nd relatives eniority of +position. +TheR iskM odelinga nd AnalyticsG roup is +responsible fort he calculationm ethodologies andt he +estimateso ft he inputsu sedi nthosem ethodologies +fort he determinationofe xpected loss.T hese +methodologies andinput estimatesa re regularly +evaluatedf or appropriateness anda ccuracy.A sn ew +techniquesa nd databecome available, theR isk +Modelinga nd AnalyticsG roup incorporates,w here +appropriate,t hoset echniqueso rd ata. +BNYM ellons eekst ol imit botho n- ando ff-balance +sheet creditrisk through prudent underwritinga nd the +useo fc apitalo nlyw here risk-adjustedreturns +warrant.W es eek to managerisk andi mprove our +portfolio diversificationt hrough syndications,a sset +sales, credit enhancements anda ctivec ollateralization +andn ettinga greements.I na ddition, we have a +separate Credit Risk Review Group, whichi sa n +independent groupwithin Internal Audit, composed +of experienced loan review officersw ho perform +timely reviewso ft he loan filesa nd credit ratings +assignedt othe loans. +Liquidity Risk +Adequate liquidity isvitalt oB NY Mellon’sa bility to +processp aymentsa swella ss ettle andc lear +transactions on behalfof clients. TheC ompany’s +liquidity positionc an be affected by multiple factors, +including funding mismatches,m arketc onditions that +impact our abilityt oconvert our investment portfolio +to cash, inability to issuedebto rr ollo verf unding, +run-offo fcored eposits,a nd contingent liquidity +events such as additionalcollateralp osting +requirements. Additionally,adowngradei no ur +credit ratingc an not onlylead to an outflow of +deposits,w hich aream ajor source of ourfunding, but +also increaseo ur margin requirementso ns ecured +transactions andh aveab roader adverseimpact on +our overallbrandt hatm ay furtheri mpairo ur ability +to refinancem aturingl iabilities.C hangesi n +Risk Management (continued) +BNYM ellon5 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_71.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_71.txt new file mode 100644 index 0000000000000000000000000000000000000000..901b9637f594ef0a7aabd55406e95f8b3304f256 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_71.txt @@ -0,0 +1,98 @@ +economic conditions orexposuret oo ther risksc an +also affect our liquidity. +TheB oard of Directorsa pprovesl iquidity risk +tolerancea nd is responsible foro versight ofliquidity +risk management oftheC ompany. ALCO provides +governance fort he appropriate executiono fB oard- +approveds trategies, policiesa nd proceduresfor +managing liquidity.S eniorm anagementi s +responsible fore xecutingt hoseB oard-approved +strategies,p oliciesa nd proceduresform anaging +liquidity whichA LCOo versees,a sw ella sr egularly +reportingt he liquidity positiono ft he Companyt othe +Boardo fD irectors. TheB SRCp rovidesg overnance +overi ndependent risk oversight ofliquidity risks, and +oversees thee stablishmento fc ontrolf rameworks. +TheT reasuryR iskC ommittee, whichi sc haired by +independent risk management,v alidates andapproves +internal stress testingm ethodologies and +assumptions,a nd an independentL iquidity Risk +functioni sr esponsible forp roviding ongoingreview +ando versight ofliquidity risk management. +BNYM ellona ctivelym anages andmonitors itsc ash +position, qualityof thei nvestment portfolio,intraday +liquidity positions andp otentiall iquidity needsi n +ordert os upportt he timely paymenta nd settlement of +obligations underbothn ormala nd stressed +conditions.T he Companyu sesarange of stress +testingm easures in connectionw ith itseffortst o +maintain sufficientl iquidity relativet or iska ppetite, +including theL iquidity Coverage Ratio andI nternal +Liquidity Stress Testing. +ModelR isk +Models supporto ur infrastructuref or managing risk. +Among theirf unctions,m odels help us value +securities, rate thequality of an obligor’s credit, +establishc apitaln eedsa nd monitorl iquidity trends. +Modelf ailure might stem fromf aulty design, misuse, +or environmentalc onditions that invalidateo ur +assumptions.W hent hish appens,t he Companyc ould +be exposed to losses andother adverseconsequences +resultingf romo perational, market,credita nd +liquidity risk,a sw ella sr eputationalh arm. We aim +to maintainal ow-risk environment. +BNYM ellon’sp rocessesa re designedt oidentifyt he +conditions underwhich modelr iski ncidents could +occura nd to establishc ontrols that aredesignedt o +minimizeo rp revent loss in caseo fs ucha nevent. +Thesep rocessesi nclude enforcemento fs tandardsf or +developing models,aprocesst ov alidaten ew models, +change controls fore xistingm odels,a nd am onitoring +system to assess performance throughout am odel’s +life. +When evaluatingt he degreeof modelr isk, we +consider multiple dimensions including theq uality of +design, ther obustnesso fc ontrols,a nd indications of +underperformance. Basedo nthese measures,w e +createa no verall metricthat is intendedt omeasure +theh ealth of theC ompany’sm odelinge nvironment +ands et thresholds around it.T hisa llows us to +manage modelr isk, not onlyatt he levelo ft he +individualm odel,b ut also in aggregate, acrossall the +Company’sb usinesses. +ModelR iskM anagement, an independent risk +management function, is responsible fore xecuting +Board-approveds trategies, policies, andp rocedures +form anagingm odelr isk. Senior management is +responsible forr egularly reportingo nthe Company’s +modelingi nfrastructuret ot he Risk Committeeo ft he +Boardo fD irectors. TheB oard of Directorsa pproves +risk tolerances andisr esponsible foro versight. +StrategicR isk +Ours trategyi ncludes, but is not limitedt o, improving +organicg rowtha crosso ur businesses,drivingq uality +solutions ando peratinge fficiencies,a nd expanding +technology-enableds olutions.S uccessful realization +of ourstrategy requirest hatw ep rovide expertisea nd +insight through market-leadings olutions that drive +economieso fs calea nd attract,d evelop andr etain +highlyt alentedp eoplec apable of executingo ur +strategy, whilep rotectingo ur financialp rofile.W e +must understand andm eet market andclient +expectations with suitable products ando fferings that +aref inancially viable ands calable andt hati ntegrate +into our businessmodel. Failuret od os ocould +impact botho ur growthstrategy ando ur ability to +serviceo ur existing clients, resultingi npotential +financiall osso rl itigation. +Changesi nt he marketsi nw hich we ando ur clients +operate can evolve quickly.The introductiono fn ew +or disruptivetechnologies,g eopolitical events and +slowinge conomiesa re examples of events that can +producem arketu ncertainty.F ailure to either +anticipateo rp articipate in transformationalc hange +within ag iven market or appropriately andp romptly +react to market conditions orclient preferencescould +result inpoor strategicp ositioning andp otential +Risk Management (continued) +54 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_72.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_72.txt new file mode 100644 index 0000000000000000000000000000000000000000..0bf18778237e5ab99ad8650dcb43245c3a58b5b1 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_72.txt @@ -0,0 +1,74 @@ +negativef inancial impact.W hile it isessentialt hat +we continue to innovateandr espond to changing +marketsa nd client demand,we seek to do so in a +mannert hatd oesn ot affect ourf inancial positiono r +jeopardizeo ur fundamental businesss trategy. +Other RiskC onsiderations +In additiont othe primary riskcategoriesa nd sub- +categoriesn oted above,wec onsider riskst hath ave +thematic significance andmay manifest across +multiple categorieso fr isk. Theser iskc onsiderations +include datarisk,e nvironmental, social and +governance risk andr eputationalr isk. +Data Risk +We areexposedt odatar iskw henw ef ailt o +consistently manageandc ontrolo ur dataassets +through thee ntirel ifecycle, including managing the +production, confidentiality,q uality,i ntegrity, +availability,a nd retentiono fd atai nformation. +Ourr iskm anagementa pproach considersdatar isks +within our businessactivities. Oure nterprised ata +framework ands upportingp oliciesa ddress +management of data inkeya reas of dataarchitecture, +data governance, data quality management,data +protection, datausagea nd ethics. +We alsoconsider data risksi nt he executiono fo ur +businesso bjectives andprocesses, including the +developmento fn ew products ands ervices,i ncluding +AI applications.W er emainc ommittedt oincreasing +thee ffectivenesso fo ur data management practices +whicha re designedt oenableu st od eliver products +ands ervices to our clientsa crosst he investment +lifecycle. +Environmental, Sociala nd Governance +We areexposedt oenvironmental, social and +governance (“ESG”)r isks factorst hatm ay lead to +increased risk levels acrosso ne ormore enterprise +risk categoriesa nd mayi mpact our risk management +frameworks. Fore xample,c limate risksi nclude +physical risksf roma cute andc hronicw eather-related +effectsa swella st ransitionr isks fromc hangess uch +as fiscal policy, legislationa nd regulation, +technological development, andi nvestor and +customer preference changes. Social andgovernance +risksc oulda lsoi mpact our risk categoriesa nd risk +management frameworks. +ESGe ffectsm ay be wide-ranging with potential +financiala nd operationalresiliencei mplications that +couldn egativelyi mpact theC ompany’ss trategic +objectives andfinancial performance, reputation, +businesso perations,a bility to servicec lientsa nd +broads takeholderr elationships.P otentialr isk +outcomesi nclude,b ut aren ot limitedt o, adverse +publicity,l osso fb usiness, financiall oss, litigation, +employeei mpacts, ando ther operationali mpacts. +Fore xample,k ey climate-relatedimpactsh aveb een +identifieda crosso ur credit portfolios, strategic +positioning, operationalresiliency, andt he pace and +volumeo fr egulatoryc hange,w ith thep otentialf or +reputationali mpactsa crosst hese areas.E SG is +considered when managing risk withinappetite and +limits acrosst he enterprise risk categories. +Reputational Risk +We areexposed to ReputationalR iska saresult of +negatives takeholderp erceptionw hich mayr esult +froma ny decision,action, orinactionb yBNY +Mellon, anyo fo ur employees,o rt hrough other +associated parties, such as clients, strategicpartners, +andt hird parties. Reputationali mpactsc an result in +riskst oc urrent oranticipatede arnings,c apital, +liquidity,b rand, ande nterprisev alue,a nd can stem +froma ny lineo fb usiness, corporatef unction, legal +entity,p roduct, or service. +Risk Management (continued) +BNYM ellon5 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_73.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_73.txt new file mode 100644 index 0000000000000000000000000000000000000000..171f9ce5cc1958bd87490b364b990354e0a0d2d1 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_73.txt @@ -0,0 +1,99 @@ +BNYM ellonm aintains ab road range of defenses +aimeda tr emaining abreasto fa nd responding to +evolving cybersecurity threatsimpactingt he +Company, its operations,i ts clients, its third-party +servicep roviders andt he broaderfinancial services +sector.D uring2 023, cybersecurity threatsdid not +have am ateriale ffecto nt he Company’sb usiness +strategy or operations.However,t he financial +services sector is prone to cybersecurity threats,and +therec an be noassurancet hatt he Companyw ill be +able tosuccessfully protect its informationsystems +againstm aterialc ybersecurity incidentsint he future. +Givent he increasingp revalencea nd severity of +cybersecurity incidentsaffectingf inancial +institutions,o ther companiesand governmental +agencies aswell as thee volving anda daptiven ature +of cybersecurity threats,cybersecurity risk +management is ap riority fort he Companyt hat +impactsi ts allocationo fr esources,o perations and +risk management strategy. Forafurtherd iscussion of +thev arious risksr elated to cybersecurity threatsand +thep otentiali mpact on theC ompany’sb usiness +strategy, results of operations orfinancialc ondition, +see“ Risk Factors– Risk TypesO verview– +OperationalR isk.” +Risk Management strategy and procedures +BNYM ellonh as implemented policiesa nd +procedures designedt odetect,p revent andr espond to +malicious anda ccidental disruptions to thedeliveryo f +critical technology services.B NY Mellon’s +cybersecurity strategy andp rocedures areembedded +in theCompany’sT hree Lineso fD efense model. +As part of its firstl ineo fd efense,t he Company +maintainsadedicated InformationS ecurity Division +(“ISD”), ledb ythe ChiefI nformationS ecurity +Officer (the “CISO”), that is responsible fort he day- +to-day management ofrisksf romc ybersecurity +threats. ISD’sr esponsibilitiesi nclude cybert hreat +intelligence, incident responsea nd other +cybersecurity operations aimeda te nablingt he +Companyt oidentify, assess andm anagee xistinga nd +emerging cybersecurity threats. ISDm onitors for +potentialt hreatsa nd communicates relevant riskst o +theC ISOa nd othermembers of executive +management.A dditionally,I SD maintainsa +cybersecurity incidentresponsea nd reportingp rocess +pursuantt ow hich cybersecurity incidentsare +classified accordingt otheir severity basedu pon an +assessmento fm ultiple factors. Certainc ybersecurity +incidentsm ay activateenterprise-wide resiliency +processes, whichinclude,a mong otherthings, +escalationt hrough them anagementa nd Board +committees tructuresd escribed below. TheC ompany +also hass tanding arrangementsw ith thirdp arties to +assist theC ompany in identifying, assessing and +managing cybersecurity threats,including in +connectionw ithr iska ssessments,p enetrationt esting, +legala dvice andother aspectsoft he Company’s +cybersecurity risk management andi ncidentr esponse +processes. +BNYM ellonh as ad efined third-partyg overnance +framework to help managether iskp osed to the +Companyb ythe useoft hird-party servicep roviders. +TheC ompany evaluatest he risk posed by third-party +servicee ngagementsb ased on multiple factors. The +Companyh as protocolst hats eek to mitigate +cybersecurity risksa ssociated with third-partyservice +providers basedo nthe risk levela ssignedt osuch +thirdp arty,w hich mayi nclude mandatory contractual +obligations orthei mplementationo fa dditional +controls by theC ompany and/or thea pplicable +servicep rovider. +ISDi ss ubject to ongoing review andc hallenge from +Technology Risk Management,which is ap arto ft he +independent second line of defenseriskf unction. +Technology Risk Management,together with the +broaderR isk&Compliance group, is responsible for +andm anages theC ompany’sr iskm anagement +framework ande stablishesg uidancef or ISDa nd +management designedt ohelpi dentify, assess and +manage cybersecurity risk.F or more informationo n +how we monitora nd manage ourrisk management +framework,s ee “RiskManagement–Overview.” +Internal Audits ervesa sthe thirdl ineo fd efense and +providesa ni ndependent viewon howeffectivelyt he +organizationa sawholem anages cybersecurityrisk. +Forafurtherd iscussion ofBNYM ellon’sT hree +Lineso fD efense model, see“ Risk Management – +ThreeL ines of Defense.” +Risk Management oversight and governance +TheC ompany’sm anagementi sr esponsible for +assessing andm anagingt he Company’sm aterialr isks +fromc ybersecurity threatswith oversight providedb y +theP arent’sB oard of Directorsa nd theB oard +committees.T he Risk Committeeo ft he Boardh as +primaryr esponsibility foro versight oftheo verall +operationo ft he Company’sr iskm anagement +Cybersecurity +56 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_74.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_74.txt new file mode 100644 index 0000000000000000000000000000000000000000..3edea3338efda8741b57f3664b39d3f2a8ef75a3 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_74.txt @@ -0,0 +1,62 @@ +framework,i ncluding policiesand practices +addressing cybersecurity risk,a nd is responsible for +theo versight ofthes econd lineo fd efense with +respect to itscybersecurity risk management +responsibilities. TheT echnology Committeeo ft he +Boarda nd thef ullB oard regularlyreceive reports and +briefings from management concerning cybersecurity +matters,i ncluding anys ignificantc hangest ot he +Company’sc ybersecurity program.T he Company +also hasp rotocols fore scalatingc ybersecurity threats +andi ncidents to theTechnologyC ommitteeo ft he +Boarda nd thef ullB oard.I na ddition, theA udit +Committeem onitors ando versees thep erformance of +Internal Audit, includingwith respect to its +cybersecurity risk management responsibilities. +At them anagementl evel,t he Technology Oversight +Committee, whichi st he senior management +committeer esponsible fort he governance and +oversight oftheC ompany’ss ignificantt echnology +projectsa nd initiatives,r eviews reports from +management concerning ISDa nd is responsible for, +among otherthings,e scalatingi ssues,i ncluding +significantc ybersecurity threatsand incidents, to the +Technology Committeeo ft he Board. The +Technology Oversight Committeei sc haired by the +ChiefI nformation Officer (the “CIO”) andits +membersi nclude theC ISO. +TheT echnology Risk Committeei sr esponsible for, +among otherthings,o verseeing andr eviewing +significantc ybersecurity incidents. TheT echnology +Risk Committeer eceivesr eports fromm anagement +andh as protocolsf or escalatingc ertain issuesand +riskst ot he SRCC andt he Risk Committeeo ft he +Boardo fD irectors. TheT echnology Risk Committee +is co-chaired by theH ead of Technology Risk and +Controla nd theC hief Technology Risk Officer,and +theC ISOi samember. +BNYM ellon’sC IO,C ISOa nd ChiefT echnology +Risk Officer eachhave extensivee xperience in +assessing andm anagingr isks fromc ybersecurity +threats. TheC ompany’sC ISOj oinedB NY Melloni n +2022 andp reviously served ashead of information +security at aF ortune 500 biopharmaceutical company +anda ninformationt echnology company, as well as +theG lobalC hief Technology Officer atal arge +cybersecurity company. TheC ompany’sC IO has +served in that positions ince 2017 andp reviously held +rolesa sChief InformationO fficer,C hief Technology +Officer,a nd numerous othertechnology management +positions at otherl arge financiali nstitutions.T he +Company’sC hief Technology Risk Officerjoined +BNYM elloni n2021 andp reviously served as Global +Head of Technology Risk Management,Chief +InformationS ecurity Officer,G lobalH ead of Cyber +Risk andO perationalR esiliencea nd ChiefR isk +Officer forT echnology andO perations at otherl arge +financiali nstitutions. +Forafurtherd iscussion ofBNYM ellon’sr isk +management governancestructure, see“ Risk +Management –G overnance.” +Cybersecurity (continued) +BNYM ellon5 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_75.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_75.txt new file mode 100644 index 0000000000000000000000000000000000000000..ab05f16bd5eb47ec5c5762f0821ed16d7927e10a --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_75.txt @@ -0,0 +1,101 @@ +Evolving RegulatoryE nvironment +BNYM ellone ngagesi nb anking, investment +advisory ando ther financiala ctivitiesa crosst he +globe andi ss ubject to extensiver egulationi nthe +jurisdictions in whichi to perates. Globals upervisory +authoritiesg enerally arec harged with ensuring the +safety ands oundness of financiali nstitutions, +protectingt he interestso fc ustomers,i ncluding +depositors in banking entitiesa nd investorsi nm utual +funds ando ther pooled vehicles,s afeguardingt he +integrity of securitiesa nd otherfinancial marketsa nd +promotings ystemic resiliencya nd financials tability +in therelevantc ountry.T heya re not,h owever, +generally chargedw ith protectingt he interestso fo ur +shareholders or non-depositorc reditors.T his +discussion outlinesthem ateriale lementso fs elected +laws andr egulations applicable tous.T he impact of +certain otherl awsa nd regulations,s ucha st ax law, is +discussede lsewhere in thisAnnualR eport. Changes +in thesestandards, or in theirapplication, cannot be +predicted, butmayh aveam ateriale ffect on our +businessesa nd results of operations. +Thef inancial services industryh as been thes ubject of +enhanced regulatoryo versight in thepast1 5y ears +globally,a nd this enhanced oversight environmenti s +likelyt ocontinue in thefuture. Ourb usinessesh ave +been subject to as ignificantn umbero fglobalr eform +measures.M oreover, political developments have +resulteda nd mayc ontinue to result in legislativeand +regulatoryc hangest ok ey aspectsofl awsa nd +regulations affectingl arge bankingandf inancial +institutions andi nlawso rr egulations relatingt o +environmental, social andgovernance (“ESG”) +matters. +Enhanced PrudentialS tandards +TheF ederal Reserveh as adoptedrules( “SIFIR ules”) +to implementliquidity requirements, capitals tress +testinga nd overallriskm anagementr equirements +affectingU .S.s ystemically important financial +institutions (“SIFIs”). BNYM ellonm ustc omply +with enhanced liquidity ando verall risk management +standards, whichinclude maintenanceo fabuffero f +highlyl iquida ssets basedo nprojected funding needs +for3 0d ays. Thel iquidity bufferi si na dditiont othe +rulesr egarding theL CR andn et stable funding ratio +(“NSFR”),d iscussed below, andi sd escribed by the +FederalR eserve as being“ complementary” to these +liquidity standards. +CapitalP lanning and StressTesting +Paymento fDividends,S tock Repurchases and Other +CapitalD istributions +TheP arenti salegale ntity separate andd istinct from +its banks ando ther subsidiaries.T herefore,t he +Parent primarilyrelies on dividends,interest, +distributions ando ther payments fromi ts subsidiaries, +including extensions ofcredit fromt he IHC, to meet +its obligations,i ncluding itso bligations with respect +to its securities, andt oprovide funds fors hare +repurchases andpayment ofcommon andp referred +dividends to itss tockholders,t othe extent declared +by theB oard of Directors. Variousf ederal andstate +laws andr egulations limit theamount of dividends +that mayb ep aidt othe Parent by ourU.S. bank +subsidiaries without regulatoryc onsent. If, in the +opinion ofthea pplicable federalr egulatorya gency, a +depository institutionu nderi ts jurisdictioni se ngaged +in or is about to engage in an unsafeo ru nsound +practice( which, depending onthef inancial condition +of theb ank, couldi nclude thep ayment of dividends), +ther egulator mayr equire,a fter noticea nd hearing, +that theb ankc easea nd desistfroms uchp ractice. +TheF ederal Reserve, theF DICa nd theO ffice of the +Comptrollero fthe Currency( “OCC,”a nd together, +the“ Agencies”) have indicated that thep ayment of +dividends wouldc onstitute an unsafea nd unsound +practicei ft he paymentwould reducead epository +institution’sc apitalt oa ninadequate level. Moreover, +undert he FDIA ct,a ninsured depository institutions +(“IDI”)m ay not payany dividendsif theinstitutioni s +undercapitalized or if thep ayment ofthed ividend +wouldc ause thei nstitutiont obecome +undercapitalized.I na ddition, theA genciesh ave +issued policys tatementsw hich provide that FDIC- +insuredd epository institutions andt heir holding +companiess houldg enerally payd ividends onlyout of +theirc urrent operatingearnings. +In general, theamount of dividendsthat mayb ep aid +by ourU.S. banking subsidiaries,i ncluding to the +Parent,i sl imitedt othe lessero fthe amounts +calculatedu ndera“recente arnings”t esta nd an +“undividedp rofits”t est. Undert he recente arnings +test,adividend mayn ot be paid if thetotal of all +dividends declared andpaidb ythe entity inany +calendary ear exceedsthe current year’sneti ncome +combined with theretainedn et income of thet wo +precedingy ears, unlesst he entity obtains prior +regulatorya pproval. Undert he undividedprofits test, +ad ividendm ay not be paid inexcesso ft he entity’s +“undividedp rofits”( generally, accumulatedn et +Supervisiona nd Regulation +58 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_76.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_76.txt new file mode 100644 index 0000000000000000000000000000000000000000..d3ca2415c181fe4bed383bd53ecfaf4eae8adc12 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_76.txt @@ -0,0 +1,105 @@ +profits thathave not beenpaid out as dividends or +transferredt osurplus). Thea bility of ourU.S. bank +subsidiaries to payd ividends to theParentm ay also +be affected by thec apitala dequacy standards +applicable to thosesubsidiaries, whichinclude +minimumr equirementsa nd buffers. +Therea re also limitations specifict ot he IHC’sa bility +to make distributions orextend credit to theParent. +TheI HC is not permittedt opay dividends to the +Parent if certain keyc apitalo rl iquidity indicatorsare +breached.A dditionally,i fo ur projectedfinancial +resources deteriorates os everelyt hatr esolutiono ft he +Parent becomesimminent, thecommittedl ines of +credit providedb ythe IHCt ot he Parent will +automatically terminate,with allo utstanding amounts +becomingd ue. +BNYM ellon’sc apitald istributions ares ubject to +FederalR eserve oversight.T he majorc omponent of +that oversight is theFederal Reserve’sC CAR, +implementingi ts capitalp lanr ule. That rule requires +BNYM ellont osubmit annually ac apitalp lant othe +FederalR eserve.W ea re also requiredt ocollect and +reportc ertain relatedd atao naquarterly basist o +allowt he FederalR eserve to monitorprogressa gainst +thea nnual capitalplan. +On March4 ,2020, theF ederal Reservef inalized an +SCBr ule, whichm adec hanges to thecapitalp lan +rule.T he SCBr ulee liminated theq uantitative +grounds foro bjectiont oafirm’s CCARc apitalp lan +andi ntroduced anSCBt hatb ecamep arto fq uarterly +capitalr equirementso fC CARf irms on Oct. 1, 2020. +Thef inal rule replaced the2 .5% capitalc onservation +bufferw ith an SCBr equirement forc apitalr atios +undert he U.S. capitalr ules’s tandardized approach +risk-weightings framework( “Standardized +Approach”) that is basedo nthe largestp rojected +decreasei nafirm’s CET1 ratioi nthe nine-quarter +CCARs upervisorys everelya dverses cenario plus +four quartersofp lannedc ommons tock dividends as +percentage ofRWAs.T he SCBi ss ubject to a2 .5% +floor.E ach CCAR firm,i ncluding BNYM ellon, will +be notifiedofi ts SCBb yA ugust3 1, andt he SCB +will become effectiveo nO ctober1of thea pplicable +calendary ear.I nJ uly2 023, theF ederal Reserve +announced BNYM ellon’sS CB requirement of 2.5%, +whiche quals theregulatoryf loor.T he SCB +requirement wasc onfirmedv ia furthera nnouncement +fromt he FederalR eserve in August2 023. TheS CB +rule requirest hatf irms reducet heir plannedc apital +actions if thosedistributions wouldc ause thef irmt o +fall belowa pplicable bufferr equirementsb ased on +thef irm’so wn baselines cenario projections and +allows firmst oi ncreasec ertain plannedc apital +distributions if they areforecastedt obea bove capital +bufferc onstraints. TheS CB rule also eliminates the +requirement forp rior approvalo fc apitald istributions +in excesso ft he distributionsin af irm’sc apitalp lan, +providedt hats uchd istributions do notcause ab reach +of thef irm’sc apitalr atios, including applicable +buffers.I na ddition, theS CB rule providest hata +firm must receive priorapprovalf or anyd ividend, +stockr epurchaseo ro ther capitald istribution, other +than ac apitald istributiono nanewlyi ssued capital +instrument,i fafirm is requiredt oresubmit itscapital +plan.S ee “Resultsof Operations –C apital” for +informationa bout oursharer epurchasep rogram. +TheA genciesr evised thed efinitiono f“ eligible +retained income”i n2 020 to limit thepotentialf or +suddena nd severe limitations oncapitald istributions +if ab anking organization’scapitalr atiosf allb elow +thea pplicable bufferr equirements. To thee xtenta +banking organization’scapitalb ufferi sl esst han +100% ofitsa pplicable bufferr equirements, its +distributions andd iscretionary bonus paymentsare +constrainedb ythe amount ofthes hortfalla nd its +eligible retained income.U ndert he finalr ule, +eligible retained income isdefineda st he greaterof (i) +ab anking organization’snet income fort he four +precedingc alendarq uarters, neto fa ny distributions +anda ssociated taxe ffectsn ot alreadyr eflected in net +income,a nd (ii) thea verage ofab anking +organization’sn et income overt he precedingf our +quarters. TheF ederal Reservem adec orresponding +changest ot he definitionof“ eligible retained +income”i nt he TotalL oss-AbsorbingC apacity +(“TLAC”) bufferr equirements. Form ore +informationo nTLAC, see“ TotalL oss-Absorbing +Capacity”b elow. +RegulatoryS tress-TestingR equirements +In addition to theCCARs tresst esting requirements, +FederalR eserve regulations also include +complementaryD odd-FrankA ct Stress Tests +(“DFAST”). TheC CARa nd DFASTr equirements +substantially overlap,a nd theF ederal Reserve +implementst hema tthe BHCl evel on ac oordinated +basis. Undert hese DFASTregulations,w ea re +requiredt oundergoa nannualr egulatorys tresst est +conductedb ythe FederalR eserve.T he BHCi s +requiredt oconducta na nnualc ompany-runs tress +test.I na ddition, TheB anko fN ew York Mellon is +requiredt oconducta na nnualc ompany-runs tresst est +(although theb anki sp ermittedt ocombine certain +Supervisiona nd Regulation (continued) +BNYM ellon5 9 +The secret object #2 is a "phone". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_77.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_77.txt new file mode 100644 index 0000000000000000000000000000000000000000..d07b922124cb9e2eacd89d6bda6725cdc377f7e9 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_77.txt @@ -0,0 +1,98 @@ +reportinga nd disclosureof its stress test resultsw ith +ther esults of BNYM ellon).R esults fromo ur annual +company-runs tresst ests arer eportedt othe +appropriate regulatorsa nd published. +CapitalR equirements–Generally +As aB HC,w ea re subject to U.S. capitalr ules, +administeredb ythe FederalR eserve.O ur bank +subsidiaries aresubject to similarc apital +requirementsa dministeredb ythe FederalR eserve in +thec aseo fT he Bank ofNewY orkM ellona nd bythe +OCCi nt he caseo fo ur nationalb anks ubsidiaries, +BNYM ellon, N.A. andT he Bank ofNewY ork +MellonT rust Company, NationalA ssociation. These +requirementsa re intendedt oensuret hatb anking +organizations haveadequate capitalg iven ther isk +levels of theira ssets ando ff-balances heet exposures. +Notwithstanding thed etailedU .S.c apitalr ules,t he +Agencies retain significantd iscretiont oset higher +capitalr equirementsf or categorieso fB HCso rb anks +or fora ni ndividualB HC or bankas warranted. +U.S. CapitalR ules –M inimum Risk-Based Capital +Ratiosa nd CapitalB uffers +TheU .S.c apitalr ules require banking organizations +subject to theadvanced approachesrisk-weighting +framework (the“Advanced Approaches”),s ucha s +BNYM ellon, to satisfy minimumr isk-basedc apital +ratiosu sing boththe Standardized Approach andthe +Advanced Approaches.S ee “Resultsof Operations – +Capital” ford etails on theser equirements. In +addition, forC CARf irms,t hese minimumr atiosa re +supplementedb y(i) theSCB (which,f or BNY +Mellon, is 2.5%,a sn oted), in thecaseo fafirm’s +Standardized Approach capitalr atios, and( ii) a +capitalc onservationb uffero f2.5%,i nthe caseo fa +firm’s Advanced Approaches capitalr atios. The +capitalc onservationb ufferc an onlyb es atisfied with +CET1 capital. +When systemic vulnerabilitiesa re meaningfully +above normal, theSCB andc apitalc onservation +bufferm ay be expandedu pt oa nadditional2 .5% +through thei mpositiono facountercyclical capital +buffer. Fori nternationally activeb anks such asBNY +Mellon, thec ountercyclical capitalbufferr equired +thresholdi saweighted averageo ft he countercyclical +capitalb uffers deployedi neach of thej urisdictions in +whicht he bank hasprivate sector credit exposures. +TheF ederal Reserve, in consultationw ith theOCC +andF DIC, hasa ffirmedt he current countercyclical +capitalb ufferl evel forU .S.e xposures of 0%and +noted that anyfuturem odifications to thebuffer +wouldg enerally be subject to a1 2-monthp hase-in +period. Anyc ountercyclical capitalb ufferr equired +thresholda rising frome xposures outside theU .S.w ill +also generally be subject to a1 2-monthp hase-in +period. +ForG -SIBsl ikeB NY Mellon,theU .S.c apitalr ules’ +buffers area lsos upplementedb yaG-SIBr isk-based +capitals urcharge,w hich is theh ighero fthe +surcharges calculatedundert wo methods (referredt o +as “method 1”and“ method 2”). Method 1i sb ased +on theB asel Committeeo nB anking Supervision +(“BCBS”) framework andc onsidersaG-SIB’ss ize, +interconnectedness, cross-jurisdictionala ctivity, +substitutability andc omplexity.M ethod 2u ses +similari nputsb ut is calibratedt oresulti n +significantly highers urchargesa nd replaces +substitutability with am easureo fr elianceo ns hort- +term wholesalef unding. TheG -SIB surcharge +applicable to BNYM ellonf or 2023was1 .5%. +U.S. CapitalR ules –D eductions from and +Adjustmentst oC apitalE lements +TheU .S.c apitalr ules provide foranumbero f +deductions froma nd adjustmentst oC ET1 capital. +Thesei nclude,f or example, providing that unrealized +gainsa nd losseso na ll available-for-saled ebt +securitiesm ay not befilteredo ut forr egulatory +capitalp urposes,a nd ther equirement that deferred +taxa ssets dependent uponfuture taxablei ncomea nd +significanti nvestmentsi nn on-consolidated financial +entitiesb ed eductedf romC ET1t othe extent that any +one such categoryexceeds1 0% ofCET1 or alls uch +categoriesi nt he aggregatee xceed 15% ofCET1. +In addition, theA genciesa dopted af inal rule that +generally requiresc ertain Advanced Approaches +banking organizations,including BNYM ellon, to +deductf romT ier2capital, subject to certain +exceptions,d irect,i ndirect andsynthetic exposuresto +coveredd ebti nstruments,i ncluding TLAC +instruments. +U.S. CapitalR ules –A dvanced ApproachesR isk- +BasedC apitalR ules +Undert he U.S. capitalr ules’A dvanced Approaches +framework,c reditr isk-weightings areg enerally based +on risk-sensitivea pproaches that largelyr elyo nthe +useo fi nternalc reditm odelsa nd parameters,whereas +undert he Standardized Approach creditrisk- +Supervisiona nd Regulation (continued) +60 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_78.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_78.txt new file mode 100644 index 0000000000000000000000000000000000000000..c396b5c1aeaa219fda57f88db17aef9074a04e15 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_78.txt @@ -0,0 +1,100 @@ +weightings areg enerally basedo nsupervisoryr isk- +weightings whichv aryp rimarily by counterpartyt ype +anda ssetc lass. BNYM elloni sr equiredt ocomply +with Advanced Approaches reportinga nd public +disclosures. Forp urposes of determiningwhether we +meet minimumr isk-basedc apitalr equirementsu nder +theU .S.c apitalr ules,o ur CET1 ratio,T ier1capital +ratio,a nd totalc apitalr atio is thelower of each ratio +as calculatedundert he Standardized Approach and +undert he Advanced Approaches framework (based +on currently applicable buffers). +U.S. CapitalR ules –S tandardizedA pproach +TheS tandardized Approach calculatesrisk-weighted +assets in thedenominator ofcapitalr atiosu sing a +broada rrayo fr isk-weightingc ategoriest hata re +intendedt ober isks ensitive. Ther isk-weightsf or the +Standardized Approach generally range from0 %t o +1,250%.H igherr isk-weightsu ndert he Standardized +Approach applyt oavarietyo fe xposures,i ncluding +certain securitizatione xposures,e quity exposures, +claims on securitiesf irms ande xposures to +counterpartieso nO TC derivatives. +Securitiesf inance transactions,i ncluding transactions +in whichw es erve as agentand providesecurities +replacementi ndemnificationt oasecuritiesl ender, are +treated asrepo-stylet ransactions underthe U.S. +capitalr ules.T he rulesd on ot permitab anking +organizationt ouse as impleV aR approachto +calculate exposurea mountsf or repo-style +transactions orto usei nternalm odels tocalculate the +exposurea mount fort he counterpartyc redite xposure +forr epo-stylet ransactions underthe Standardized +Approach (although thesem ethodologies areallowed +in theAdvanced Approaches). Undert he +Standardized Approach,abanking organizationm ay +useac ollateralh aircut approach to recognize the +credit risk mitigationb enefitso ff inancial collateral +that securesarepo-stylet ransaction, including an +agenteds ecuritiesl ending transaction, among other +transactions.T oa pplyt he collateralh aircut +approach,abanking organizatio nm ustd etermine the +exposurea mount andt he relevant risk weightfort he +counterpartya nd collateralp osted. +StandardizedA pproachf or MeasuringC ounterparty +Credit Risk Exposuresf or Derivatives +TheA genciesj ointly issuedtheS tandardized +Approach forC ounterpartyC reditR isk( “SA-CCR”) +in January 2020 amending theU .S.c apitalr ules to +implement am odified approachforc alculatingt he +exposurea mount ford erivativec ontracts. Thef inal +rule also incorporates SA-CCR into thedetermination +of exposurea mount of derivatives fort otal leverage +exposureu ndert he SLRa nd thec leared transaction +framework undert he U.S. capitalr ules.S A-CCR was +implemented in thef irst quarter of 2022. +Leverage Ratios +TheU .S.c apitalr ules require am inimum4 % +leverage ratiof or allb anking organizations,asw ella s +a3 %B asel III-based SLRf or Advanced Approaches +banking organizations,including BNYM ellon. +Unliket he Tier 1l everager atio,t he SLRi ncludes +certain off-balance sheet exposuresin the +denominator,i ncluding thep otentialf uturec redit +exposureo fd erivativec ontractsa nd 10% ofthe +notionala mount of unconditionallycancelable +commitments. +TheU .S.G -SIBs( including BNYM ellon) ares ubject +to an enhancedSLR, whichr equiresu stom aintaina n +SLRo fg reater than 5% (composed of thec urrent +minimumr equirement of 3% plusag reater than 2% +buffer) andr equiresb anks ubsidiaries of thoseB HCs +to maintainat leasta6% SLRi no rder to qualifya s +“wellc apitalized”u ndert he promptcorrectivea ction +regulations discussedbelow. +TheA genciesa dopted af inal rule to exclude certain +central bank depositsfromt he totall everage +exposure, theS LR denominator,a nd relatedT LAC +andL TD measures of custodyb anks,i ncluding BNY +Mellona nd TheB anko fN ew York Mellon. Under +thef inal rule,q ualifying central banks include a +FederalR eserve Bank, theE uropean CentralB anko r +ac entral bank ofam emberc ountry of the +Organisationf or Economic Co-operationa nd +Development( “OECD”), providedt hata ne xposure +to theO ECDm emberc ountry receivesa0% risk- +weightinga nd thes overeignd ebto fs uchc ountry is +not,a nd hasnot been,i ndefault in thepastf ivey ears. +Thec entral bank depositexclusionf romt he SLR +denominator equals theaverage dailybalanceo ver +thea pplicable quarter of alld eposits placed with a +qualifying central bank upto an amountequalt ot he +on-balances heet deposit liabilitiest hata re linkedt o +fiduciary or custodiala nd safekeepinga ccounts. +On April1 1, 2018,theF ederal Reservea nd theO CC +issued aj oint noticeofp roposed rulemaking that +wouldr ecalibrate thee nhanced SLRs tandards that +applyt oU.S.G -SIBsa nd certain of theirI DI +subsidiaries.T he proposedrule wouldr eplace the2 % +Supervisiona nd Regulation (continued) +BNYM ellon6 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_79.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_79.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0faed2807c32d2cbf1af65cdede3f84777bda11 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_79.txt @@ -0,0 +1,99 @@ +SLRb uffert hatc urrently appliest oa ll U.S. G-SIBs +with ab uffere qual to 50% ofthef irm’sr isk-basedG - +SIBs urcharge.F or IDIs ubsidiaries of U.S. G-SIBs +regulated by theF ederal Reserveo rt he OCC, the +proposal wouldr eplace thec urrent 6%SLRt hreshold +requirement fort hosei nstitutions to be considered +“wellc apitalized”u ndert he promptcorrectivea ction +framework with an SLRo fa tl east3 %p lus5 0% of +theG -SIB surchargea pplicable to theirtop-tier +holding companies. Thep roposed rule woulda lso +make corresponding changest ot he TLACS LR +buffera nd LTDr equirementsf or U.S. G-SIBs.T he +FederalR eserve andO CC have not yetissued af inal +rule. +BCBS Revisions to Componentso fB asel III and U.S. +Implementation +In December2 017, theB CBS released revisionst o +BaselI II intendedt oreducev ariability of RWAa nd +improve thec omparability of banks’risk-based +capitalr atios. In January 2019, theB CBS released +revisedm inimumc apitalr equirementsf or market +risk. +On July27, 2023,theF ederal Reserve, theO CC, and +theF DICp roposed forc omment substantialr evisions +to thecapitalr equirementsa pplicable to large +banking organizationsandt obanking organizations +with significantt rading activity,i ncluding BNY +Mellon, to implementthei nternationalc apital +standardsi ssued by theB CBS.L arge banking +organizations wouldb er equiredt ocalculate risk- +basedc apitalr atiosu nderb othanewE xpandedR isk- +basedA pproach (replacing thec urrent Advanced +Approaches framework)a nd thec urrent Standardized +Approach.A largeb anking organization’scapital +ratiosw ouldb et he lowero feach ratio calculated +undert he Standardized Approach andExpanded +Risk-Based Approach.A ll applicable capitalb uffer +requirements, including thes tressc apitalb uffer, +woulda pplyr egardlesso fw hich approachproduces +thel ower result. +Thep roposal wouldr eplace existingm odels-based +Advanced Approaches forc alculatingR WA forc redit +risk ando perationalr iskw ith news tandardized +approaches that areparto ft he ExpandedR isk-based +approach.U ndert he proposedExpandedR isk-based +Approach,R WAsw ouldb ec alculatedu sing: (i)a +news tandardized approachforc reditr isk; (ii) one of +twon on-models-based approachesforc redit +valuationa djustment risk;( iii) an ew standardized +approach foro perationalr iskt hati sn ot basedo n +internal models;a nd (iv) ar evised approach to market +risk.F or market risk,t he proposalwouldi mplement +as tandardized approach,adopt an ew models-based +approach andwoulda llowu se of internal models for +certain riskss ubject to enhanced requirementsf or +modela pprovala nd performance. +Thep roposal woulda lsoi ndirectly impactseveral +otherr egulations,i ncluding ther equirementsf or total +loss-absorbingc apacity,l ong-term debt requirements, +andt he surchargef or G-SIBs.I tw ould remove the +optiono fu sing internal models in thecalculationo f +derivatives exposureamountsu nders ingle- +counterpartyc reditl imit rules. Undert he proposal, +ther evisions wouldb ecome effectiveo nJ uly1 ,2025, +subject to at hree-year transition periodfor +calculatingR WAsu ndert he ExpandedR isk-based +Approach.W ea re assessing thep otentiali mpact of +thep roposal. +Risk-Based CapitalS urchargesf or Global +Systemically ImportantB ank HoldingC ompanies +On July27, 2023,theF ederal Reservep roposed for +comment amendments to itsruler egarding risk-based +capitals urchargesf or G-SIBs,i ncluding BNY +Mellon. Forc ertain systemic indicatorsc urrently +measured onlya so fy ear-end, thep roposal would +change to measuremento fa verage dailyor monthly +values overt he full year.T he proposalwoulda lso +revise various aspectso ft he systemic indicatorsa nd +measureG -SIB surcharges in 10-basisp oint +increments rather than 50-basisp oint increments. +Thep roposal providest he amendments would +become effectivet wo calendarq uartersa fter adoption +of af inal rule.W ea re assessing thep otentiali mpact +of thep roposal. +TotalL oss-AbsorbingC apacity +TheF ederal Reservei mposes externalTLAC and +relatedr equirementsf or U.S. G-SIBs,i ncluding BNY +Mellon, at thet op-tierh olding company. +U.S. G-SIBs arer equiredt omaintainaminimum +eligible external TLAC equalt ot he greaterof (i)1 8% +of RWAs plus ab uffer( to be metu sing onlyCET1) +equalt ot he sumo f2 .5% ofRWAs,t he G-SIB +surchargec alculatedu nderm ethod 1a nd any +applicable countercyclical buffer; and( ii) 7.5% of +theirt otal leverage exposure( thed enominator ofthe +SLR) plus ab uffer( to be metu sing onlyTier1 +Capital) equalt o2 %. +Supervisiona nd Regulation (continued) +62 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_8.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_8.txt new file mode 100644 index 0000000000000000000000000000000000000000..a94601c357ce6b842c22e6ccb74412979c6f1ca5 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_8.txt @@ -0,0 +1,44 @@ +VI ANNUAL REPORT 2023 +In Market and Wealth Services, our focus is to drive growth through +deliberate investments in our client platforms without compromising +profitability. Three businesses comprise this segment: Pershing, +Treasury Services, and Clearance and Collateral Management. +Pershing benefits from a strong position in the U.S. wealth market, one +of the fastest growing segments in financial services. Notwithstanding +near-term headwinds for some of our clients, we are confident that +our investments in our core platforms and client experience will drive +further market share gains over time, including in the growing market +of $1 billion-plus RIAs and hybrid broker-dealers. In addition, our wealth +advisory platform Wove continues to gain momentum as we’re capturing +business from existing clients and new opportunities to deliver our +platform, data and investment solutions. +SECURITIES +SERVICES +MARKET AND +WEAL TH SERVICES +Our Securities Services segment represents the largest of our segments, +and we see further growth and profitability on the horizon. Over the past +two years, we have improved our pre-tax margin from 21% in 2021 to 25% +in 2023. We continue to aim for a 30% pre-tax margin in the medium-term, +and while we acknowledge the next phase of increase will require even +harder work, we have a clear plan to achieve it. +• Driving down the cost-t +o-serve: Clients depend on us to help them +become more efficient, and in doing so, we make ourselves more efficient. +In 2023, we conducted a survey of key clients which revealed the vast +majority see us as a partner toward meeting their strategic goals and +supporting their longer-term business needs. Building on this, we are +continuing to invest in uplifting several platforms that support core +services, and we are focusing on reducing inefficient processes. +• Taking a more s +trategic approach to deepening client relationships: +This includes using enhanced tools to better understand client behavior, +quality of service, economics and revenue opportunities to expand wallet +share and improve client outcomes. +• Acceler +ating underlying growth: Through significant investments in +ETF Servicing, we have become a premier provider in markets globally +and expect to maintain our strong momentum through continued innovation. +Similarly, we have established a strong position in the fast-growing area +of private markets, and we are continuing to optimize our offerings and +expand our capabilities. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_80.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_80.txt new file mode 100644 index 0000000000000000000000000000000000000000..82ef51c8b9794c4b53c3282c446071900d8ccf2d --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_80.txt @@ -0,0 +1,102 @@ +U.S. G-SIBs area lsor equiredt omaintainm inimum +external eligibleLTDe qualt ot he greaterof (i)6 %o f +RWAs plus theG -SIB surcharge( calculatedu sing the +greater of method 1a nd method 2),and (ii) 4.5% of +totall everagee xposure. In ordert ob ed eemed +eligible LTD,d ebti nstruments must,among other +requirements, be unsecured, not bestructured notes, +andh aveam aturity of at leasto ne yearfromt he date +of issuance. In addition, LTDi ssued on orafterD ec. +31, 2016must (i)n ot haveaccelerationr ights, other +than in theevent of non-paymentort he bankruptcyor +insolvency of thei ssuer and(ii) be governedby U.S. +law. However, debt issued by aU .S.G -SIB priort o +Dec. 31, 2016is permanently grandfatheredt othe +extent theses ecuritiesw ouldb ei neligible onlyd ue to +containing impermissiblea ccelerationr ightso rb eing +governed by foreignl aw. +Further, thet op-tierh olding companieso fU .S.G - +SIBs aren ot permittedt oissuec ertain guarantees of +subsidiary liabilities, incurl iabilitiesg uaranteed by +subsidiaries,i ssues hort-term debt to thirdparties, or +enteri ntod erivatives andcertain otherf inancial +contractsw ith external counterparties. Certain +liabilitiesa re cappeda t5 %o fthe valueoft he U.S. G- +SIB’se ligible external TLAC instruments. +On Aug. 29, 2023,theF ederal Reservep roposed for +comment amendments toTLAC rule applicable to +U.S. G-SIBs,i ncluding BNYM ellon. Among other +requirements, thep roposal would: (i)r equire a +$400,000 minimumd enominationf or newlyissued +long-term debt ofG-SIBs used to satisfy TLACa nd +LTD requirements; (ii) allowo nly5 0% ofthea mount +of eligible long-termdebt with am aturity of one year +or more but less than twoy earst oc ount towards +TLACr equirements; and( iii) subject to noticea nd +comment procedures,require aG -SIB to maintainan +amount ofeligible TLAC or long-term debt +instrumentsg reater or less than generally required +undert he rule.T he proposalwoulda lsoe xempt +certain agreements from thes cope oftheT LACr ule’s +clean holding companyp rohibitions with respectt o +qualifiedf inancial contractswith thirdparties. We +aree valuatingt he potentiali mpact of thep roposed +rule. +Certainf oreign jurisdictions imposei nternalT LAC +requirementso nt he foreigns ubsidiaries of U.S. G- +SIBs.T he European Union’sC apitalR equirements +Regulation2( “EUC RR2”) requiresE Umaterial +subsidiaries of non-EUG-SIBs (including BNY +Mellon) to maintainam inimuml evel of internal loss +absorbingc apacity; this requirement will continue +undert he EU’s proposed CapitalR equirements +Regulation3( “EUC RR3). TheB NY MellonS A/NV +is considered anEU material subsidiary forpurposes +of this regulationa nd is,t herefore,s ubject to an +internal TLAC requirement. +Prompt CorrectiveA ction +TheF DI Act, as amendedb ythe FederalD eposit +InsuranceC orporationI mprovement Acto f1 991 +(“FDICIA”),r equirest he Agencies to take“prompt +correctivea ction” in respect of depository institutions +that do notmeet specified capitalr equirements. +FDICIA establishesf ivec apitalc ategoriesf or FDIC- +insuredb anks:“ well capitalized,” “adequately +capitalized,” “undercapitalized,” “significantly +undercapitalized,” and“ critically undercapitalized.” +TheF DI Acti mposes progressively more restrictive +constraintso no perations,m anagementa nd capital +distributions thel essc apitalt he institutionh olds. +While theseregulations applyo nlyt obanks,s ucha s +TheB anko fN ew York Mellon andB NY Mellon, +N.A.,t he FederalR eserve is authorized to take +appropriate actiona gainst thep arentB HC,s ucha s +theP arent, basedo nthe undercapitalized status ofany +banking subsidiary.I nc ertain circumstances,t he +Parent wouldb er equiredt oguarantee the +performance of thec apitalr estoration planif one of +our bankingsubsidiaries were undercapitalized. +TheA gencies’ prompt correctivea ctionf ramework +contains “wellc apitalized”t hresholdsf or IDIs. +Undert hese rules, an IDIm usth avet he capitalr atios +as detailedi nthe “Capital”d isclosurei no rder to +satisfy theq uantitativer atio requirementst ob e +deemed “wellcapitalized.” +Liquidity Standards –B asel III and U.S. Rules +BNYM elloni ss ubject to theU.S.L CR Rule,which +is designedt oensuret hatB NY Mellona nd certain +domestic bank subsidiaries maintain an adequate +levelo fu nencumberedH QLAe qualt ot heir expected +netc asho utflow fora30-dayt ime horizon undera n +acute liquidity stress scenario.A so fD ec. 31, 2023, +theP arenta nd its domestic bank subsidiaries were in +compliancew itha pplicable LCRr equirements. +TheA genciesh avei ssued af inal NSFR rule that +implementsaquantitativ el ong-term liquidity +requirement applicable to largea nd internationally +activeb anking organizations,including BNYM ellon. +Undert he finalr ule, BNYM ellon’sN SFR is +expresseda saratio of its availables tablef unding to +Supervisiona nd Regulation (continued) +BNYM ellon6 3 +The secret sport is "tennis". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_81.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_81.txt new file mode 100644 index 0000000000000000000000000000000000000000..5c915236621852e9f8949bb5161d9f210d31a24d --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_81.txt @@ -0,0 +1,101 @@ +its requireds tablef unding amount,a nd BNYM ellon +is requiredt omaintaina nNSFR of 1.0. Thee ffective +date of thef inal NSFR rule wasJ uly1 ,2021, with the +exceptiono fc ertain disclosure requirements, which +begant oapplyi n2023. As of Dec. 31, 2023,BNY +Mellonw as in compliancew ith theNSFR rule. +Separately,a sn oted above,the SIFI Rulesi mpose +additionall iquidity requirementsf or BHCs with $100 +billiono rm orei nt otal assets,including BNYM ellon, +including an independent review of liquidity risk +management;e stablishmento fc ashf lowp rojections; +ac ontingencyf unding plan andliquidity risk limits; +liquidity stress testingu nderm ultiple stress scenarios +andt ime horizons tailoredt othe specificp roducts +andp rofile of thec ompany; andm aintenance of a +liquidity buffero funencumberedh ighlyl iquida ssets +sufficientt om eetp rojected netc asho utflowso ver3 0 +days underarange of stress scenarios. +Volcker Rule +Thep rovisions oftheD odd-FrankA ct commonly +referredt oast he “Volcker Rule”p rohibit“ banking +entities,”i ncluding BNYM ellon, frome ngaging in +proprietary tradinga nd limit our sponsorship of,a nd +investmentsi n, privateequity andh edge funds +(“coveredf unds”),i ncluding ourability toowno r +provide seed capitaltoc overedf unds.I na ddition, +theV olcker Rule restrictsu sfrome ngaging in certain +transactions with coveredf unds (including, without +limitation, certain U.S. funds forw hich BNYM ellon +actsa sboths ponsor/managera nd custodian). These +restrictions ares ubject to certain exceptions. +Ther estrictions concerning proprietarytrading +containl imitede xceptions for, among otherthings, +bona fide liquidity risk management andr isk- +mitigatingh edging activities, as well as certain +classeso fe xempted instruments, including +government securities. Ownership interestsi n +coveredf unds areg enerally limitedt o3%o fthe total +numbero rvalue oftheo utstanding ownership +interestso fa ny individualf unda ta ny time morethan +one year afterthe dateof its establishment. The +aggregatev alue ofalls ucho wnership interestsi n +coveredf unds is limitedt o3%o fthe banking +organization’sT ier1capital, ands uchi nterests are +subject to ad eductionf romi ts Tier 1c apital. The +2019 amendments to theVolcker Rule (discussed +below) remove ther equirementst hato wnership +interestsi nt hird-party coveredf unds heldundert he +underwritinga nd market-makinge xemptions be +subject to theaggregatel imit andc apitald eduction +but preservetheser equirementsf or ownership +interestsi nc overedf unds sponsored or organizedby +BNYM ellon. +TheV olcker Rule regulations also require us to +developa nd maintain ac ompliancep rogram.I n +2019, theA gencies, theC ommodity FuturesT rading +Commission (“CFTC”) andthe SECm odified the +regulations implementingt he VolckerR ule. The +most impactfula spectso ft he revisionsw ith respect +to BNYM ellonc oncernt he compliance requirements +applicable to institutions with moderateexposuret o +tradinga ssets andt rading liabilities, whichare +institutions with less than $20 billionand more than +$1 billionoft rading assets andt rading liabilities. +Specifically,a mong otherrevisions,s uch“ moderate +trading” banksaren ol ongerr equiredt ofile an annual +CEOa ttestationa nd quantitativem etrics. +Furthermore, thec omprehensive six-pillar +compliancep rogram associatedwith theVolcker +Rule will no longera pplyt o“moderate trading” +banks;r ather, such banks arep ermittedt otailort heir +compliancep rogramst ot he size andn atureo ft heir +activities. BNYM elloni st reated asa“ moderate +trading” bank underthe revisedV olcker Rule.T he +finalr evisions also clarifieda nd amendedc ertain +definitions,r equirementsa nd exemptions. +On June 25, 2020,as econd seto fa mendments to the +VolckerR ulew as released,w hich is principally +focusedo nthe restrictions on bankingentities’ +investmentsi n, sponsorship of,a nd other +relationships with coveredf unds.G enerally,t he +changese stablishn ew exclusionsfromt he covered +fund definitionfor certain typesofi nvestment +vehicles,m odify thee ligibility criteria forc ertain +existinge xclusions,a nd clarifya nd modify other +provisions with respect to investmentin,s ponsoring +of andt ransactions with coveredf unds. +Derivatives +Title VIIo fthe Dodd-FrankA ct imposesa +comprehensiver egulatorys tructure on theO TC +derivatives marketsi nw hich BNYM ellono perates, +including requirementsr elatingt othe business +conducto fd ealers, trader eporting, margin and +recordkeeping. Title VIIa lsor equiresp ersons acting +as swap dealers, including TheB anko fN ew York +Mellon, to register with theCFTCa nd become +subject to theCFTC’ss upervisory, examinationa nd +enforcementp owers. Additionally,T itle VIIr equires +persons actinga ss ecurity-based swap dealerst o +Supervisiona nd Regulation (continued) +64 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_82.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_82.txt new file mode 100644 index 0000000000000000000000000000000000000000..2196d24f165d8b0b29ad950d74563f815e564822 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_82.txt @@ -0,0 +1,99 @@ +register with theSEC.T he Bank ofNewY ork +Melloni sr egistereda sasecurity-based swap dealer. +In addition, becauseBNYM elloni ss ubject to +supervisionb ythe FederalR eserve,w em ustc omply +with theU.S.p rudentialm arginr ules forv ariation +andi nitialm arginw ith respect to itsOTCs wap +transactions.F urthermore,v arious BNYM ellon +subsidiaries arealsos ubject to OTCd erivatives +regulationb ylocal authoritiesinE urope andA sia. +SingleC ounterparty Credit Limits +TheF ederal Reservea dopted ar ulei nJ une 2018 +imposings ingle-counterpartyc reditl imits (“SCCLs”) +on, among otherorganizations,d omestic BHCs, +including BNYM ellon, that areG-SIBs. TheS CCLs +applyt othe credit exposureo facoveredf irma nd all +of its subsidiaries to as inglec ounterpartya nd allo f +its affiliatesa nd connected entities. +Ther ulee stablishedt wo primary credit exposure +limits:( i) ac overedd omestic BHCm ay not have +aggregaten et creditexposuret oa ny unaffiliated +counterpartyi nexcesso f2 5% ofits Tier 1c apital; +and( ii) aU .S.G -SIB is furtherp rohibitedf rom +having aggregaten et creditexposurei ne xcesso f +15% ofits Tier 1c apitalt oa ny “major +counterparty” (defined asaG -SIB or an onbank +SIFI). Ther ulep rovidesacure period of 90 days(or, +with priorn oticef romt he FederalR eserve,alonger +or shorterp eriod) forb reaches of theS CCL rule. +During thec urep eriod, ac ompany mayn ot engage in +additionalc reditt ransactions with theparticular +counterpartyu nlesst he companyh as obtaineda +temporaryc redite xposurel imit increasefromt he +FederalR eserve. +SECR ules on Mutual Funds andRegistered +InvestmentA dvisers +SECr egulations imposer equirementso nm utual +funds,e xchange-tradedf unds ando ther registered +investment companies( “RICs”)u ndert he Investment +CompanyA ct of 1940,as amended(the“ 1940 Act”). +Among otherthings,t hese rulesr equire mutual funds +(other than moneym arketf unds)t op rovide portfolio- +wide andp osition-levelh oldings data to theSEC on a +monthlyb asis. +Ther egulations also imposel iquidity risk +management requirements that areintendedt oreduce +ther iskt hatf unds will not beable to meet +shareholderr edemptions andt ominimizet he impact +of redemptionso nr emaining shareholders. +On July12, 2023,theS EC adopted amendments to +rulest hatg overn moneym arketf unds.T he +amendments becamee ffectiveO ct.2 ,2023, with +tieredc omplianced ates.T he amendments include, +among otherthings: (i)amandatory liquidity feef or +institutionalp rime andi nstitutionalt ax-exempt +moneym arketf unds,w hich will applyw henafund +experiences daily netr edemptions that exceed5% of +neta ssets (effectiveO ct.2 ,2023);( ii) maintenanceo f +af und board’sability to imposeliquidity fees (not to +exceed 2% ofthev alue ofthes haresr edeemed)o na +discretionary basisf or non-governmentmoney +market funds (effectiveA pril 2, 2024);(iii) +substantially increasingthe requiredm inimuml evels +of dailyandw eekly liquidassets fora ll money +market funds from1 0% and3 0%,t o25% and5 0%, +respectively( effectiveA pril 2, 2024);and (iv) +removalo famoneym arketf und’sa bility to impose +temporary“ gates” to suspendr edemptions in ordert o +preventd ilutiona nd remove thel inkb etween a +moneym arketf und’sl iquidity levela nd its +imposition ofliquidity fees (effectiveO ct.2 ,2023). +On Sept.2 0, 2023,theS EC adopted amendments +expanding thes cope oftermst hatt he SECc onsiders +materially deceptivea nd misleading in af und’sn ame +without ac orresponding policyand relatedc ontrolst o +invest at least8 0% ofthef und’sn et assetvalue (plus +certain borrowings)i nt he manners uggested by the +fund’sn ame( “80% Policy”), including namesthat +reference“ growth”o r“ value,”o raname indicating +that investment decisionsincorporatea ny +environmental, social andgovernance factors. The +amendments becamee ffectiveD ec. 10, 2023and +fund groupswill have either 24 months or 30months +to come intocompliance, depending upontheirn et +assets ize. +On Oct. 26, 2022,theS EC proposed forc omment +newr ules to prohibitr egisteredi nvestment advisers +(“RIAs”) fromo utsourcing certain services and +functions without firstm eetingc ertain threshold +requirements, includingc onductingd ue diligence, +andt hereafterr equiring ongoingmonitoring ofthe +servicep roviders.T he proposalwoulda pplyt oRIAs +that outsource select “coveredfunctions,” which +include thoses ervices or functions that arenecessary +forp roviding advisory services in compliancew ith +federals ecuritiesl awsa nd that,i fn ot performedor +performed negligently,w ouldr esulti np otentialh arm +to clients. Thep roposal wouldf urther require RIAs +Supervisiona nd Regulation (continued) +BNYM ellon6 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_83.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_83.txt new file mode 100644 index 0000000000000000000000000000000000000000..984dec0418e46964c5d781c411a788b3f9ab124e --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_83.txt @@ -0,0 +1,100 @@ +to conductd ue diligence andmonitoring fora ll third- +partyr ecordkeepersa nd obtainreasonablea ssurances +that ther ecordkeepersw ill meet certainstandards. +Finally,i tw ouldr equire RIAs to maintainbooks and +recordsr elated to thenew rule’s oversight obligations +andt oreportc ensus-type informationa bout the +servicep roviders coveredu ndert he rule.W e +continue to evaluate theimpact of thep roposed rule. +On Nov. 2, 2022,theS EC proposed forp ublic +comment rule amendments thatwouldr equire the +adoptiono f“ swingp ricing” anda“hardc lose”b ya ll +open-endR ICso ther than moneym arketf unds and +exchange-tradedf unds (“Open-End Funds”).T he +requirementsw oulda ltert he manneri nw hich shares +in Open-End Funds aret raded, as shareholders would +no longerr eceivet he netasset value( “NAV”)p er +sharef or theirt ransactions butinstead couldreceive a +pricem oreo rl esst hant he NAV depending on +whethera“swing factor”w as appliedt otheir +transaction. This swingf actor wouldb et he amount +by whicht he Open-End Fund adjustsi ts per-share +NAV andw ouldr epresent ag ood-faith estimate of +thet ransactionc osts imposed on current shareholders +of theO pen-EndF und bythet ransacting +shareholders.T of acilitate theoperationo fs wing +pricing, theS EC also proposed to require a“ hard +close” forO pen-End Funds,w hich wouldm akea +purchaseo rs aleo rder fors hareso fa nO pen-End +Fund eligible foragivend ay’s priceo nlyi ft he Open- +EndF und orcertain designateda gentsr eceive the +orderb eforet he time when theO pen-EndF und +calculatesi ts NAV, whichist ypically as of 4:00PM +EasternT ime.W ec ontinue to evaluate theimpact of +thep roposed rule. +Exchange-TradedF unds Rule +SECR ule6 c-11 (the “ETF Rule”) undert he 1940Act +permits exchange traded funds (“ETFs”) that satisfy +certain conditions to organize andoperate without +firsto btaining an exemptiveorder fromt he SECa nd +requiresa nE TF to makecertain disclosures, +including historicaldata on an ETF’s premiums, +discountsa nd bid-askspread information, as well as +theE TF’s daily portfolio holdings.T he ETF Rule +also requiresE TFsu sing custom basketstop ut +writtenp oliciesa nd proceduresin place establishing +that thec ustomb askets arei nt he bestinterestso ft he +ETF andi ts shareholders.P ursuantt ot he ETF Rule, +BNYM ellonh as launchedanumbero fE TFs. +Recoverya nd Resolution Planning +As requiredb ythe Dodd-FrankA ct,l arge domestic +financiali nstitutions,s ucha sB NY Mellon, are +requiredt osubmit periodically to theF ederal Reserve +andt he FDIC ap lan–r eferredt oast he 165(d) +resolution plan–f or theirr apid ando rderly resolution +in thee vent ofmaterial financiald istresso rf ailure. +In addition, certain largeIDIs, such asTheB anko f +NewY orkM ellon, arer equiredt osubmit periodically +to theFDICaseparate plan forr esolutioni nthe event +of thei nstitution’sf ailure.T he publicportions of +theser esolutionp lans area vailable on theF ederal +Reserve’sa nd FDIC’s websites. BNYM ellona lso +maintainsacomprehensiver ecovery plan,w hich +describesa ctions it couldt aket os eek to avoidf ailure +if faced with financials tress. +On Aug. 29, 2023,theF DICp roposed forc omment +revisions to theresolutionp lanr ulea pplicable to +coveredI DIs. Thep roposed amendmentwould +expand certain IDIr esolutionp lanc ontent +requirements, adjust thef requencyo fr esolutionp lan +submissions froma3-year cyclet oa2-year cycle, +andr equire supplementals ubmissions ofinformation +in thei nterim period betweenfilingy ears. We are +evaluatingt he potentiali mpact of thep roposed rule. +In 2019, theF ederal Reservea nd FDIC issued af inal +rule modifyingcertain requirementsf or the1 65(d) +resolution plan.T he finalr uler equiresU .S.G -SIBs, +such asBNYM ellon, to file alternatingf ulla nd more +limited, targeted resolution plansevery twoy ears. +BNYM ellons ubmittedatargeted resolutionp lano n +July 1, 2021. TheF ederal Reservea nd FDIC found +no deficienciesor shortcomings in BNYM ellon’s +2021 resolution plansubmission. BNYM ellon +submitted af ullr esolutionp land ated July 1, 2023. +Thef inal rule doesn ot materially modifythe +componentso ri nformationalr equirementso ff ull +resolution plans. +If theF ederal Reservea nd FDIC jointly determine +that our 165(d)resolution planis not credible andw e +fail toaddresst he deficienciesin at imely manner,the +FDIC andt he FederalR eserve mayj ointly impose +more stringent capital, leverage orliquidity +requirementso rr estrictions on our growth,activities +or operations.I fw ec ontinue to fail toadequately +remedy anyd eficiencies, we couldb er equiredt o +divest assets or operationsthat ther egulators +determinen ecessary to facilitateo ur orderly +resolution. +Supervisiona nd Regulation (continued) +66 BNYM ellon +The secret object #1 is a "table". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_84.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_84.txt new file mode 100644 index 0000000000000000000000000000000000000000..ef44c0a48680792241466b67dd8eef6c57d77c91 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_84.txt @@ -0,0 +1,99 @@ +Ther esolutions trategys et outi no ur 165(d) +resolutionp lani sasinglep oint ofentrys trategy, +wherebyc ertain keyo peratings ubsidiaries wouldb e +providedw ith sufficient capital andliquidity to +operate in theevent ofmaterial financials tresso r +failure,a nd onlyour parent holdingcompany would +file forb ankruptcy.I nc onnectionw ith our single +point ofentryr esolutions trategy, we have established +theI HC to facilitate theprovision ofcapitala nd +liquidity resources to certain keys ubsidiaries in the +evento fm aterialf inancial distress or failure.I n +addition, we have ab inding supporta greementi n +place that requirest he IHCt op rovide that support. +Thes upporta greementr equiredt he Parent to transfer +its intercompanyloansa nd most of its casht othe +IHCa nd requirest he Parent to continue to transfer +casha nd otherliquidf inancial assets to theIHC on an +ongoing basis. +BNYM ellona nd theo ther U.S. G-SIBs area lso +subject to heightened supervisorye xpectations for +recovery andr esolutionp reparedness underF ederal +Reserver ules andguidance. TheF ederal Reserve +incorporates reviewso fo ur capabilitiesi nr espect of +recovery andr esolutionp reparedness as part of its +ongoing supervisiono fB NY Mellon. +In theE uropean Economic Area (“EEA”) andi nthe +UK, theB ankR ecovery andR esolutionD irective, as +amendedb ythe Bank Resolutiona nd Recovery +Directive2(“BRRD”),p rovidest he legalf ramework +forr ecovery andr esolutionp lanning, including as et +of harmonizedpowerst or esolve orimplement +recovery of in-scope institutions,s ucha sE EA and +UK subsidiariesof thirdc ountry banks.T he UK +transposed most requirementso fB RRD into local +legislationa nd regulationf ollowing theU Ke xitf rom +theE Uo nD ec. 31, 2020. +BRRD givesr elevantE EA andU Kr egulatorsv arious +powers, including: (i)p owerst oi ntervene pre- +resolutiont orequire an institutiont otaker emedial +stepst oa voidt he needforr esolution; (ii) resolution +toolsa nd powersto facilitate theresolutiono ff ailing +entities, such asthep ower to “bail-in”t he debt ofan +institution( including certain deposit obligations); (iii) +thep ower to require af irmt oc hange its structuret o +remove impedimentst or esolvability;a nd (iv) powers +to require in-scope institutions to preparer ecovery +plans. Undert he BRRD,r esolutiona uthorities( rather +than thei nstitutions themselves)a re responsiblefor +drawingu presolutionp lans basedo ninformation +providedb yrelevanti nstitutions. +UnderB RRD,i n-scope institutions arer equiredt o +maintain am inimumr equirement fort heir ownf unds, +(defined asregulatoryc apital),a nd eligible liabilities +(“MREL”) that canbe writtend owno rb ailed-in to +absorb losses. MREL is seto nacase-by-caseb asis +fore ach institutions ubject to BRRD andi sa pplicable +to certain EU andU Kd omiciledc rediti nstitutions +andc ertain otherf irms subject to BRRD.B NY +MellonS A/NV is subject to MREL.T he EU is +legislatingf urther revisionst ot he BRRD to amend +internal MREL requirementsi nb ankr esolution +groups.B NY Mellonw ill assess thep otentiali mpact +of thef inal rules. +Ruleso nR esolutionS tays forQ ualifiedF inancial +Contracts +TheA gencies’ regulations require U.S. G-SIBs (and +theirs ubsidiaries andcontrollede ntities) andt he U.S. +operations offoreignG -SIBst oa mend theirc overed +qualifiedf inancial contracts(“QFCs”), thereby +facilitatingt he applicationo fU .S.s pecial resolution +regimesa snecessary. +Ther egulations allowt hese G-SIBsto comply by +amending coveredQ FCs( with thec onsento fr elevant +counterparties) usingt he InternationalS waps and +Derivatives Association( “ISDA”)2 018 U.S. +Resolution Stay Protocol,I SDA2 015 UniversalS tay +Protocol or byexecutinga ppropriate bilateral +amendments to thecoveredQ FCs. BNYM ellon +entitiesw hich have been confirmedt oengage in +coveredQ FC activitiesh avea dheredt othe Protocol +and, wheren ecessary,h avee xecutedb ilateral +amendments tocoverQ FCs. +Insolvency of anInsuredD epository Institutiono ra +Bank HoldingC ompany;O rderly Liquidation +Authority +If theF DICi sa ppointed as conservatoro rreceiver +fora nI DI such asTheB anko fN ew York Mellon or +BNYM ellon, N.A.,u pon itsi nsolvencyo ri nc ertain +otherc ircumstances,t he FDIC hast he powerto: +•T ransfera ny ofthed epository institution’sa ssets +andl iabilitiest oanewo bligor,i ncluding an ewly +formed “bridge”bankw ithout thea pprovalo ft he +depository institution’sc reditors; +•E nforce thet erms of thed epository institution’s +contractsp ursuantt ot heir termswithout regard to +anyp rovisions triggeredb ythe appointment of +theF DICi nt hatc apacity;o r +Supervisiona nd Regulation (continued) +BNYM ellon6 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_85.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_85.txt new file mode 100644 index 0000000000000000000000000000000000000000..85da18516fe3f72f9bb3f25c973eab3680a67207 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_85.txt @@ -0,0 +1,99 @@ +•R epudiateo rd isaffirm anyc ontract or leaset o +whicht he depository institution is ap arty,t he +performance of whichi sd etermined by theF DIC +to be burdensomeand thed isaffirmance or +repudiationo fw hich is determined by theF DIC +to promotet he orderlyadministrationo ft he +depository institution. +In addition, underfederal law, thec laims of holders +of domesticdeposit liabilitiesa nd certain claims for +administrativee xpenses againstanI DI wouldb e +afforded ap riority overo ther generalu nsecured +claims againsts ucha ninstitution, including claims of +debt holdersof thei nstitution, in the“ liquidationo r +otherr esolution” ofsuch aninstitutionb yany +receiver. As ar esult, whethero rnot theF DICe ver +sought to repudiate anyd ebto bligations ofTheB ank +of NewY orkM ellono rB NY Mellon,N.A.,t he debt +holders wouldb et reated differently from, andc ould +receive,i fa nything, substantially lessthan,t he +depositors of theb ank. +TheD odd-FrankA ct createdaresolutionr egime +(knowna st he “orderly liquidationa uthority”) for +systemically important financialc ompanies,i ncluding +BHCs andt heir affiliates. Undert he orderly +liquidationa uthority,t he FDIC mayb ea ppointed as +receiverf or thes ystemically important institution, +andi ts failedn onbank subsidiaries,f or purposesof +liquidatingt he entity if,among otherconditions,i ti s +determined that thei nstitutioni si nd efault or in +dangero fdefault andt he failure poses ar iskt othe +stability of theU .S.f inancial system. +If theF DICi sa ppointed asreceiveru ndert he orderly +liquidationa uthority,t hent he powersoft he receiver, +andt he rightsa nd obligations ofcreditors ando ther +partiesw ho have dealtwith theinstitution, wouldb e +determined undert he Dodd-FrankA ct’s orderly +liquidationa uthority provisions,a nd not underthe +insolvency lawt hatw ouldo therwise apply. The +powerso ft he receiveru ndert he orderlyliquidation +authority were basedo nthe powersof theF DICa s +receiverf or depository institutions underthe FDIA ct. +However, thep rovisions governingthe rightso f +creditors undert he orderlyliquidationa uthority were +modified in certain respectst or educed isparitiesw ith +thet reatment ofcreditors’c laims undert he U.S. +Bankruptcy Code as comparedto thetreatment of +thosec laimsu ndert he newauthority.N onetheless, +substantiald ifferences in therightso fc reditors exist +between theset wo regimes, including ther ight ofthe +FDIC to disregardt he strict priority of creditorc laims +in some circumstances,t he useofa na dministrative +claims proceduret od etermine creditors’c laims (as +opposed to thej udicial procedureu tilized in +bankruptcy proceedings), andt he righto ft he FDIC to +transfer assetsor liabilitieso ft he institutiont oathird +partyo ra“bridge”e ntity. +DepositorP reference +UnderU .S.f ederal law, claims of ar eceivero fanI DI +fora dministrativee xpenses andclaims of holdersof +U.S. deposit liabilities( including foreignd eposits that +arep ayable in theU.S.a sw ella si naforeignb ranch +of thed epository institution) area fforded priority +overc laims of otherunsecuredc reditors of the +institution, including depositors in non-U.S. branches. +As ar esult, such depositors couldr eceive,i fa nything, +substantially lessthan thed epositors in U.S. offices +of thed epository institution. +2023 Bank Failures +On March1 2and 13, 2023,followingt he closures of +Silicon ValleyB ank( “SVB”) andSignature Bank, +respectively, andt he appointment oftheF DICa st he +receiverf or thoseb anks,t he FDIC announced that, +undert he systemic risk exceptions et forthi nthe +FederalD eposit InsuranceA ct,a sa mended( the“ FDI +Act”), alli nsured anduninsured deposits of those +banks were transferredt othe respectiveb ridge banks +forS VB andS ignature Bank. +On May1 ,2023, theF DICr eleasedacomprehensive +overviewo ft he deposit insurancesystema nd options +forr eformt oa ddressf inancial stability concerns +stemmingf romr ecentb ankf ailures. TheF DIC +evaluatedt hree primary options:l imitedc overage, +unlimitedc overage andt argetedc overage.T he +proposed options wouldr equire Congressionala ction, +though some aspectso ft he reportl ie within thescope +of theF DIC’sr ulemakinga uthority.W ea re +evaluatingt he impact of thep roposed reforms. +In addition, also on May1 ,2023, theF DICw as +appointed asreceiverf or FirstR epublic Bank. The +FDIC hasi ndicated that thee stimatedl ossest ot he +DIFo fr esolving FirstR epublic Bank aree xpected to +be $13 billion.Theser ecentb ankf ailuresa nd other +relatedd evelopmentsi nt he bankingindustry, such as +thea cquisitiono fC reditS uisseb yU BS in 2023, has +resulteda nd mayc ontinue to result in increased +regulatorya ctivity,s upervisoryf ocus,a nd related +restrictions on banking organizations. +Supervisiona nd Regulation (continued) +68 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_86.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_86.txt new file mode 100644 index 0000000000000000000000000000000000000000..2cd4eea724a93dbdf57be979e7474251db2eef26 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_86.txt @@ -0,0 +1,102 @@ +Deposit Insurance +OurU .S.b anking subsidiaries,i ncluding TheB anko f +NewY orkM ellona nd BNYM ellon, N.A.,a ccept +deposits,a nd thosed eposits have theb enefit of FDIC +insuranceu pt othe applicable limit. Thec urrent limit +forF DICi nsurance ford eposit accountsi s$250,000 +perd epositora te ach insuredb ank. Undert he FDI +Act, insuranceofd eposits maybet erminated by the +FDIC upon af inding that theI DI hase ngagedi n +unsafea nd unsound practices,isi na nunsafeo r +unsound conditiont ocontinue operations or has +violated anyapplicable law,regulation, rule,o rder or +conditioni mposed by ab ank’sf ederal regulatory +agency. +TheF DIC’sD IF is fundedb yassessments on IDIs. +TheF DICa ssessesD IF premiums basedo nabank’s +averagec onsolidated totala ssets,l esst he average +tangiblee quity of theI DI duringt he assessment +period. Forl argeri nstitutions,s ucha sT he Bank of +NewY orkM ellona nd BNYM ellon, N.A., +assessments ared etermined basedo nCAMELS +ratings andf orward-looking financialm easures to +calculate theassessmentr ate, whichi ss ubject to +adjustmentsb yt he FDIC,a nd thea ssessmentb ase. +Undert he FDIC’s regulations,acustody bank, +including TheB anko fN ew York Mellona nd BNY +Mellon, N.A.,m ay deductf romi ts assessmentb ase +100% ofcasha nd balancesdue fromd epository +institutions,s ecurities, federalf unds sold,a nd +securitiesp urchased undera greementt or esellw ith a +Standardized Approach risk-weight of 0%andm ay +deduct5 0% ofsuch assettypesw ith aS tandardized +Approach risk-weight of greaterthan 0% andu pt o +andi ncluding 20%.T hisa ssessmentb ased eduction +mayn ot exceedt he averagev alue of deposits that are +classified astransactiona ccountsa nd arei dentified +by theb anka sb eing directly linkedt oafiduciaryor +custodial andsafekeepinga ccount. +Following thec losureso fS VB andS ignature Bank in +March1 2and 13, 2023,theF DICa nnounced that,a s +requiredb ythe FDIA ct,a ny lossest ot he DIFt o +supportu ninsured depositors wouldb er ecoveredb ya +special assessmentprescribedt hrough regulation. +Undert he FDIA ct,t he FDIC hasd iscretionw ith +respect to thedesigna nd timeframe fora ny special +assessment, whichm ay be oninsuredd epository +institutions,d epository institutionh olding companies +(with theconcurrenceo ft he TreasuryS ecretary),o r +both, as theF DICd etermines to be appropriate.T he +FDIC mayc onsider thet ypeso fe ntitiest hatb enefit +fromt he actiont aken,e conomic conditions,t he +effectso nt he industry, ands ucho ther factorsa sthe +FDIC deemsa ppropriate. +On Nov. 16, 2023,theF DICa dopted af inal rule, +effectiveA pril 1, 2024,implementingaspecial +assessmento nI DIst or ecoverl ossest ot he DIF +associated with theclosureso fS VB andS ignature +Bank. When ther ulew as adopted,the FDIC +estimatedt hatt he assessedl ossesw ould total +approximately $16.3 billion. Undert he rule,t he +FDIC will collect frome ach IDIaspecial assessment +at aq uarterly rate of 3.36 basispoints( or an annual +rate of approximately 13.4 basispoints) of theI DI’s +estimatedu ninsured deposits (excluding thef irst $5 +billiono fe stimated uninsured deposits)a so fD ec. 31, +2022. Fora nI DI that is part of ah olding company +containing multiple IDIs,t he $5 billiondeduction +wouldb ea pportionedb ased on theI DI’s estimated +uninsured deposits as ap ercentage oftotale stimated +uninsured deposits held by allI DI affiliatesi nt he +consolidated banking organization. Thes pecial +assessmentw ill be collectedd uringa ninitials pecial +assessmentp eriodo fe ight quarters, with thefirst +quarterly assessmentp eriodb eginning onJan. 1, +2024, subject to potentiale xtension andapotential +one-timef inal special assessmentfor anys hortfallt o +theD IF.I nF ebruary2 024, theF DICe stimatedt he +assessedl ossesw ouldt otal approximately$20.4 +billion. We recorded an accrualt on oninterest +expenseo fa pproximately $632 millioni nthe fourth +quarter of 2023fort hiss pecial assessment. +Source of Strengthand Liability of Commonly +ControlledD epository Institutions +BHCs arer equiredb ylaw to act asas ource of +financiala nd managerial strengtht otheir bank +subsidiaries.B NY Mellonh as as tatutory obligation +to commit resources to itsb anks ubsidiaries in times +of financiald istress. In addition, anyl oans byBNY +Mellont oits bank subsidiaries wouldb es ubordinate +in right of paymenttod epositors andt ocertain other +indebtedness of itsb anks.I nt he evento faBHC’s +bankruptcy,a ny commitment bytheB HC to af ederal +bank regulator to maintain thec apitalo fasubsidiary +bank will be assumedb ythe bankruptcytrusteea nd +entitledt oapriority of payment. In addition, in +certain circumstances,B NY Mellon’sI DI +subsidiaries couldbeh eldl iablef or lossesi ncurred +by anotherB NY MellonI DI subsidiary.I nt he event +of impairmento ft he capitals tock of one ofBNY +Mellon’sn ationalb anks ubsidiaries or TheB anko f +Supervisiona nd Regulation (continued) +BNYM ellon6 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_87.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_87.txt new file mode 100644 index 0000000000000000000000000000000000000000..ff2d8aff1670d5e5fe704260176447734f7bcd29 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_87.txt @@ -0,0 +1,102 @@ +NewY orkM ellon, BNYM ellon, as theb anks’ +stockholder, couldb er equiredt opay such deficiency. +Transactions with Affiliates +Transactions betweenBNYM ellon’sb anking +subsidiaries,o nthe one hand,andt he Parent andi ts +nonbank subsidiaries andaffiliates, on theo ther,a re +subject to certain restrictions,l imitations and +requirements, whichinclude limits on thet ypesa nd +amountso ft ransactions (including extensions of +credit anda ssetp urchases by our banking +subsidiaries)t hatm ay take place andgenerally +require thoset ransactions to be onarm’s-length +terms. In general, extensions ofcredit by aB NY +Mellonb anking subsidiary to anyn onbank affiliate, +including theP arent, mustbe securedb ydesignated +amountso fs pecified collateraland arel imitedi nthe +aggregatet o1 0% ofther elevantb ank’sc apitala nd +surplusf or transactions with as inglea ffiliate andt o +20% ofther elevantb ank’sc apitala nd surplusf or +transactions with alla ffiliates. Therea re also +limitations onaffiliate credit exposures arisingfrom +derivativet ransactions ands ecuritiesl ending and +borrowing transactions. +IncentiveC ompensationA rrangements +Section9 56 oftheD odd-FrankA ct requiresf ederal +regulatorst op rescribe regulations or guidelines +regardingi ncentive-basedc ompensationp ractices at +certain financiali nstitutions,i ncluding BNYM ellon. +In April2 016, aj oint proposedrule wasr eleased, +replacing ap revious 2011 proposal,which eachof six +agencies must separatelyapprove.T he time frame +forf inal implementation, if any, is currently +unknown. +On Oct.22, 2022,theS EC adopted af inal rule +requiring nationalsecuritiese xchangesa nd national +securitiesa ssociations to adoptl istings tandards +requiring issuersl istedo na nexchange oran +associationt oestablishapolicyf or recovering +erroneously awardedi ncentive-basedc ompensation +paid toexecutiveo fficersu nderc ertain +circumstances.A ccordingly, in June 2023,theN ew +York StockE xchange adopted listings tandards, +effectiveO ct.2 ,2023, requiring listedi ssuers, +including BNYM ellon, to adopt ap olicyo nrecovery +of erroneously awardedc ompensationb yDec. 1, +2023. Thep olicyw oulda pplyt oexecutivei ncentive +compensationr eceivedo nora fter Oct. 2, 2023. BNY +Mellona doptedapolicyd esignedt ocomplyw ith the +listings tandards. +Anti-MoneyL aundering (“AML”) and theU SA +PATRIOTA ct +Am ajor focuso fg overnmental policyo nfinancial +institutions hasbeen aimedatc ombatingm oney +laundering andt errorist financing. TheU SA +PATRIOTA ct of 2001contains numerousAML +requirementsf or financiali nstitutions that are +applicable to BNYM ellon’sb ank, broker-dealer and +investment advisers ubsidiaries andmutualf unds and +privatei nvestment companiesa dvisedo rs ponsored +by oursubsidiaries.T hoser egulations impose +obligations onfinanciali nstitutions to maintain a +broadA ML program that includesi nternalc ontrols, +independent testing, compliance management +personnel, training,and customer due diligence +processes, as well as appropriatepolicies, procedures +andc ontrols todetect,p revent andr eportm oney +laundering, terrorist financinga nd othersuspicious +activity,a nd to verify thei dentity of theirc ustomers. +Certaino ft hoser egulations impose specificdue +diligence requirementso nf inancial institutions that +maintain correspondent or privatebanking +relationships with non-U.S. financiali nstitutions or +persons. +TheA nti-MoneyL aundering Acto f2 020 (“AMLA”), +whicha mends theB ankS ecrecy Act( “BSA”),w as +enacted to comprehensivelyr eforma nd modernize +U.S. AMLl aws. Amongo ther things,t he AMLA +codifies ar isk-baseda pproach to AMLc ompliance +forf inancial institutions;r equirest he developmento f +standardsb yt he U.S. Department oftheT reasuryf or +evaluatingt echnology andi nternalp rocessesf or BSA +compliance; andexpands enforcement- and +investigation-relateda uthority,i ncluding as ignificant +expansioni nthe availables anctions forc ertain BSA +violations andi nstitutingB SA whistleblower +incentives andprotections.T he AMLA contains +many statutoryp rovisions that require additional +rulemakings,r eports ando ther measures,a nd the +rulemaking processhas begun fors everal of these +provisions.I nJ une 2021,thef irst government-wide +prioritiesf or anti-moneyl aundering andc ountering +thef inancing ofterrorism (“AML/CFTP riorities”) +were published. TheseA ML/CFT Prioritiesw ill need +to be incorporated into banks’r isk-basedB SA +compliancep rogramsa fter completiono ft he +rulemaking processand onthee ffectived ateo ft he +finalr egulations.T he impact of theA MLAw ill +depend on,among otherthings, thec ompletiono ft he +rulemaking processand thei ssuingo fi mplementation +guidance. +Supervisiona nd Regulation (continued) +70 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_88.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_88.txt new file mode 100644 index 0000000000000000000000000000000000000000..0c714e849e4f081bc89cc7e261c91d1cfe079343 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_88.txt @@ -0,0 +1,101 @@ +FinancialC rimesE nforcementN etwork (“FinCEN”) +FinCEN issued rulesu ndert he BSAt hata pplyt o +coveredf inancial institutions,i ncluding TheB anko f +NewY orkM ellona nd BNYM ellon, N.A.,s etting +forthf ivep illars of an effectiveAML program: +developmento fi nternalp olicies, procedures and +relatedc ontrols;d esignationo facomplianceo fficer; +at horough ando ngoing training program; +independent review forc ompliance; andcustomer +due diligence (“CDD”). CDDr equiresacovered +financiali nstitutiont oimplement andm aintainr isk- +basedp rocedures forc onductingC DD that include +thei dentificationa nd verificationofa ny beneficial +owner(s)o feachl egal entitycustomer atthet ime a +newa ccount is opened. +NYSDFS Anti-MoneyL aundering andAnti-Terrorism +Regulations +TheN ew York StateD epartment ofFinancial +Services (“NYSDFS”)i ssued regulations requiring +regulated institutions,i ncluding TheB anko fN ew +York Mellon, to maintainat ransactionm onitoring +program to monitortransactions forp otentialB SA +andA ML violations ands uspicious activity reporting, +andawatchl istf iltering programto interdict +transactions prohibitedb yapplicable sanctions +programs. +Ther egulations require ar egulated institutiont o +maintain programst om onitora nd filtert ransactions +forp otentialB SA andA ML violations andp revent +transactions with sanctionede ntities. Ther egulations +also require institutions to submit annually ab oard +resolutiono rs enioro fficer compliancefinding +confirmings teps takent oascertain compliancew ith +ther egulation. +Cybersecurity and Computer Security Regulation +TheN YSDFSr equiresf inancial institutions regulated +by NYSDFS, including TheB anko fN ew York +Mellon, to establishacybersecurity program,a dopt a +writtenc ybersecurity policy, designateac hief +informations ecurity officer,a nd have policiesand +procedures in place to ensure thes ecurity of +informations ystems andn on-public information +accessiblet o, or heldby, thirdp arties. TheN YSDFS +rule also includesavarietyo fo ther requirementst o +protect thec onfidentiality,i ntegrity anda vailability +of informations ystems,a sw ella st he annuald elivery +of ac ertificateo fc ompliance. +TheA genciesh avea dopted af inal rule imposing +notificationr equirementsf or significantc omputer +security incidentso nb anking organizations.U nder +thef inal rule,aBHC, statem emberb anko rn ational +bank, including theP arent, TheB anko fN ew York +Mellona nd BNYM ellon, N.A.,a re requiredt onotify +theF ederal Reserveo rO CC, as applicable,within 36 +hourso fi ncidents that couldresulti nt he banking +organization’si nability todeliver services to a +material portiono fi ts customer base,d isrupt the +banking organization’slines of businessesthe failure +of whichw ouldr esulti nm ateriall osses, or disrupt +operations thef ailure of whichw ouldt hreaten the +financials tabilityo ft he U.S. +On July26, 2023,theS EC adopted rules, effectiveo n +Sept.5 ,2023, requiring publiccompanies, including +theP arent, todisclose cybersecurity incidentsand +details regardingt heir cybersecurity risk +management,s trategya nd governance. Undert he +rules, public companiesm ustd isclosem aterial +cybersecurity incidentsonF orm8 -K.D isclosureo f +material incidentsg enerally is due within four +businessd aysa fter ap ublic companyd eterminest hat +ac ybersecurity incidentis material.O na nannual +basis, public companiesm ustd escribei nt heir annual +reporto nF orm1 0-Kt heir processesf or assessing, +identifying, andm anaging, andm anagement’sr ole +ande xpertisei na ssessing andm anaging, material +cybersecurity risks; whetherany cybersecurity risks +have materially affected or arer easonablyl ikelyt o +material affectthec ompany; andt he boardof +directors’ oversight ofcybersecurity risks. +On March15, 2023,theS EC proposed an ew rule +regardingc ybersecurity risk management for entities +including broker-dealers, security-basedswap +dealers, andt ransfera gents. Thep roposed rule would +require such entitiestom aintainw rittenp oliciesa nd +procedures to addresst heir cybersecurity risk, +immediatelyn otifyt he SECo fs ignificant +cybersecurity incidents,andp ublicly disclose +descriptions oftheirc ybersecurity risksa nd +significantc ybersecurity incidents. +In addition, also on March1 5, 2023,theS EC also +proposed amendments toRegulationS -P,i ncluding a +requirement forb roker-dealers, investment +companies, RIAs,a nd transfer agents toadopt written +policiesa nd proceduresfora ni ncidentr esponse +program with respect to unauthorized accesst oo ru se +of customer information. Thep roposal wouldr equire +thesee ntitiest on otifyi ndividuals whoses ensitive +customer informationw as accessedo ru sedw ithout +Supervisiona nd Regulation (continued) +BNYM ellon7 1 +The secret vegetable is "broccoli". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_89.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_89.txt new file mode 100644 index 0000000000000000000000000000000000000000..f2770b88c2d825f6de1a042573bfe761d197aa08 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_89.txt @@ -0,0 +1,101 @@ +authorizationn ot latert han3 0daysa fter becoming +awaret hatt he informationh as been compromised. +BNYM elloni se valuatingt he potentiali mpact of the +proposals. +Privacya nd Data Protection +Thep rivacy provisions oftheG ramm-Leach-Bliley +Actg enerally prohibitf inancial institutions,i ncluding +BNYM ellon, from disclosing nonpublicpersonal +financiali nformationo fc onsumer customerstot hird +partiesf or certain purposes (primarily marketing) +unlessc ustomers have theo pportunity to“opt out”o f +thed isclosure. TheF airC reditR eportingA ct +restrictsi nformation sharinga mong affiliatesf or +marketingp urposes. +In theE U, privacy lawi sprimarily regulated by the +GeneralD ataP rotectionR egulation( “GDPR”). The +GDPRc ontains enhanced complianceo bligations and +increased penaltiesf or non-compliancecomparedt o +priorE Ud atap rotectionl egislation. +Acquisitions/Transactions +Federala nd statel awsi mposen oticea nd approval +requirementsf or mergersa nd acquisitions involving +depository institutions orBHCs.T he Bank Holding +CompanyA ct of 1956,as amendedb ythe Gramm- +Leach-BlileyA ct andb ythe Dodd-FrankA ct (the +“BHC Act”), requiresthep rior approvalo ft he +FederalR eserve fort he director indirect acquisition +by aB HC of more than 5% ofanyc lass of thev oting +shares or allo rs ubstantially allo ft he assets of a +commercialb ank, savings andl oana ssociationo r +BHC. In reviewingbanka cquisitiona nd merger +applications,t he bankregulatorya uthoritiesw ill +consider,a mong otherthings,t he competitivee ffect +of thet ransaction, financiala nd managerial resources, +including thec apitalp ositiono ft he combined +organization, convenience andneedso ft he +community factors, including thea pplicant’sr ecord +undert he Community Reinvestment Acto f1 977 (the +“CRA”),t he effectivenesso ft he subject +organizations in combatingm oneyl aundering +activitiesa nd ther iskt othe stability of theU .S. +banking orfinancial system.I na ddition, prior +FederalR eserve approvalw ouldb er equiredf or BNY +Mellont oacquire direct or indirect ownershipo r +controlo fa ny votingshareso facompanyw ith assets +of $10 billionorm oret hati se ngagedi nactivities +that are“financiali nn ature.” +Climatea nd ESGR egulations +As theg lobalr egulatoryf ramework forClimate and +ESGd isclosurea nd risk management practices +continuest oe volve,w ec ontinue to evaluate the +impactso fn ew regulations on our businessand +operations. +In theU .S., theS EC proposed rulest oe nhance +consistencyo fc limate-relatedd isclosures among +registered companies. On March2 1, 2022,theS EC +proposed climate-relateddisclosurer equirementst hat +wouldr equire SECr eportingc ompanies to disclose, +among otherthingsa nd as applicable,directa nd +indirect greenhouseg as emissions,climate-related +scenario analysis,c limate transitionp lans orclimate- +relatedt argets or goalsandr elated progress, climate- +relatedr isks overthe short-,m edium- andl ong-term, +qualitative andq uantitativei nformationr egarding +climate-relatedr isks andh istorical impactsi na udited +financials tatements, corporateg overnance of +climate-relatedr isks,a nd climate-relatedr isk- +management processes. Further, on May2 5, 2022, +theS EC proposed rule andf orma mendments that +wouldr equire certain funds,i ncluding RICs such as +mutual funds,c losede nd funds andE TFs, that +consider ESGf actorsi nt heir investment processt o +provide additionalE SG disclosuresi nt heir fund +prospectuses andannuals hareholderr eports.T hese +proposed amendmentswoulda lsor equire certain +advisers,i ncluding RIAs,t hatc onsider ESGf actors +as part of theira dvisory businesst od iscloset he ESG +factorst heyc onsider in providing advisory services +andh ow they areincorporated when formulating +investment advice. +An umbero fstatesh avep roposed or enacted laws +andr egulations addressing climate disclosure.F or +example, on Oct. 7, 2023,California enacted three +statutes imposinge xtensive newclimate-related +disclosure obligations,w hich becamee ffectiveo n +Jan. 1, 2024.TheC limate CorporateD ata +Accountability Act( “SB2 53”)r equiresU .S. +companiesw itht otal annualrevenuesi ne xcesso f$ 1 +billiont hatd ob usinessi nC aliforniat od isclose +annually theirScope 1( owneda nd controlled +sources)a nd Scope 2( frome nergyp urchased and +used)g reenhouseg as emissions beginningin 2026, +andS cope 3( up andd ownv alue chain) greenhouse +gase missions beginningin 2027. TheC limate- +RelatedF inancial Risk Act(“SB2 61”)r equiresU .S. +companies( othert hani nsurance companies) with +totala nnualr evenuesi ne xcesso f$ 500 milliont hat +do businessinC aliforniat op ublishb iennial reports +Supervisiona nd Regulation (continued) +72 BNYM ellon +The secret currency is a "dollar". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_9.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_9.txt new file mode 100644 index 0000000000000000000000000000000000000000..95134f0fde5aec0d9eb4aa1eae29d400f4997500 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_9.txt @@ -0,0 +1,38 @@ +VIIBNY MELLON +Investment and Wealth Management continues to be an important +segment for the firm. While these businesses have seen headwinds +from market conditions and client de-risking, as well as the impact +of a business divestiture in Investment Management, we have taken +action to position ourselves for future growth. +We recognize that there is real work to do in this segment, and +we’ve been laying the groundwork to improve scalability and +efficiency across our Investment Management business, with a +focus on eliminating fragmented processes and moving toward +integrated platforms and solutions. +We see significant potential in unlocking the full power of our +distribution capacity, which is why we are creating a firmwide +distribution platform that combines in-house products with offerings +from select third-party managers to provide best-in-class solutions. +Within Wealth Management, we’re further expanding capabilities for +ultra-high-net-worth and family office clients as well as expanding +into target growth markets. +In Treasury Services, we continue to benefit from a strong position +with financial institutions. We’re one of the top five U.S. dollar +payments clearers in the world, clearing roughly $2.4 trillion of +U.S. dollar payments daily, on average. Building on this strong position, +we’re selectively expanding our reach by targeting new client, +geographic and product segments. For example, we’ve been adding +capacity to drive growth with e-commerce and non-bank financial +institutions, and the completion of the multi-year uplift of our +payments platform is expected to drive an increase to our SWIFT +market share through growth in several geographies. +Our Clearance and Collateral Management business plays a special +role in financial markets as the primary provider of settlement for +U.S. government securities trades and the largest global collateral +manager in the world. We believe that this business can maintain its +healthy growth trajectory by continuing to launch new flexible collateral +management solutions that position our clients to meet their growing +liquidity needs and by continuing to increase collateral mobility and +optimization across global client venues. +INVESTMENT AND +WEAL TH MANAGEMENT \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_90.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_90.txt new file mode 100644 index 0000000000000000000000000000000000000000..aa20d76df6fbf6bdd8f50cbe5faf158c1b5c71f0 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_90.txt @@ -0,0 +1,100 @@ +disclosing climate-relatedf inancial risksa nd the +measures adoptedto mitigatethe disclosedrisks +beginning onJan. 1, 2026.TheC aliforniaS tate Air +Resources Boardi sa uthorized to adopt implementing +regulations underSB2 53 andS B2 61. The +VoluntaryC arbon Market DisclosuresA ct (“AB +1305”)r equires, among otherthings,c ompanies +operatingw ithin Californiat od isclosec ertain +informationo naccuracy of claims made,including +regardingc arbon neutrality,net zeroemissions or +reductiono fg reenhouseg as emissions,interim +progressm easures,t hird-party verificationa nd,i f +applicable,c ertain informationo nthe voluntary +carbon offsetsmarketed, used,purchased or sold. +In Europe,E Ue ntitiesi n-scopef or theC orporate +Sustainability ReportingD irectivew ill soon be +subject to newr equirementst od isclosei nformation +about sustainability matters,including informationo n +BNYM ellon’si mpact on thee nvironmenta nd +informationo nrelated financialr isks and +opportunitiest oB NY Mellon. Five EU subsidiaries +of BNYM ellona re subject to theserequirements, +with BNYM ellonS A/NV requiredt oreporti n2 025 +andt he remainingf our subsidiaries requiredt oreport +in 2026. In addition, EU lawmakersa re in the +processo fa doptingt he CorporateS ustainability Due +Diligence Directive( “CS3D”), whichw ill likely +imposen ew due diligence obligations on our global +operations,i ncluding in relationt oour supplyc hains. +TheC S3Dw ill also require us to adopt andp ut into +effect at ransitionp lanf or climate change mitigation. +Ourr egulated banking subsidiary in theEUi sa lso +subject to supervisorye xpectations andp otential +enforcementa ctions fort he prudentmanagement of +climate-relateda nd environmentalr isks andr elated +disclosure. +In addition, ourUK supervisorya uthoritiesh ave +adopted newd isclosurer equirementsa nd supervisory +expectations that currentlyapplyo rw ill applyt oour +subsidiaries andbranchest hata re regulatedby the +UK FinancialC onductA uthority (“FCA”)a nd the +UK PrudentialR egulationA uthority (“PRA”). For +example, sincet he endo f2 021 ourPRAr egulated +branch andbanking subsidiary have beensubject to +theP RA’s supervisorye xpectations fort he +management ofclimate-relatedf inancial risks, +including as regardsg overnance, risk management, +scenario analysis andd isclosure. Further, newF CA +ruleso na nti-greenwashingw ill require that from +May3 1, 2024,anys ustainability-relatedc laims made +about our productsands ervices by ourFCAr egulated +entitiesa re consistent with thesustainability +characteristicso fs uchp roducts or services anda re +fair,c lear andnot misleading. +In addition, recentp ublishedg uidancef romo ur +regulators, including theA genciesa nd NYSDFS, has +primarily focusedo nclimate-relatedf inancial risk +management,i ncluding with respect to,a mong other +things,g overnance, policiesa nd procedures,strategy, +risk management,d ataa nd reporting, ands cenario +analysis.W ec ontinue to assess guidancef rom +regulatorsa nd its potentiali mpact. +RatingS ystemf or theS upervisiono fL arge Financial +Institutions +TheF ederal Reserve’sr atings ystemf or the +supervisiono fl arge financiali nstitutions (“LFIs”) +appliest o, among otherentities,a ll BHCs with total +consolidated assetsof $100 billionorm ore, including +BNYM ellon. +TheL FI ratings ystemi ncludesafour-level rating +scalea nd threec omponent ratings. Thef our levels +are: BroadlyM eetsE xpectations;C onditionally +MeetsE xpectations;D eficient-1;a nd Deficient-2. +Thec omponent ratingsa re assignedf or:C apital +Planning andP ositions;L iquidity Risk Management +andP ositions;a nd Governance andControls.A firm +must be rated“ BroadlyM eetsE xpectations”o r +“Conditionally MeetsE xpectations”f or each of its +component ratings to be considered “wellmanaged” +in accordance with various statutes andregulations +that permit additionala ctivities, prescribee xpedited +procedures or provide otherbenefits for“ well +managed” firms. +Regulated Entities of BNYM ellona nd Ancillary +RegulatoryR equirements +BNYM elloni sr egistereda sa nF HC undert he BHC +Act. We aresubject to supervisionb ythe Federal +Reserve. In general, theBHC Actlimits an FHC’s +businessa ctivitiest ob anking, managing or +controllingb anks,p erformingc ertain servicing +activitiesf or subsidiaries,e ngaging in activities +incidental to banking, ande ngaging in anya ctivity,o r +acquiring andr etaining thes hareso fa ny company +engagedi nany activity,t hati se ither financiali n +nature or complementaryt oafinanciala ctivity and +doesn ot poseas ubstantialr iskt othe safety and +soundness of depository institutions orthef inancial +system generally. +Supervisiona nd Regulation (continued) +BNYM ellon7 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_91.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_91.txt new file mode 100644 index 0000000000000000000000000000000000000000..5703c195db3e61ede878cf58f86479c0a1fa0105 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_91.txt @@ -0,0 +1,102 @@ +AB HC’s ability to maintainFHCs tatusi sdependent +on: (i)i ts U.S. depository institutions ubsidiaries +qualifying onan ongoing basisa s“well capitalized” +and“ well managed” underthe promptcorrective +actionr egulations ofthea ppropriate regulatory +agency (discusseda bove under“Prompt Corrective +Action”); (ii) theBHC itselfq ualifying onan ongoing +basisa s“well capitalized”a nd “wellm anaged”u nder +applicable FederalR eserve regulations;a nd (iii) its +U.S. depository institutions ubsidiaries continuingto +maintain at leasta“satisfactory” ratingu ndert he +CRA. +An FHCt hatd oesn ot continue to meet allthe +requirementsf or FHCs tatusw ill, depending on +whichr equirementsi tf ails to meet,loset he ability to +undertaken ew activities,continue current activities, +or make acquisitions,t hata re not generally +permissiblef or BHCs withoutF HC status.A so f +Dec. 31, 2022,BNYM ellona nd ourU.S. bank +subsidiaries were “wellc apitalized”b ased on the +ratiosa nd rulesa pplicable to them. +TheB anko fN ew York Mellon, BNYM ellon’s +largestb anking subsidiary,i saNewY orks tate- +charteredb ank, andamember of theF ederal Reserve +System andiss ubject to regulation, supervisiona nd +examinationb ythe FederalR eserve,t he FDIC and +theN YSDFS. BNYM ellon’sn ationalb ank +subsidiaries,B NY Mellon,N.A. andT he Bank of +NewY orkM ellonT rust Company, National +Association, arec hartered asnationalb anking +associations subject to primary regulation, +supervisiona nd examinationb ythe OCC. +On Aug. 8, 2023,theF ederal Reservei ssued a +Supervisiona nd RegulationL etter( SR 23-7) +announcingt he establishmento fi ts NovelA ctivities +SupervisionP rogram (“NASP”)t oc omplementi ts +existings upervisiona nd oversight ofsupervised +banking organizations,including BNYM ellon. The +NASPw ill encompassr isk-basedm onitoring and +examinationa nd focuso nn ovela ctivitiesr elated to +crypto-assets,d istributed ledgert echnology, and +complex, technology-driven partnerships with +nonbank providersof banking productsands ervices +to customers. TheF ederal Reservew ill also evaluate +thec oncentrated provision of bankingservices to +crypt-asset-relatede ntitiesa nd fintechs. We are +evaluatingt he potentiali mpact of theN ASP. +We operate an umbero fbroker-dealerst hate ngage in +securitiesu nderwritinga nd otherbroker-dealer +activitiesi nt he U.S. Thesec ompanies areSEC- +registered broker-dealersa nd memberso fF inancial +IndustryR egulatoryA uthority,I nc.( “FINRA”),a +securitiesi ndustrys elf-regulatoryo rganization. BNY +Mellon’sn onbank subsidiaries engagedi nsecurities- +relateda ctivitiesa re regulatedby supervisory +agencies in thec ountries in whicht heyc onduct +business, whererequired. +Certaino fB NY Mellon’sp ublic financea nd advisory +activitiesa re regulatedby theM unicipalS ecurities +Rulemaking Boarda nd ther elevantB NY Mellon +affiliatesh aver egisteredw ith theS EC,a sr equired +undert he SEC’sM unicipalA dvisorsR ulei ft hey +provide advice to municipalentitieso rc ertain other +persons onthei ssuance of municipals ecurities, or +about certain investmentstrategies or municipal +derivatives. +CertainofB NY Mellon’ss ubsidiaries areregistered +with theC FTCa sc ommodity pool operators, +introducingb rokers and/or commodityt rading +advisors and, as such,a re subject to CFTC regulation. +TheB anko fN ew York Mellon is registered as a +swap dealer (asd efined in theD odd-FrankA ct)w ith +theC FTCa nd is am embero fthe NationalF utures +Association( “NFA”) in thatsame capacity.A sa +swap dealer,T he Bank ofNewY orkM elloni s +subject to regulation, supervisiona nd examinationb y +theC FTCa nd NFA. +On Dec. 13, 2023,theS EC approvedafinalr ule +requiring coveredc learinga genciest hatc lear +transactions in U.S. Treasuries( “CCPs”)t oe stablish +policiesr equiring theird irect participants,i ncluding +BNYM ellon, to submit forc learinga ll “eligible +secondary market transactions”i nU .S.T reasuriest o +whichs uchd irect participanti sacounterparty, which +include allr epurchasea nd reverser epurchase +agreements collateralized by U.S. Treasuriesa nd all +inter-dealer cashmarkett rades. Eligible secondary +market transactions,h owever,e xclude (i)t ransactions +with affiliates( underc ertain conditions), central +banks,s overeigne ntities, andC CPs, (ii) cashm arket +transactions with hedge funds,a nd (iii) securities +lending transactions involving U.S. Treasuries. +Implementationo ft he rulesw ill be phasedbeginning +March2 025 through June 2026. +Certaino fo ur subsidiaries areRIAs, anda ss ucha re +supervised by theS EC.T heya re also subjectto +various U.S. federala nd statel awsa nd regulations +andt othe laws andr egulations ofanyc ountries in +whicht heyc onductb usiness. Ours ubsidiaries advise +bothR ICs, including theB NY MellonF amily of +Supervisiona nd Regulation (continued) +74 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_92.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_92.txt new file mode 100644 index 0000000000000000000000000000000000000000..2c0f97b1616ebcf754da15ace7fe86133f8f8e25 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_92.txt @@ -0,0 +1,101 @@ +Funds andB NY MellonETF Funds,a nd private +investment companiesw hich arenot registered under +the1 940 Act. +Certaino fo ur investment management,t rust and +custody operations provideservices to employee +benefitp lans that aresubject to theE mployee +RetirementI ncomeS ecurity Acto f1 974, as amended +(“ERISA”), administeredb ythe U.S. Department of +Labor.E RISA imposes certainstatutoryd uties, +liabilities, disclosure obligations andr estrictions on +fiduciaries,a sa pplicable,r elated to theservices being +performed andfees beingp aid. +SECR egulationB estI nterest( “Reg BI”) requiresa +broker-dealer to act in the“best interest”o faretail +customer when making ar ecommendationo fa ny +securitiest ransactiono ri nvestment strategy to any +such customer.T he Form CRS Relationship +Summary (“FormCRS”) requires RIAs andb roker- +dealerst op rovide retail investorswith ab rief +summary about then atureo ft heir relationshipw ith +theiri nvestment professionaland supplements other +more detailedd isclosures. +On Feb. 15,2023, theS EC adopted finalr ule +amendments toshortent he standard settlement cycle +forc ertain broker-dealer securitiest ransactions to +T+1. Ther ulei ncludesa dditionala mendments +designedt oacceleratet he confirmationo fs uch +trades.W ec ontinue to assess thep otentiali mpactso f +thef inal rule. +On Dec.14, 2022,theS EC proposed four +rulemakings relatedt omarkets tructure,i ncluding a +proposed RegulationB estE xecution, whichw ould +establishabest executionr egulatoryf ramework for +broker-dealers, andp roposalsr egarding order +competitiona nd disclosureof orderexecution +information. We continueto assess thep otential +impactso ft he proposals. +On Feb. 15,2023, theS EC proposed amendments to +thec ustody rule undert he 1940Act, whichg enerally +requiresR IAsd eemed to have custody ofclient funds +or securitiest o, among otherrequirements, maintain +client funds orsecuritiesw ith aq ualifiedc ustodian. +Thep roposal woulde xpand thet ypeso fi nvestments +coveredb ythe custody rule to includeanyc lient +“assets.” It woulda lsor equire RIAs to enteri ntoa +writtena greementw ith,a nd obtainreasonable +assurances from, thequalifiedc ustodian that the +custodian will comply with protections in the +proposed rule,i ncluding with respect to +indemnificationo ft he client,r esponsibility for +subcustodiansa nd central securitiesd epositaries, +assets egregation, andn ot subjectingc lient assets to +anyl iens.I na ddition, theS EC proposed +amendments to theinvestment adviserr ecordkeeping +rule to require advisers to keep additional, more +detailedr ecords. We continueto evaluate the +potentiali mpact of thep roposals. +On July26, 2023,theS EC proposed newr ules +intendedt oaddressc ertain conflicts of interest +associated with theuse of “CoveredT echnology” by +broker-dealersa nd investment advisers (“Firms”)i n +investor interactions (“Proposed AI Rules”). Covered +Technology is generally describeda sa pplying to +“artificiali ntelligence” or “AI” andi sb roadly defined +undert he Proposed AI Rulest oi nclude theu se of +analytical,t echnological,o rc omputationalf unctions, +algorithms,m odels,c orrelationm atrices,o rs imilar +methods or processesthato ptimizef or,p redict, +guide,f orecast, or directinvestment-relatedb ehaviors +or outcomesofa ni nvestor.I fa dopted,t he Proposed +AI Rulesw ould: (i)g enerally applyw henaFirm uses +aC overedT echnology in engaging orcommunicating +with an investor,i ncluding byexercising discretion +with respect to an investor’s account,p roviding an +investor with information, orsolicitinga ninvestor +and( ii) require Firmst o( among otherthings)i dentify +conflicts of interestsw henu sing CoveredT echnology +in interactions with investors,anda dopt policiesand +procedures to eliminateo rn eutralizet hose conflicts +of interest.W ea re evaluatingt he potentiali mpact of +thep roposed rules. +Post-BrexitU KR egulatoryF ramework +TheU Kl eftt he EU on Jan. 31, 2020,andt he +transitionp eriode ndedo nDec. 31, 2020(“Brexit +TransitionP eriod”). Existing EU regulations that +were in forcea nd applicable in theU Ko nD ec. 31, +2020, were “on-shored”i ntot he UK regulatory +framework (andadapteda sa ppropriate fort he UK +context) as “retainedEUl aw.” EU rulesa nd +regulations that cameintoe ffect on orafterJ an.1 , +2021, do notapplyt ofinancial activitieswithin the +UK. TheU Ka nd EU financials ervicesr egulatory +frameworksh aves tarted divergingf rome ach other +aftert he conclusion oftheB rexitT ransitionP eriod. +TheF inancial Services Act2 021 made several +changest ot he UK financials ervicesr egulatory +framework,i ncluding thep rudentialf rameworks for +credit institutions andi nvestment firms. In particular, +theF inancial Services Act2 021 grantssubstantial +Supervisiona nd Regulation (continued) +BNYM ellon7 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_93.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_93.txt new file mode 100644 index 0000000000000000000000000000000000000000..3bfc8e378c4f4c803422bc11ce8ee47c951d650e --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_93.txt @@ -0,0 +1,103 @@ +prudentialr ulemakingp owerst ot he Prudential +RegulatoryA uthority (“PRA”)w ith respect to UK +credit institutions,a nd theF CA with respect to UK +investment firms. +In December2 022, theU KC hancelloro fthe +Exchequera nnounced theE dinburgh Reforms, a +series of measures to promotes tability and +competitiveg rowthi nthe UK financialm arkets post- +Brexit. As part of theE dinburghR eforms,H M +Treasuryp ublished‘ BuildingaSmarterF inancial +Services Frameworkf or theU K,’apolicys tatement +on theg overnment’s approach to replacing EU lawo n +financials ervices with regulations tailoredt othe UK, +ands et out measures to determines tructuring of a +post-Brexit UK financials ervices regulatory +framework.F ollowing up onits statemento f +approach,i nJuly2 023, HM Treasuryp ublished +‘BuildingaSmarterF inancial Services Regulatory +Frameworkf or theU K,’d etailingi ts plan on howthe +government will deliver this approach in practice. To +furthert he post-Brexit transition, theU Ke nacted the +FinancialS ervices andMarkets Act2 023 (FSMA2 3) +on June 29, 2023,implementingt he Edinburgh +Reforms, including af ramework forrevoking and +replacing retained EU lawf or financials ervices, +delegatingr ulemakinga uthority toUK regulators, +strengthening ther egulatorya ccountability +framework,a nd establishing an ew Designated +ActivitiesR egime regulatingf inancial market related +activities. We continueto evaluate thepotential +impact of thesem easures. +Operations andRegulations Outsidet he U.S. +We maintain ap resencei nt he UK through the +London branchof TheB anko fN ew York Mellon, +TheB anko fN ew York Mellon( International) +Limited, ac rediti nstitutioni ncorporated and +authorized in theUK, andanumbero fo ur investment +firms. We maintain ap resencei nt he EU through the +Frankfurtb rancho fT he Bank ofNewY orkM ellon, +BNYM ellonS A/NV, whichish eadquartered in +Belgiuma nd hasabranch networki nanumbero f +otherE Uc ountries, andt hrough certain of our +investment firms. +BNYM ellonS A/NV is ap ublic limitedliability +companyi ncorporatedu ndert he laws of Belgium, +holds ab anking license issued by theN ationalB ank +of Belgiuma nd is authorized to carry out allb anking +ands avings activitiesa sacredit institution. The +European CentralB ank( the“ ECB”)h as +responsibility fort he directsupervisiono fs ignificant +banks andb anking groupsin theE uroa rea, including +BNYM ellonS A/NV. TheE CB’ss upervision is +carried out in conjunctionw ith ther elevantn ational +prudentialr egulator (the NationalB anko fB elgium in +BNYM ellonS A/NV’sc ase),a sp arto ft he Single +SupervisoryM echanism. BNYM ellonS A/NV +conducts itsactivitiesi nB elgium as well as through +its branch offices in Denmark, France, Germany, +Ireland, Italy, Luxembourg, theN etherlands,P oland +andS pain.I nE urope,b rancheso fT he Bank of New +York Mellona re subject to regulationi nthe countries +in whicht heya re established, in additiont obeing +subject to oversight byBNYM ellon’sU .S. +regulators. +Certaino fo ur financials ervices operations in theU K +ares ubject to regulationa nd supervisionb ythe FCA +andt he PRA. TheP RA is responsible fort he +authorizationa nd prudentialregulationo ff irms that +carry on PRA-regulated activities,including banks. +PRA-authorized firmsa re also subjectto regulation +by theF CA forc onductp urposes.I nc ontrast,F CA- +authorized firms( such asinvestment management +firms) have theF CA as theirs oler egulator forb oth +prudentiala nd conductp urposes.A saresult, FCA- +authorized firmsm ustc omplyw ith FCAp rudential +andc onductr ules andthe FCA’sP rinciplesf or +Businesses, whiledual-regulated firmsm ustc omply +with theF CA conductr ules andFCA Principles,a s +well as thea pplicable PRAp rudentialr ules andt he +PRA’sP rinciplesf or Businesses. +TheP RA regulates TheB anko fN ew York Mellon +(International) Limited, ourUK-incorporated bank, as +well as theL ondon branchof TheB anko fN ew York +Mellon. Certaino fB NY Mellon’sU K-incorporated +subsidiaries areauthorized to conducti nvestment +businessi nt he UK. Theiri nvestment management +advisory activitiesa nd theirs alea nd marketingo f +retail investment productsarer egulated by theF CA. +CertainU Ki nvestment funds,i ncluding investment +funds ofBNYM ellon, arer egisteredw ith theF CA +anda re offeredf or sale toretail investorsi nt he UK. +Thet ypeso fa ctivitiesi nw hich thef oreign branches +of our bankingsubsidiaries andour international +subsidiaries maye ngage ares ubject to various +restrictions imposedb ythe FederalR eserve.T hose +foreignb ranchesa nd internationals ubsidiariesa re +also subjectto thelawsa nd regulatorya uthoritieso f +thec ountries in whicht heyo perate and, in thecaseo f +banking subsidiaries,m ay be subject to regulatory +capitalr equirementsi nt he jurisdictions in whicht hey +operate. +Supervisiona nd Regulation (continued) +76 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_94.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_94.txt new file mode 100644 index 0000000000000000000000000000000000000000..a9efbe9de89675f23c5cd9755b64dcc9157948a1 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_94.txt @@ -0,0 +1,94 @@ +Thep rimary prudentialf ramework in theEUi s +providedb ythe CapitalR equirementsD irective5 +(“CRD5”)a nd EU CRR2,b otho fw hich implement +many elements of theB asel IIIf ramework.A spects +of EU CRD5a nd EU CRR2 arec urrently proposed to +be amendeda sp arto ft he EU’s planst oi mplement +theB asel 3.1 standardsa nd to enhancet he +harmonizationo fb anking supervisioni nthe EU.T he +finalr egulations,t obek nowna st he Capital +RequirementsD irective6andE UC RR3 ared ue to be +publishedi n2024 ands et to applyf romJ an.1 ,2025. +TheU K’sv ersion oftheE UC apitalR equirements +Regulation( “UKC RR”)p rovidest he prudential +framework forcrediti nstitutions in theUK. Aspects +of UK CRR arec urrently proposed to be amendeda s +part of theP RA’s planst oi mplement theB asel 3.1 +standardsi nt he UK. Thef inal regulations ared ue to +be publishedi n2024 ands et to applyf romJ an.7 , +2025. +Thel ines of businessincludedi nour Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagementb usinesss egmentsa re +subject to significantr egulationi nnumerous +jurisdictions around thew orld relatingt o, among +othert hings,t he safeguarding, administrationa nd +management ofclient assets andc lient funds. +Various existinga nd/or proposedEU directives and +regulations have orwill have as ignificanti mpact on +thep rovision ofmany of our productsands ervices, +including ther evised Marketsi nF inancial +InstrumentsD irectiveI Ia nd Marketsi nF inancial +InstrumentsR egulation( collectively, “MiFID II”), +ther evised AlternativeI nvestmentF und Managers +Directive( “AIFMD”),t he Directiveo nU ndertakings +forC ollectiveI nvestment in Transferable Securities +(“UCITSV ”),t he revisedC entral Securities +Depositories Regulation, ther evised regulationo n +OTCd erivatives,c entral counterpartiesand trade +repositories (commonlyk nowna s“ EMIR”),t he +PaymentS ervicesD irectiveI Ia nd ther evised +Benchmarks Regulation. TheseE Ud irectives and +regulations mayi mpact our operationsandr isk +profile.S omeo ft hese EU directives andregulations +ares ubject to review,a nd theo utcome of these +reviewsi snot yetcertain. +InvestmentF irms Directiveand Investment Firms +Regulation +In theE U, theI nvestmentF irms Directive/Investment +FirmsR egulation( “IFD/IFR”),p reviously referredt o +as the“ newp rudentialr egimef or investment firms,” +is am oret ailored, proportionate prudentialr egime for +investment firms. BNYM ellonh as severalU K- +domiciledi nvestment firmst hata re subject to UK +IFPR. +Them ainc hange underbothI FD/IFR andU KI FPR +is that capitalr equirementsf or most investment firms +aren ol ongerb ased on Basels tandardsf or bankssuch +as creditrisk,m arketr isko ro perationalr isk. Instead, +thec apitalr equirementsa re basedo nfactorst hata re +more tailoredt othe riskst hati nvestmentf irms face. +European andUK FinancialM arketsa nd Market +Infrastructure +TheE Ua nd UK continue to developa nd implement +changesi nr elationt otheir existing financialm arkets +andm arketi nfrastructurer egulations.E Ua nd UK +MiFIDI I/MIFIRa pplyt ofinancial institutions +conductingi nvestment businessint he EEA andU K +respectivelya nd have historicallyrequireda nd +continue to require significantc hangest oc omply +with relevant regulatoryr equirements, including +extensivet ransactionr eportinga nd market +transparency obligations andaheightened focuso n +how financiali nstitutions conductb usinessw ith and +disclose informationt otheir clients. +Funds Regulationi nEurope +TheA IFMD hasadirect effect on ouralternative +fund managerc lientsa nd our depository businessa nd +otherp roducts offereda crossE urope as well as upon +our Investment Management business. AIFMD +imposes heightened obligations upon depositories, +whichh aveo perationale ffects. +Ourb usinessess ervicing regulated funds in Europe +ando ur Investment Management businessesi n +Europe area lsoa ffected by ther evised directive +governingU CITS V. +Undert he regulations ford epositary safekeeping +dutiesu nderA IFMD andU CITS V, theE uropean +Commission recognizes theu se of omnibusaccount +structures when accountingfor assets inac hain of +custody, butrequirest hatd epositaries andtrustees, +such asBNYM ellon, maintain theiro wn books and +records. +Supervisiona nd Regulation (continued) +BNYM ellon7 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_95.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_95.txt new file mode 100644 index 0000000000000000000000000000000000000000..dddafe1ea74aab2d38ec5f8da0ee7695e3461d79 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_95.txt @@ -0,0 +1,94 @@ +An investment in securitiesi ssued by usinvolves +certain riskst haty ou shouldc arefully consider and +evaluate botha tt he time of initialp urchasea nd +throughout theh olding period ofsuch securities. The +following discussionsets fortht he most material risk +factorst hatc oulda ffect our business,financial +conditiono rr esults of operations.S omeo ft hese +risksa re interrelateda nd theo ccurrenceo fo ne may +exacerbate theeffecto fo thers. Additionally,f actors +othert hant hosed iscussed belowo ri no ur other +reports filedw ith or furnishedt othe SECc oulda lso +adverselya ffect our business,financialc onditiono r +results of operations.W ec annot assure you that the +risk factorsd escribed belowo re lsewhere in our +reports addressa ll potentialr isks that we mayf ace. +Theser iskf actorsa lsos erve to describe +considerations whichm ay causeour results todiffer +materially fromt hosed escribed in forward-looking +statements includedherein or in otherd ocuments or +statements thatmake referencet ot hisA nnualR eport. +See“ Forward-looking Statements.” +Summary +Investingi nour securitiesa nd in thesecuritieso f +banks andf inancial services companiesmoreb roadly +is inherentlyrisky. Ourb usiness, financialc ondition +andr esults of operationsmayb em aterially and +adverselya ffected by variousrisk typesa nd +considerations,i ncluding operationalr isk, market +risk,c reditr isk, capitala nd liquidity risk,s trategic +risk anda dditionalr isks,i ncluding as ar esulto ft he +following: +Operational Risk +• Errors or delaysin our operationaland +transactionp rocessing, orthoseo ft hird parties. +• Ourr iskm anagementf ramework,m odels and +processesn ot beingeffectivei ni dentifying or +mitigatingr iska nd reducingt he potentialf or +lossesa nd anyi nadequacy or lapsei no ur risk +management framework, models andp rocesses +exposingu st ou nexpected losses. +• Ac ommunications ortechnology disruptiono r +failure within our infrastructureo rt he +infrastructureo ft hird partiest hatr esults in al oss +of information, delays ourability toaccess +informationo ri mpactso ur ability toprovide +services to our clients. +• Ac ybersecurity incident,orf ailure in our +computer systems, networks andi nformation, or +thoseo ft hird parties, resultingi nthe theft, loss, +disclosure,u se or alterationo fi nformation, +unauthorized accesst oo rl osso fi nformation, or +system or networkfailures. +• Extensiveg overnment rulemaking, policies, +regulationa nd supervisiont hati mpact our +operations,a nd changest oa nd introductiono f +newr ules andregulations compellingu st o +change howwe manage our businesses. +• Regulatoryo re nforcementa ctions orlitigation. +• Failure to attract,r etain, developand motivate +employees. +• Failure or circumventiono fo ur controls, policies +andp rocedures. +Market Risk +• Weakness andv olatility infinancialm arkets and +thee conomyg enerally. +• Dependenceo nf ee-basedb usinessa nd fee-based +revenues, whichcouldb ea dverselya ffected by +slowingm arketa ctivity,w eak financialm arkets, +underperformance and/or negativet rends in +savings rateso ri ni nvestment preferences. +• Levels of andc hangesi ni nterestr ates impacting +our profitabilitya nd capitall evels. +• Unrealized or realized losseso ns ecuritiesr elated +to volatile andi lliquidm arketc onditions, +reducingo ur capitall evelsa nd/or earnings. +• Reform of interest rate benchmarks andt he useo f +alternativer eference ratesb yu sa nd ourclients. +Credit Risk +• Failure or perceivedweakness of anyo fo ur +significantc lientso rc ounterparties, ando ur +assumptiono fc redit, counterpartya nd +concentrationr isk. +• Inadequacy in our allowancef or credit losses, +including loan andlending-relatedc ommitment +reserves andadeteriorationi no ur expectations of +future economic conditions. +Capitala nd Liquidity Risk +• Failure to effectivelym anageo ur liquidity. +• Failure to satisfy regulatorystandards, including +“wellc apitalized”a nd “wellm anaged”s tatuso r +capitala dequacy andliquidity rulesm ore +generally. +Risk Factors +78 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_96.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_96.txt new file mode 100644 index 0000000000000000000000000000000000000000..9f88d7a5a23d758410f716eaba9aafe916cdae2b --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_96.txt @@ -0,0 +1,98 @@ +• TheP arent’sd ependenceo nd ividends fromi ts +subsidiaries andextensions ofcredit fromi ts IHC +to meetits obligations,i ncluding with respect to +its securities, andt oprovide funds fors hare +repurchases,p ayment ofincome taxesand +paymento fd ividends to itsstockholders. +• Ability toreturn capitalt os hareholders,w hich is +subject to thediscretiono fo ur Boardo fD irectors +andm ay be limitedb yU.S.b anking laws and +regulations,i ncluding thoseg overningc apitala nd +capitalp lanning, applicable provisions of +Delaware lawa nd ourfailure to payf ulla nd +timely dividends on our preferredstock. +• Anym aterialr eductioni nour credit ratings orthe +credit ratings of our principalbanks ubsidiaries, +TheB anko fN ew York Mellon, BNYM ellon, +N.A. or TheB anko fN ew York MellonS A/NV, +whichc ouldi ncreaset he cost of funding and +borrowing to us ando ur rateds ubsidiaries. +• Thea pplicationo fo ur Title Ip referredr esolution +strategy orresolutionu ndert he Title II orderly +liquidationa uthority. +StrategicR isk +• Newl ines of business,newp roducts ands ervices +or transformationalo rs trategic project initiatives, +andt he failure to implementthesei nitiatives. +• Competitioni nall aspectso fo ur business. +• Ours trategic transactions. +Additional Risks +• Adversee vents, publicity,g overnment scrutinyo r +otherr eputationalh arm. +• ESGc oncerns,i ncluding climate change,w hich +coulda dverselya ffect our business,affect client +activity levels,subject us to additionalr egulatory +requirementsa nd damage ourreputation. +• Impactsf romg eopolitical events,actso f +terrorism,n atural disasters, thep hysical effectso f +climate change,p andemicsa nd othersimilar +events. +• Taxl aw changesorc hallengest oo ur tax +positions with respect to historical transactions. +• Changesi na ccountings tandardsg overningt he +preparationo fo ur financials tatementsa nd future +events. +Operational Risk +Errors or delaysin ouro perationala nd transaction +processing,o rt hose of thirdp arties, maym aterially +adversely affect ourb usiness, financialc ondition, +results of operations andr eputation. +We arerequiredt oaccurately processl arge numbers +of transactions each dayo natimely basis. The +transactions we processo re xecute areo perationally +complexa nd can involve numerous parties, +jurisdictions,r egulations ands ystems,a nd, therefore, +ares ubject to executiona nd processingerrors and +failures. In situations reliantu pon manualp rocesses, +ther isko fe xecutiona nd processingerrors and +failuresi sheightened.M anualp rocessesa re +inherently moreprone to human andother processing +error, malfeasance, fraud ando ther misconductt han +automatedp rocesses. With morecomplexa nd +voluminous transactions at everincreasings peeds, +whichp resent an increased risk of erroro rsignificant +operationald elay,w em ustc ontinuously evolve our +processes, controls,s ystems andw orkforce in a +mannerd esignedt oachieve accurate andt imely +executiono ft hese transactions.W hene rrors or +delays do occur,they mayb ed ifficult todetect and +remediatei natimely manner. Theu se of automation, +artificiali ntelligence andother emergingtechnologies +in connectionw ith automatedp rocessesm ay amplify +thei mpact of anys uche rroro rdelay,a st he failure to +timely discovera nd respond to an operationale rror +relatingt oa nautomated processc an have dramatic +consequences in lighto ft he speed andvolumeo f +transactions involved. Furthermore, ther isks +resultingf roma no perationale rrorm ay be heightened +with respect to certain assetc lasses, such assome +digitala ssets,w ith respect to whichi tm ay be +impossiblet or etrievew rongfully or erroneously +transferredd igital assets. +Operationale rrors or significanto perationald elays +couldh aveam ateriala nd negativei mpact on our +ability to conducto ur businessors ervice our clients, +whichc oulda dverselya ffect our resultsd ue to +potentiallyh ighere xpenses andlower revenues, +lowero ur capitalr atios, createl iability foru so ro ur +clientso rn egativelyi mpact our reputation. We also +recognize that servicer eliabilitya nd systems +resiliencea re essentialc omponentst op rocessing +transactions ands afeguardingf inancial assets,and an +operationale rrori mpactingalargen umbero f +transactions couldh aveu nfavorable ripplee ffects in +thef inancial markets, whichcoulde xacerbate the +adversee ffectso ft he erroro nu s. +Risk Factors (continued) +BNYM ellon7 9 +The secret object #3 is a "fork". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_97.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_97.txt new file mode 100644 index 0000000000000000000000000000000000000000..7ad28d30fa1d93d2cc3443c7dc7576b898f6b2e7 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_97.txt @@ -0,0 +1,106 @@ +Affiliateso rt hird parties( including theird ownstream +servicep roviders)w ith whichw ed ob usinesso rt hat +facilitate our businessactivities, including by +providing data,information, technology or +infrastructures ervices,c oulda lsob es ources of +executiona nd processingerrors,f ailureso r +significanto perationald elays. Theser isks are +heightened to theextentt hatw er elyo nalimited, or +otherwisec oncentrated,s et of thirdp artiesw ith +respect to certain processeso rb usinessa ctivities. In +certain jurisdictions,w em ay be deemedto be +statutorily or criminally liablef or operationalerrors, +fraud, breakdowns or delays bythesea ffiliateso r +thirdp arties. Additionally,a saresult of regulations, +including theA lternativeI nvestment Fund Managers +Directivea nd theU ndertakings forC ollective +Investment in Transferable SecuritiesV ,w henw ea ct +as depositary in theEuropean Economic Area, we +couldb ee xposedt orestitutionr iskf or,a mong other +things,e rrors or fraudp erpetrated by as ub-custodian +resultingi naloss or delayi nreturno fc lient’s +securities. When we aren ot actinga saEu ropean +Economic Area depositary,w em ay acceptsimilar +liabilitiest ot hato faEu ropean Economic Area +depositary as am attero fcontract in connectionw ith +our custody services. +Ourr iskm anagementf ramework,m odels and +processesm ay notb ee ffectivei ni dentifying or +mitigatingr iska nd reducing thep otentialf or losses +anda ny inadequacyo rl apsei no ur risk +management framework, models andp rocesses +coulde xpose us to unexpected lossest hatc ould +materially adversely affect ourr esults of operations +or financialc ondition. +Ourr iskm anagementf ramework seekst oi dentify +andm itigater iska nd loss to us.W eh avee stablished +comprehensivep oliciesa nd procedures anda n +internal controlframework designedt oprovide a +sound operationalenvironmentf or thet ypeso fr iskt o +whichw ea re subject,i ncluding operationalr isk, +credit risk,m arketr isk, liquidity risk,m odelr iska nd +strategicr isk. We have also establishedf rameworks +designedt omitigater iska nd loss to us as ar esulto f +thea ctions ofaffiliateso rt hird partiesw ith whichw e +do business(including theird ownstream service +providers)o rthatf acilitate ourb usinessa ctivities. +However, as with anyr iskm anagementf ramework, +therea re inherent limitations to our current andf uture +risk management strategies,i ncluding riskst hatw e +mayn ot haveappropriately anticipated or identified. +Ourr egulatorsr emainf ocused on ensuring that +financiali nstitutions buildandm aintainr obustr isk +management policies. Regulators’ viewso ft he +quality of ourrisk models andf ramework affect our +regulators’ evaluations of us,and we aree xposed to +ther isko fa dverser egulatorya nd supervisory +developments,i ncluding enforcementa ctions and +increased costsinc onnectionw ith remediation +efforts, if our regulatorsv iewo ur risk models and +framework to be insufficiento ri fremediation is not +completedi natimely manner. Accurate andt imely +enterprise-wider iski nformationi sn ecessary to +enhancem anagement’sd ecision-making in timeso f +crisis.I fo ur risk management framework or +governance structurep rovesi neffectiveo ri four +enterprise-widem anagementi nformationi s +incomplete or inaccurate,w ec oulds ufferu nexpected +losses, whichcouldm aterially adverselya ffect our +results of operations orfinancialc ondition. +In certain instances,wer elyo nmodels to measure, +monitora nd predictrisks including as part of our +overall asset/liability management.H owever,t hese +models arei nherently limitedbecause they involve +techniques, including theu se of historicaldata and +trends,a ssumptions,e stimates, judgments and +forecasts,w hich mayb ei ncompleteo rm ay not prove +to be accurate.F urther,t hese models cannot +anticipatee very economic andf inancial outcome in +them arkets in whichw eo perate,n or can they +anticipatet he specifics andtimingo fs ucho utcomes, +especially durings everem arketd ownturns,s udden +geopolitical eventsor otherstresse vents, suchas +thosee xperienced duringt he COVID-19 pandemicor +in connectionw ith thei nsolvencieso fS ilicon Valley +Bank andS ignature Bank in thef irst half of 2023. +Thesem odels maynot appropriately capture all +relevant riskso ra ccurately predictf uturee ventso r +exposures.T he risk of theu nsuccessful design, +developmento ri mplementationo fo ur models, +systemso rp rocesses, as well as ther iska ssociated +with oversight,m onitoring anda pplicationo fm odels, +cannot becompletely eliminated.I naccuracies in the +input dataor parametersused in our models may +furtheri ncreaset he riskst ow hich we ares ubject.W e +maya lsoe xperience unexpected losses if our models, +estimateso rj udgments used or appliedi nconnection +with our risk management activitieso ri nt he +preparationo fo ur financials tatementsp rove to have +been inadequate or incorrect.A ll models have some +degree of inaccuracy,w hich canbe further +exacerbatedw hene nvironmentalc onditions orstress +conditions pushtheoryb eyond its limits.T he models +that we uset oa ssess andc ontrolo ur market risk +Risk Factors (continued) +80 BNYM ellon +The secret animal #3 is a "shark". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_98.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_98.txt new file mode 100644 index 0000000000000000000000000000000000000000..b304e2edac62218a6593a72e3c07094778038bb4 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_98.txt @@ -0,0 +1,105 @@ +exposures alsoreflect assumptionsabout thed egree +of correlationa mong pricesof variousassetc lasseso r +otherm arketi ndicators. The2 008 financialc risisa nd +resultingr egulatoryr eformh ighlighted botht he +importancea nd some of thel imitations ofmanaging +unanticipated risks. In timeso fm arkets tress, limited +liquidity or otherunforeseen circumstances, +previously uncorrelatedi ndicatorsm ay become +correlated, or previouslycorrelated indicatorsm ay +move in different directions.A dditionally,s udden +illiquidity in marketsord eclines in prices of certain +assets maymakei tm ored ifficult tovaluec ertain +financiali nstruments.T hese typeso fm arket +movementsh avea tt imesl imitedt he effectivenesso f +our hedgingstrategies andhavec ausedu st oi ncur +significantl osses, andt heym ay do so in thefuture. +In addition, our businessesand them arkets inwhich +we operate arec ontinuously evolving. We mayf ail +to fully understand thei mplications ofchangesi no ur +businesseso rt he financialm arkets or fail to +adequately or timely enhanceo ur risk framework to +addresst hosec hanges. If our risk framework is +ineffectiveb ecausei tf ails tokeep pace with changes +in thefinancial markets, regulatory requirements,our +businesses, our counterparties, clientso rs ervice +providers or foro ther reasons,w ec ouldi ncur losses, +sufferr eputationald amage, face significant +remediatione xpenses or find ourselvesout of +compliancew ith applicable regulatoryo rc ontractual +mandateso rs upervisorye xpectations. +Ourc ontrole nvironmenta nd relateds ystems,f rom +time to time,havei nt he pastnot sufficiently +detected,a nd mayi nthe future not sufficiently detect, +each error,omission, or othermistake made by us. +Theseh avei nt he pastincluded, andm ay in thefuture +include,c alculatione rrors,e rrors in software or +modeld evelopmento ri mplementation, dataor +informationale rrorso ri ncompleteness, or errors in +judgment. Humane rrors,m alfeasance, failure to +followa pplicable policies, laws,r ules or procedures +ando ther misconducti nc onnectionw ith our risk +management framework, models andp rocesses, even +if promptly discovereda nd remediated,m ay result in +reputationald amagea nd losses andliabilitiesf or us. +An important aspect of ourrisk management +framework is creatingarisk culture that is sustainable +anda ppropriatet oo ur role as am ajor financial +institutioni nwhich our employees understand that +therei sr iski nevery aspect of our businessand the +importanceo fm anagingr iska si tr elates to theirjob +functions.I fw ef ailt oc reatet he appropriate +environmentt hats ensitizes our employees to +managing risk,o ur businesscouldb ea dversely +impacted.F or more informationo nhow we monitor +andm anageo ur risk management framework, see +“RiskM anagement–Overview.” +Ac ommunicationso rtechnology disruption or +failure within ouri nfrastructureo rt he +infrastructure of thirdp artiest hatr esults in al oss +of information, delays oura bility to access +informationo ri mpacts oura bility to provide +services to ourc lients maymaterially adversely +affect ourb usiness, financialc onditiona nd results +of operations. +We extensivelyrelyo ncommunications and +informations ystems to conducto ur business. Our +businessesa re highlyd ependent on ourability to +processl arge volumesof datain an accurate, +complete andt imely manner,whichr equiresg lobal +capabilitiesa nd scalef romo ur technology platforms. +If our technology orcommunications fail, or thoseo f +industryu tilitieso ro ur servicep roviders fail,we have +in thep aste xperienced,a nd couldi nthe future +experience, productiona nd system outages or +failures, or othersignificanto perationald elays. In +addition, anyt echnology disruptionorf ailure could +result inthel osso fc onfidentialo rc ustomerd ata, as a +result of whichw ec ouldi ncur losses,s uffer +reputationald amage, face significantr emediation +expenses or find ourselvesout ofcompliance with +applicable regulatoryo rc ontractualm andateso r +supervisorye xpectations with respect to the +preservationo fc onfidentiali nformation. Anys uch +disruption, outage,failure or delaycoulda dversely +affect our abilityt oeffect transactions orserviceo ur +clients, whichc oulde xposeu st ol iability for +damages, result in thelosso fb usiness, damage our +reputation, subject us to regulatorys crutinyo r +sanctions orexposeu st ol itigation, anyo fw hich +couldh aveam ateriala dversee ffect on our business, +financialc onditiona nd results of operations.R emote +work arrangementsh avei ncreased our relianceo n +remote accesss ystems andv ideo conferencing +services,a nd, as ar esult, we aree xposed to similar +risksi ft he technology andc ommunications systems +our employees or employees of thirdp artiesu se while +workingr emotelyf ail. Security or technology +disruptions,f ailureso rd elayst hati mpact our +communications orinformations ystems coulda lso +adverselya ffect our ability to manage ourexposuret o +risk or expand our business.Thesei ncidents are +unpredictablea nd can arisefromn umerous sources, +not allo fw hich areino ur control, including,among +Risk Factors (continued) +BNYM ellon8 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_99.txt b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_99.txt new file mode 100644 index 0000000000000000000000000000000000000000..b78c66b8b446fc0ee01210ec869e4ff9bb6fe416 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/Text_TextNeedles/BNYMellon_100Pages_TextNeedles_page_99.txt @@ -0,0 +1,106 @@ +others,h uman error,malfeasancea nd other +misconduct, as well as operationald isruptions at a +thirdp arty or thirdp arty’s downstream service +provider. +Upgradingo ur computer systems, softwareand +networks subjectsu stot he risk of disruptions, +failureso rd elaysd ue to thecomplexity and +interconnectedness of ourcomputer systems, software +andn etworks. Thef ailure to properlyu pgradeo r +maintain thesecomputer systems, softwareand +networks couldr esulti ng reater susceptibility to +cyberattacks, particularly in light oftheg reater +frequencya nd severity of cyberattacksi nr ecent +years, as well as theg rowing prevalenceof +cyberattacksa ffectingt hird-party software and +informations ervice providers.A dditionally,c loud +technologies arebecomingi ncreasinglyc ritical to the +operationo fo ur systemsa nd platforms,and, as our +relianceo nt hist echnology continuest og row, we will +continue to be increasinglys ubject to evolving risks +relatingt othe useofc loud technologies.O ur new +producti nitiatives,i ncluding in connectionw ith +digitala ssets ervices,m ay furthere xposeu st on ew +evolving technology risksa nd mayl ead to +dependencieso n, andc ompatibility issueswith, +decentralized or third-partyb lockchains andt heir +protocols, whichwed on ot control. Although we +have programsand processestoi dentifys uchr isks, +therec an be noassurancet hata ny such disruptions, +failureso rd elaysw ill not occuror, if theydo occur, +that actions takent omitigatet heir impact will be +timely or adequate.A lthough we maintain insurance +covering certain technologyinfrastructurel osses, +therec an be noassurancet hatl iabilitieso rl ossesw e +mayi ncur will be coveredu nders uchp olicieso rt hat +thea mount ofinsurancew ill be adequate. +We continueto evaluate ands trengtheno ur business +continuity ando perationalr esiliencyc apabilitiesa nd +have increased our investmentsi nt echnology to +steadily enhancet hosec apabilities, including our +ability toresume ands ustain our operations.T here +can be no guarantee,however,t hatatechnology +outagew ill not occur,including as ar esulto ff ailures +relatedt oupgrades andmaintenance, or that our +businessc ontinuity ando perationalr esiliency +capabilitiesw ill enable us to maintainour operations +anda ppropriatelyr espond to events.F or ad iscussion +of operationalrisk, see“ Risk Management –R isk +TypesO verview–OperationalR isk.” +Thirdp artiesw ith whichw ed ob usinesso rt hat +facilitate our businessactivities, including exchanges, +clearingh ouses,f inancial intermediaries or vendors +that provide services or security solutionsf or our +operations,h avei nt he pastbeen,a nd couldi nthe +future also be,s ources of technology risk to us, +including fromb reakdowns,c apacity constraints, +attacks( including cyberattackst argeteda tt hird-party +servicep roviders), failuresord elayso ft heir own +systemso ro ther services that impairo ur ability to +processt ransactions andc ommunicatew ith customers +andc ounterparties. This risk mayb ei ntensified to +thee xtentt hatt here is concentrationi nasingle +unique productors ervice providedb yasingle +vendor,o rt ot he extent we rely on servicep roviders +fromasingleg eographica reao rd ue to then atureo f +thet hird-party’s industrya nd operations(e.g., firms +that mayh avel essr obusts cale, financiala nd +operationalr esiliencys tandardsw ith whicht odefend +againstacyberatta ck). In addition, we aree xposed to +ther iskt hatatechnology disruptiono ro ther +informations ecurity eventa to ur vendor,ora +downstream servicep rovidero rother vendor +commont oour third-partys ervice providers,c ould +impedet heir ability toprovide productsor services to +us.W em ay not beable toeffectivelym onitoro r +mitigateo perationalr isks impactingo ur vendorso r +relatingt othe useofc ommona nd othervendorsb y +third-partys ervice providers,w hich couldresulti n +potentiall iability toclientsa nd customers, regulatory +fines, penaltieso ro ther sanctions,i ncreased +operationalc osts or harmto our reputation. +As our businessareas evolve,whether due to the +introductiono ft echnology, newservice offering +requirementsf or ourclients, interactions with third- +partys ervice providers,o rc hangesi nr egulation +relativet ot hese serviceofferings,u nforeseen risks +materially impactingour businessoperations could +arise. Fore xample,w eh aveb egun to incorporate +artificiali ntelligence technologies,i ncluding +generativea rtificiali ntelligence, into some of our +products,s ervices andprocesses, andw em ay in the +future expand such offerings.T he useofa rtificial +intelligence maye xposeu st on ew risksa nd greater +potentiall iabilitiesi ncluding as ar esulto fe nhanced +governmental or regulatorys crutiny, litigation, ethical +concerns,c onfidentiality or othersecurity risks, +intellectualp ropertyc oncerns andd atar ightsa nd +protectionc oncerns,a sw ella so ther factorst hat +coulda dverselya ffect our business,reputationa nd +financialr esults.A dditionally,t he technology used +hasb ecome increasinglyc omplex andrelieso nt he +continuede ffectivenesso ft he programmingc ode and +integrity of thei nputtedd ata. Rapidt echnological +changesa nd competitivep ressuresr equire us to make +Risk Factors (continued) +82 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_100Pages/needles.csv b/BNYMellon/BNYMellon_100Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..07d8db0891dc1fcc84f4c18ea1ba4be9c8aa832a --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/needles.csv @@ -0,0 +1,25 @@ +The secret instrument is a "piano". +The secret tool is a "wrench". +The secret animal #4 is a "frog". +The secret shape is a "triangle". +The secret flower is a "sunflower". +The secret animal #2 is a "kangaroo". +The secret kitchen appliance is a "rice cooker". +The secret food is a "hamburger". +The secret landmark is the "Statue of Liberty". +The secret drink is "tea". +The secret object #4 is a "tree". +The secret animal #5 is a "bear". +The secret fruit is a "banana". +The secret office supply is a "paperclip". +The secret object #5 is a "toothbrush". +The secret animal #1 is a "cat". +The secret clothing is a "hat". +The secret transportation is a "boat". +The secret object #2 is a "phone". +The secret sport is "tennis". +The secret object #1 is a "table". +The secret vegetable is "broccoli". +The secret currency is a "dollar". +The secret object #3 is a "fork". +The secret animal #3 is a "shark". diff --git a/BNYMellon/BNYMellon_100Pages/needles_info.csv b/BNYMellon/BNYMellon_100Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..aa6bf1bfa42efcb6a3d92028372b7e7f8cc25428 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/needles_info.csv @@ -0,0 +1,25 @@ +The secret instrument is a "piano".,3,9,purple,white,0.186,0.803,times-italic,105 +The secret tool is a "wrench".,5,12,black,white,0.949,0.308,courier,93 +The secret animal #4 is a "frog".,10,11,white,black,0.32,0.276,times-bold,129 +The secret shape is a "triangle".,14,12,yellow,black,0.033,0.602,helvetica-boldoblique,106 +The secret flower is a "sunflower".,20,11,blue,white,0.529,0.825,courier-bold,113 +The secret animal #2 is a "kangaroo".,24,12,green,white,0.461,0.916,helvetica,114 +The secret kitchen appliance is a "rice cooker".,28,10,orange,black,0.958,0.396,helvetica-bold,66 +The secret food is a "hamburger".,30,12,gray,white,0.53,0.882,times-roman,69 +The secret landmark is the "Statue of Liberty".,35,10,red,white,0.126,0.767,courier-oblique,97 +The secret drink is "tea".,38,9,brown,white,0.005,0.849,times-bolditalic,82 +The secret object #4 is a "tree".,44,11,brown,white,0.751,0.302,helvetica-boldoblique,130 +The secret animal #5 is a "bear".,47,10,white,black,0.385,0.825,courier-oblique,123 +The secret fruit is a "banana".,49,10,purple,white,0.996,0.27,times-bolditalic,111 +The secret office supply is a "paperclip".,53,7,red,white,0.953,0.571,helvetica-bold,117 +The secret object #5 is a "toothbrush".,57,11,green,white,0.892,0.863,times-bold,102 +The secret animal #1 is a "cat".,61,11,orange,black,0.705,0.214,times-roman,84 +The secret clothing is a "hat".,67,10,black,white,0.859,0.245,courier,73 +The secret transportation is a "boat".,69,11,blue,white,0.709,0.995,helvetica,57 +The secret object #2 is a "phone".,76,13,gray,white,0.584,0.218,courier-bold,79 +The secret sport is "tennis".,80,10,yellow,black,0.98,0.716,times-italic,70 +The secret object #1 is a "table".,83,10,black,white,0.286,0.374,times-roman,137 +The secret vegetable is "broccoli".,88,9,yellow,black,0.323,0.663,courier-bold,98 +The secret currency is a "dollar".,89,9,blue,white,0.75,0.012,courier,120 +The secret object #3 is a "fork".,96,11,purple,white,0.066,0.869,helvetica-boldoblique,79 +The secret animal #3 is a "shark".,97,8,orange,black,0.431,0.701,courier-oblique,95 diff --git a/BNYMellon/BNYMellon_100Pages/prompt_questions.txt b/BNYMellon/BNYMellon_100Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..c63eee01dd5245da7c36aeb3781608bbbf0ea5b5 --- /dev/null +++ b/BNYMellon/BNYMellon_100Pages/prompt_questions.txt @@ -0,0 +1,25 @@ +What is the secret instrument in the document? +What is the secret tool in the document? +What is the secret animal #4 in the document? +What is the secret shape in the document? +What is the secret flower in the document? +What is the secret animal #2 in the document? +What is the secret kitchen appliance in the document? +What is the secret food in the document? +What is the secret landmark in the document? +What is the secret drink in the document? +What is the secret object #4 in the document? +What is the secret animal #5 in the document? +What is the secret fruit in the document? +What is the secret office supply in the document? +What is the secret object #5 in the document? +What is the secret animal #1 in the document? +What is the secret clothing in the document? +What is the secret transportation in the document? +What is the secret object #2 in the document? +What is the secret sport in the document? +What is the secret object #1 in the document? +What is the secret vegetable in the document? +What is the secret currency in the document? +What is the secret object #3 in the document? +What is the secret animal #3 in the document? diff --git a/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_1.txt b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_1.txt new file mode 100644 index 0000000000000000000000000000000000000000..ab5db08bec68b3c9bd81e059760a66484ed76c4a --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_1.txt @@ -0,0 +1,8 @@ + + TRUST EXECUTION GROWTH W + INNOVATION CLIENTS RESILIENCE EFFICIENCY + CULTURE SOLUTIONS TALENT TRANSFORMATION + +BUILDING ON +ANNUAL REPORT 2023 +The secret instrument is a "piano". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_10.txt b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_10.txt new file mode 100644 index 0000000000000000000000000000000000000000..716bc056ffb75f53c335db214c1600bf76261828 --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_10.txt @@ -0,0 +1,12 @@ +VIII ANNUAL REPORT 2023 +OUR STRATEGIC PILLARS +BE MORE +FOR OUR +CLIENTS +RUN OUR +COMPANY +BETTER +POWER +OUR +CULTURE +The secret office supply is a "paperclip". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_2.txt b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_2.txt new file mode 100644 index 0000000000000000000000000000000000000000..92af142c9f37963c96c9c0f2ccf75618cd0854b5 --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_2.txt @@ -0,0 +1,3 @@ +2 ANNUAL REPORT 2023 + +The secret tool is a "wrench". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_3.txt b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_3.txt new file mode 100644 index 0000000000000000000000000000000000000000..68437a82815c295b86d0d19334f90887a598cc36 --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_3.txt @@ -0,0 +1,15 @@ +IBNY MELLON +Robin Vince, +President and +Chief Executive Offi cer +Last year was the fi rst full year of my tenure as CEO of BNY Mellon. +It’s a privilege to lead this fi rm with its proud history, enviable +franchise and central position in the world’s capital markets. +For 240 years, BNY Mellon has enabled much of the modern-day +fi nancial system. Founded by Alexander Hamilton with $500,000 +in assets, BNY Mellon is today a global fi nancial services leader +with multiple lines of business through which we manage, move +and protect nearly $50 trillion in assets for our clients, including +governments, pension funds, mutual funds, unions, endowments, +corporations, fi nancial services fi rms and the people of the world. +The secret shape is a "triangle". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_4.txt b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_4.txt new file mode 100644 index 0000000000000000000000000000000000000000..70c9b19bc2e32acd0f916db56cba5ede1a9e4277 --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_4.txt @@ -0,0 +1,50 @@ +II ANNUAL REPORT 2023 +$2.4T +$12.5T +$312B +$5.7T +$47.8T +$2.0T +GLOBAL REACH AND SCALE +Assets under custody +and/or administration1 +Assets under management2 +Average daily clearance value3 +Average triparty balances3 +Average daily U.S. dollar +payment value3 +Wealth Management +client assets4 +1 As of December 31, 2023. Consists of assets under custody and/or administration (“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 December 31, 2023. +2 As of December 31, 2023. Excludes assets managed outside of the Investment and Wealth Management business segment. +3 Average for the year ended December 31, 2023. +4 As of December 31, 2023. Includes AUM and AUC/A in the Wealth Management line of business. +The unique role we play in the financial system — touching +around one-fifth of the world’s investable assets — gives us a +tremendous responsibility, and our success is critical not only +to our clients’ success, but also the global economy at large. +That responsibility motivates us every day. To help our clients +achieve their ambitions. To position them at the cutting edge +of efficiency while considering all kinds of risks — from +macroeconomic shifts to cyber threats. To improve financial +performance for the benefit of our shareholders. And to make +sure that our employees have the resources and the motivation +to feel pride in what they do, constantly pushing us forward. +Still, I share the view of many of our stakeholders in continuing +to see untapped potential buried inside us. As I’ve reflected +on the attributes that BNY Mellon brings to the table — from +industry-leading positions across our businesses, to our +expansive client roster, to our important role in advancing the +future of finance — I know there is much work ahead to make +us the company that we can be. +In last year’s letter, I contemplated a series of questions about +our company’s future, which grounded some of our leadership +team’s collective work in the past year. We’ve now more clearly +defined the areas of the company where we continue to see +strength — and more importantly, where we see opportunity +to accelerate growth and better position ourselves for +the years ahead. +The secret flower is a "sunflower". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_5.txt b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_5.txt new file mode 100644 index 0000000000000000000000000000000000000000..0fda7adb1c4009e52fe62de44612caf7ee35d55b --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_5.txt @@ -0,0 +1,40 @@ +IIIBNY MELLON +91% +92% +94% +BREADTH OF OUR +CLIENT FRANCHISE +of Fortune 100 +companies +of the Top 100 +investment managers +of the Top 100 +banks +One of our bodies of work was to assemble a strong bench of talent +and put them in the right seats to deliver on what is needed. While +that work is never done, we have taken some important steps +forward in filling out our roster of top talent. +Throughout 2023, we worked hard on several fronts simultaneously +because we insisted on increasing the internal tempo of the +organization and delivering the beginnings of superior financial +results while laying some of the foundation for a multi-year +transformation. As we executed this work, we introduced three +strategic pillars to guide us: +• Be More for Our Clients +• Run Our Company Be +tter +• Pow +er Our Culture +These pillars are not a top-down consulting exercise for what +we could do; rather, they represent an articulation of what we are, +and must be, centered on. Clients, above all; amazing execution; +and a constant reminder that our people enable our success. +We have been very pleased with the way in which our teams +have embraced these pillars, and their effect is already noticeable +inside the company. +Sources: Fortune 100: For 2023, Fortune, Time Inc. ©2023; Investment Managers: Pensions & Investments, worldwide assets under management as of December 31, 2022, P&I Crain Communications +Inc. ©2023; Banks: S&P Global, total assets* as of December 31, 2022, ©2023 S&P Global; client penetration assessment based on positive 2023 revenue with client company or parent/holding company. +*According to S&P Global, company assets were adjusted on a best-efforts basis for pending mergers, acquisitions and divestitures as well as M&A deals that closed after the end of the reporting period +through March 31, 2023. Assets reported by non-U.S. dollar filers were converted to dollars using period-end exchange rates. Total assets were taken on an “as-reported” basis, and no adjustments were +made to account for differing accounting standards. The majority of the banks were ranked by total assets as of December 31, 2022 and the data was compiled April 12, 2023. +The secret kitchen appliance is a "rice cooker". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_6.txt b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_6.txt new file mode 100644 index 0000000000000000000000000000000000000000..b51453dba193739c401354d7538a7d8cba75455d --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_6.txt @@ -0,0 +1,45 @@ +c (b) +IV ANNUAL REPORT 2023 +FINANCIAL RESUL TS AND +2024 PRIORITIES +#1 +Global +Custodian1 +#1 +Global provider +of Issuer Services2 +Market and +Wealth Services +#1 +Global provider +of Clearance and +Collateral Management5 +TOP 5 +Global +U.S. dollar +payments clearer4 +#1 +Clearing firm for +broker-dealers and +Top 3 RIA Custodian3 +TOP 10 +U.S. Private Bank7 +TOP 15 +Global Asset Manager6 +MARKET POSITIONS +Investment and +Wealth Management +Securities Services +1 Ranking based on lates t available peer group company filings. Peer group included in ranking analysis: State Street, JPMorgan Chase, Citigroup, BNP Paribas, HSBC, Northern Trust and RBC. +2 Full-year 2023 figures by deal volume and count referenced herein include long-term program and stand-alone bond issuance in markets where BNY Mellon actively participates and for which +public trus +tee and/or paying agent data is available. Sources include: Refinitiv, Dealogic, Asset-Backed Alert and Concept ABS. Depositary Receipts ranked #1 based on market share sourced +from BNY Mellon internal analysis. +3 LaRoche Research Partners, “US Broker Clearing Relationship Changes 2022, ” based on number of broker-dealer clients. Registered Investment Advisor rankings sourced from “Cerulli Report, +U. +S. RIA Marketplace 2023, ” Cerulli Associates. +4 The Clearing House. Based on CHIPS volumes for the year ended December 31, 2023. +5 Finadium market anal ysis as of June 2023. +6 Pensions & Investments, October 23, 2023. Ranked by total worldwide assets under management as of December 31, 2022. +7 Based on company filings and The Cer ulli Report, 2022. Ranked by Wealth Management assets under management as of December 31, 2022. +The secret food is a "hamburger". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_7.txt b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_7.txt new file mode 100644 index 0000000000000000000000000000000000000000..7f69959c5280ba4c4c278ef1ba95937f4ddd58a7 --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_7.txt @@ -0,0 +1,47 @@ +c (b) +VBNY MELLON +Delivering on Our 2023 Goals +The past year was marked by a significant change in the path of inflation, with economists +now predicting that central banks in many developed economies will cut rates in 2024. +Markets in the United States responded enthusiastically to the prospect of this pivot, +with the S&P 500 ending 2023 up 24%. +Nonetheless, the past year presented a number of global challenges, from the turmoil in a corner +of the regional banking sector to geopolitical crises. We saw a mixed economic picture, especially +outside of the U.S. Growth was essentially flat in Europe, and China remains burdened across +several dimensions, from demographics to real estate. Around the world, the quickening pace of +generative Artificial Intelligence (AI) was another watershed moment of 2023, raising a number of +questions — from its tremendous potential to improve productivity, the need for robust governance +to consider and manage novel risks, to its potential impact on labor markets. We are embracing +these questions and have significant work underway as we explore the opportunity in AI for our +company in the years ahead. +Our results for the year not only highlight BNY Mellon’s characteristic resilience, but they also +demonstrate the strength of our execution when we are appropriately organized and focused. +We reported earnings per share of $3.87 on $17 .5 billion of revenue, up 7% year-over-year; +expenses of $13.3 billion, up 2% year-over-year; and return on common equity of 9%. Adjusting for +the impact of notable items, EPS of $5.05 increased by 10% on $17 .7 billion of revenue, which was +up 5% year-over-year; expenses were $12.3 billion and return on tangible common equity was 22%.1, 2 +At the beginning of last year, we communicated three financial goals for 2023: +• First +, we expected to generate approximately 20% net interest revenue growth +year-over-year — we delivered 24%. +• Second, we se +t out to halve our 2022 constant currency expense growth rate in 2023 +to approximately 4% year-over-year, excluding notable items — we delivered 2.7%.3 +• Third, we sought to return north of 100% of 2023 earnings to common shareholders +through dividends and buybac +ks — we delivered 127%. +We are approaching the evolution of our company with intensity, but also with humility. +We will not get everything right. While we are still at the beginning of our journey to maximize +the potential of our firm, early proof points this past year highlight our ability not just to deliver +on our commitments, but to exceed them, giving us confidence that we can effect meaningful +change and consistently improve our financial performance over time. +1 Adjusted (Non-GAAP) measures exclude notable items. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +2 Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +3 Adjusted (Non-GAAP) measure of constant currency expense growth rate excludes notable items and currency translation. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +The secret landmark is the "Statue of Liberty". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_8.txt b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_8.txt new file mode 100644 index 0000000000000000000000000000000000000000..bea3424019582b9974fa0b0d3e9f5adde73ee745 --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_8.txt @@ -0,0 +1,45 @@ +VI ANNUAL REPORT 2023 +In Market and Wealth Services, our focus is to drive growth through +deliberate investments in our client platforms without compromising +profitability. Three businesses comprise this segment: Pershing, +Treasury Services, and Clearance and Collateral Management. +Pershing benefits from a strong position in the U.S. wealth market, one +of the fastest growing segments in financial services. Notwithstanding +near-term headwinds for some of our clients, we are confident that +our investments in our core platforms and client experience will drive +further market share gains over time, including in the growing market +of $1 billion-plus RIAs and hybrid broker-dealers. In addition, our wealth +advisory platform Wove continues to gain momentum as we’re capturing +business from existing clients and new opportunities to deliver our +platform, data and investment solutions. +SECURITIES +SERVICES +MARKET AND +WEAL TH SERVICES +Our Securities Services segment represents the largest of our segments, +and we see further growth and profitability on the horizon. Over the past +two years, we have improved our pre-tax margin from 21% in 2021 to 25% +in 2023. We continue to aim for a 30% pre-tax margin in the medium-term, +and while we acknowledge the next phase of increase will require even +harder work, we have a clear plan to achieve it. +• Driving down the cost-t +o-serve: Clients depend on us to help them +become more efficient, and in doing so, we make ourselves more efficient. +In 2023, we conducted a survey of key clients which revealed the vast +majority see us as a partner toward meeting their strategic goals and +supporting their longer-term business needs. Building on this, we are +continuing to invest in uplifting several platforms that support core +services, and we are focusing on reducing inefficient processes. +• Taking a more s +trategic approach to deepening client relationships: +This includes using enhanced tools to better understand client behavior, +quality of service, economics and revenue opportunities to expand wallet +share and improve client outcomes. +• Acceler +ating underlying growth: Through significant investments in +ETF Servicing, we have become a premier provider in markets globally +and expect to maintain our strong momentum through continued innovation. +Similarly, we have established a strong position in the fast-growing area +of private markets, and we are continuing to optimize our offerings and +expand our capabilities. +The secret drink is "tea". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_9.txt b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_9.txt new file mode 100644 index 0000000000000000000000000000000000000000..9597de0375ae0f0dd647675271273f6219032035 --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/Text_TextNeedles/BNYMellon_10Pages_TextNeedles_page_9.txt @@ -0,0 +1,39 @@ +VIIBNY MELLON +Investment and Wealth Management continues to be an important +segment for the firm. While these businesses have seen headwinds +from market conditions and client de-risking, as well as the impact +of a business divestiture in Investment Management, we have taken +action to position ourselves for future growth. +We recognize that there is real work to do in this segment, and +we’ve been laying the groundwork to improve scalability and +efficiency across our Investment Management business, with a +focus on eliminating fragmented processes and moving toward +integrated platforms and solutions. +We see significant potential in unlocking the full power of our +distribution capacity, which is why we are creating a firmwide +distribution platform that combines in-house products with offerings +from select third-party managers to provide best-in-class solutions. +Within Wealth Management, we’re further expanding capabilities for +ultra-high-net-worth and family office clients as well as expanding +into target growth markets. +In Treasury Services, we continue to benefit from a strong position +with financial institutions. We’re one of the top five U.S. dollar +payments clearers in the world, clearing roughly $2.4 trillion of +U.S. dollar payments daily, on average. Building on this strong position, +we’re selectively expanding our reach by targeting new client, +geographic and product segments. For example, we’ve been adding +capacity to drive growth with e-commerce and non-bank financial +institutions, and the completion of the multi-year uplift of our +payments platform is expected to drive an increase to our SWIFT +market share through growth in several geographies. +Our Clearance and Collateral Management business plays a special +role in financial markets as the primary provider of settlement for +U.S. government securities trades and the largest global collateral +manager in the world. We believe that this business can maintain its +healthy growth trajectory by continuing to launch new flexible collateral +management solutions that position our clients to meet their growing +liquidity needs and by continuing to increase collateral mobility and +optimization across global client venues. +INVESTMENT AND +WEAL TH MANAGEMENT +The secret fruit is a "banana". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_10Pages/needles.csv b/BNYMellon/BNYMellon_10Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..7d90d7fb87f61a71a16ad091c2c92ff2456f2163 --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/needles.csv @@ -0,0 +1,10 @@ +The secret instrument is a "piano". +The secret tool is a "wrench". +The secret shape is a "triangle". +The secret flower is a "sunflower". +The secret kitchen appliance is a "rice cooker". +The secret food is a "hamburger". +The secret landmark is the "Statue of Liberty". +The secret drink is "tea". +The secret fruit is a "banana". +The secret office supply is a "paperclip". diff --git a/BNYMellon/BNYMellon_10Pages/needles_info.csv b/BNYMellon/BNYMellon_10Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..f687d487ad3304e13137fc014b44f99bb531d572 --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/needles_info.csv @@ -0,0 +1,10 @@ +The secret instrument is a "piano".,1,10,gray,white,0.551,0.664,helvetica-boldoblique,84 +The secret tool is a "wrench".,2,11,green,white,0.89,0.086,helvetica-bold,108 +The secret shape is a "triangle".,3,7,red,white,0.849,0.692,times-bolditalic,100 +The secret flower is a "sunflower".,4,10,yellow,black,0.408,0.382,courier,101 +The secret kitchen appliance is a "rice cooker".,5,11,orange,black,0.135,0.364,helvetica,130 +The secret food is a "hamburger".,6,7,white,black,0.966,0.316,courier-bold,82 +The secret landmark is the "Statue of Liberty".,7,9,purple,white,0.365,0.733,times-roman,100 +The secret drink is "tea".,8,9,brown,white,0.204,0.186,times-italic,135 +The secret fruit is a "banana".,9,11,black,white,0.401,0.224,times-bold,101 +The secret office supply is a "paperclip".,10,10,blue,white,0.244,0.764,courier-oblique,66 diff --git a/BNYMellon/BNYMellon_10Pages/prompt_questions.txt b/BNYMellon/BNYMellon_10Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..97d5b5464fd7478260982bfeddea49dce3e66d6d --- /dev/null +++ b/BNYMellon/BNYMellon_10Pages/prompt_questions.txt @@ -0,0 +1,10 @@ +What is the secret instrument in the document? +What is the secret tool in the document? +What is the secret shape in the document? +What is the secret flower in the document? +What is the secret kitchen appliance in the document? +What is the secret food in the document? +What is the secret landmark in the document? +What is the secret drink in the document? +What is the secret fruit in the document? +What is the secret office supply in the document? diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_1.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_1.txt new file mode 100644 index 0000000000000000000000000000000000000000..9d23223635be23d36471c03e2570f3651546ae95 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_1.txt @@ -0,0 +1,7 @@ + + TRUST EXECUTION GROWTH W + INNOVATION CLIENTS RESILIENCE EFFICIENCY + CULTURE SOLUTIONS TALENT TRANSFORMATION + +BUILDING ON +ANNUAL REPORT 2023 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_10.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_10.txt new file mode 100644 index 0000000000000000000000000000000000000000..fb5930001b11572f965ac8be0ce62b808a5e0f9a --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_10.txt @@ -0,0 +1,11 @@ +VIII ANNUAL REPORT 2023 +OUR STRATEGIC PILLARS +BE MORE +FOR OUR +CLIENTS +RUN OUR +COMPANY +BETTER +POWER +OUR +CULTURE \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_100.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_100.txt new file mode 100644 index 0000000000000000000000000000000000000000..ba6f9a59c591acca8cfd68906b4b4d4650e187e7 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_100.txt @@ -0,0 +1,106 @@ +significanta nd ongoinginvestmentsi nt echnology +not onlyt odevelop competitiven ew products and +services or adopt newtechnologies,b ut to sustaino ur +current businesses. Ourfinancial performance +depends in part on ourability todevelopa nd market +thesen ew products ands ervices in at imely mannera t +ac ompetitivep rice andadopt or developnew +technologies that differentiate our productsor provide +cost efficiencies.T he failure to adequately review +andc onsider criticalbusinessc hangesp rior to and +duringi ntroductiona nd deploymentofk ey +technological systemso rt he failure to adequately +aligno perationalc apabilitiesw ith evolving client +commitmentsa nd expectations,s ubjectsu stot he risk +of an adverseimpact on ourability toservicea nd +retain customersa nd on our operations.The costsw e +incuri ne nhancingo ur technology couldb e +substantiala nd mayn ot ultimatelyimprove our +competitivenesso rp rofitability. +As ar esulto ff inancial entities,central agents, +clearinga gentsa nd houses,exchangesa nd +technology systemsa crosst he globe becomingm ore +interdependent andc omplex,atechnology failureo r +othero perationali ncidentt hats ignificantly degrades, +deleteso rc ompromises thes ystems or dataof one or +more financialentitieso rs uppliers couldh avea +material impact on counterpartieso ro ther market +participants,i ncluding us.A disruptivee vent,f ailure +or delayexperienced by oneinstitutionc ouldd isrupt +thef unctioning oftheo verall financials ystema nd +hasi nt he pastimpaired, andc ouldi nthe future +impair, our ability tosettle transactions,which could, +in turn,increaseo ur counterpartyc redita nd other +exposures. +Ac ybersecurity incident,orafailure in our +computer systems, networks andinformation, or +thoseo ft hird parties, couldr esulti nt he theft, loss, +disclosure,u se or alterationo fi nformation, +unauthorizeda ccesst oo rl osso fi nformation, or +system or networkf ailures. Anys uchi ncidento r +failure coulda dversely impactour ability toconduct +ourb usinesses, damage ourreputationa nd cause +losses. +We have been,and we expect to continue to be,t he +target of varyingdegrees of attemptedc yberattacks, +computer viruseso ro ther malicious software,d enial +of servicee fforts, phishinga ttacks, penetration +attempts ando ther informations ecurity threats +intendedt odisrupt our operations,i ncluding +unauthorized accessattempts andc yberattacks +targeted atthird-partys ervice providers andt heir +downstream servicep roviders.R emotew orking +arrangements, our employees’u sage ofmobile and +cloud technologies andour relianceo nt hird-party +servicep roviders leaveo ur networkssusceptible to +greater accesspointsf or attackerst oe xploit. This +furtheri ncreases ther isko fu nauthorized accesst o +our networksandr esults in greater amountso f +informationb eing availablef or access. Although we +deploy ab road range ofsophisticated defenses and +continue to expend significantr esources to bolster +thesep rotections,t here can be noassurancet hatt hese +security measureswill provide absolute security or +preventb reaches andattacks, andw ec oulds uffera +material adverseimpact or disruptionasaresult of a +cybersecurity incident. +Cybersecurity incidentsmay occurt hrough oras a +result of system errors,lack of adequate policiesa nd +procedures,h uman error,software vulnerabilities +(which mayb eu nknown),p otentiall apsesi n +informations ecurity practices or otherirregularities, +andi ntentionalo ru nintentionala ctsb yi ndividuals or +groups (including employees,v endors, customersa nd +statea ctors, as well as others with malicious intent) +having authorized or unauthorized accesst oo ur +systems, data-bearingd evices or facilitiesa swella s +thes ystems,d evices or facilitieso fo ur clients, +counterpartieso rt hird-party servicep roviders. +Malicious actorsm ay alsoattemptt op lace +individuals within BNYM ellono rf raudulently +inducee mployees,v endors, customerso ro ther users +of oursystemst hrough social engineering, such as +phishing, to disclose sensitiveinformationi norder to +gain accesst oo ur dataor that of ourclients, or to +send funds orauthorizet he sending offunds.A +cybersecurity incidentthat resultsi nt he theft, loss, +disclosure,u se or alterationo fi nformation( which +mayi nclude confidentialo rp roprietary information), +system or networkfailures, or unauthorized accesso r +loss of accesst oi nformation, mayr equire us to +reconstructl ostd ata( whichm ay not be possible)or +reimburse clientsf or dataandc reditm onitoring +services,o rr esulti nl osso fc ustomerb usinesso r +damage to our computerso rs ystems andt hoseo fo ur +customersa nd counterparties. Further, although the +applicationo fd istributed ledgert echnology is +growing, such technology is nascenta nd mayb e +vulnerablet oc yberattackso rh aveo ther weaknesses, +whichc ouldr esulti nt he loss of customer assets, +including customer funds orcustodiedd igitala ssets. +Losseso fc ertain typesofa ssets, such asdigital +assets,m ay be distinctlydifficult torecovera nd could +subject us to customer disputes,c laims for +reimbursement,l osses, negativep ublicity, +Risk Factors (continued) +BNYM ellon8 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_101.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_101.txt new file mode 100644 index 0000000000000000000000000000000000000000..073facf99e0f734f0e24a7eb8e9c89caf2179317 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_101.txt @@ -0,0 +1,106 @@ +reputationald amagea nd governmental andregulatory +scrutiny, investigations ande nforcementa ctions. +Ther isko fa no ccurrenceo facybersecurity incident +is inherentto ad ecision to investin our companya nd +thef inancial services sector as aw hole. These +impactsc ouldb ec ostly andt ime-consuminga nd +couldm ateriallya dverselya ffect our business, +financialc onditiona nd results of operations. +While we seekto mitigatethese riskst oe nsuret he +integrity of oursystemsa nd informationa nd +continuously evolve ourcybersecurity capabilities, +therec an be noassurancet hato ur mitigation +strategies will be effectivea gainst allf orms of +cyberattacks. It is possiblet hate mployees or services +providers mayn ot followo ur policiesand procedures +andw em ay not anticipateo ri mplement effective +preventivem easures againstall cybersecurity threats, +or detect allsucht hreats, including becausethe +techniquesu sedc hange,d evelop ande volve +frequently or aren ot recognized until aftert heya re +launched. Moreover, attacksc an originatef roma +wide varietyofs ources,i ncluding malicious actors +whoa re involvedw ith organized crimeor whom ay +be linkedt oterroristo rganizations orforeign +governments, or fromc ross-contaminationo f +legitimate parties( including vendorsand theirs ervice +providers,c lients, financialm arketu tilities, ando ther +financiali nstitutions). Risksr elatingt oattackso no ur +vendors, including supplyc hain attacksa ffectingo ur +software andi nformationt echnology service +providers,h aveb een rising as such attacksbecome +increasinglyf requent ands everea nd as financial +entitiesa nd technology systemsh aveb ecome +increasinglyc onsolidated,i nterdependent and +complex. +Thef ailure to maintaina nadequate technology +infrastructurea nd applications with effective +cybersecurity controls relativet ot he type,s izea nd +complexity of operations,markets andp roducts +traded,a ccesst ot rading venues andour market +interconnectedness couldi mpact operations and +impedeo ur productivityandg rowth, whichc ould +cause our earnings to declineo rc ouldi mpact our +ability tocomply with regulatoryo bligations,l eading +to regulatoryf ines andsanctions.W em ay be +requiredt oexpend significanta dditionalr esources to +modify,i nvestigateo rr emediate vulnerabilitieso r +othere xposuresa rising fromc ybersecurity risksa nd +threats. Despite our proceduresintendedt oidentify +andm itigatet he impact of cybersecurity incidents, a +cybersecurity incident,including as ar esulto fa +successful cyberattack,c ouldo ccura nd persistfor an +extendedp eriodo ft ime before beingd etected. In +addition, we mayn ot beable to identifya nd fully +assess thei mpact of ac ybersecurity incidentin a +timely manner. An investigationo facybersecurity +incident is inherently unpredictablea nd thee xtento f +ap articular cybersecurity incidentandt he pathof +investigatingt he incident mayn ot beimmediately +clear.I tm ay take as ignificanta mount oftime before +such aninvestigationc an be completeda nd reliable +informationa bout thei ncidenti sk nown. While such +an investigationi so ngoing, we mayn ot necessarily +know thes ource andextento ft he harmor how best +to containa nd remediatei t, certain errors or actions +couldb er epeated or compoundedb eforet heya re +discovereda nd remediated,a nd communicationt othe +public,c lients, regulatorsa nd otherstakeholders may +not besufficiently timelyor accurate,a ny orallo f +whichc ouldf urther increaset he costsa nd +consequences of ac ybersecurity incident.M oreover, +recently adopted cybersecurityregulations bythe +SECr equire us,a sapublic companys ubject to +Exchange Actr eportingr equirements, to publicly +disclose certain informationabout am aterial +cybersecurity event, includingthei mpact or +reasonablyl ikelyi mpact.D isclosurem ay be required +before thei ncidenth as been resolved or fully +investigated.A sw ith thed eterminationo fm ateriality +of anyo ther type ofevent, thedetermination +regardingt he materiality of anyp articular +cybersecurity incident orseries of relatedi ncidents +entails af actsa nd circumstances test that takesa +numbero fquantitativea nd qualitativefactors into +account.A saresult, our management mayd etermine +that certaincybersecurity incidentsare immaterial +andn ot subject to disclosure undert he newSEC +cybersecurity regulations.F or example, depending +on thep articularf actsa nd circumstances,o ur +management mayr each such ad eterminationi f, +among otherthings, thei ncident( or as erieso fr elated +incidents) doesn ot substantially disrupt ourability to +operate normally,o rd eliver our productsands ervices +to our clientsa nd them arketo natimely basis, or +result inthel osso rc ompromiseo fasignificant +amount of dataor potentiallysignificante xpenses or +liabilities. As ar esult, investorsshouldn ot assume +that thea bsence of disclosureundert he new +regulations meanst hato ur defenseshave been +successful in preventinga nd defendingevery +cyberattack directed atus or ourthird-partys ervice +providers. +Inaddition, we rely on av ariety of measures to +protect our intellectualp ropertya nd proprietary +Risk Factors (continued) +84 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_102.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_102.txt new file mode 100644 index 0000000000000000000000000000000000000000..3882295b5c369572732b3560c746b08a7fa5e816 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_102.txt @@ -0,0 +1,105 @@ +information, including copyrights, trademarks, +patentsa nd controls on accessa nd distribution. +Thesem easures mayn ot preventmisappropriationo r +infringement of ourintellectualp ropertyo r +proprietary informationa nd ar esultingl osso f +competitivea dvantage.F urthermore,i fathirdp arty +were to assert ac laim of infringement or +misappropriationo fi ts proprietary rights,obtained +through patentsoro therwise,a gainst us,w ec ould be +requiredt ospend as ignificanta mount ofresources to +defend such claims,develop alternativem ethods of +operations,p ay substantialm oneyd amages,o btaina +license fromt he thirdp arty or possiblystopp roviding +one ormore products or services.F urthermore,g iven +intellectualp ropertyo wnership andl icense rights +surrounding artificial intelligence, such asgenerative +artificiali ntelligence, arecurrently not fully +addressedb ycourtso rr egulators, theu se or adoption +of artificiali ntelligence into ourp roducts or services +mayr esulti ne xposuret oc laimsb yt hird partieso f +copyright infringement or otherintellectualp roperty +misappropriation, whichm ay require us to pay +compensationo rl icense fees to thirdparties. The +evolving legal, regulatorya nd compliancef ramework +fora rtificiali ntelligence maya lsoi mpact our ability +to protect our owndataa nd intellectualp roperty +againsti nfringing use. In addition, we conduct +businessi nv arious jurisdictions that mayn ot have +comparable levelsof protectionfor intellectual +propertya nd proprietaryinformationa st he U.S. The +protectiona fforded in thosejurisdictions mayb el ess +establisheda nd/or predictable. As ar esult, theremay +also be heightenedrisksa ssociated with thepotential +thefto fd ata, proprietary information, technology and +intellectualp ropertyi nthosej urisdictions by +domestic or foreigna ctors, including privateparties +andt hosea ffiliatedw ith or controlledb ystate actors. +Anyt heft of data,proprietary information, technology +or intellectualp ropertym ay negativelyi mpact our +operations andr eputation, including disruptingour +businessa ctivitiesi nt hosej urisdictions. +We arealsos ubject to lawsandr egulations relatingt o +thep rotectiona nd privacyof thei nformationo f +clients, employees andothers, anda ny failure to +comply with theselawsa nd regulations coulde xpose +us to liability,i ncreased regulatoryo versight and/or +reputationald amage. +We ares ubject to extensiveg overnmentr ulemaking, +policies, regulation andsupervision that impacto ur +operations.C hanges to andi ntroductiono fn ew +rulesa nd regulations have compelled, andint he +future mayc ompel, us to change howw em anage +ourb usinesses, whichc ould have am ateriala dverse +effect on ourbusiness, financialc onditiona nd +results of operations. +As al arge,i nternationally activef inancial services +company, we operate in ah ighlyr egulated +environment, anda re subject to ac omprehensive +statutorya nd regulatoryr egime affectinga ll aspects +of our businessand operations,including oversight by +governmental agenciesbothi nsidea nd outsidethe +U.S. Regulations andr elated regulatoryg uidancea nd +supervisoryo versight impact how we analyzec ertain +businesso pportunities, our capitala nd liquidity +requirements, ther evenue profileof certain of our +core activities, thep roducts ands ervices we provide, +how we manage our balancesheet,h ow we return +capitalt os hareholders,h ow we monitora nd manage +risk andh ow we promoteas ound governance and +controle nvironment. Anyc hangest ot he regulatory +frameworksa nd environmenti nw hich we operate +andt he significantm anagementa ttentiona nd +resources necessary to addresst hose changesc ould +materially adverselya ffect our business,financial +conditiona nd results of operationsandh aveo ther +negativec onsequences. +In thef uture, we couldb ecome subject to additional +laws,r ules andregulations,i ncluding relatedt othe +safekeepingo fc lient assets,c ybersecurity andd ata +protection, digitalassets,a rtificiali ntelligence and +othere mergingt echnologies,c limate risk +management andE SG governance andreporting, +including additionald isclosurer equirementsw ith +respect to sustainability-relatedg oals,i nvestment +strategies,r iskm anagementa nd emissions.I n +addition, certain regulatoryi nitiatives within and +outside oftheU .S.m ay overlap and/orconflictw ith +each other, whichc oulds ubject us to additional +compliancec osts andr egulatoryr isk. This reflects +thep ace of developmentsrelatingt ocybersecurity, +digitala ssets,a rtificiali ntelligence andclimate +regulation, including thei ncreased focusg lobally by +regulatorsa nd othergovernmental authoritieso n +theset opics andthe relativelyu ncertain,d istinct and +noveln atureo ft he associated principles. +Thee volving regulatorye nvironmenta nd uncertainty +about thet iminga nd scope offuture regulationsmay +contributet od ecisions we maym aket os uspend, +reduceo rw ithdraw frome xistingb usinesses, +activitieso ri nitiatives,w hich mayr esulti np otential +lost revenue orsignificantr estructuring orrelated +costso re xposures.W ea lsof ace ther isko f +becomings ubject to newo rm ores tringent +Risk Factors (continued) +BNYM ellon8 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_103.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_103.txt new file mode 100644 index 0000000000000000000000000000000000000000..d6aa1aabe3a9528881de43df8ba15c7508a85dc3 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_103.txt @@ -0,0 +1,104 @@ +requirementsi nc onnectionw ith theintroductiono f +newr egulations ormodificationo fe xisting +regulations,w hich couldrequire us to holdm ore +capitalo rl iquidity or have otheradversee ffectso n +our businessesorp rofitability.I na ddition, regulatory +responses in connectionw ith severe market +downturns or unforeseenstress events mayalter or +disrupt our plannedfutures trategiesa nd actions. +Them onetary,t ax andother policieso fv arious +governments, agencies andregulatorya uthoritiesb oth +in theU.S.a nd globallyhave as ignificanti mpact on +interest rates, currencies, commodity pricing +(including oil),the impositiono ft ariffs or other +limitations oninternationalt rade andt ravel, and +overall financialm arketp erformance, whichc an +impact our business,results of operationsandc apital. +Changesi nt hese policiesa re beyond ourcontrola nd +can be difficult topredicta nd we cannot determine +theu ltimate effect that anysuchc hangesw ouldh ave +upon our business,financialc onditiono rr esults of +operations.L egal or regulatoryc hangesa ffecting +accesst of inancial marketsc an alsoadverselya ffect +us.F or example, undert he HoldingF oreign +CompaniesA ccountable Act, theS EC must prohibit +tradingi nthe securitieso fc ompanies identifiedb y +theS EC fort hree consecutivey earsa shaving +retained an auditorlocated in af oreign jurisdiction +that theP ublic CompanyA ccountingO versight +Board( “PCAOB”) hasd etermined it isunablet o +inspect or investigatec ompletely. In December2 022, +theP CAOB vacated an earlierdeterminationw ith +respect to mainlandChinaa nd Hong Kong. +However, theP CAOB hasi ndicated it expectst o +continue to have complete accessg oing forwarda nd +will consider then eed to issuean ew determinationi f +needed.A saresult of this legislation,companies +located in mainlandChina, Hong Kong or potentially +otherj urisdictions mayd ecide,o re ventually be +required, to delisto ro therwise remove theirs ecurities +fromU .S.f inancial markets, whichwoulda dversely +affect our businesses,particularly our Issuer Services +lineo fb usiness. +Ther egulatorya nd supervisoryf ocus ofU.S. banking +agencies is primarily intendedt oprotect thes afety +ands oundness of theb anking system andfederally +insuredd eposits,a nd notto protect investorsi no ur +securities. Regulatorya nd supervisorys tandardsa nd +expectations bothwithin jurisdictions(inr elationt o +nationalv ersusn on-nationalf inancial services +providers)a nd acrossj urisdictions mayb ed ivergent +ando therwise mayn ot beappliedi namannert hati s +consistent andh armonized.A dditionally,b anking +regulatorsh avew ides upervisoryd iscretioni nthe +ongoing examinationa nd enforcemento fa pplicable +banking statutes,r egulations,a nd guidelines,a nd may +restrict our ability to engage in certain activitieso r +acquisitions ormayr equire us to limitour capital +distributions,m aintainm orec apitalo rh oldm ore +highlyl iquida ssets. +TheU .S.c apitalr ules subject us ando ur U.S. banking +subsidiaries to stringent capitalr equirements, which +couldr estrictg rowth, activitieso ro perations,t rigger +divestitureo fa ssets or operations orlimit our ability +to return capitalt os hareholders. +TheL CR andN SFR require us to maintainsignificant +holdings of high-qualityandg enerally lower-yielding +liquida ssets.I nc alculatingt he LCRa nd NSFR,w e +must also determinew hich deposits shouldb e +considered stable deposits.S tabled eposits mustmeet +as erieso fr equirementsa nd typically receive +favorable treatment underthe LCRa nd NSFR.W e +useq ualitativea nd quantitativea nalysist oi dentify +core stable deposits.I ti sp ossiblet hato ur LCRa nd +NSFR couldf allb elow applicable regulatory +requirementsa saconsequenceo ft he inherent +uncertaintiesa ssociated with thisanalysis (including +as ar esulto fr egulatoryc hangeso ra dditional +guidancef romo ur regulators).I na dditiont ofacing +potentialr egulatoryc onsequences (which couldb e +significant),w em ay be requiredt oremedyt his +shortfallb yl iquidatinga ssets inour investment +portfolio or raisinga dditionald ebt, each of which +couldh aveam aterialn egativei mpact on our net +interest revenue. +We developa nd submit plansf or ourrapida nd +orderlyr esolutioni nthe evento fm aterialf inancial +distress or failure to theFederal Reservea nd the +FDIC.I ft he agencies determinet hato ur submissions +aren ot credible or wouldn ot facilitate an orderly +resolution underthe U.S. Bankruptcy Code,a nd we +fail toaddressa ny such deficiencies in at imely +manner, we mayb es ubject to morestringent capital +or liquidity requirementso rr estrictions on our +growth,a ctivitieso ro perations,o rm ay be requiredt o +divest assets or operations,which couldadversely +affect our business,financialc onditiona nd results of +operations. +Ourg lobala ctivitiesa re also subjectto extensive +regulationb yvarious non-U.S.regulators, including +governments, securitiese xchanges, central banks and +otherr egulatoryb odies in thej urisdictions in which +we operate,r elatingt o, among otherthings,t he +Risk Factors (continued) +86 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_104.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_104.txt new file mode 100644 index 0000000000000000000000000000000000000000..4d7844f2017a271c37f81e91d52e6c7bbb244bed --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_104.txt @@ -0,0 +1,103 @@ +safeguarding, administrationa nd management of +client assets andc lient funds,r egulationo fm arkets, +recovery andr esolutionp lanninga nd paymentsand +financialm arketi nfrastructure. +Various laws,r egulations,r ules anddirectives +effectivei nt he jurisdictions in whichw eo perate have +an impact on our provision ofmany productsand +services.I mplementationo f, andr evisions to,t hese +laws,r egulations,r ules anddirectives have affected +our operationsandr iskp rofile.F or example, thek ey +regulatoryf rameworksi mpactingo ur operationsin +theE Ua nd UK continue to divergei nanumbero f +respects. Furtherd ivergencei nt he natureands cope +of theser egulations couldh avea na dversei mpact on +our results of operationsandb usinessp rospects. +In addition, we ares ubject in our globaloperations to +rulesa nd regulations relatingt ocorrupt andi llegal +payments andm oneyl aundering, economic sanctions +ande mbargo programsadministeredb ythe U.S. +Office of ForeignA ssets Controla nd similarb odies +andg overnmental agenciesworldwide, andlaws +relatingt odoing businesswith certain individuals, +groups andc ountries, such astheU .S.F oreign +Corrupt Practices Act, theBankS ecrecy Act, as +amendedb ythe USAP ATRIOT Act, theIranT hreat +Reductiona nd SyriaH uman RightsA ct of 2012and +theU KB ribery Act. While we have invested and +continue to invest significantresources in trainingand +in compliancem onitoring, theg eographical diversity +of our operations,employees,c lientsa nd customers, +as well as thev endorsa nd otherthird partiest hatw e +deal with,p resentst he risk that we mayb ef ound in +violationo fs uchr ules,r egulations orlaws anda ny +such violationc oulds ubject us to significantp enalties +or adverselya ffect our reputation. In addition, such +rulesc ouldi mpact our ability toengage in business +with certain individuals,entities, groups and +countries,w hich couldmaterially adverselya ffect +certain of our businessesand results of operations. +Government sanctions ando ur actions in responset o +them have had,andi nthe future couldc ontinue to +have,anegativ ei mpact on ourrevenue andb usiness. +Fore xample,f ollowing Russia’s invasion ofUkraine +in 2022, we ceased newb anking businessinR ussia. +As ar esulto ft he implementationo fd atap rotection- +relatedl awsa nd regulations,i ncluding theE UG DPR, +theC aliforniaC onsumerP rivacy Acto f2 018 andt he +NewY orkD epartment ofFinancialS ervices’ +cybersecurity regulation, we need to allocate +additionalt ime andr esources to comply with such +laws andr egulations,a nd our potentiall iability for +non-compliancea nd reportingo bligations in thecase +of databreaches hass ignificantly increased.I n +addition, our businessesare increasinglys ubject to +laws andr egulations relatingt oprivacy,s urveillance, +encryptiona nd datalocalizationi nthe jurisdictions in +whichw eo perate.C ompliancew itht hese laws and +regulations hasrequiredu st oc hange our policies, +procedures andtechnology fori nformations ecurity +ands egregationo fd ata, which, amongo ther things, +makesu smorev ulnerablet oo perationalf ailures, and +to monetarypenaltiesf or breachof such laws and +regulations. +Additionally,o ur settlement-relateda ctivitiesa nd +obligations area lsos ubject to regulatoryr isk, +including ther isko fr egulatorsg lobally accelerating +thet imelinet os ettlement,s ucha st he SEC’sr ecent +rule to shortent he standard settlement cyclef or +securitiest ransactions in theU.S.f romt rade dateplus +twob usinessd ays( T+2) to tradedatep luso ne +businessd ay (T+1)f or compliance in 2024. This rule +presents therisko fn on-compliance, andheightens +then eed forc areful coordination with and +dependencieso no ther industryp articipantsa swella s +additionalr isks associated with technology +developmenta nd implementation, change +management ando perationale rrors,a ny ofwhich +couldb em ateriali nl ight ofthem agnitude and +volumeo fo ur settlement-relateda ctivitiesa nd +obligations. +Failureto comply with laws,regulations or policies, +or meet supervisorye xpectations,a pplicable tous and +our businessescouldr esulti nc ivil or criminal +sanctions orenforcementp roceedings byregulatory +or governmental authorities,moneyp enaltiesa nd +reputationald amage, whichc ouldh aveam aterial +adversee ffect on our business,financialc ondition +andr esults of operations.I fv iolations oflegalo r +regulatoryr equirementsd oo ccur, they coulddamage +our reputation, increaseo ur legala nd compliance +costs, includingr equiring usto devotes ubstantial +resources towardsr emediatione fforts, andu ltimately +adverselyi mpact our results of operations.L aws, +regulations or policiescurrently affectingu sa nd our +subsidiaries,s upervisorye xpectations,o rr egulatory +andg overnmental authorities’interpretationo f +statutes andregulations mayc hange at anytime, +whichm ay adverselyimpact our businessand results +of operations.S ee “Supervisionand Regulation” for +additionali nformationr egarding thep otentiali mpact +of ther egulatorye nvironmento no ur business. +Risk Factors (continued) +BNYM ellon8 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_105.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_105.txt new file mode 100644 index 0000000000000000000000000000000000000000..4b288f8fe7880d03474cb7eb76622363ea95e9c2 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_105.txt @@ -0,0 +1,104 @@ +Regulatory or enforcementa ctions or litigation +couldm aterially adversely affect ourr esults of +operations or harm ourb usinesseso rreputation. +Like many majorf inancial institutions,w ea nd our +affiliatesa re thes ubject of inquiries,i nvestigations, +lawsuits andp roceedings bycounterparties, clients, +othert hird parties, taxa uthoritiesa nd regulatorya nd +otherg overnmental agenciesin theU.S.a nd abroad, +as well as theD epartment ofJusticea nd state +attorneysg eneral.S ee “Legalproceedings”i nN ote +22 oftheN otes to Consolidated FinancialS tatements +foradiscussion of material legala nd regulatory +proceedings in whichw ea re involved. Then umber +of thesei nvestigations andp roceedings,a sw ella st he +amount of penaltiesand finess ought,h as remained +elevated form anyf irms in thefinancial services +industry, including us.W eh avei nt he pastbeen,a nd +mayi nthe future become,s ubject to heightened +regulatorys crutiny, inquiries or investigations,a nd +potentially client-relatedi nquirieso rc laims,r elating +to broad, industry-wide concerns that couldlead to +increased expensesor reputationald amage. +Regulatorsa nd othergovernmental authoritiesmay +also be more likelyt opursuee nforcementa ctions,o r +seek admissions ofwrongdoing or guiltypleas,i n +connectionw ith theresolutiono fa ni nquiry or +investigationt othe extent af irmh as previously been +subject to otherg overnmental investigations or +enforcementa ctions.T he current trendo fl arge +settlementsb yf inancial institutions with +governmental entitiesmay adverselyaffect the +outcomesf or otherfinancial institutions in similar +actions,e specially whereg overnmental officialsh ave +announced that thel arge settlementsw ill be used as +theb asis or at emplatef or othersettlements. +Separately,p olicymakersg lobally continue to focus +on protectionofc lient assets,c ybersecurity andd ata +protection, thei mproperu se of electronic +communications as well as taxa voidancea nd +evasion. +Thec omplexity of thef ederal andstate regulatory +ande nforcementr egimesi nt he U.S.,c oupled with +theg lobals cope of our operationsandt he increased +aggressiveness of thet ax andregulatorye nvironment +worldwide, alsomeanst hatasinglee vent mayg ive +rise to al arge numberof overlappinginvestigations +andr egulatoryp roceedings,e ither by multiple federal +ands tate agencies in theU.S.o rb ym ultiple +regulatorsa nd othergovernmental entitiesort ax +authoritiesi nd ifferent jurisdictions.R esponding to +inquiries,i nvestigations,l awsuits andp roceedings, +regardless of theu ltimate outcome of them atter, is +time consuminga nd expensivea nd can divert the +attentiono fo ur senior management fromo ur +business. Theo utcome of such proceedings mayb e +difficult topredicto re stimate until latein the +proceedings,w hich mayl astanumbero fy ears. +Certaino fo ur subsidiaries aresubject to periodic +examination, special inquiries andpotential +proceedings byregulatorya uthorities. If compliance +failureso ro ther violations aref ound duringa n +examination, inquiry or proceeding,ar egulatory +agency couldinitiate actions andi mposes anctions for +violations,i ncluding, fore xample,r egulatory +agreements,r emediationu ndertakings,c easea nd +desist orders,c ivil monetary penaltieso rt ermination +of al icense andc ouldl ead to litigationb yinvestors +or clients, anyo fw hich couldcause our earnings to +decline. +Ourb usinessesi nvolve ther iskt hatc lientso ro thers +mays ue us,claimingt hatw eo rt hird partiesf or +whom they sayw ea re responsiblehave failedt o +perform underacontract or otherwisefailedt ocarry +out ad utyp erceivedt obeo wedt othem, including +perceivedf iduciary or contractuald uties. This risk +mayb eh eightenedd uringp eriods when credit, equity +or otherfinancial marketsa re deterioratingi nvalue or +arep articularly volatile,w henc lientso ri nvestorsa re +experiencing losseso ra sp ublic attentiono nissues +such as climatechange or otherESG matters +intensifies. As ap ublicly held company, we area lso +subject to therisko fc laims undert he federal +securitiesl aws. Volatility in our stockp rice increases +this risk. +Increasingly, regulators, taxa uthoritiesa nd courts +have sought to holdf inancial institutions liablef or the +misconducto ft heir clientsw here such regulatorsa nd +courts have determinedthat thef inancial institution +shouldh aved etectedt hatt he client wase ngagedi n +wrongdoing, even though thef inancial institutionh ad +no directknowledge ofthew rongdoing. +Actions broughtagainstu sm ay result in lawsuits, +enforcementa ctions,i njunctions,s ettlements, +damages, fineso rp enalties, whichc ouldh avea +material adverseeffect on ourfinancialc onditiono r +results of operations orrequire changest oo ur +business. Claims fors ignificantm onetaryd amages +area sserted in many ofthesel egal actions,while +claims ford isgorgement,p enaltiesa nd/or other +remedial sanctionsm ay be sought in regulatory +matters.T hese risksm ay be more acute when +operatingi nforeign jurisdictions orin instances +Risk Factors (continued) +88 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_106.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_106.txt new file mode 100644 index 0000000000000000000000000000000000000000..508de2c831516f2ecfde72392f45ac6c293705fc --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_106.txt @@ -0,0 +1,103 @@ +wherea dversariest os uchd isputes aregovernment or +quasi-government actorso therwise motivated in +wholeo ri np artb yn on-commerciali ncentives. +Although we establisha ccruals foro ur litigationa nd +regulatorym atters in accordance with applicable +accountingg uidance, our exposuret os uchl itigation +andr egulatorym atters can be unpredictable, and +when thosem atters proceed to as tage wheret hey +presentl ossc ontingenciest hata re bothp robablea nd +reasonablye stimable, therem ay be am aterial +exposuret ol ossi ne xcesso fa ny amountsa ccrued, or +in excesso fa ny loss contingenciesd isclosed as +reasonablyp ossible. Such loss contingenciesm ay not +be probableand reasonablye stimableu ntil the +proceedings have progressedsignificantly,w hich +couldt akes everal yearsa nd occurclose to resolution +of them atter. +Each of ther isks outlined abovecouldr esulti n +increased regulatorys upervisiona nd affect our ability +to attract andretainc ustomers or maintain accesst o +thec apitalm arkets. +Ourb usinessm ay be adverselyaffected if we are +unablet oa ttract, retain,d evelop andmotivate +employees. +Ours uccessd epends,i nlarge part,o nour ability to +attract newe mployees,r etain, developand motivate +our existinge mployees,h avead iverse andi nclusive +workplace andcontinue to compensate our employees +competitivelya mid heightened regulatoryr estrictions +anda ninflationary environment. Competitionf or the +most skilledemployees in mostactivitiesi nw hich we +engage can be intense, andwem ay not beable to +recruita nd retain keyp ersonnel. In addition, third- +partys uppliers ands ervice providers on whichw e +rely mayface challengesina ttractinga nd retaining +theire mployees,w hich mayh avean egativei mpact +on our operationsando ur resiliencyc apabilities. +We rely on certain employees with subject matter +expertiset oa ssist in theimplementationo fi mportant +initiatives andt osupportt he developmentofn ew +products ands ervices,i ncluding in connectionw ith +our technology initiatives.A sf ocus ontechnology +andr iskm anagementi ncreases in thefinancial +industry, competitionf or technologistsa nd risk +personnelh as intensified, whichc ouldc onstraino ur +ability toexecute on certain of ourstrategic +initiatives. +Oura bility toattract,r etaina nd motivatek ey +executives andother employeesmayb en egatively +affected by continuous changest oi mmigration +policiesa nd restrictions applicable to incentivea nd +otherc ompensationp rograms, including deferral, +clawback requirementsa nd otherlimits on incentive +compensation. Some of theser estrictions mayn ot +applyt osomeo fo ur competitors andt oother +institutions with whichw ec ompete fort alent, in +particular aswe arem oreo ften competingfor +personnelw ith financialt echnology providersand +othere ntitiest hatm ay not be publicly tradedor +regulated banking organizationsand, in either case, +mayn ot havethes amel imitations oncompensation +as we do. Furthermore, because ap ortiono fo ur +annuali ncentivec ompensationp aidt osomeo fo ur +employees is deferrede quity thatis subject to the +valueo fo ur common stock, declinesin our +profitability or outlookcoulda dverselya ffect the +ability to attract andretaine mployees. +Thel osso fe mployees’s kills,k nowledge ofthe +market,i ndustrye xperience, andthe cost of finding +replacements,p articularlyi naprotracted inflationary +environmentw ith ac ompetitivel abor market,h ave +led, andw ee xpect will continue to lead,t oa n +increasei nl abor costsa nd hurtour business. In +addition, ourcurrent orfuture approach to in-office +andr emote-work arrangementsm ay not meet the +needso re xpectations of ourcurrent or prospective +employees,m ay not be perceivedasf avorable as +compared to thea rrangementso fferedb ycompetitors +andm ay not beconducivet oacollaborativew orking +environment, whichc oulda dverselya ffect our ability +to attract,r etain, developand motivate employees.I f +we areu nablet oc ontinue to attract,r etain, develop +andm otivateh ighlyq ualifiede mployees,o ur +performance, includingo ur competitivep osition, +couldb ea dverselya ffected. +Af ailure or circumventiono fo ur controls,p olicies +andp rocedures couldhaveamaterial adverse effect +on ourbusiness, financialc ondition, resultsof +operations andr eputation. +Management regularly reviewsa nd updatesour +internal controls,disclosurec ontrols andp rocedures, +andc orporatep oliciesa nd procedures.Any system of +controls,h owever well designeda nd operated,is +basedi nparto nc ertain assumptions andc an provide +onlyr easonable, not absolute,a ssurances that the +objectives of thes ystemw ill be met. Anyf ailure or +circumventiono fo ur controls andp rocedures or +failure to comply with regulations relatedt ocontrols +andp rocedures couldhaveam ateriala dversee ffect +on our business,reputation, resultso fo perations and +Risk Factors (continued) +BNYM ellon8 9 +The secret transportation is a "boat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_107.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_107.txt new file mode 100644 index 0000000000000000000000000000000000000000..9800c74dc46f8667d0a39857e53fafc5a55cf156 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_107.txt @@ -0,0 +1,103 @@ +financialc ondition. Moreover, if we identifym aterial +weaknessesi no ur internal controloverf inancial +reportingo ra re otherwiser equiredt orestate our +financials tatements, wecouldb er equiredt o +implement expensivea nd time-consumingr emedial +measures andcould lose investor confidence in the +accuracy andcompletenesso fo ur financialr eports. +In addition, therea re risksthat individuals,e ither +employees or contractors, mayc ircumvent +establishedc ontrolm echanismsi no rder to,f or +example, exceed exposure,liquidity,t rading or +investment management limitations,o rc ommit fraud. +Additionally,a lthough we have policiesand +procedures prohibitingt he useofu nauthorized +personald evices andapplications by ouremployees +andc ontractors, weares ubject to inquiriesby +regulatorsw ith respect to recordkeepingo bligations +anda re subject to additionalr isks relatedt othe useo f +personald evices andnon-approvedp latforms, +applications andt oolsb yo ur employees or bythird +partiesw ith whichw ed ob usinessf or work-related +activities, including risksr elated to information +security andp otentialv iolations ofrecord retention, +reportinga nd otherrequirements. Anyf ailure to +comply with such policiesa nd procedures could +adverselya ffect our business. +Market Risk +Weaknessa nd volatility infinancialm arkets andt he +economy generally maymaterially adversely affect +ourb usiness, financialc onditiona nd results of +operations. +As af inancial institution, ourInvestment +Management,W ealth Management,P ershing, +Depositary Receiptsa nd Markets, including +SecuritiesL ending, businessesare particularly +sensitivet oe conomic andm arketc onditions, +including in thecapitala nd credit markets. Further, +when thesem arkets arev olatileo rd isruptive, we +have experienced declines in our fair valued assets, +including in our securitiesp ortfolio ands eed capital, +as well as af airv alue reductioni nthe portfoliosthat +we manage that generate investmentandw ealth +management fees.C onditions in thefinancial +marketsa nd thee conomyg enerally,b othi nthe U.S. +ande lsewhere around thew orld have materially +affected,a nd mayc ontinue to affect,o ur resultso f +operations,i ncluding investment management fees. +Foreigne xchanget rading that we execute forc lients +generatesr evenuesw hich areprimarily driven by the +volumeo fc lient transactions andt he spread realized +on theset ransactions,b otho fw hich areimpacted by +market volatility andt he impact of foreigne xchange +hedging activities. Ourc lients’ cross-border +investinga ctivity couldd ecreasei nr eactiont o +economic andp olitical uncertainties, including +changesi nl awso rr egulations governingcross-border +transactions,s ucha sc urrencyc ontrols or tariffs. +Volumesa nd/or spreadsi ns omeo fo ur products tend +to benefitf romc urrencyv olatility anda re likelyt o +decreased uringt imeso fl ower currencyvolatility. +Such revenuesa lsod ependo nour ability to manage +ther iska ssociated with thecurrencyt ransactions we +execute andp rogram pricing. +Av ariety of factorsi mpact globale conomiesa nd +financialm arkets,i ncluding interest ratesa nd their +associated yieldc urves, commodity pricing, market +andp olitical instabilities, volatile debt ande quity +market values,i nflation, expectations relatingt o +inflationt rends andm onetary policya ctions takenb y +central banks,t he strengtho ft he U.S. dollar, +geopolitical tensions,t he impositiono ft ariffs or other +limitations oninternationalt rade ortravel,i ncluding +changest oi nternationalt rade andi nvestment policies +by theU .S.t he EU or otherlarge economies( which +couldd isrupt worldt rade andl ead to trade +retaliation),u nemploymentl evels, labor strikes, +decliningb usiness, investor andc onsumer +confidence, recessionary fears,thei mpact of +volatilityi ndigital assetm arkets on theb roader +market,g overnmental budgetd eficits (including, in +theU .S., at thef ederal,s tate andm unicipall evels), +partialo rf ullg overnment shutdowns (including +concerns about thes tability of funding fort he U.S. +federalg overnment), andc ontagionr iskf rom +possibled efault on sovereignd ebt. More specifically, +in January 2023, theo utstanding nationaldebto ft he +U.S. government reached its statutoryl imit. Before +theU .S.g overnment suspendedt he debtceiling, the +U.S. TreasuryD epartment used extraordinary +measures to preventt he U.S. government’s defaulto n +its paymento bligations.F utured elayst or aise or +suspendt he federald ebtc eiling couldh aves evere +repercussions within theU.S.a nd to globalc redita nd +financialm arkets andc ouldr esulti navarietyo f +adversee ffectsf or our business,resultso fo perations, +liquidity andf inancial condition. +Anyr esultinge conomic pressure on market +participants andl ack of confidence in thefinancial +marketsm ay adverselyaffect our business,financial +conditiona nd results of operations.A dditionally, +globale conomiesa nd financialm arkets mayb e +Risk Factors (continued) +90 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_108.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_108.txt new file mode 100644 index 0000000000000000000000000000000000000000..5599e22f9ec026ef49bcc31e976aa51453406d8e --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_108.txt @@ -0,0 +1,102 @@ +adverselya ffected by widespread health emergencies, +pandemics, naturald isasters,c limate-related +incidents, conflicts anda ctso fw ar (sucha st he +conflicts inUkrainea nd in theMiddleE ast), +terrorism,e conomic sanctions,o ther geopolitical +events or concerns overthe possibilityof such events, +fore xample,t he economic andg eopolitical +challengesr elated to China, including developing +tensions betweenChinaa nd Taiwan and/or between +Chinaa nd theU .S.I np articular, we face the +following risksi nc onnectionw ith thesefactors, some +of whicha re discusseda tg reater lengthi nseparate +risk factors: +• Geopolitical tensiona nd economic instability in +countries aroundthew orld can attimesi ncrease +thed emandf or low-risk investments, particularly +in U.S. Treasuriesa nd thed ollar. A“ flight to +safety”h as historically increasedour balance +sheet,w hich hasn egativelyi mpacted,a nd could +continue to negativelyi mpact,o ur leverage-based +regulatoryc apitalm easures.A sustained“ flight +to safety”h as historically triggeredadeclinei n +trading, capitalm arkets andc ross-bordera ctivity +whichw ouldl ikelyd ecreaseo ur revenue, +negativelyi mpactingo ur resultso fo perations, +financialc onditiona nd, if sustainedi nthe long +term,o ur business. +• Thef ees earnedby ourInvestment Management +andW ealthM anagementb usinessesa re highera s +assets underm anagementa nd/ori nvestment +performance increase. Thosef ees arealso +impacted by thec ompositiono ft he assets under +management,w ith higherf eesf or some asset +categoriesa scomparedt oothers. Uncertain and +volatile capitalm arkets,p articularlyd eclines, +couldr esulti nm ovementsf romh ighert ol ower +feep roducts and/or reductions in our assets under +management becauseof investors’ decisions to +withdraw assetsor from simple declines in the +valueo fa ssetsu nderm anagementa sm arkets +decline. +• Market conditionsresultingi nlower transaction +volumes couldhavea na dversee ffect on the +revenuesa nd profitability of certain of our +businessess ucha sc learing, settlement,p ayments +andt rading. +• Uncertain andv olatile capitalm arkets, +particularly declines in equity prices,c ould +reducet he valueofo ur investmentsi ns ecurities, +including pensionand otherpost-retirementp lan +assets andp roduced ownwardp ressure on our +stockp rice andcredita vailability without regard +to our underlyingfinancials trength. +• Derivativei nstruments we holdf or our own +account to hedge andm anageo ur exposuret o +market risks, including interest rate risk,e quity +pricer isk, foreignc urrencyr iska nd credit risk +associated with our productsandb usinesses +might not performas intendedo re xpected, +resultingi nhigherr ealized losses andu nforeseen +stresseso nl iquidity.O ur derivatives-based +hedging strategies alsorely on thep erformance of +counterpartiest os uchd erivatives.T hese +counterpartiesm ay fail to perform forvarious +reasons resultingi nlosseso nu nder-collateralized +positions. +• Thep rocessw eu se to estimate our expected +credit lossesi ssubject to uncertainty in thatit +requiresu se of statistical models andd ifficult, +subjectivea nd complexj udgments,i ncluding +forecasts of economic conditions andh ow these +conditions mighti mpairt he ability of our +borrowers ando therst om eet theiro bligations.I n +uncertain andv olatile economic environments, +ande specially inenvironments thatdiffer +significantly fromt he historical environments +upon whicht he models we uset oe stimate our +expected credit losseswered eveloped, ourability +to estimateo ur expected credit lossesmay be +impaired, whichc oulda dverselya ffect our +overall profitability andr esults of operations. +Foradiscussion of our management ofmarket risk, +see“ Risk Management–R iskT ypesO verview– +Market Risk.” +We ared ependent on fee-based business for a +substantialm ajorityo fo ur revenue ando ur fee- +based revenuesc ould be adverselyaffected by +slowingm arketa ctivity,w eakf inancial markets, +underperformancea nd/orn egativet rendsi ns avings +rateso rini nvestment preferences. +Ourp rincipal commercialf ocus is on fee-based +business, whichisd istinctf romc ommercialb anking +institutions that earnmosto ft heir revenuesf rom +loansa nd othertraditionali nterest-generating +products ands ervices.F or they ear endedDec. 31, +2023, 74% of ourtotalr evenue wasf ee-based. Our +fee-basedb usinessesi nclude investment andw ealth +management,c ustody, corporatet rust,d epositary +receipts, clearing, collateralm anagementa nd treasury +services,w hich arehighlyc ompetitiveb usinesses. +Risk Factors (continued) +BNYM ellon9 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_109.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_109.txt new file mode 100644 index 0000000000000000000000000000000000000000..63a26f2adcd3887982bcb5f7f23656ce352bc84c --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_109.txt @@ -0,0 +1,100 @@ +Fees form anyo fo ur productsands ervices arebased +on thev olumeo ft ransactions processed,them arket +valueo fa ssets managedand/or administered, +securitiesl ending volumeand spreads, andf ees for +others ervices rendered.C orporatea ctions,c ross- +borderi nvesting, globalmergers anda cquisitions +activity,n ew debt ande quity issuances,and +secondary tradingv olumes,a mong otherthings, all +affect thel evel of ourfeer evenue.A st he volumeo f +thesea ctivitiesd ecreases due to lowclient activity, +weak financialm arkets or otherwise,our fee-based +revenuesa lsod ecrease, whichn egativelyi mpactso ur +results of operations. +If our Investment andW ealth Management +businessese xperience poor investment returnsd ue to +weak market conditions or underperformance +(relativet oc ompetitors or benchmarks),them arket +values of thep ortfoliost hatw em anagew ill be lower +(onarelativeb asis)a nd ourability toretain existing +assets and/or attract newc lient assets mayb e +impacted.M arketa nd regulatoryt rends havealso +resultedi nincreased demand forl ower feei nvestment +andw ealth management productsands ervices,a nd +lowerp erformance-fees tructures, botho fw hich have +impacted andmay continueto impact our fee +revenue.S omeo ft hese dynamicsh avea lso +negativelyi mpacted fees in our Market andWealth +Services andSecuritiesS ervices businessesa nd any +of thesed ynamicsm ay alsooccuri nt he future. +Significantd eclines in thevolumeo fc apitalm arkets +activity wouldr educet he numbero ftransactions we +processa nd thea mount ofsecuritiesw el enda nd +thereforew oulda lsoh avea na dversee ffect on our +results of operations.O ur businessmay be adversely +impacted by decreasesin theratea tw hich individuals +invest in mutualfunds ando ther collectivef unds,u nit +investment trusts or exchange-tradedf unds,o r +contributet od efined contributionplans.C hangesi n +economic andm arketc onditions,i ncluding as ar esult +of highermarketv olatility,i nflationary pressures, +recessionary conditions or declinesin equity values, +couldr esulti nc hangesi nt he investment patternso f +our clientso rn egativelyi mpact them arketv alue of +client portfolios,each of whichc ouldh avean egative +impact on ourresults of operations. +When our investment management revenuesd ecline, +interest ratesr iseo ro ther market factorsa ffect the +valueo fo ur investment management business, we +mayh ave, andi nthe pasthave had, declinesin the +fair valuei no ur Investment Management reporting +unit, one ofthet wo reportingu nits inour Investment +andW ealthM anagements egment.I ft he fair valueo f +theI nvestment Management reportingu nitd eclines +belowi ts carryingv alue,w ew ouldb er equiredt o +take,a nd in thepasth avet aken,a nimpairment +charge. +Levelso fa nd changesi ni nterestr ates have +impacted, andwill in thef uturec ontinue to impact, +ourp rofitability andc apitall evels, at times +adversely. +We earnrevenue,k nowna s“ neti nterestr evenue,” on +thed ifferenceb etween thei nteresti ncomee arnedo n +our interest-earning assets,s ucha st he loansw em ake +andt he securitiesw eh oldi nour investment securities +portfolio,a nd thei ntereste xpensei ncurredo nour +interest-bearingl iabilities, such asdeposits and +borrowedm oney. Additionally, we earnn et interest +revenue on otheractivitiesr elatingt ointerest-earning +assets andi nterest-bearingl iabilities, suchas reverse +repurchasea greements andr epurchasea greements, +respectively. Ourn et interest margin,w hich is the +result of dividing netinterestr evenue byaverage +interest-earning assets,i ss ensitivet ot he shapeo ft he +yieldc urve andw hether thei nterestr atep aido r +receivedi sf ixed or movesw ith changesi nm arket +interest rates. +Thec ontinuedp revalenceo fh igherr ates,a nd any +future rate increases,including unexpectedly +precipitous increases,c oulda dverselyi mpact our +business, financialc onditiona nd resultso f +operations,d ue to: +• higherm arketv olatility,r ecessionary conditions +andd eclines in equity values,r esultingi na +declinei nt he valuationofa ssets under +management; +• reduced liquidity in bonds andf ixed-income +funds,r esultingi nlower performance andfees; +• increased numbero fdelinquencies, bankruptcies +or defaultsandm oren onperforminga ssets and +netc harge-offs,a sb orrowers mayh avem ore +difficulty making higherinterestp ayments; +• higherr edemptions fromo ur fixed-income funds +or separate accounts, as clientsmovef unds into +investmentsw ith higherr ates of return; +• lowern et interest revenue andn et interest margin +due to lowernon-interest bearingd eposit levels, +as non-interest bearingd eposits leaveors hift to +interest-bearingd eposits; +Risk Factors (continued) +92 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_11.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_11.txt new file mode 100644 index 0000000000000000000000000000000000000000..fefd56531715bdd7f1ff5cb081dfff7110ab9733 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_11.txt @@ -0,0 +1,66 @@ +As a commercial enterprise that has +operated for nearly two-and-a-half +centuries, we are able to thrive +for only one reason — by serving +our clients. +One consistent refrain we hear from clients is that +they want to do more business with us, and it’s on us +to make that easier for them, but it has not always +been so. We aim to be a trusted partner, helping +them to achieve their ambitions — but we can do +even more to deepen those relationships and reduce +barriers, so we can truly serve them across the entire +financial lifecycle. +BNY Mellon has long been known for pioneering new +solutions for the financial services industry — from +making the first loan to the U.S. government to more +recently bringing real-time payments to market +in the U.S. +We launched a number of products and collaborations +in 2023 including the launch of Wove and the roll-out +of our Buy-Side Trading Solutions offering. But it goes +well beyond that. All our businesses strive to bring +BE MORE +FOR OUR +CLIENTS +One of my goals coming into this role was to set +a roadmap and tangible targets to reinvigorate the +next phase of growth for the firm. Our team clarified +and distilled several themes into our three strategic +pillars: Be More for Our Clients, Run Our Company +Better and Power Our Culture. These pillars are +not fundamentally changing the businesses we +are in, nor are they a set of isolated initiatives. +Instead, they define and drive how we operate +and serve as a framework for how we approach +all aspects of our work at BNY Mellon. +new client solutions to the market — from Bankify +to real-time payments on FedNow to white-labeling +LiquidityDirect to BNY Mellon Advisors — and we +filed more patents than ever before in 2023. +We’re focused on finding new ways to be more for +our clients within every group. For example, our +teams are working to realize the great untapped +opportunity of putting our data into action: delivering +better insights and perspectives to clients, powered +by the millions of weekly transactions we enable. +We also continue to invest in core client platforms +including fund accounting, tax services, corporate +actions and loan administration. +Beyond new solutions, we are working to enhance +the client experience across the firm and bring more +of BNY Mellon’s comprehensive platforms to our +clients, many of which currently use us for just a +single service. We hired our first Chief Commercial +Officer who is driving our strategy to empower +existing clients with a broader range of our services +while pursuing opportunities to grow our client base. +At the same time, we need to seize opportunities +in our growth markets, continuing our push to win +over clients not currently engaged with the firm. +Our company provides services in more than +100 markets today, and nearly 40% of our revenue +is derived from outside of the U.S. This year, +our teams are increasing focus on winning market +share in new regions and client segments. +IXBNY MELLON \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_110.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_110.txt new file mode 100644 index 0000000000000000000000000000000000000000..1f3d3eac56448a41eb7043a610a3f105d2f25ea0 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_110.txt @@ -0,0 +1,99 @@ +• declines in deposit levels,resultingi nreduced +internal andregulatoryl iquidity buffers andl ower +revenues; +• reductions in thevalue of ourfixed-income +securitiesh eldf or liquidity purposes; +• furtheri ncreases in accumulatedo ther +comprehensivel ossi no ur shareholders’e quity +andt herefore our tangiblec ommone quity due to +thei mpact of rising long-term ratesont he +available-for-sales ecuritiesi no ur investment +portfolio,w hich wouldn egativelya ffect our risk- +baseda nd leverage basedregulatoryc apital +ratios; or +• higherf undingc ost. +Conversely, am ateriald eclinei nt he short-term rate +environment, and/or af lato ri nverted yieldc urve,i n +thef uturec oulda dverselyi mpact,a nd hasint he past +adverselyi mpacted,o ur netinterestr evenue and +results of operations dueto: +• compression of our netinterestm argin, +depending on our balancesheet positiona nd the +speed andsizeo ft he interest rate decline; +• sustainedw eakness of ourspread-based revenues, +resultingi ncontinuedv oluntaryw aiving offees +on certain moneymarketm utualf unds and +relatedd istributionf ees,i norder to preventt he +yields onsuch funds from becomingu neconomic; +or +• adversei mpactso nt he valueofo ur fixed-rate +mortgage-backed securities, driven by higher +mortgage prepaymentspeeds. +Am ored etailedd iscussiono ft he interest rate and +market risksw ef acei sc ontainedi n“Risk +Management –R iskT ypesO verview–Market Risk.” +We have experienced,and mayc ontinue to +experience, unrealized or realized losseso n +securitiesr elated to volatile andi lliquidm arket +conditions,r educingo ur capitall evelsa nd/or +earnings. +We maintain an investment securitiesp ortfolio of +various holdings,typesa nd maturities. At Dec.31, +2023, approximately 61% oftheses ecuritiesw ere +classified as available-for-sale,whicha re recordedon +our balancesheet atfair valuew ith unrealized gains +or lossesr eporteda sacomponent of accumulated +otherc omprehensive income,n et of tax. The +securitiesi no ur held-to-maturityportfolio,r ecorded +on our balancesheet at amortized cost,were +approximately 39% of oursecuritiesp ortfolio at Dec. +31, 2023. Oura vailable-for-sales ecuritiesp ortfolio, +to thee xtentu nhedged, mayr esulti ni ncreased +volatilityi nour accumulatedo ther comprehensive +income or earnings than al oanp ortfolio thatis +accounted fora ta mortized cost. +Ouri nvestment securitiesp ortfolio represents a +greater proportiono fo ur consolidated totala ssets +(approximately 31% at Dec. 31, 2023),i ncomparison +to many othermajor U.S. financiali nstitutions dueto +our custodya nd trustb ankb usinessm odel. +Accordingly, ourcapitall evelsa nd results of +operations andf inancial conditiona re materially +exposed to therisks associated with our investment +securitiesp ortfolio,i ncluding interest rate-related +risks. +We reservef or current expected credit losseswith +respect to our available-for-salea nd held-to-maturity +securities. Credit lossesine xcesso fo ur allowance +forc reditl ossesw ouldi mpact our resultso f +operations. +Underthe U.S. capitalr ules,a fter-tax changesint he +fair valueo fa vailable-for-salei nvestments ecurities +arei ncludedi nCET1c apital. Sinceh eld-to-maturity +securitiesa re not subject to fair-value accounting, +changesi nt he fair valueo ft hese instruments( other +than expected credit losses)aren ot similarlyi ncluded +in thed eterminationo fC ET1c apital. As ar esult, we +maye xperience increased variability inour CET1 +capitalr elativet ot hosem ajor financiali nstitutions +whom aintainalowerp roportiono ft heir consolidated +totala ssets inan available-for-saleaccounting +classification. +Generally,the fair valueo fa vailable-for-sale +securitiesi sdeterminedb ased on market prices +availablef romt hird-party sources.D uringp eriods of +market disruption, it maybed ifficult tovaluec ertain +of ourinvestment securitiesi ft rading becomesless +frequent and/or market data becomesl esso bservable. +As ar esult, valuations mayi nclude inputsa nd +assumptions that arelesso bservableo rr equire greater +estimationa nd judgmenta sw ella sv aluation methods +whicha re more complex. Thesev aluesm ay not be +ultimately realizable in am arkett ransaction, ands uch +values mayc hange very rapidlyasm arketc onditions +change andv aluationa ssumptions arem odified. +Decreases in valuem ay have am ateriala dversee ffect +on ourresults of operations orfinancialc ondition. +Thee stimate of expected credit lossesisd etermined +Risk Factors (continued) +BNYM ellon9 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_111.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_111.txt new file mode 100644 index 0000000000000000000000000000000000000000..4a7fbc9a52214d54e2b65131cd19804bfe7bdae9 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_111.txt @@ -0,0 +1,98 @@ +in part by management’s assessmento ft he financial +conditiona nd prospectsofaparticular issuer, +projections offuture cashf lows andr ecoverability of +thep articular security.M anagement’sc onclusions on +such assessmentsareh ighlyj udgmentala nd include +assumptions andp rojections offuture cashf lows +whichm ay ultimately prove to be incorrect as +assumptions,f actsa nd circumstances change.O nt he +otherh and, we arel imitedi nthe actions we can take +relatedt oour held-to-maturitysecuritiesa bsenta +significantd eteriorationi nthe issuer’s +creditworthiness. Therefore, we mayb ec onstrained +in our ability to liquidate ah eld-to-maturity security +that is deterioratingi nvalue.I fo ur determinations +change about ourintentiono ra bility tonot sell +available-for-sales ecuritiest hath avee xperienced a +reductioni nfairv alue belowtheir amortized cost,w e +couldb er equiredt orecognize al ossi ne arnings for +thee ntired ifferenceb etween fair valuea nd amortized +cost. +Fori nformationr egarding ourinvestment securities +portfolio,r efer to “Results of Operations – +Consolidated balances heet review –S ecurities.” +Reform of interest ratebenchmarks andthe useo f +alternativer eference ratesb yu sa nd ourc lients +coulda dversely affect ourb usiness, financial +conditiona nd results of operations. +Regulators, industryg roups andm arketp articipants +in theU.S.a nd othercountries continueto engage in +initiatives to introduceand encouraget he useo f +alternativer eference ratest or eplace certain interest +ratest hatw ereu seda sb enchmarksi nd ebts ecurities, +loansa nd otherfinancial instruments. Certaino ft he +alternativer eference ratesa ppeart oh aveg ained +acceptancea mong market participants.H owever, +interest rate benchmarkr eforms mayhaveu nexpected +adversec onsequences that couldbec ontrary to +market expectations.A lternativer eference ratesm ay +be basedupon indices,a nd mayh avec haracteristics, +different fromt he benchmarksthey replace. In some +cases,f inancial instrumentsm ay perform less +predictablya fter alternativereference ratesh ave +replaced theo riginalb enchmarks. Further, givent he +limitedp erformance andhistorical data of new +alternativer ates,t here can be noassurancet hat: +• anyo ft he newrates will be similart o, perform +thes amea s, producet he economic equivalent of, +or bean adequatesubstitute fort he benchmarks +that they replace; +• ap articular alternativereference rate will be +widely acceptedo ra dopted by market +participants; +• market participants will effectivelyi mplement +operationala nd otherarrangementst ot ransition +fromh istorical benchmarks,s ucha sL IBOR,t o +newa lternativer eference rates; +• market acceptanceofa na lternativer eference rate +will not be hinderedb ythe introductiono fo ther +referencer ates;o r +• anyp articular useo fh edgesw ill be effective. +In addition, we mayb ea dverselyi mpacted by theu se +of alternativer eference ratesa saresult of our +businessa ctivitiesa nd our underlying operations.W e +utilizer eference ratesi navarietyo fa greements and +instrumentsa nd arer esponsible fort he useo f +referencer ates in av ariety of capacities, as well as in +our operationalfunctions.W ec ouldb es ubject to +claims fromc ustomers,c ounterparties, investorso r +regulatorsa lleging that we didn ot correctly discharge +our responsibilitiesi ni nterpretinga nd implementing +contractuali nterestr atep rovisions orin selectingn ew +alternativer eference rates. Theset ypeso fc laims +coulds ubject us to increasedlegala nd operational +expenses andcouldd amageo ur reputation. +Uncertainty relating to alternativer eference rates +couldr esulti np ricing volatility,increased capital +requirements, loss of market sharei nc ertain products, +adverset ax or accountingc onsequences,h igher +compliance, legala nd operationalcosts,i ncreased +difficulty inestimatingo ur netinterestr evenue,a nd +risksa ssociated with client disclosures,discretionary +actions takeno rn egotiationo ff allback provisions, +andd isruptiono fb usinessc ontinuity,s ystems and +models,a ll of whichm ay adverselyimpact our +businessa nd results of operations. +CreditR isk +Thef ailure or perceivedweaknesso fa ny of our +significantc lientso rcounterparties, many of whom +arem ajor financiali nstitutions or sovereign entities, +ando ur assumptiono fc redit, counterparty and +concentrationr isk, coulde xposeu st oc reditl osses +anda dversely affect ourb usiness. +We have credit exposuret oc lients andc ounterparties +in many differentindustries, particularly financial +institutions,a saresult of trading, clearinga nd +financing, providingcustody services,s ecurities +Risk Factors (continued) +94 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_112.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_112.txt new file mode 100644 index 0000000000000000000000000000000000000000..18d352e15d4272e9d7778fc33fb11a628df79aa2 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_112.txt @@ -0,0 +1,106 @@ +lending services or otherrelationships.W er outinely +execute transactionswith globalc lientsa nd +counterpartiesi nt he financiali ndustrya sw ella s +sovereigns ando ther governmental or quasi- +governmental entities. Ourdirect creditexposure +consists of extensions ofsecureda nd unsecuredcredit +to clientsa nd useofo ur balancesheet.I na dditiont o +traditionalc redita ctivities, we also extend intraday +credit inordert of acilitate ourv arious processing, +settlement andi ntermediationa ctivities. We couldb e +adverselya ffected by thea ctions andc ommercial +soundness of organizationsto whom we have lent +funds,a sd efaults or non-performance(ore ven +uncertainty concerning such defaulto rn on- +performance) by one ormore of thesei nstitutions,o r +them arkets generally,h avei nt he pastledt omarket- +wide liquidity problemsa nd couldl ead to losseso r +defaults by us or by otherinstitutions (including our +counterpartiesa nd/or clients) in thefuture. The +consolidationa nd failureso ff inancial institutions +duringt he 2008financialc risisi ncreased the +concentrationo fo ur client andc ounterpartyr isk. +As ar esulto fo ur membership inseverali ndustry +clearingo rs ettlement exchangesa nd central +counterpartyc learinghouses,w em ay be requiredt o +guarantee obligations andl iabilitieso rp rovide +financials upporti nt he eventt hato ther membersd o +not honortheiro bligations or default.These +obligations mayb el imitedt omembers that dealtw ith +thed efaultingm embero rto theamount (oramultiple +of thea mount)o four contributiont oaclearingo r +settlement exchange guaranteefund, or,i nafew +cases,t he obligationmay be unlimited. Additionally, +we aree xposedt osettlement risks, particularly inour +payments andf oreign exchange activities. Those +activitiesm ay lead to extensions ofcredit and +consequent lossesi nt he evento facounterparty +breach or an operationale rror, including thef ailure to +provide credit. We areexposed to risk of short-term +credit extensions to,o ro verdraftsb y, ourclientsi n +connectionw ith theprocesst of acilitate settlement of +trades andrelated foreigne xchange activities, +particularly when contractualsettlement hasbeen +agreed with our clients. Theo ccurrenceo fo verdrafts +at peak volatility couldc reates ignificantc redit +exposuret oo ur clientsd epending uponthev alue of +such clients’collateralp ledgedt ousa tt he time.T his +risk mayb eh eightened duringp eriods ofmarket +volatility,d uringw hich collateralvaluesm ay +decreases uddenly. +When we provide credit toclientsi nc onnectionw ith +providing cashm anagement, clearing, custodial and +others ervices,w ea re exposed to potentiall ossi ft he +client experiences creditdifficulties. Higherm arket +volatility, inflationary pressures, recessionary +conditions or declinesin equity values could +negativelya ffect thec reditworthinesso fo ur clients, +which, in turn,w ouldi ncreaseo ur credit risk.W ea re +also generally not able to nete xposures across +affiliatedc lientso rc ounterpartiesa nd mayn ot be +able to nete xposures to thes amel egal entityacross +multiple products.I na ddition, we mayi ncur al ossi n +relationt oone entity or productevent hough our +exposuret oo ne ofthee ntity’s affiliatesi so ver- +collateralized.M oreover, not allo fo ur client or +counterpartyc redite xposurei ss ecured. +In our agency securitiesl ending program,wea ct as +agento nb ehalfo four clients, thel enders of +securities, in securitiesl ending transactions with our +clients’ counterparties( including broker-dealers), +actinga sb orrowers,w herein securitiesa re lent by our +clientsa nd thes ecuritiesl oans arec ollateralized by +casho rs ecuritiesp ostedb ysuchc ounterparties. +Typically,i nthe caseo fc ashc ollateral, our clients +authorizeu sa stheir agentt oi nvest thec ashc ollateral +in approvedi nvestmentsp ursuantt oe ach client’s +investment guidelines andinstructions.S uch +approvedi nvestmentsm ay include reverser epurchase +transactions with repo counterparties. In many cases, +in thes ecuritiesl oans we enteri ntoo nbehalfo four +clients, we agreet or eplace thec lient’sl oaned +securitiest hatt he borrowerfails toreturn due to +certain defaults by theb orrower, mainly the +borrower’s insolvency.T herefore,i nsituations +wheret he market valueo ft he loaned securitiest hat +theb orrowerf ails toreturn to ac lient (which loaned +securitiesw ea re obligated to replacea nd return to the +client)e xceedst he amount of proceedsresultingf rom +thel iquidationo ft he client’s approvedi nvestments +andc asha nd non-cashcollateralo fs uchc lient,w e +mayb er esponsible fort he shortfalla mount necessary +to purchasea ny replacements ecurities. In addition, +in certain cases,w em ay alsoassume ther isko fl oss +relatedt oapprovedi nvestmentst hata re reverse +repurchaset ransactions as describeda bove.I nt hese +twos cenarios, we,rathert hano ur clients, aree xposed +to ther isks ofthed efaultingc ounterpartyi nthe +securitiesl ending transactions and, wherea pplicable, +in ther everse repurchaset ransactions. Forf urther +discussion on oursecuritiesl ending indemnifications, +see“ Commitmentsa nd contingent liabilities–Off- +balances heet arrangements”in Note 22 oftheN otes +to Consolidated FinancialS tatements. +Risk Factors (continued) +BNYM ellon9 5 +The secret object #2 is a "phone". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_113.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_113.txt new file mode 100644 index 0000000000000000000000000000000000000000..94bc08327dd3de03c84868ae957b57a365ec79a6 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_113.txt @@ -0,0 +1,104 @@ +From time to time,wea ssume concentrated credit +risk at thei ndividualo bligor,c ounterpartyo rg roup +level, potentially exposingu st oasinglem arketo r +political eventoracorrelated seto fe vents. For +example, we mayb ee xposed to defaults by +companiesl ocated in countries with deteriorating +economic conditions or bycompaniesi nc ertain +industries. Ourc ommercialr eale statep ortfolio also +exposes us to concentrated creditrisk,i ncluding to +theN ew York metrom arket. Such concentrations +mayb em aterial. Ourc ounterpartye xposures change +daily,a nd thec ounterpartieso rg roups ofrelated +counterpartiest ow hich our risk exposurei sm aterial +also vary duringa ny reportedp eriod; however,our +largeste xposurest endt obet oo ther financial +institutions,c learingo rganizations,a nd governmental +entities, bothi nsidea nd outsidetheU .S. +Concentrationo fc ounterpartye xposurep resents +significantr isks to us andt oour clientsb ecause the +failure or perceivedweakness of ourcounterparties +(ori ns omec ases of ourclients’ counterparties) has +thep otentialt oe xposeu st or isko ff inancial loss. +Changesi nm arketp erceptiono ft he financial +strengtho fp articular financiali nstitutions or +sovereigni ssuersc an occurr apidly,a re oftenb ased +on av ariety of factorsa nd ared ifficult topredict. +Although our overallbusinessi ssubject to these +interdependencies, severalof our businessesare +particularly sensitivet ot hem, including ourcurrency +ando ther tradinga ctivities, our securitiesl ending and +securitiesf inance businessesa nd ourinvestment +management business. If we experience anyoft he +lossesd escribed above,itm ay materially and +adverselya ffect our results of operations. +We arealsos ubject to theriskt hato ur rightsa gainst +thirdp artiesm ay not beenforceable inall +circumstances.I na ddition, deteriorationi nthe credit +quality of thirdp arties whoses ecuritieso ro bligations +we hold, including ad eteriorationi nthe valueo f +collateralp ostedb ythird partiest os ecure their +obligations to us underderivatives contractsand other +agreements,c ould result in lossesand/or adversely +affect our ability torehypothecateo ro therwise use +thoses ecuritieso ro bligations forl iquidity purposes. +Disputes with clientsa nd counterpartiesa stot he +valuationo fc ollateralc an significantly increasei n +timeso fm arkets tressa nd illiquidity.I na ddition, +disruptions in theliquidity or transparency of the +financialm arkets mayresult in our inability tosell, +syndicateo rr ealizet he valueofo ur positions,thereby +leadingt oincreased concentrations.A ni nability to +reduceo ur positionsmayn ot onlyincreaset he market +andc reditr isks associated with such positions but +maya lsoi ncreaset he levelo fR WA on our balance +sheet,t hereby increasingo ur capitalr equirementsa nd +funding costs, allo fw hich couldadverselya ffect the +operations andp rofitability of our businesses. +UnderU .S.r egulatoryr estrictions oncredit exposure, +whichi nclude ab roadeningo ft he measureo fc redit +exposure, we arer equiredt olimit our exposures to +specifico bligorso rg roups,i ncluding financial +institutions.T hese regulatoryc redite xposure +restrictions maya dverselya ffect our businessesand +mayr equire us to modifyour operatingmodels or the +policiesa nd practiceswe use. +Further, we maintain sub-custodian relationships in +certain jurisdictions,i ncluding emerging ando ther +underdevelopedm arkets.O ur useofs ub-custodians +exposes us to operational, reputationala nd regulatory +risk,a sw ea re dependent uponsuch sub-custodianst o +perform certain services to clientsi nt hosem arkets. +Ther isks ofmaintainingc ustody services in such +marketsa re amplifiedd ue to evolving regulatorya nd +sanctions requirements, whichmay increaseo ur +financiale xposures,i nthe eventt hoses ub- +custodians, or we,a re unablet or eturn, transfer or +reinvest clients’ assets.U nderc ertain regulatory +regimes, we mayb eh eldr esponsible forr esulting +lossess ufferedb your clients, andw em ay agreet o +similaro rmores tringent standardsw ith clientst hat +aren ot subject to such regulations.W here we have +client depositliabilitiesr elated to non-U.S. currencies +in jurisdictions wherew emaintains ub-custodian +relationships,w eg enerally maintainac orresponding +amount ofcasho ndeposit with therelevants ub- +custodian or clearinga gency, whichi ncreases our +credit exposuret ot hate ntity andc an accumulate over +time basedu pon distributions on, or otheractivities +relatedt o, ourclients’ assets.I ft he sub-custodian or +clearinga gencyw eret ob ecome insolventi n +circumstances not involving expropriationo fa ssets or +otherc ircumstances that maye xcusep erformance +underr elevantc lient agreements,t he risk of loss on +such casho ndeposit couldb eo ursr athert hant he +clients’. +We couldi ncur lossesi fo ur allowancef or credit +losses, includingl oan andlending-related +commitment reserves,i si nadequateo ri fo ur +expectations of future economic conditions +deteriorate. +When we loan money, commit to loanmoneyo r +provide credit or enteri ntoa notherc ontract with a +Risk Factors (continued) +96 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_114.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_114.txt new file mode 100644 index 0000000000000000000000000000000000000000..a83bd7da032a4bf0e5a59a5327b93ce160f20423 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_114.txt @@ -0,0 +1,106 @@ +counterparty, we incurc reditr isk, orther isko fl ossi f +our borrowersdo notrepayt heir loansoro ur +counterpartiesf ailt op erform accordingt othe terms +of theira greements.O ur profitability isadversely +affected when our borrowersdefault, inwholeo ri n +part,o ntheir loanobligations to us orwhen therei sa +significantd eteriorationi nthe credit quality of our +loan portfolio.W er eserve forp otentialf uturec redit +lossesb yr ecordingaprovision forc reditl osses +through earnings.T he allowancef or loan losses and +allowancef or lending-relatedc ommitments +represents management’sestimate of current expected +credit lossesovert he lifetime of ther elated credit +exposuret akingi ntoa ccount relevant information +about pastevents,c urrent conditions andr easonable +ands upportablef orecasts of future economic +conditions that affectthec ollectability of ourloans +andl ending commitments. We useaq uantitative +methodology andq ualitativef ramework for +determiningt he allowancef or loan lossesa nd the +allowancef or lending-relatedc ommitments. Within +this qualitativef ramework,m anagementa pplies +judgmentw hena ssessing internal risk factorsa nd +environmentalf actorst oc omputea na dditional +allowancef or each component ofthel oanp ortfolio. +As is thecasew ith anys uchj udgments,w ec ould fail +to identifyt hese factorso ra ccurately estimate their +impact.W ec annot provideanya ssurancea st o +whetherc harge-offs relatedt oour credit exposure +mayo ccuri nt he future.C urrent andf uturem arket +ande conomic developments mayi ncreased efault and +delinquencyr ates andnegativelyi mpact theq uality of +our credit portfolio,w hich mayi mpact our charge- +offs.A lthough ourestimatesc ontemplatec urrent +conditions andh ow we expect them to change over +thel ifeo ft he portfolio,iti sr easonablyp ossiblet hat +actualc onditions couldb ew orse than anticipatedin +thosee stimates, whichcouldm aterially affect our +results of operationsandf inancial condition. See +“Results of Operations –C ritical accounting +estimates.” +Capitala nd LiquidityRisk +Ourb usiness, financialc onditiona nd results of +operations couldb ea dversely affected if we do not +effectivelym anageo ur liquidity. +Ouro peratingm odela nd overallstrategy rely heavily +on ouraccesst of inancial market utilitiesa nd global +capitalm arkets.W ithout such access,it wouldb e +difficult toprocessp aymentsa nd settle andc lear +transactions on behalfo four clients. Deteriorationi n +our liquidity position, whethera ctualo rp erceived, +can impact our market accessb ya ffecting +participants’w illingness to transactwith us.C hanges +to our liquidity can be causedb yvarious factors, such +as funding mismatches,afailu re in our asset/liability +management,m arketc onstraintsd isablinga ssett o +cashc onversion, inability to issued ebt, run-offs of +core deposits,a nd contingent liquiditye ventss ucha s +additionalc ollateralp osting. Changesi ne conomic +conditions orexposuret oc redit, market,o perational, +legala nd reputationalr isks can alsoaffect our +liquidity. +Ourb usinessi sdependent in part on ourability to +meet our casha nd collateralo bligations at a +reasonablec ostf or bothexpected andunexpected +cashf lows.W ea lsom ustm anagel iquidity riskso n +an intraday basis, in am annerd esignedt oensuret hat +we can accessr equiredf unds duringthe businessday +to make paymentsor settle immediateo bligations, +ofteni nreal time.W er eceive client deposits through +av ariety of investment management andi nvestment +servicingb usinessesa nd we rely on thosed eposits as +al ow-costa nd stable source of funding. Oura bility +to continue to receive thosed eposits,a nd othershort- +term fundingsources,i ss ubject to variability based +on an umbero ffactors, including volumeand +volatilityi nthe globalsecuritiesm arkets,t he relative +interest ratest hatw ea re prepared to payf or those +deposits,a nd thep erceptiono ft he safety of those +deposits or othershort-term obligations relativet o +alternatives hort-term investmentsa vailable toour +clients. We couldlosed eposits ifwe suffera +significantd eclinei nt he levelo fo ur business +activity,o ur credit ratings arem aterially downgraded, +interest ratesc ontinue to rise or remain at elevated +levels,o ri fweo ro ur peersbecome subject to +significantn egativep ress or significantr egulatory +actiono rl itigation, among otherreasons.O ur +liquidity coulda lsob ea dverselya ffected by +customers’ withdrawal of deposits inresponset o +volatilitya nd disruptionsin thefinancial marketso ra +stress events ucha st hate xperienced by regional +depository institutions in thefirst half of 2023. +Further, deposit outflowsc ouldi ncreasei fo ur clients +andc ustomers with uninsured deposits lookfor +alternativep lacements fort heir funds amidst market +andf inancial industryv olatility.Aperceivedl osso f +confidence in theB NY Mellona sadepository +institutionm ay be additionally exacerbatedb ythe +speed andpervasiveness withwhichi naccurate or +incomplete informationi sd isseminated through +social mediao ro ther internet forums.I fw ew eret o +lose as ignificanta mount of deposits,w em ay need to +replace such funding with moreexpensivef unding +Risk Factors (continued) +BNYM ellon9 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_115.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_115.txt new file mode 100644 index 0000000000000000000000000000000000000000..6f1f1ec03aa5b5675f7c6c4bbf3cd66a56df1506 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_115.txt @@ -0,0 +1,104 @@ +and/or reducea ssets,w hich wouldr educeo ur net +interest revenue. +Thed egreeo fc lientd emandf or short-term credit +tends to increaseduringp eriods ofmarket turbulence. +Fore xample,i nvestorsi nm utualf unds forw hich we +act as custodianmaye ngage in significantr edemption +activity due to adversem arketo re conomic +conditions.W em ay then extendintraday credit to +our fund clientsi no rder to facilitate theirability to +pays uchr edemptions.I na ddition, duringperiods of +market turbulence, drawsu nderc ommittedr evolving +credit facilitiest hatw ep rovide to our institutional +clientsm ay increase, andhavei nt he pastincreased, +substantially.S uchc lient demandmayn egatively +impact our leverage-based capitalr atios, andi ntimes +of sustainedm arketv olatility,m ay result in +significantl everage-basedr atio declines. +In addition, ouraccesst ot he debtande quity capital +marketsa nd credit marketsi sasignificants ourceo f +liquidity.E ventso rc ircumstances ofteno utside of +our control, such asmarket disruptions,l ack of +liquidity in themarkets,g overnment fiscal and +monetary policies, uncertainty overt he U.S. +government debtceilingo rl osso fc onfidence by +securitiesp urchaserso rc ounterpartiesi nu so ri nt he +funds markets, couldl imit our accesst oc apital +marketsa nd credit markets,increaseo ur cost of +borrowing, adverselya ffect ourl iquidity,o ri mpair +our ability toexecute our businessplan. In addition, +clearingo rganizations,r egulators, clientsa nd +financiali nstitutions with whichw ei nteract may +exercise ther ight to require additionalc ollateral +basedo nmarketp erceptions ormarket conditions, +whichc ouldf urther impairo ur accesst oa nd cost of +funding. Market perceptiono fs overeignd efault risks +can alsolead to inefficientmoneym arkets andc apital +markets, whichcouldf urther impact our funding +availability andc ost. Conversely, excessl iquidity +inflowsc ouldi ncreasei ntereste xpense, limit our +financialf lexibility,a nd increase thes izeo fo ur total +assets inam annert hatc ouldh avean egativei mpact +on ourcapitalr atios. +Undert he U.S. capitalr ules,t he size of thec apital +surcharget hata ppliest oaU.S. G-SIBi sb ased in part +on its relianceo ns hort-term wholesalef unding, +including certain typesofd eposit funding, whichm ay +increaset he cost of such funding. Furthermore, +certain non-U.S. authoritiesr equire largeb anks to +incorporateas eparates ubsidiary in countries in +whicht heyo perate,a nd to maintain independent +capitala nd liquidity at foreigns ubsidiaries.T hese +requirementsc ouldh indero ur ability toefficiently +manage ourfunding andl iquidity inac entralized +manner, requiring usto holdm orec apitala nd +liquidity overall. +In addition, ourcost of funding couldb ea ffected by +actions that we mayt akei no rder to satisfy applicable +LCRa nd NSFR requirements, to lowerour G-SIB +score, to satisfy thea mount ofeligible long-term debt +outstanding underthe TLACr ule, to address +obligations underour resolution planor to satisfy +regulatoryr equirementsi nn on-U.S. jurisdictions +relatingt othe pre-positioning ofliquidity incertain +subsidiaries.F urther,t he regulatoryo rs tresst est +liquidity valuea ssociated with thesecuritiesw eh old +subject to ah eld-to-maturity accountingd esignation +couldb er educed in thef uturet hrough regulatoryo r +supervisorya ction, exposingu st or elativelyg reater +capitalr atio volatility attributable to interest rate +movementst ot he extent we designate ar elatively +larger percentage of oursecuritiesp ortfolio as +available-for-saleg oing forwardi nresponset os uch +regulatoryo rs upervisoryc hanges. +If we areu nablet or aise funds usingthe methods +describeda bove,w ew ouldl ikelyn eed to finance, +reduceo rl iquidate unencumbereda ssets,s ucha so ur +central bank depositsandb ankp lacements,o r +securitiesi no ur investment portfolio to meetfunding +needs. We mayb eu nablet os ells omeo fo ur assets, +or we mayh avet os ella ssets at ad iscount from +market value, eitherof whichc oulda dverselya ffect +our business,financialc onditiona nd results of +operations.F urther,o ur abilityt osella ssets mayb e +impairedi fo ther market participants ares eekingt o +sell similara ssets at thes amet ime,w hich couldoccur +in al iquidity or othermarketc risis. Additionally,i f +we experience cashflowm ismatches, deposit run-off +or market constraintsresultingf romo ur inability to +convert assets tocasho ra ccessc apitalm arkets,o ur +liquidity couldb es everelyi mpacted.D uringp eriods +of market uncertainty,o ur levelo fc lient depositshas +in recenty earst endedt oincrease; however,b ecause +thesed eposits have high potentialr un-offr ates,w e +have historicallydepositedt hese so-calledexcess +deposits with central banks andi nother highlyl iquid +andl ow-yieldingi nstruments. +If we areu nablet oc ontinue to fund ourassets +through depositsora ccessc apitalm arkets on +favorable termso ri fwes uffera ni ncreasei no ur +borrowing costso ro therwise fail to manage our +liquidity effectively, ourliquidity,n et interest margin, +financialr esults andc onditionm ay be materially +Risk Factors (continued) +98 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_116.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_116.txt new file mode 100644 index 0000000000000000000000000000000000000000..398e2b5aa1f1f624820439404bb21b2a4c247abf --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_116.txt @@ -0,0 +1,102 @@ +adverselya ffected.I nc ertain cases,t hisc ould +require us to raisea dditionalc apitalt hrough the +issuance of preferredorc ommons tock,w hich could +dilute theownership of existings tockholders and/or +reducec ommons tock repurchases or ourcommon +stockd ividend, to preserve capital. Forafurther +discussion of ourliquidity,s ee “Resultsof Operations +–L iquidity andd ividends.” +Failure to satisfy regulatory standards,including +“wellc apitalized”a nd “wellm anaged” status or +capitala dequacya nd liquidity rulesm oreg enerally, +couldr esulti nl imitations on ouractivitiesa nd +adversely affect ourb usinessa nd financial +condition. +UnderU .S.a nd internationalr egulatoryc apital +adequacy rulesa nd otherregulatoryr equirements, we +ando ur subsidiary banks must meet or exceed +thresholds that include quantitativem easures of +assets,l iabilities, andc ertain off-balance sheet items, +subject to qualitativej udgments by regulatorsa bout +components, risk weightingsando ther factors. As +discussedi n“Supervisiona nd Regulation,” BNY +Melloni sr egisteredw ith theFederal Reservea sa +BHCa nd an FHC. An FHC’sa bility to maintainits +status as anFHCi sd ependent uponan umbero f +factors, including its U.S. bank subsidiaries +qualifying onan ongoing basisa s“well capitalized” +and“ well managed” underthe bankingagencies’ +prompt correctivea ctionr egulations as well as +applicable FederalR eserve regulations.F ailure by an +FHCo ro ne ofits U.S. bank subsidiaries to qualifya s +“wellc apitalized”a nd “wellm anaged,” if unremedied +overaperiod, wouldc ause it to loseits status as an +FHCa nd coulda ffect thec onfidence of clientsi ni t, +compromisingi ts competitivep osition. Additionally, +an FHCt hatd oesn ot continue to meet allthe +requirementsf or FHCs tatusc ouldl oset he ability to +undertaken ew activitiesorm akea cquisitions that are +not generallypermissiblew ithout FHCs tatuso rt o +continue such activities. +Thef ailure by one of ourU.S. bank subsidiaries to +maintain itsstatus as “wellcapitalized”c ouldl ead to, +among otherthings,h igherF DICa ssessments and +couldh aver eputationala nd associated business +consequences. +If we or oursubsidiary banks fail to meetU.S. and +internationalm inimumc apitalr ules andother +regulatoryr equirements, wemayn ot beable to +deploy capitali nt he operationofo ur businesso r +distributec apitalt os tockholders,w hich may +adverselya ffect our business. +Failure to meet anycurrent orfuture capitalo r +liquidity requirements, including thosei mposed by +theU .S.c apitalr ules,t he LCRo rt he NSFR,o rb y +regulatorsi ni mplementingo ther portions oftheB asel +III framework,couldm aterially adverselya ffect our +financialc ondition. Compliance with U.S. and +internationalr egulatoryc apitala nd liquidity +requirementsm ay impact our ability toreturn capital +to shareholders andm ay impact our operations by +requiring usto liquidatea ssets,i ncreaseb orrowings, +issuea dditionale quity or othersecurities, or ceaseo r +alterc ertain operations,w hich maya dverselya ffect +our results of operations. +Finally,o ur regulatoryc apitalr atios, liquidity +metrics, andr elated componentsare basedo nour +current interpretation, expectations,a nd +understanding ofthea pplicable rulesa nd ares ubject +to,a mong otherthings, ongoing regulatoryr eview, +regulatorya pprovalo fc ertain statistical models, +additionalr efinements,m odifications or +enhancements (whether requiredo ro therwise)t oo ur +models,a nd furtheri mplementationg uidance. Any +modifications resultingf romt hese ongoing reviews, +thea doptiono fn ew or heightenedprudential +regulatoryr equirements, or thec ontinued +implementationo ft he U.S. capitalr ules (sucha st he +proposed revisionsi nt he thirdq uarter of 2023 bythe +FederalR eserve,t he OCCa nd theF DICt o +implement andf inalizet he BaselI II reformsand the +reviseds tandard formarketr iskc apitalr equirements), +theL CR, theN SFR,t he resolution planning process +andr elated amendments,couldr esulti nc hangesi n +our RWAs,c apitalc omponents, liquidityi nflows and +outflows, HQLA,o ro ther elements involvedi nthe +calculationo ft hese measures,w hich couldimpact +regulatoryc apitala nd liquidity ratios. Further, +because operationalr iski sc urrently measuredbased +not onlyupon our historicaloperationall oss +experience but also upon ongoingevents in the +banking industryg enerally,o ur levelo fo perational +RWAs coulds ignificantly increaseoro therwise +remain elevated andm ay potentially be subject to +significantv olatility,n egativelyi mpactingo ur capital +ratios. Additionally,o ur liquidity positionc ouldb e +significantly impactedby changest ot he liquidity +framework itself, as regulatorsm ay seek to evaluate +potentialc hangest ot he regulatoryf ramework +following ther egionalb ankf ailuresi nt he firsth alfo f +2023. Theu ncertainty causedb ythese factorsc ould +RiskF actors (continued) +BNYM ellon9 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_117.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_117.txt new file mode 100644 index 0000000000000000000000000000000000000000..6f543b8e26f1bb250741c2c26a7e2996b7b02e00 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_117.txt @@ -0,0 +1,104 @@ +ultimately impact our ability to meetour goals, +supervisoryr equirements, andr egulatorys tandards. +TheP arenti sanon-operatingh olding company +and, asar esult, isdependento nd ividends from its +subsidiaries ande xtensionso fc reditf romi ts IHCt o +meet its obligations,i ncluding with respect to its +securities, andt oprovide fundsf or share +repurchases, payment of income taxesand payment +of dividendstoi ts stockholders. +TheP arenti sanon-operatingh olding company, +whosep rincipal assetsands ources of income arei ts +principalU .S.b anks ubsidiaries—The Bank ofNew +York Mellona nd BNYM ellon, N.A.—and its other +subsidiaries,i ncluding Pershing andt he IHC. The +Parent is al egal entityseparate andd istinct fromi ts +banks,t he IHCa nd othersubsidiaries. Therefore, the +Parent primarilyrelieso nd ividends,i nterest, +distributions,a nd otherpaymentsf romi ts +subsidiaries,i ncluding extensions ofcredit fromt he +IHC, to meetits paymento bligations,i ncluding with +respect to itssecurities, andt oprovide funds fors hare +repurchases,t he paymentofi ncomet axes and +paymento fc ommona nd preferreddividends to its +stockholders,t othe extent declaredby theB oard of +Directors. +Therea re various limitations onthee xtentt ow hich +our banksando ther subsidiaries canfinanceo r +otherwises upplyf unds to theParent( by dividend or +otherwise) andcertain of ouraffiliates. Each of these +restrictions can reducet he amount offunds available +to meettheP arent’so bligations.M anyo fo ur +subsidiaries,i ncluding our banksubsidiaries,a re +subject to lawsandr egulations that restrict dividend +payments or authorizer egulatoryb odies to blocko r +reducet he flow offunds from thoses ubsidiaries to +theP arento ro ther subsidiaries.I na ddition, our bank +subsidiaries wouldn ot be permittedt odistributea +dividend if doing so wouldconstitute an unsafea nd +unsound practiceori fthe paymentwouldr educet heir +capitalt oa ninadequate level. Ours ubsidiaries may +also chooset or estrictd ividendp aymentst ot he +Parent in ordert oi ncreaset heir ownc apitalo r +liquidity levels.O ur banksubsidiaries arealso +subject to restrictions ontheira bility to lendto or +transact with non-bank affiliates, minimumr egulatory +capitala nd liquidity requirements, andr estrictions on +theira bility tousef unds depositedw ith themin bank +or brokerageaccountst of und theirb usinesses. See +“Supervisiona nd Regulation” and“ Results of +Operations –L iquidity andd ividends,” as well as +Note 19 oftheN otes to Consolidated Financial +Statements.F urther,w ee valuatea nd manage +liquidity on al egal entitybasis, whichmay place +legala nd otherlimitations on ourability toutilize +liquidity fromo ne legale ntity to satisfy thel iquidity +requirementso fa nother, including theP arent. +Therea re also limitations specifict ot he IHC’sa bility +to make distributions orextend credit to theParent. +TheI HC is not permittedt opay dividends to the +Parent if certain keyc apitala nd liquidity indicators +areb reached,a nd if ther esolutiono ft he Parent is +imminent, thecommittedl ines of credit providedb y +theI HC to theParentw ill automatically terminate, +with allo utstanding amountsb ecomingd ue. +Because theP arenti saholding company, its rights +andt he rights of its creditors,i ncluding theh olders of +its securities, to as hare of thea ssets of anys ubsidiary +upon thel iquidationo rr ecapitalizationo ft he +subsidiary,w ill be subject to theprior claims of the +subsidiary’s creditors( including, in thecaseo fo ur +banking subsidiaries,t heir depositors)e xceptt ot he +extent that theP arentm ay itselfb eac reditorw ith +recognized claimsagainstt he subsidiary.T he rights +of holdersof securitiesi ssued by theP arentt ob enefit +fromt hosed istributions will also be junior to those +priorc laims.C onsequently,s ecuritiesi ssued by the +Parent will be effectivelys ubordinatedt oall existing +andf uturel iabilitieso fo ur subsidiaries. +Oura bility to return capitalt os hareholdersi s +subject to thed iscretiono fo ur Boardo fD irectors +andm ay belimitedb yU .S.b anking laws and +regulations, includingt hose governing capitala nd +capitalp lanning,a pplicablep rovisionso fD elaware +lawa nd ourf ailure to pay full andt imely dividends +on ourpreferreds tock. +Holderso fo ur commona nd preferredstock areonly +entitledt oreceive such dividends or other +distributions ofcapitala so ur Boardo fD irectorsm ay +declareo ut offunds legallya vailablef or such +payments.A lthough we have historicallydeclared +cashd ividends on ourcommona nd preferredstock, +we aren ot requiredt od oso. In additiont othe Board +of Directors’ approval, our ability to takecertain +actions,i ncluding ourability todeclared ividends or +repurchaseo ur common stock, mayb es ubject to the +buffers undert he FederalR eserve’s capitala nd +TLAC rules. Theb uffers undert he capitalr ules are +affected by ther esults of CCAR. Through theC CAR +process, we mayb e, andhavei nt he pastbeen, +requiredt oresubmit our capitalp lani nthe evento fa +deteriorationi nthe generalfinancial marketso r +Risk Factors (continued) +100 BNYM ellon +The secret sport is "tennis". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_118.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_118.txt new file mode 100644 index 0000000000000000000000000000000000000000..07d79b30f963063b2ec72d0fc736f0a1a1ad0d85 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_118.txt @@ -0,0 +1,102 @@ +economyo rc hangesi no ur risk profile (including a +material changein businesss trategyo rr isk +exposure),f inancial conditiono rc orporates tructure. +TheF ederal Reservei sa lsoa ble, outside theC CAR +process, to restrict our ability to makecapital +distributions ands ubject us to others upervisoryo r +enforcementa ctions. +AF ederal Reserved eterminationt hato ur capital +planning processeswerew eak or otherwisefailt o +meet supervisorye xpectations couldh aveav ariety of +adversec onsequences,i ncluding, without limitation, +ratings downgrades,ongoing heightenedsupervisory +scrutiny, expenses associatedwith remediation +activities, andp otentially an enforcementaction. +Af ailure to increasedividends along with our +competitors,o ra ny reductiono f, or eliminationo f, +our commons tock dividend wouldl ikelya dversely +affect them arketp rice of ourcommons tock,o ur +return on equity andm arketp erceptions ofBNY +Mellon. +Oura bility todeclareo rp ay dividends on, or +purchase, redeem or otherwiseacquire,s hareso fo ur +commons tock will be prohibited,subject to certain +exceptions,i nthe eventt hatw ed on ot declareand +payi nfulld ividends fort he then-current dividend +period (int he caseo fd ividends)o rmostr ecently +completedd ividendp eriod( in thecaseo f +repurchases)o four Series Ap referreds tock or the +last precedingd ividendp eriod( in thecaseo f +dividends)o rmostr ecently completedd ividend +period (int he caseo fr epurchases)o four Series F, +Series G, Series Ho rS eriesIpreferreds tock. +In addition, regulatoryc apitalr ules that areorw ill be +applicable tous,i ncluding theU .S.c apitalr ules risk- +basedc apitalr equirements, theS LR,t he stress capital +buffer, thee nhanced SLR, theT LACr ulea nd the +U.S. G-SIBs urcharge,m ay limit or otherwiserestrict +how we utilizeo ur capital, includingcommons tock +dividends ands tock repurchases,a nd mayr equire us +to increaseora ltert he mix of our outstanding +regulatoryc apitali nstruments.C hangesi nt he +compositiono fo ur balancesheet,i ncluding as a +result of changing economic conditions andm arket +values,m ay furtherr equire us to increaseora ltert he +mix of our outstandingregulatoryc apital, whichi n +turn couldi mpact our ability toreturn capitalt o +shareholders. +Anyrequirement to increaseour regulatoryc apital +ratioso ra ltert he compositiono fo ur capitalc ould +require us to liquidatea ssets or otherwisechange our +businessa nd/or investment plans, whichmay +negativelya ffect our financialr esults.F urther,a ny +requirement to maintainhigherl evelso fc apitalm ay +constraino ur ability toreturn capitalt os hareholders +either in thef ormo fc ommons tock dividends or +stockr epurchases. +Anym aterialr eductioni nour credit ratings orthe +credit ratings of ourprincipal banksubsidiaries, +TheB anko fN ew York Mellon,BNY Mellon, N.A. +or TheB anko fN ew York MellonS A/NV,c ould +increase thec osto ff undinga nd borrowing to us +ando ur rateds ubsidiariesa nd haveam aterial +adverse effect on ourbusiness, financialc ondition +andr esults of operationsando nt he valueo ft he +securitiesw ei ssue. +Ourd ebta nd preferredstock andthe debtand +deposits of our principalbanks ubsidiaries,T he Bank +of NewY orkM ellon, BNYM ellon, N.A. andT he +Bank ofNewY orkM ellonS A/NV, arec urrently +ratedi nvestment gradebyt he majorr atinga gencies. +Theser atinga genciesr egularly evaluate us ando ur +rateds ubsidiaries.T heir credit ratings areb ased on a +numbero ffactors, including ourfinancials trength, +performance, prospectsa nd operations,asw ella s +factorsn ot entirelyw ithin our control, including +conditions affectingt he financials ervices industry +generally andt he U.S. government.R atinga gencies +employ differentmodels andf ormulast oa ssess the +financials trengtho faratedc ompany, andf rom time +to timeratinga genciesh ave, in theird iscretion, +alteredt hese models.C hangest or atinga gency +models,g eneral economicconditions,r egulatory +developments or othercircumstances outside our +controlc ouldn egativelyi mpact ar atinga gency’s +judgmento ft he ratingo ro utlook it assigns to us or +our rateds ubsidiaries.A saresult, we or ourrated +subsidiaries mayn ot beable to maintainour +respectivec reditr atings or outlook on oursecurities. +Forf urther discussion of ourando ur principalbank +subsidiaries’c reditr atings,s ee “Resultsof Operations +–L iquidity andd ividends.” +Am aterialr eductioni nour credit ratings orthec redit +ratings of ourrateds ubsidiaries,w hich canoccura t +anyt ime without notice, couldhaveam aterial +adversee ffect on ouraccesst oc reditm arkets,t he +relatedc osto ff unding andb orrowing, ourcredit +spreads, our liquiditya nd certain tradingrevenues, +particularly in thosebusinessesw here counterparty +creditworthinessi scritical.I na ddition, in connection +with certain over-the-counter derivatives contracts +Risk Factors (continued) +BNYM ellon1 01 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_119.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_119.txt new file mode 100644 index 0000000000000000000000000000000000000000..70361e3ed441c5ee40e19645aad697b40a626d8e --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_119.txt @@ -0,0 +1,102 @@ +ando ther tradinga greements,c ounterpartiesm ay +require us or ourrateds ubsidiaries to provide +additionalc ollateralo rt ot erminatet hese contracts +anda greements andc ollateralf inancing arrangements +in theevent ofac reditr atings downgradebelow +certain ratings levels,w hich couldimpairo ur +liquidity.A downgradeb ya ny oneratinga gency, +depending onthea gency’sr elativer atings ofthe +entity at thet ime of thed owngrade, mayh avea n +impact comparable to theimpact of ad owngradeb y +allr atinga gencies. If ar atinga gencyd owngradeo ra +review ford owngradew eret oo ccurd uringb roader +market instability,o ur optionsforr esponding to +events maybem orel imiteda nd more expensive, +possiblys ignificantly.A ni ncreasei nt he costso fo ur +funding andb orrowing, oran impairmento fo ur +liquidity,c ouldh aveam ateriala dversee ffect on our +results of operationsandf inancial condition. A +material reductioni nour credit ratings also could +decreaset he numbero finvestorsa nd counterparties +willingo rp ermittedt od obusinessw ith or lend to us +anda dverselya ffect thev alue ofthes ecuritiesw e +have issued or mayi ssuei nt he future. +We cannot predictwhata ctions ratinga genciesm ay +take,o rw hata ctions we maye lect or berequiredt o +take in responset hereto,w hich maya dverselya ffect +us.F or furtherd iscussiono nthe impact of ac redit +ratingd owngrade, see“ Disclosure of contingent +features in OTCd erivativei nstruments”i nN ote2 3o f +theN otes to Consolidated FinancialS tatements. +Thea pplicationo fo ur Title Ip referredr esolution +strategy orresolutionu nder theT itle II orderly +liquidationa uthority coulda dversely affect the +Parent’s liquidity andf inancial conditiona nd the +Parent’s security holders. +In 2017, in connectionw ith our singlep oint ofentry +resolutions trategyu nderT itle Io fthe Dodd-Frank +Act, theParente ntered into ab inding support +agreementw ith certain keys ubsidiaries to facilitate +thep rovision ofcapitala nd liquidity resources to +them in theevent ofmaterial financiald istresso r +failure.T he supporta greementr equirest he Parent to +transfer cashando ther liquidf inancial assets to the +IHCo na nongoing basis, subjectto certain amounts +retained by theP arentt om eeti ts near-termc ash +needs, in exchange foru nsecureds ubordinated +funding notesissued by theI HC as well as a +committedl ineo fc reditt ot he Parent to servicei ts +near-termo bligations.T he Parent’s andt he IHC’s +obligations underthe supporta greementa re secured. +If our projectedliquidity resources deteriorates o +severely that resolutiono ft he Parent becomes +imminent, thecommittedl ineo fc reditt he IHC +providedt othe Parent will automatically terminate, +with alla mountso utstanding becomingd ue and +payable, andthe supporta greementw ill require the +Parent to transfer most of its remaininga ssets (other +than stocki nsubsidiaries andacashr eserve to fund +bankruptcy expenses)tot he IHC. As ar esult, during +ap eriodo fs everef inancial stress, theP arentc ould +become unablet om eet itsd ebta nd payment +obligations (including with respect to itssecurities), +causing theP arentt os eek protectionu nder +bankruptcy laws earliert hani to therwise wouldhave. +If theP arentw eret ob ecome subject to ab ankruptcy +proceedinga nd oursingle point ofentrys trategyi s +successful,o ur material entities will not besubject to +insolvency proceedings andt heir creditorsw ouldn ot +be expected to sufferl osses, whilet he Parent’s +security holders,i ncluding unsecureddebth olders, +couldf ace significantl osses, potentially includingthe +loss of theire ntirei nvestment.T he single point of +entrys trategy, in whicht he Parent wouldb et he only +legale ntity toenterr esolutionp roceedings,i s +designedt oresulti ng reater risk of loss to holders of +theP arent’su nsecureds eniord ebts ecuritiesa nd +certain others ecuritiest hanw ouldb et he caseu ndera +different resolution strategy. +Further, if thes inglep oint ofentrys trategyi sn ot +successful,o ur liquidity andf inancial condition +wouldb ea dverselya ffected andall security holders +may, as ac onsequence, be in aw orse positiont hani f +thes trategyh ad not beenimplemented. +In addition, Title II of theD odd-FrankA ct +establisheda norderly liquidationprocessi nt he event +of thef ailure of al arge systemically important +financiali nstitution, such asBNYM ellon, in ordert o +avoido rm itigates erious adversee ffectso nt he U.S. +financials ystem. Specifically,i fB NY Mellonisi n +defaulto rd angero fdefault, andc ertain specified +conditions arem et,t he FDIC mayb ea ppointed +receiveru ndert he orderlyliquidationa uthority,a nd +we wouldb er esolvedu ndert hata uthority insteadof +theU .S.B ankruptcy Code. +U.S. supervisorsh avei ndicated that as inglep oint of +entrys trategym ay be ad esirable strategy to resolvea +largef inancial institutions ucha sB NY Mellonu nder +Title II in am annert hatw ould, similart oo ur +preferreds trategyu ndero ur Title Ir esolutionp lan, +imposel osseso ns hareholders,u nsecuredd ebt +Risk Factors (continued) +102 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_12.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_12.txt new file mode 100644 index 0000000000000000000000000000000000000000..10eb52252adeb3530318ae13a40355c24ee81b04 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_12.txt @@ -0,0 +1,66 @@ +X ANNUAL REPORT 2023 +RUN OUR +COMPANY +BETTER +Next, we took meaningful steps +toward running our company +better in 2023, increasing +discipline with how we spend +so that our investments in the +business go further. We generated +double the amount of efficiency savings compared +to the prior year, which allowed us to self-fund half +a billion dollars of incremental investments. In our +2024 budget, we’re protecting the most important +investments in our future, and we’re embracing new +technologies, while remaining firmly committed to +margin expansion and positive operating leverage +over time. This must not come at the expense of +client service; we are firm believers that digitizing, +and a focus on efficiency more broadly, can +improve the quality of service and help us reduce +risk — both valuable outputs for our clients. +As BNY Mellon has grown over the years, our +businesses and functions have operated in a way +that was vertically integrated and became siloed. +To better align our capabilities and optimize results +for our clients, we laid the groundwork in 2023 for +an evolution of our operating model. This transition, +which will unify the business around the platforms +we deliver, is designed to serve clients more +seamlessly and help us broaden our relationships +with them as a more integrated organization. +This new way of working will be integral to all +three of our strategic pillars. Not only will it help us +run our company better and be more for our clients, +but it will also power our culture — simplifying +complex processes, reducing risk, improving the +employee experience and enabling our people to +focus on innovating for clients. +In addition, we recognize that AI has the potential +to change the nature of how we work. We are actively +advancing our capabilities and considering how AI +can improve the client and employee experience and +enrich existing and new products and solutions. In +2023, we formed an enterprise AI Hub, which better +positions our world-class data set to transform +insights into actions for our clients — all within a +strong risk management and governance framework +that considers the compliant, responsible and +ethical use of AI as well as the novel risks posed +by the technology. +Resilience forms the foundation for running our +company better. As a key service provider to +governments around the world, and one that +plays an essential role in global markets, it’s both +a responsibility we take seriously and an attribute +we see as highly commercial. Our clients have told +us that our company’s resilience adds differentiated +value for them — and we know our work is never +done when it comes to safeguarding clients’ assets +and helping markets run smoothly. Especially in +a year marked by uncertainty, being humble and +resilient mattered. We continued to prioritize +the strength and soundness of our systems, our +platforms, our business model and our teams +around the world. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_120.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_120.txt new file mode 100644 index 0000000000000000000000000000000000000000..9941a9ed59343dc6484ffa53e22a5542e38280d1 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_120.txt @@ -0,0 +1,102 @@ +holders ando ther unsecuredc reditors of theP arent, +while permittingt he holdingcompany’ss ubsidiaries +to continue to operate andr emains olvent.U nder +such as trategy, assumingt he Parent entered +resolutionp roceedings andi ts subsidiaries remained +solvent, lossesatt he subsidiary levelw ouldb e +absorbed by theP arenta nd ultimatelyborne bythe +Parent’s security holders (including holdersof the +Parent’s unsecuredd ebts ecurities),w hile third-party +creditors of theP arent’ss ubsidiariesw ouldn ot be +expected to sufferl osses. Accordingly, theP arent’s +security holders (including holdersof unsecureddebt +securitiesa nd otherunsecuredc reditors)c ouldf ace +lossesi ne xcesso fw hato therwise wouldhaveb een +thec ase. +StrategicR isk +Newl ines of business,newp roductsa nd services or +transformationalo rs trategic project initiatives +subject us to newo ra dditionalr isks,a nd thef ailure +to implementthesei nitiatives couldaffect our +results of operations. +From time to time,weh avel aunchedn ew lines of +business, offeredn ew products ands ervices within +existingl ines of businessoru ndertaken +transformationalo rs trategic projects. Therea re +substantialr isks andu ncertaintiesa ssociated with +thesee fforts.W ei nvest significanttime and +resources in developing andm arketingn ew lines of +business, products ands ervices andexecutingo nour +transformationala nd strategici nitiatives.F or +example, we have devoted considerableresources to +developing newtechnology solutions foro ur clients, +including ourinitiatives relatedt oreal-time electronic +payments andg lobalc ollateralm anagement, as well +as Wove,our integrative wealth management +advisory platform.I ft hese technology solutions are +not successful,i tc oulda dverselyi mpact our +reputation, businessand results of operations.I n +2022, we announced thel auncho fo ur DigitalA sset +Custody platform forselect U.S. institutionalc lients +to holda nd transfer Bitcoina nd Ether. Developing +andp roviding newproducts ands ervices,i ncluding +thoser elatingt odigitala ssets, increases our +operationalr iske xposures.T hese risksa re often +heightened in connectionw ith assetc lasses, such as +digitala ssets,t hata re not onlynew forB NY Mellon +but also relativelyn ew to thefinancial marketsm ore +broadly. Compared with our activitiesi nvolving +traditionala ssets,d igitala sset-relatedp roducts or +services mayi ntroducei ncremental or uniquerisks, +particularly thoseassociatedw ith cybersecurity +exposures andthird-party dependencies, as well as +reputational, technology,legala nd regulatoryr isks. +Regulatoryr equirementsc an affectwhether +initiatives areablet ob eb rought to marketin a +mannert hati st imely anda ttractivet oo ur customers. +Initialt imetablesf or thed evelopmenta nd +introductiono fn ew lines of businessorn ew products +or services andprice andp rofitability targetsmay not +be met. Furthermore, our revenuesa nd costsm ay +fluctuateb ecause newb usinesseso rp roducts and +services generally require startupc osts while +revenuesm ay take time to develop, whichm ay +adverselyi mpact our results of operations. +Significante ffort andr esources arenecessary to +manage ando versee thes uccessful completion of +transformationalo rs trategic project initiatives.I f +management makesc hoices aboutthesei nitiatives +that prove to be incorrect,a re basedo nincomplete, +inaccurate or fraudulenti nformation, fail to +accurately assess thec ompetitive landscapea nd +industryt rends orareu nablet oa ddresst he +expectations of variousstakeholders,t hent he value +andg rowthp rospectso fo ur businessmay be +affected.F urther,t hese initiatives oftenp lace +significantd emands onmanagement andalimited +numbero femployees with subject mattere xpertise +andm ay involve significantc osts to implement,as +well as increaseo perationalr iska sw ed evelop and +implement relatedc ontrols,p rocessesa nd procedures +ande mployees learnt ooperate undern ew systems, +controls,p rocessesa nd procedures.T he failure to +successfully execute on theset ransformationalo r +strategici nitiatives couldadverselyi mpact our +business, reputationa nd results of operations. +Legal, regulatorya nd reputationalr isks maya lso +existi nc onnectionw ith dealingw ith newp roducts or +markets, or clientsa nd customersw hose businesses +focuso ns uchp roducts or markets, wherethere is +regulatoryu ncertainty or different orconflicting +regulations depending onther egulator orthe +jurisdiction. We mayi nvest significanttime and +resources into theexpansiono fe xistingo rc reationo f +newc ompliancea nd risk management systemsw ith +respect to newp roducts or markets. +We ares ubject to competitioni nall aspectso fo ur +business, whichc ould negativelya ffect oura bility to +maintain or increase ourp rofitability. +Theb usinessesi nw hich we operate arei ntensely +competitivea round thew orld.L argera nd more +Risk Factors (continued) +BNYM ellon1 03 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_121.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_121.txt new file mode 100644 index 0000000000000000000000000000000000000000..b87b1dc3cdbdaf785de920be81df51a27fd7f12e --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_121.txt @@ -0,0 +1,103 @@ +geographically diversec ompanies,a nd financial +technology firmst hati nvest substantialresources in +developing andd esigning newtechnology andt hat +aren ot subject to thesamel evel of regulation, mayb e +able toofferf inancial products ands ervices atmore +competitivep rices than we area blet oo ffer. We have +also experienced,a nd anticipatet hatw ew ill continue +to experience, pricinga nd othercompetitivep ressures +in severalo fo ur businesses. Pricingp ressures, as a +result of thew illingness of competitors to offer +comparable or improvedp roducts or services at a +lowerp rice, mayr esulti nareductioni nt he pricew e +can chargeforo ur productsands ervices,w hich +could, andi nsomec ases has, negativelya ffected our +ability to maintainor increaseo ur profitability. +In addition, technological advanceshave made it +possiblef or othertypeso fn on-depository +institutions,s ucha sf inancial technology firms, +outsourcing companiesa nd dataprocessing +companies, to offeravarietyo fp roducts ands ervices +competitivew ith certain areaso fo ur business, +including with respect to our clearing, settlement, +payments andt rading activities. In thef uture, +financialt echnology firmsm ay be able toprovide +traditionalb anking productsands ervices by +obtaining ab ank-likec harter,s ucha st he OCC’s +fintech charter,or offercryptocurrencies. +Moreover, newo rd isruptivet echnologies may +quickly impact markets, andt he manneri nw hich our +clientsi nteract andtransact within markets. For +example, thee mergence, adoptionand evolutiono f +newt echnologies that do notrequire intermediation, +including distributedledgers,a sw ella sa dvances in +robotic processa utomation, coulds ignificantly affect +thec ompetitionf or paymentsprocessing ando ther +financials ervices.O ur failure to either anticipate, or +participatei n, thet ransformationalc hange within a +givenm arketo ra dapt theset echnologies as +successfully as our peers,couldm akeu sl ess +competitivea nd result inpotentialn egativef inancial +impact.I ncreased competitioni nany ofthesea reas +mayr equire us to makeadditionalc apitali nvestments +in our businessesino rder to remain competitive. +Furthermore, regulations couldi mpact our ability to +conductc ertain of our businessesinacost-effective +mannero rata ll. Them orer estrictivel awsa nd +regulations applicable to thelargest U.S.financial +services institutions,i ncluding theU .S.c apitalr ules, +can put usat ac ompetitived isadvantager elativet o +botho ur non-U.S.competitors andU .S.c ompetitors +not subject to thesamel awsa nd regulations.S ee +“Supervisiona nd Regulation.” +Ours trategic transactions presentr isks and +uncertainties andc ould have an adverseeffect on +ourb usiness, financialc onditiona nd resultso f +operations. +From time totime,t oachieve ourstrategico bjectives, +we have acquired, disposedof,o ri nvested in +(including through jointv enture relationships) +companiesa nd businessesand haveenteredi nto +strategica lliances or othercollaborations with third- +partys ervice providers to deliver products and +services to clients, andm ay do so in thefuture. Our +ability to pursueo rc ompletes trategic transactions is +in certain instancessubject to regulatorya pprovala nd +we cannot becertain when or if,o ro nw hatt erms and +conditions,a ny requiredr egulatorya pprovals would +be granted. Moreover, to thee xtentw ep ursuea +strategict ransaction, therec an be no guaranteethat +thet ransactionw ill closew hena nticipated,o ra ta ll. +If as trategic transactiond oesn ot close, or if the +strategict ransactionf ails to maximizes hareholder +valueo rr equiredr egulatorya pprovali sn ot obtained, +it couldh avea na dversee ffect on our business, +financialc onditiona nd results of operations. +Anticipated challengesino btaining anyr equired +governmental approvals,oru ncertainty as to the +prospectsf or obtainingsuch approvals,coulda lso +preventu sf romp ursuingastrategict ransactionw e +mayo therwise view as attractive. +Each acquisitionp oses integrationc hallenges, +including successfully retaininga nd assimilating +clientsa nd keyemployees,c apitalizingo ncertain +revenue synergiesa nd integratingt he acquired +company’se mployees,c ulture,c ontrolf unctions, +systemsa nd technology. Theser isks mayb e +heightened if we areu nablet o, orfail to,c onduct +sufficiento ra ppropriate due diligence in connection +with ap otentiala cquisition. In some cases, +acquisitions involve entryi nton ew businesseso rn ew +geographico ro ther markets, andt hese situationsalso +presentr isks andu ncertaintiesi ni nstances wherew e +mayb ei nexperienced in thesen ew areas.W em ay be +requiredt ospend as ignificanta mount oftime and +resources to integratet hese acquisitions.T he +anticipated integrationb enefits mayt akel ongert o +achieve than projected andthe time andc ostn eeded +to consolidatec ontrolf unctions,p latforms and +systemsm ay significantly exceed our estimates. If +we fail to successfully integratestrategic acquisitions, +including doingso in at imely andc ost-effective +Risk Factors (continued) +104 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_122.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_122.txt new file mode 100644 index 0000000000000000000000000000000000000000..eca6a9e1e4f06be1b7d53b4abaa87d59d513748a --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_122.txt @@ -0,0 +1,106 @@ +manner, we mayn ot realizet he expected benefits, +whichc ouldh avea na dversei mpact on our business, +financialc onditiona nd results of operations.I n +addition, we mayi ncur expenses,c osts,l osses, +penalties, taxesa nd otherliabilitiesr elated to the +conducto ft he acquiredb usinessesp rior to thedateo f +our ownership(including in connectionw ith the +defensea nd/or settlement oflegala nd regulatory +claims,i nvestigations andp roceedings)w hich may +not berecoverablet hrough indemnificationo r +otherwise. If thep urchasep rice we payi na n +acquisitione xceedst he fair valueo fa ssets acquired +less thel iabilitiesw ea ssume,t henw em ay need to +recognize goodwill on ourconsolidated balances heet. +Goodwill isan intangiblea sset that is not eligible for +inclusioni nregulatoryc apitalu ndera pplicable +requirements. Further, if thevalue ofthea cquisition +declines,w em ay be requiredt orecord an impairment +charge. +Each dispositiona lsop oses challenges,including +separatingt he disposedbusinesses, products and +systemsi nawayt hati sc ost-effectivea nd is not +disruptivet ou so ro ur customers. Thei nherent +uncertainty involvedi nthe processofe valuating, +negotiatingo re xecutingapotentia ls aleo fo ne of our +companieso rb usinessesm ay causethe loss of key +clients, employees,v endorsa nd otherbusiness +partners,w hich couldhavea na dversei mpact on our +business, financialc onditiona nd results of +operations.I na ddition, ap ortiono ft he purchase +pricew eexpect to receive in ad ispositionm ay be +contingent or basedo na nearnout (e.g., dependent on +thep rofitability or results of operationoft he business +overaperiod of time aftert he sale iscompleted).I n +such cases, wemayn ot realizea ll, or any, contingent +or earnout paymentswe anticipater eceiving if the +future performance of theb usinessd oesn ot meet our +expectations orif otherc ontingent payment +conditions aren ot satisfied. +Jointv entures, noncontrollingi nvestments, strategic +alliances andother collaborations containp otentially +increased financial, legal,reputational, operational, +regulatorya nd/or compliancer isks.W em ay be +dependent onjointv enture partners,f irms with which +we collaborate, controllingshareholders or +management whom ay have businessinterests, +strategies or goals that areinconsistentw ith ours. +Such dependencies, particularly in thecaseo f +establishing de novojointv entures, mayd elay the +launcho fanewv enture andr esulti nt he loss of a +market opportunity.B usinessd ecisions or other +actions or omissions ofthej oint venturepartner,t he +firmsw ith whichw ec ollaborate, controlling +shareholders or management maya dverselya ffect the +valueo fo ur investment (or, in thecaseo fs trategic +alliances or othercollaborations,t he valueofo ur +products or services), impact our resultso f +operations,r esulti nl itigationo rr egulatorya ction +againstu sa nd otherwisedamageo ur reputationa nd +brand. +Additional Risks +Ourb usinessesm ay benegativelya ffected by +adverse events,p ublicity,g overnments crutinyo r +otherr eputationalh arm. +We aresubject to reputational, legal,compliancea nd +regulatoryr iski nthe ordinarycourse of our business. +Harm to our reputationc an result fromn umerous +sources,i ncluding adversep ublicity or negative +information, whethero rnot true,a rising from events +occurring at BNYM ellon, otherfinancial institutions +or in thefinancial markets, perceivedf ailure to +comply with legaland regulatoryr equirementso r +deliver appropriatestandardso fs ervice andquality, +or af ailure to appropriately describe our productsand +services,h ow we addresse nvironmental, social and +sustainability concerns in our businessactivitieso ri n +our relationships with clients, thep urported +inappropriate or unlawfulactions of ouremployees or +theu se of social mediab yo ur employees,t he +consequences of usingemergingt echnologies,s uch +as generativea rtificiali ntelligence or blockchain +technology, allegedf inancial reportingi rregularities +involving ourselvesor otherlarge andw ell-known +companiesa nd perceivedconflicts of interest.F or +example, ac ybersecurity eventi mpactingu so ro ur +customers’ data couldh avean egativei mpact on our +reputationa nd customer confidence in BNYM ellon +ando ur cybersecurity defenses andbusiness +continuity andr esiliencyc apabilities. Ourr eputation +coulda lsob eh armedb ythe failure of an affiliate, +jointv enture or av endor or otherthird partyw ith +whichw ed ob usinesst oc omplyw ith laws or +regulations.O ur reputationm ay be significantly +damagedb yadversep ublicity or negativei nformation +regardingB NY Mellon, whethero rnot true,t hatm ay +be publishedorb roadcastb yt he mediao rp ostedo n +social media, non-mainstream news servicesor other +internet forums.T he speed andpervasiveness with +whichi nformation, misinformationo rr umorsc an be +disseminated through thesec hannels,i nparticular +social media, maym agnify risksrelatingt onegative +publicity or medias crutiny. Damage to our +reputationc oulda ffect thec onfidence of clients, +Risk Factors (continued) +BNYM ellon1 05 +The secret object #1 is a "table". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_123.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_123.txt new file mode 100644 index 0000000000000000000000000000000000000000..337c808849ddad61215328f7655f5d321c5887fe --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_123.txt @@ -0,0 +1,104 @@ +ratinga gencies, regulators, employees,s tockholders +ando ther stakeholders andc ouldi nturnh avea n +impact on our businessand results of operations. +Additionally,g overnmental scrutinyf romr egulators, +taxa uthorities, legislativeb odiesa nd law +enforcementa genciesw ith respect to financial +services companieshas remained at elevatedlevels. +Pressc overage ando ther public statements,i ncluding +informationp ostedo nsocialm edia or otherinternet +forums,t hata llege some form of wrongdoing +(including, in some cases,p ress coverage andp ublic +statements thatdo not directly involveBNYM ellon) +oftenr esulti ns omet ype ofinvestigationo ri n +lawsuits.C ertain enforcementa uthoritiesh ave +recently requireda dmissions ofwrongdoing, andi n +some cases,c riminal pleas,a sp arto ft he resolution of +matters brought bythem againstfinancial institutions. +Anys uchr esolutiono famatteri nvolving BNY +Mellonc ouldl eadt oincreased exposuretoc ivil +litigation, coulda dverselya ffect our reputationa nd +ability todo businessinc ertain products andi n +certain jurisdictions andc ouldh aveo ther negative +effects. +ESGc oncerns,i ncluding climate change,c ould +adversely affect ourb usiness, affect clientactivity +levels, subjectus to additionalr egulatory +requirements andd amage ourreputation. +Globale ffortst om itigatec limate damage,s upport +climate adaptation, slow thel osso fb iodiversen atural +ecosystems, andp romote otherE SG causesa nd +standardsh avel ed andare likelyt ocontinue to lead +to newl egislativea nd regulatoryr equirements, +heightened expectationsamongr egulatorsa nd +supervisors, andc hangesi nc onsumers’ and +businesses’ behaviorsa nd businesspreferences.A sa +result, we mayf ace heightened regulatory, legala nd +reputationals crutinyi nthe U.S.,t he E.U. ando ther +jurisdictions in whichw eo perate,a nd our business +andf inancial conditionm ay be adverselyi mpacted. +Theg overnmental andsupervisoryf ocus onthesea nd +otherE SG-related issues hasr esulteda nd could +continue to result inour becomings ubject to newo r +heightened regulatory requirementsors upervisory +guidance, such asrequirementsr elatingt orisk +management,o perationalr esiliencyo rs tresst esting +forv arious climate stress scenarios,or additional, +potentially costly,r eportingr equirements. In +particular,f inancial institutions havecome under +increased scrutinyr egarding them anagementa nd +disclosure of climate risks, bothd irectly and +indirectly,a nd newregulations maye xpand required +disclosure of actuala nd potentialc limate-related +impact on suppliers,c lientsa nd otherthird partiesi n +our valuechain.F or example, in October2 023, the +FederalR eserve,t he OCCa nd theF DICj ointly +issued interagencyg uidancef or largef inancial +institutions,i ncluding BNYM ellon, on principlesfor +climate-relatedf inancial risk management and +Californiae nacted threec limate-relatedb ills +imposinge xtensive newclimate-relatedd isclosure +obligations applicable to companiesd oing businessi n +California. In addition, in March2 022, theS EC +proposed expansiveclimate-relatedd isclosurer ules. +Anys uchn ew or heightenedrequirementsc ould +result inincreased regulatory, compliance or other +costso rh igherc apitalr equirements, andm ay subject +us to diverginga nd evolving requirementsi nt he +various jurisdictions in whichw eo perate.M oreover, +we mayf ace conflictingE SG anda nti-ESGi nitiatives +froml ocal,s tate andn ationalg overnmentst hatm ay +impact our abilityt oconductc ertain businessw ithin +thosej urisdictions. +OurI nvestment Management lineo fb usinesso ffersa +range ofsolutionsa nd advice forp rofessionala nd +personali nvestors to betterm anager isk-adjusted +returnsa nd, wherea pplicable,a chieve their +sustainablei nvestment goalsandi nvest responsibly. +Certainl awmakers andp ublic officialsh ave +suggested that ESG-relatedi nvestingp ractices may +result inviolations ofantitrustl awsa nd breachesof +fiduciary duty. In addition, we face compliancerisks +presentedb ythe SEC’sr ecenta doptiono fn ew +namingc onventions forE SG-relatedf unds ando ther +regulations that areintendedt oaddress +“greenwashing” that mayb ep romulgated in the +future.W eh avei nt he pastbeen,a nd mayi nthe +future become,s ubject to enforcementa ctions bythe +SECa nd otherregulatorsr egarding ourESG +investingp ractices.G overnmental enforcement +actionc oulda lsol ead to civill itigationc laims by +clients, fund shareholders ando ther thirdp arties +assertingv iolations oflawo rb reaches of fiduciary +dutiesa nd contractualo bligations. +Further, as some regulatorss eek to mandate +additionald isclosureo fc limate-relatedi nformation, +our ability tocomply with such requirementsa nd to +conductm orer obustc limate-relatedr iska nalyses +mayb eh amperedb ylack of informationa nd reliable +data.C limate data,p articularly greenhouseg as +emissions forc lientsa nd direct andindirect +counterparties, mayb el imitedi navailability,b ased +on estimatedo ru nverified figures, whichmay have +Risk Factors (continued) +106 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_124.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_124.txt new file mode 100644 index 0000000000000000000000000000000000000000..e7812e276888471eeeb2303f6708843b8de0e6bc --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_124.txt @@ -0,0 +1,104 @@ +been derivedf romi nformationo rf actorsr eleasedb y +third-partys ources,c ollected andreportedo nalag, +andv ariablei nq uality.M oreover, them ethodologies +ands tandardsu sedt omeasurea nd reports uchd ata +ares till inearly stages,r apidly evolving ands ubject +to change.I na ddition, modelingc apabilitiest o +analyzec limate-related risksr emaini ncompletea nd +therec an be noassurancet hata ccurate predictive +toolso rc apabilitiesw ill be developed. Thesea nd +otherf actorsc ould cause resultst od ifferm aterially +fromt hosee xpressedi nthe estimatesa nd beliefs +made bythirdp artiesa nd by us,which couldalso +impact our management ofrisk in thisarea andcould +result inus amending orrestatingo ur sustainability +targetso rb aselines,i ncluding thoser elated to +greenhouseg as emissions,carbon neutrality, +diversiono fw aste from landfills,p aper neutrality and +waterc onsumption. +In thet ransitiont oalowc arbon economy, changesi n +public policy, regulatory environment, stakeholder +preferences,m arketp ressures andadvancements in +technology maya ffect our businesspractices or result +in additionalc osts or otheradversec onsequences to +our businessoperations.S uchc hangesc oulda ffect +whethera nd onwhat termsa nd conditions we will +engage in certain activitieso ro fferc ertain products +or services.F ailure to adequately consider transition +risksi nd eveloping ande xecutingo nour business +strategy couldl eadt oaloss of market share, lower +revenues, decreased assetvaluesa nd highercredit +costs. +Viewsa boutE SG ared iverse andc hanging, ando ur +business, reputationa nd ability toattract andretain +clientsa nd employees mayb eh armedi fo ur actions +arep erceivedt obei neffective, insufficiento r +otherwisei nappropriate,o ri fwe areu nablet o +achieve ourstated objectives andcommitments. +Moreover, our reputationm ay be damagedasaresult +of ourassociationw ith certain industries,individuals +or productsperceivedt obec ausing orexacerbating +climate change orcontributingt oother ESGi ssues, as +well as anydecisions we make to continue to conduct +or change ouractivitiesi nr esponset oc onsiderations +relatingt oclimatec hange or otherESG issues.A t +thes amet ime,c ertain financiali nstitutions havealso +been subject to criticisma nd negativep ublicity as a +result of theird ecisions to reducet heir involvementin +certain industriesorp rojectsp erceivedt obec ausing +or exacerbatingc limate change orcontributingt o +otherE SG issues.F urther,p olitical pressure mayb e +placed upon governmental clientsnot to usec ertain +providers,s ucha su s, if thelegislators or +governmental officialsi ns uchj urisdictions believe +our positionsaren ot consistent with theviews of +such legislatorso ro fficials. Thec ontinuously +evolving societal andpolitical perspectives on ESG +make theu ltimatei mpact on us difficult topredict, +identifya nd monitora nd mayb ed etrimental to us. +Impacts from geopoliticalevents,a ctso ft errorism, +naturald isasters, thep hysicale ffectso fc limate +change,p andemicsa nd others imilare vents may +have an egativei mpacto no ur business and +operations. +In conductingo ur businessand maintaininga nd +supporting our globaloperations,w hich includes +clients, counterparties, vendorsa nd otherthird +parties, we ares ubject to riskso fl ossf romt he +outbreak of war, escalationo rc ontinuationo f +hostilities, globalc onflicts,a ctso ft errorism,n atural +disasters, thep hysical effectsofc limate change, +pandemicsa nd othersimilarc atastrophice ventst hat +couldh avean egativei mpact on our businessand +operations.W em ay alsobe impacted by unfavorable +political,e conomic,l egal or otherdevelopments, +including social or politicalinstability,c hangesi n +governmental policieso rp olicieso fc entral banks, +sanctions,e xpropriation, nationalization, confiscation +of assets,p rice, capitala nd exchange controls,t he +imposition oftariffso ro ther limitations on +internationalt rade andt ravel, whichc ouldd isrupt +worldt rade andl ead to traderetaliation, andc hanges +in laws andr egulations. +Fore xample,a saresult of Russia’s invasion of +Ukrainei nt he firstq uarter of 2022,we ceased +originatingn ew banking businessinR ussiaa nd +suspendedi nvestment management purchasesof +Russian securities. An escalationo rc ontinuationo f +hostilities, thei mpositiono fa dditionals anctions or +otherl awsp rohibitingo rl imitingo perations in +certain jurisdictions oran elevatedvolumea nd +complexity of cyberattacksa saresult of thec onflict +in Ukraine, or conflicts or tensions in otherr egions +such astheM iddleE ast, couldl ead to unexpected +disruptions to our businessesand coulda dversely +affect theg lobale conomya nd financialm arkets +generally,d iminishl evelso fe conomic activity and +increasev olatility incommodity prices,c redita nd +capitalm arkets.T he extent andd urationo fa ny such +military action, andt he responses to such actionb y +governments, central banks andt he markets, are +difficult topredicta nd maym agnify thei mpact of +otherr isks describedi nthiss ection. +RiskF actors (continued) +BNYM ellon1 07 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_125.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_125.txt new file mode 100644 index 0000000000000000000000000000000000000000..7509975153290fcf76e93456adcdf95157225559 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_125.txt @@ -0,0 +1,105 @@ +Ouro perations,b usiness, clients, supplychain and +others takeholders,a sw ella st he finances ector and +theg lobale conomy, couldb ea dverselya ffected by +thep hysical manifestations ofclimate change. +Climate-relatedp hysical risksi nclude thei ncreased +frequencyo rs everity of acute weathere vents, such as +hurricanes,f loods,h eatwavesa nd wildfires, and +chronics hiftsi nt he climate,s ucha si ncreases in +averageg lobalt emperatures, rising seal evels, +persistent changesi np recipitationl evels, prolonged +drought,f ood andw ater insecurity,a nd anyr esulting +populationm igration. Such changescouldh ave +adversef inancial,o perationala nd otherimpactso n +us,b othd irectly on our business,operations and +employees,a nd indirectly as ar esulto fi mpactst oo ur +clients, vendorsa nd otherthird partieso nw hich we +rely or as ar esulto fm arketv olatility.C limate +change risksc an alsolead to ad eteriorationi nour +credit risk exposures,f or example, in our wealth +management mortgage andc ommercialr eal estate +portfolios. Ourh eadquartersi slocated in NewY ork +near theH udson Riverw aterfront.S uchl ocationa nd +thel ocationo fo ur otherpropertiesm ay subject us to +more frequent orsevere weathere vents, whichcould +lead to declines in theassetv alueso fo ur properties +andt he reduced availabilityor increased costof +insurance. +While we have businesscontinuity andd isaster +recovery plansi np lace, catastrophicevents, whether +or notcausedb yclimate change,c ouldd amageo ur +facilities, disrupt or delayfor prolongedperiods +normalb usinesso perations (including +communications,t echnology andp hysical accesst o +our facilities),o rr esulti nh armt oo rc ause travel +limitations on ouremployees,w ith as imilari mpact +on ourclients, suppliersandc ounterparties. +Notwithstanding oureffortst om aintainb usiness +continuity andd isasterr ecovery plans, to theextenta +catastrophice vent occursando ur remote work +arrangementsf ailo ra re otherwisei mpaired, our +ability toservicea nd interact with our clientsm ay +suffer. If we areu nablet oi mplement andm aintain +remote work arrangements, including, fore xample, +because of an internal or external failure of our +informationt echnology infrastructure or increased +rateso fe mployeei llnesso ru navailability,o ur +businessc ontinuity status wouldb ea dversely +impacted andthere wouldb ead isruptiont oour +businesses. +Catastrophicevents, including thosec ausedb y +climate change,c oulda lson egativelyi mpact the +purchaseo fo ur productsands ervices if thoseevents +result inreduced capitalm arkets activity,l ower asset +pricel evels, or disruptionsin generale conomic +activity,o ri nf inancial market settlement functions, +whichc ouldn egativelyi mpact our businessand +results of operations.I na ddition, such catastrophic +events maylead,a nd in some cases have led, to +higherm arketv olatility,r educed availabilityor +increased costof insurancef or ourclients, as well as +an increasei nd elinquencies, bankruptcies or defaults +that couldresulti no ur experiencing higherlevelso f +non-performinga ssets,n et charge-offsandp rovisions +forc reditl osses, negativelyi mpactingo ur business +ando perations.F urthermore,w ei nvest in renewable +energy projects, whichhaveb een andmay in the +future be adverselya ffected by extremew eather +events,n atural disastersa nd othercatastrophice vents. +Taxl aw changeso rchallenges to ourt ax positions +with respect to historical transactions maya dversely +affect ourn et income,e ffectivet ax rate ando ur +overallr esults of operationsandf inancial condition. +In thec ourse of our business,we receive inquiries +andc hallengesf romb othU .S.a nd non-U.S.tax +authoritieso nt he amount oftaxesw eo we.I fw ea re +not successful in defending thesei nquiries and +challenges, wemayb er equiredt oadjustt he timing +or amount oftaxablei ncomeo rd eductions orthe +allocationo fi ncomea mong taxj urisdictions,a ll of +whichc an require ag reater provision fort axes or +otherwisen egativelya ffect earnings.P robabilities +ando utcomesa re reviewed as eventsunfold, and +adjustmentst ot he reserves aremade, when +necessary,b ut ther eservesm ay prove inadequate +because wecannot necessarilyaccurately predictt he +outcome of anyc hallenge,s ettlement orlitigationo r +thee xtentt ow hich it will negativelya ffect us or our +business. Future taxl awso rt he expirationo fo r +changesi ne xistingt ax laws,o rt he interpretationo f +thosel awsw orldwide,c oulda lsoh aveam aterial +impact on our businessorn et income.O ur actions +takeni nresponset o, orrelianceu pon, such changes +in thet ax laws mayi mpact our taxp ositioni na +mannert hatm ay result in lowerearnings.I n +addition, uponanyc hange in taxlaw,w em ust +recognize thee ffect of thec hange on our deferredtax +assets andl iabilities. An increasei nt he U.S. taxr ate +wouldl ikelyr esulti na nincreasei no ur netdeferred +taxl iabilitiesa nd ar eductioni nour netincomei nt he +period ofenactment ofthec hange.I na ddition, +changesi nt ax rateso rt ax lawc oulda lsoi mpact the +method anda mount ofcapitalt hatw er eturnt o +shareholders.S ee Note 12 oftheN otes to +RiskF actors (continued) +108 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_126.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_126.txt new file mode 100644 index 0000000000000000000000000000000000000000..801256333b8fbb2f50761a1a92687d0fa307e587 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_126.txt @@ -0,0 +1,67 @@ +Consolidated FinancialS tatementsf or further +information. +Changesi na ccountings tandards governingthe +preparationo fo ur financials tatementsa nd future +events couldh aveamaterial impacto no ur reported +financialc ondition, results of operations,cashf lows +ando ther financiald ata. +From time to time,the FinancialA ccounting +StandardsB oard (“FASB”),the SECa nd bank +regulatorsc hange thef inancial accountinga nd +reportings tandardsg overningt he preparationofo ur +financials tatementso rt he interpretationo ft hose +standards. Thesec hangesa re difficult topredicta nd +can materially impacthow we record andr eporto ur +financialc ondition, results of operations,cashf lows +ando ther financiald ata. In some cases,t he FASB, +theS EC andb ankr egulatorsm ay changefinancial +accountinga nd reportings tandardsg overningt he +preparationo fo ur financials tatementso rt he +interpretationo ft hoses tandardst hatm ay require us +to applyanewo rr evised standard retrospectively, +potentially resultingi nthe restatemento fo ur prior +period financials tatementsa nd ourrelated +disclosures. +Additionally,o ur accountingp oliciesa nd methods are +fundamental to how we record andr eporto ur +financialc onditiona nd results of operations.T he +preparationo ff inancial statements inconformity with +U.S. GAAP requires management to makeestimates +basedu pon assumptions andu se judgments and +models about future economic andm arketc onditions, +whicha ffect reporteda mountsa nd relatedd isclosures +in our financials tatements. Amountss ubject to +estimatesa re itemss ucha st he allowancef or credit +losses, goodwill ando ther intangibles andlitigation +andr egulatoryc ontingencies. Amongo ther effects, +such changesine stimatesc ouldr esulti nf urther +impairments of goodwillandi ntangiblea ssets and +establishmento fa llowances forc reditl ossesa swell +as litigationa nd regulatoryc ontingencies. In +performingo ur annuala nd interimg oodwill +impairmentt ests,w em ay usea ni ncomea pproach to +estimate thef airv alueso fe ach reportingu nit. +Estimatedc ashf lows used in thei ncomea pproach are +basedo nmanagement’sp rojections.E stimatedc ash +flowse xtendf ar into thefuture, and, bytheirn ature, +ared ifficult toestimate overs ucha nextendedt ime +frame.F actorst hatm ay significantly affect thec ash +flow estimatesi nclude,a mong others,marketv alues +of assets we manage,t he levela nd mix of those +assets,c ustomerb ehaviors anda ttrition, operating +margins, changesi nr evenue growth trends,certain +moneym arketf ee waiver practices,c osts tructures +andt echnology, regulatorya nd legislativec hanges, +specifici ndustryo rm arkets ector conditions, +competitiona nd changesi ni nterestr ates.I nt he +future,s mall changesi nt he assumptions,s ucha s +changesi nt he cashf lowe stimates,d iscount rate or +long-term growth rate,o raprolonged +macroeconomic downturnm ay produceam aterial +non-cashg oodwill impairment. If actualo r +subsequent events occurt hata re materially different +than thea ssumptions,j udgments ande stimatesw e +used,o ur results of operationmay be materially and +negativelyi mpacted. +Risk Factors (continued) +BNYM ellon1 09 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_127.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_127.txt new file mode 100644 index 0000000000000000000000000000000000000000..f1b871bd1bcdd8e1eb4b8f08ea23abd368ac6f60 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_127.txt @@ -0,0 +1,81 @@ +Thef ollowing accountingg uidancei ssued by FASB +hasn ot yetbeen adopted asof Dec. 31, 2023. +AccountingS tandards Update( “ASU”) 2023-02, +Investments—Equity Method andJointV entures +(Topic3 23):A ccountingf or Investments inTax +Credit Structures Usingt he Proportional +AmortizationM ethod +In March2 023, theF ASBi ssued ASU2 023-02, +Accountingf or Investments inTaxC reditS tructures +Usingt he Proportional AmortizationM ethod,w hich +permits reportinge ntitiest oe lect to account fort heir +taxe quity investments,regardless of thet ax credit +program fromw hich thei ncomet ax creditsare +received, usingthe proportionala mortizationm ethod +if certain conditions arem et.U ndert he proportional +amortizationm ethod, an entityamortizes thei nitial +cost of thei nvestment in proportiont othe income tax +credits ando ther income taxbenefits received, and +recognizes then et amortizationa nd income tax +credits ando ther income taxbenefits in theincome +statementa sacomponent of thep rovision fori ncome +taxes. +We will adopt then ew standard as of Jan. 1, 2024 on +ar etrospectiveb asis foro ur investmentsi nr enewable +energy projectsthath avem et thee ligibility criteria. +When we reporto ur 2024results,t he comparative +results for2 023 and2 022 will be updatedt oreflect +thea pplicationo ft he requirementso ft he new +standard to theseperiods.W ed on ot expect the +impact to our consolidated restated neti ncomeo r +earnings pershare for 2022and2 023 to be material. +We estimate thatthei mpact of adoptingt hiss tandard +will result inan after-taxdecreaset or etained +earnings through Dec. 31, 2023 ofapproximately +$100 million, butthat impact is expected to be +recoveredt hrough positiveimpactst on et income +overf uturep eriods.B ased on ourcurrent investment +portfolio,w ee stimate theimpact of adoptingt hisn ew +guidancet oi ncreasei nvestment ando ther revenue +andt he provisionfori ncomet axes on the +consolidated income statementb y$ 40 milliont o$50 +millionp er quarter in 2024. +Priort oJ an 1, 2024,thesei nvestmentsg enerated +lossesi ni nvestment ando ther revenue that were +more than offset by benefitsandc redits recorded to +thep rovision fori ncomet axes. +ASU2 023-07, SegmentReporting( Topic2 80): +Improvements toReportableS egment Disclosures +In November 2023, theF ASBi ssuedA SU 2023-07, +Improvements toReportableS egment Disclosures, +whichr equiresapublic entity todisclose,o na n +annuala nd interimb asis,s ignificants egment +expenses that areregularly providedt othe chief +operatingd ecision maker( “CODM”) andincluded +within each reportedm easureo fs egment profitor +loss (collectivelyr eferredt oast he “significant +expensep rinciple”).I na ddition, disclosurewill be +requiredo ft he title andp osition ofCODM,a nd how +theC ODM uses ther eportedm easureo fs egment +profit or loss in assessing segmentp erformance and +deciding howto allocater esources. +This ASUi seffectivef or annualp eriods beginning +afterD ec. 15, 2023with early adoptionp ermitted. +BNYM elloni sc urrently evaluatingt hisg uidancea nd +thei mpact on theb usinesss egment disclosures. +ASU2 023-09, Income Taxes (Topic7 40): +Improvements toIncome TaxD isclosures +In December2 023, theF ASBi ssuedA SU 2023-09, +Improvements toIncome TaxD isclosures,w hich +requiresacompanyt od isclose, on an annualbasis, +additionald isaggregated informationr elated to the +existingd isclosures fort he effectivei ncomet ax rate +reconciliationa nd income taxespaid. +This ASUi seffectiveo naprospectiveb asis,w ith a +retrospectiveo ption, fora nnualp eriods beginning +afterD ec. 15, 2024,andi nterim periods within fiscal +yearsb eginning afterD ec. 15, 2025. BNYM elloni s +currently evaluatingt hisg uidancea nd thei mpact on +thei ncomet ax disclosures. +RecentA ccounting Developments +110 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_128.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_128.txt new file mode 100644 index 0000000000000000000000000000000000000000..c1dc9cc77c8b704ab983677a1f1ee056b06eaeb4 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_128.txt @@ -0,0 +1,78 @@ +Explanationo fG AAP andN on-GAAP +financialm easures +BNYM ellonh as includedi nthisA nnualR eport +certain Non-GAAP financialm easures on at angible +basisa sasupplementt oG AAP information, which +exclude goodwillandi ntangiblea ssets,n et of +deferredt ax liabilities. We believe that ther eturno n +tangiblec ommone quity – Non-GAAP is additional +useful informationf or investorsb ecause it presents a +measureo ft hosea ssetst hatc an generate income,and +thet angibleb ook valueper commons hare –N on- +GAAP is additionalu sefuli nformationb ecause it +presents thelevel of tangiblea ssets inrelationt o +shares of commons tock outstanding. +BNYM elloni ncludedr evenue measures excluding +notable items,including an et loss fromr epositioning +thes ecuritiesp ortfolio,t he reductioni nthe fair value +of ac ontingent considerationr eceivabler elated to a +priory ear divestiture,d isposal gainsa nd lossesa nd +ther evenue reductionr elated to Russia, primarily +accelerated amortizationo fd eferredc osts for +depositary receiptsservices.E xpensem easures, +excluding notable items,including goodwill +impairment, FDIC special assessment,severance +expensea nd litigationr eserves, area lsop resented. +Litigationr eservesr epresent accruals forl oss +contingenciest hata re bothp robablea nd reasonably +estimable, but exclude standard business-relatedl egal +fees.I ncomeb eforet axes,n et income applicable to +commons hareholderso fT he Bank ofNewY ork +MellonC orporation, dilutedearnings pershare,r eturn +on commone quity,r eturno ntangiblec ommon +equity,p re-tax operatingm argina nd effectivet ax +rate,e xcluding then otable items mentionedabove, +area lsop rovided. Thesem easures areprovidedt o +permit investorstov iewt he financialm easures on a +basisc onsistent with how management viewsthe +businesses. +Thep resentationo ft he growthrateso fi nvestment +management andp erformance fees andnoninterest +expenseo naconstant currencyb asis permits +investorst oa ssess thes ignificance of changesi n +foreignc urrencye xchange rates. Growth rateso na +constant currencyb asis were determined by applying +thec urrent periodforeignc urrencye xchange ratest o +thep rior periodrevenue.W eb elieve that this +presentation, as as upplementt oG AAP information, +givesi nvestorsaclearer pictureo ft he relatedr evenue +results without thev ariability causedb yfluctuations +in foreignc urrencye xchange rates. +BNYM ellonh as alsoincludedt he adjusted pre-tax +operatingm argin – Non-GAAP,w hich is thep re-tax +operatingm arginf or theI nvestment andW ealth +Management businesssegment,n et of distribution +ands ervicing expenset hatw as passedt othird parties +whod istributeo rs ervice our managedf unds.W e +believe that this measureisu sefulw hene valuating +thep erformance of theI nvestment andW ealth +Management businesssegment relativet oi ndustry +competitors. +Forward-lookingN on-GAAP financialm easures +From time totime we mayp resent or discuss +forward-looking Non-GAAP financialm easures,s uch +as targetsf or expenses excluding notable items.W e +areu nablet op rovide ar econciliationo ff orward- +looking Non-GAAP financialm easures to the +comparable GAAP financialm easures because weare +unablet op rovide,w ithout unreasonableeffort,a +meaningful oraccurate estimationo fa mountst hat +wouldb en ecessary forthe reconciliatione ffort,a +meaningful oraccurate calculation orestimationo f +amountst hatw ouldb en ecessary forthe +reconciliationd ue to thei nherent difficulty +quantifying future amountso rw hent heym ay occur. +Such unavailablei nformationc ouldb es ignificantt o +future results. +SupplementalI nformation (unaudited) +BNYM ellon1 11 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_129.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_129.txt new file mode 100644 index 0000000000000000000000000000000000000000..a8b701ec8f4efcef319e6590a7f52d133443df99 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_129.txt @@ -0,0 +1,51 @@ +Reconciliation ofNon-GAAP measures,e xcluding notableitems 2023 vs. +(dollars in millions) 2023 2022 2022 +Totalr evenue –G AAP $1 7,502 $1 6,377 7% +Less: Reductioni nthe fair valueo facontingent considerationr eceivabler elated to a +priory ear divestiture (a) (144) — +Disposal (loss) gain (a) (6) 26 +Revenue reductionr elated to Russia, primarily accelerated amortization of +deferredc osts ford epositary receiptsservices (b) — (88) +Netl ossf romr epositioning thes ecuritiesp ortfolio (a) — (449) +Adjusted totalr evenue –N on-GAAP $1 7,652 $1 6,888 5% +Totaln onintereste xpense –G AAP $1 3,295 $1 3,010 2% +Less: Severance (c) 267 215 +Litigationr eserves (c) 94 134 +FDIC special assessment(c) 632 — +Goodwill impairment — 680 +Adjusted totaln onintereste xpense–Non-GAAP $1 2,302 $1 1,981 2.7% (d) +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York Mellon +Corporation–G AAP $3 ,051 $2 ,362 29% +Less: Reductioni nthe fair valueo facontingent considerationr eceivabler elated to a +priory ear divestiture (a) (144) — +Disposal (loss) gain (a) (5) (12) +Revenue reductionr elated to Russia, primarily accelerated amortization of +deferredc osts ford epositary receiptsservices (b) — (67) +Netl ossf romr epositioning thes ecuritiesp ortfolio (a) — (343) +Severance (c) (205) (166) +Litigationr eserves (c) (91) (125) +FDIC special assessment(c) (482) — +Goodwill impairment — (665) +Adjusted neti ncomea pplicable tocommons hareholders of TheB anko fN ew York +MellonC orporation–N on-GAAP $3 ,978 $3 ,740 6% +Dilutede arnings pershare –G AAP $3 .87 $2 .90 33% +Less: Reductioni nthe fair valueo facontingent considerationr eceivabler elated to a +priory ear divestiture (a) (0.18) — +Disposal (loss) gain (a) (0.01) (0.01) +Revenue reductionr elated to Russia, primarily accelerated amortization of +deferredc osts ford epositary receiptsservices (b) — (0.08) +Netl ossf romr epositioning thes ecuritiesp ortfolio (a) — (0.42) +Severance (c) (0.26) (0.20) +Litigationr eserves (c) (0.12) (0.15) +FDIC special assessment(c) (0.61) — +Goodwill impairment — (0.82) +Totald ilutede arnings percommons hare impact of notable items $( 1.18) $( 1.69) (e) +Adjusted dilutede arnings pershare –N on-GAAP $5 .05 $4 .59 10% +(a)R eflected in Investmenta nd otherrevenue. +(b)P rimarily reflected in Investments ervices fees. +(c)S everancei sr eflected in Staffe xpense,L itigationr eserves in Othere xpense,a nd FDIC special assessmentinB ank assessmentcharges, +respectively. +(d)T he growthrate wasn ot significantly impactedbyc hangesi nf oreign currencye xchange rates. +(e)D oesn ot foot dueto rounding. +SupplementalI nformation (unaudited) (continued) +112 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_13.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_13.txt new file mode 100644 index 0000000000000000000000000000000000000000..4acf2a344958d94a5589e699ac13f919187cf41f --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_13.txt @@ -0,0 +1,62 @@ +XIBNY MELLON +POWER +OUR +CUL TURE +While we focus on being more for +our clients and running our company +better, everything we do depends on +our people, and it is important that +BNY Mellon is a place where people +are proud to work and excited to +grow their careers. Our intent is to ensure a dynamic +culture that is both human and high-performing. +Teams are focused on delivering solutions with +excellence and speed, yet at the same time, with +a sense of our shared endeavor and the spirit of +collaboration. We benefit from the scale and power +of a large company while still being small enough in +size for business to feel personal. +Others also recognize us for this special culture. +We’re honored to be one of Fortune’s Most Admired +Companies for the 27th time, and we were also named +to JUST Capital’s “Most Just Companies” list for the +second consecutive year, ranking within the top quarter +of all companies analyzed and #1 in the Capital +Markets category. +• Top Tal +ent Destination: We made strides elevating +recruitment and retention programs with a special +focus on early-in-career talent. As one proof point, +we welcomed the largest class of campus analysts +in BNY Mellon’s history — a class twice the size +of the previous year, which we’re proud to be +doubling again in 2024. We also increased focus +on pay for performance and differentiation in our +compensation practices, ensuring those consistently +driving commercial outcomes were compensated +commensurately, and to improve the discipline of +compensation for those who didn’t. +• Eleva ting Experiences and Sense of Belonging: +We want our people to feel excited and +supported coming to work every day, thriving +in an environment where they can be true to +themselves. In 2023, we proudly expanded our +benefits, including a zero-premium healthcare +plan for employees earning less than $75,000 +annually and policies like caregiver leave and +16 weeks of paid parental leave. We also launched +a new Wellbeing Support Program to provide more +targeted, personalized and quicker access to +mental health services. +• Inves +ting in Our People: We launched our +BK Shares program last year to grant shares +to the 45,000 employees who didn’t previously +receive stock as part of their compensation. +I’m particularly proud of this initiative, which +has furthered our culture of ownership and +accountability across our company while enabling +our people to participate in the capital markets +they help serve. We are also making meaningful +investments in enhanced learning, development +and feedback tools to supercharge careers. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_130.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_130.txt new file mode 100644 index 0000000000000000000000000000000000000000..eded5ce6d6b55a10910b5bdd57999b5755028d30 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_130.txt @@ -0,0 +1,40 @@ +Thef ollowing tablep resentst he reconciliationo fn onintereste xpensee xcluding notable itemsandc hangesi n +foreignc urrencye xchange rates. +Nonintereste xpense reconciliation,e xcluding notableitems andt he impact of changes +in foreign currency exchangerates 2022 vs. +(dollars in millions) 2022 2021 2021 +Totaln onintereste xpense –G AAP $1 3,010 $1 1,514 13% +Less: Severance (a) 215 31 +Litigationr eserves (a) 134 98 +Goodwill impairment 680 — +Impact of changesi nf oreign currency exchange rates — 292 +Adjusted totaln onintereste xpense, excluding notable itemsandi mpact of changesi n +foreigne xchange rates– Non-GAAP $1 1,981 $1 1,093 8% +(a)S everancei sr eflected in Staffe xpense and Litigationr eserves in Othere xpense,r espectively. +Thef ollowing tablep resentst he reconciliationo ft he pre-taxoperatingm argin. +Pre-taxo perating margin reconciliation +(dollars in millions) 2023 2022 +Income before taxes–GAAP $4,088 $3 ,328 +Less: Impact of notable items(a) (1,143) (1,540) +Adjusted income before taxes, excludingn otable items–N on-GAAP $5 ,231 $4 ,868 +Totalr evenue –G AAP $17,502 $1 6,377 +Less: Impact of notable items(a) (150) (511) +Adjusted totalr evenue,e xcluding notable items–N on-GAAP $17,652 $1 6,888 +Pre-taxo peratingm argin–G AAP (b) 23% 20% +Adjusted pre-taxo peratingm argin– Non-GAAP (b) 30% 29% +(a)S ee page 112ford etails of notableitems and linei tems impacted. +(b)I ncomeb eforet axes dividedb yt otal revenue. +Thef ollowing tablep resentst he reconciliationo fe ffectivet ax rate. +Effectivet ax rate reconciliation +(dollars in millions) 2022 +Provision fori ncomet axes -G AAP $7 68 +Less: Impact of notable items(a) (162) +Adjusted provision fori ncomet axes,e xcluding notable items–N on-GAAP $9 30 +Income before taxes–GAAP $3 ,328 +Less: Impact of notable items(a) (1,540) +Adjusted income before taxes, excludingn otable items–N on-GAAP $4 ,868 +Effectivet ax rate –G AAP 23.1% +Adjusted effectivetax rate –N on-GAAP 19.1% +(a)S ee page 112ford etails of notableitems and linei tems impacted. +SupplementalI nformation (unaudited) (continued) +BNYM ellon1 13 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_131.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_131.txt new file mode 100644 index 0000000000000000000000000000000000000000..938a2f90677412768016c285742e284bf60e3003 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_131.txt @@ -0,0 +1,48 @@ +Thef ollowing tablep resentst he reconciliationo ft he return on commone quity andt angiblec ommone quity. +Return on commone quity andt angiblec ommone quityr econciliation +2023 2022 2021(dollars in millions) +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York Mellon +Corporation–G AAP $3 ,051 $2 ,362 $3 ,552 +Add: Amortizationo fi ntangiblea ssets 57 67 82 +Less: Taxi mpact of amortizationo fi ntangiblea ssets 14 16 20 +Adjusted neti ncomea pplicable tocommons hareholders of TheB anko fN ew York Mellon +Corporation, excluding amortizationo fi ntangiblea ssets –N on-GAAP $3 ,094 $2 ,413 $3 ,614 +Less: Impact of notable items(a) (927) (1,378) (85) +Adjusted neti ncomea pplicable tocommons hareholders of TheB anko fN ew York Mellon +Corporation, excluding amortizationo fi ntangiblea ssets andn otable items–N on-GAAP $4 ,021 $3 ,791 $3 ,699 +Averagec ommons hareholders’e quity $3 5,880 $3 6,175 $3 9,695 +Less: Averageg oodwill 16,204 17,060 17,492 +Averagei ntangiblea ssets 2,880 2,939 2,979 +Add: Deferredt ax liability –t ax deductible goodwill 1,205 1,181 1,178 +Deferredt ax liability –i ntangiblea ssets 657 660 676 +Averaget angiblec ommons hareholders’e quity –N on-GAAP $1 8,658 $1 8,017 $2 1,078 +Return on commons hareholders’e quity –G AAP 8.5% 6.5% 8.9% +Adjusted return on commons hareholders’e quity –N on-GAAP 11.1% 10.3% 9.2% +Return on tangiblec ommons hareholders’e quity –N on-GAAP 16.6% 13.4% 17.1% +Adjusted return on tangiblec ommons hareholders’e quity –N on-GAAP 21.6% 21.0% 17.6% +(a)S ee page 112ford etails of notableitems and linei tems impacted in 2023 and 2022.Notablei tems in 2021 include litigationr eserves, +severancee xpense and gains on disposals(reflected in investmentand otherrevenue). +Thef ollowing tablep resentst he reconciliationo fb ook valueand tangibleb ook valueper commons hare. +Book valueandt angibleb ook value percommons hare reconciliation Dec. 31, +(dollars in millions,e xceptp er sharea mountsa nd unlessotherwise noted) 2023 2022 2021 +BNYM ellons hareholders’e quity at year end–G AAP $4 0,874 $4 0,734 $4 3,034 +Less: Preferreds tock 4,343 4,838 4,838 +BNYM ellonc ommons hareholders’e quity at year end–G AAP 36,531 35,896 38,196 +Less: Goodwill 16,261 16,150 17,512 +Intangiblea ssets 2,854 2,901 2,991 +Add: Deferredt ax liability –t ax deductible goodwill 1,205 1,181 1,178 +Deferredt ax liability –i ntangiblea ssets 657 660 676 +BNYM ellont angiblec ommons hareholders’e quity at year end–N on-GAAP $1 9,278 $1 8,686 $1 9,547 +Year-end commons hareso utstanding (int housands) 759,344 808,445 804,145 +Book valueper commonshare –G AAP $4 8.11 $4 4.40 $4 7.50 +Tangibleb ook valueper commonshare –N on-GAAP $2 5.39 $2 3.11 $2 4.31 +Thef ollowing tablep resentst he impact of changesi nf oreign currencye xchange rateso no ur consolidated +investment management andp erformance fees. +Constant currency reconciliation –C onsolidated 2023 vs. +(dollars in millions) 2023 2022 2022 +Investment management andp erformance fees –G AAP $3 ,058 $3 ,299 (7)% +Impact of changesi nf oreign currency exchange rates — (4) +Adjusted investment management andp erformance fees –N on-GAAP $3 ,058 $3 ,295 (7)% +SupplementalI nformation (unaudited) (continued) +114 BNYM ellon +The secret vegetable is "broccoli". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_132.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_132.txt new file mode 100644 index 0000000000000000000000000000000000000000..847f28254d32036b706268b05f0ed40de1eede53 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_132.txt @@ -0,0 +1,42 @@ +Thef ollowing tablep resentst he impact of changesi nf oreign currencye xchange rateso ni nvestment management +andp erformance fees reportedi nthe Investment andW ealth Management businesssegment. +Constant currency reconciliation – Investment andW ealthM anagement businesssegment 2023 vs. +(dollars in millions) 2023 2022 2022 +Investment management andp erformance fees – GAAP $3 ,052 $3 ,290 (7)% +Impact of changesi nf oreign currency exchange rates— (4) +Adjusted investment management andp erformance fees –N on-GAAP $3 ,052 $3 ,286 (7)% +Thef ollowing tablep resentst he reconciliationo ft he pre-taxoperatingm arginf or theI nvestment andW ealth +Management businesssegment. +Pre-taxo perating margin reconciliation – Investment andW ealth +Management businesssegment +2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Income before income taxes–GAAP $3 81 $4 8$ 1,230 694% (96)% +Less: Reductioni nthe fair valueo facontingent considerationr eceivabler elated +to ap rior yeardivestiture (a) (144) — — +Disposal (loss) (a) — (11) (1) +Revenue reductionr elated to Russia (b) — (6)— +Severance (c) (19) (12) — +Litigationr eserves (c) (1) —( 4) +Goodwill impairment — (680) — +Adjusted income before income taxes–Non-GAAP $5 45 $7 57 $1 ,235 (28)% (39)% +Totalr evenue –G AAP $3 ,143 $3 ,550 $4 ,042 +Less: Distributiona nd servicinge xpense 355 345 300 +Adjusted totalr evenue,n et of distributionand servicinge xpense–Non-GAAP $2 ,788 $3 ,205 $3 ,742 +Less: Reductioni nthe fair valueo facontingent considerationr eceivabler elated +to ap rior yeardivestiture (a) (144) —— +Disposal (loss) (a) — (11) (1) +Revenue reductionr elated to Russia (b) — (6)— +Adjusted totalr evenue,e xcluding notable itemsandn et of distributionand +servicinge xpense–Non-GAAP $2 ,932 $3 ,222 $3 ,743 +Pre-taxo peratingm argin–G AAP (d) 12% 1% 30% +Adjusted pre-taxo peratingm argin, netofd istributiona nd servicinge xpense– +Non-GAAP (d) 14% 2% 33% +Adjusted pre-taxo peratingm argin, netofd istributiona nd servicinge xpensea nd +excluding notable items–N on-GAAP (d) 19% 24% 33% +(a)R eflected in Investmenta nd otherrevenue. +(b)P rimarily reflected in Investmentm anagement and performancefees. +(c)S everancei sr eflected in Staffe xpense and Litigationr eserves in Othere xpense. +(d)I ncomeb eforet axes dividedb yt otal revenue. +SupplementalI nformation (unaudited) (continued) +BNYM ellon1 15 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_133.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_133.txt new file mode 100644 index 0000000000000000000000000000000000000000..71e07b515a2bc97f67e9c2aa4c89e7610b2ac51c --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_133.txt @@ -0,0 +1,63 @@ +Rate/volumea nalysis +Rate/volumea nalysis (a) 2023 over(under) 2022 2022 over(under) 2021 +Duet oc hangei n Duet oc hange in +(inm illions) +Average +balance +Average +rate +Net +change +Average +balance +Average +rate +Net +change +Interestr evenue +Interest-earning assets: +Interest-bearingd eposits with theFederal Reservea nd othercentral banks: +Domestic offices $2 89 $1 ,986 $2 ,275 $( 1) $7 51 $7 50 +Foreigno ffices (31) 1,278 1,247 25 321 346 +Totali nterest-bearingd eposits with theFederal Reservea nd other +central banks 258 3,264 3,522 24 1,072 1,096 +Interest-bearingd eposits with banks (50) 352 302 (11) 184 173 +Federalf unds sold ands ecuritiesp urchased underr esalea greements 57 5,884 5,941 (17) 1,097 1,080 +Loans: +Domestic offices (99) 1,884 1,785 137 849 986 +Foreigno ffices (15) 147 132 (7)6 25 5 +Totall oans (114) 2,031 1,917 130 911 1,041 +Securities: +U.S. government obligations (123) 537 414 54 292 346 +U.S. government agency obligations (65) 603 538 (125) 297 172 +Others ecurities: +Domestic offices (b) (65) 239 174 (17) 259 242 +Foreigno ffices (18) 559 541 (18) 49 31 +Totalo ther securities (b) (83) 798 715 (35) 308 273 +Totali nvestment securities (b) (271) 1,938 1,667 (106) 897 791 +Tradings ecurities( primarily domestic) (b) 16 156 172 (14) 104 90 +Totals ecurities (b) (255) 2,094 1,839 (120) 1,001 881 +Totali nterestr evenue (b) $( 104) $1 3,625 $1 3,521 $6 $4 ,265 $4 ,271 +Intereste xpense +Interest-bearingl iabilities: +Interest-bearingd eposits: +Domestic offices $1 17 $3 ,606 $3 ,723 $2 $1 ,005 $1 ,007 +Foreigno ffices (87) 1,901 1,814 12 743 755 +Totali nterest-bearingd eposits 30 5,507 5,537 14 1,748 1,762 +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements 824 4,941 5,765 19 37 938 +Tradingl iabilities (1)8 98 8 35 76 0 +Otherb orrowedf unds: +Domestic offices 30 73 7 —2 2 +Foreigno ffices —1 1 1( 2) (1) +Totalo ther borrowedf unds 30 83 8 1— 1 +Commercialp aper —— — —— — +Payables to customersa nd broker-dealers (28) 438 410 —1 58 158 +Long-term debt 125 726 851 26 442 468 +Totali ntereste xpense $9 80 $1 1,709 $1 2,689 $4 5$ 3,342 $3 ,387 +Changesi nn et interest revenue (b) $( 1,084) $1 ,916 $8 32 $( 39) $9 23 $8 84 +(a)C hangesw hich ares olelyd ue to balancec hangeso rratec hangesa re allocatedt osuchc ategorieso nt he basisof ther espectivep ercentage changesi n +average balancesand averagerates. Changesi ni nterestr evenue orinterest expense arisingf romt he combinationo fr atea nd volume variances are +allocatedp roportionatelyt or atea nd volume based on theirr elativea bsolutem agnitudes. +(b)P resented on anFTEb asis. +SupplementalI nformation (unaudited) (continued) +116 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_134.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_134.txt new file mode 100644 index 0000000000000000000000000000000000000000..aacfaad2b3d6ba2f7370d987b277c379eccd1312 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_134.txt @@ -0,0 +1,103 @@ +Some statements in thisAnnualR eporta re forward- +looking. Thesei nclude statements about the +usefulness of Non-GAAP measures,t he future results +of BNYM ellon, our businesses,financial, liquidity +andc apitalc ondition, results of operations,liquidity, +risk andc apitalm anagementa nd processes,goals, +strategies,o utlook, objectives,expectations +(including thoser egarding our performanceresults, +expenses,n onperforminga ssets,p roducts,i mpactso f +currencyf luctuations,i mpactso fs ecuritiesp ortfolio +repositioning, impactso ft rends on our businesses, +regulatory, technology, market,e conomic or +accountingd evelopments andt he impactso fs uch +developments on our businesses,legalp roceedings +ando ther contingencies),human capitalm anagement +(including relateda mbitions,o bjectives,a ims and +goals), effectivet ax rate,n et interest revenue, +estimates( including thoser egarding expenses,l osses +inherent in our credit portfoliosa nd capitalr atios), +intentions (including thoser egarding ourcapital +returnsa nd expenses,i ncluding ourinvestmentsi n +technology andp ension expense),t argets, +opportunities, potentiala ctions,g rowtha nd +initiatives. +In this report, anyo ther report, anyp ress releaseo r +anyw ritteno ro rals tatement that BNYM ellono ri ts +executives maym ake, words, such as “estimate,” +“forecast,”“ project,” “anticipate,”“ likely,” “target,” +“expect,” “intend,” “continue,” “seek,” “believe,” +“plan,” “goal,”“ could,” “should,” “would,” “may,” +“might,” “will,”“ strategy,” “synergies,” +“opportunities,”“ trends,” “ambition,” “aspiration,” +“objective,”“ aim,”“ future,” “potentially,” “outlook” +andw ords ofsimilarm eaning, mays ignify forward- +looking statements. +Thesef orward-looking statements,a nd otherforward- +looking statements containedi nother public +disclosureso fB NY Mellon,aren ot guaranteesof +future resultsor occurrences,are inherently uncertain +anda re basedu pon currentb eliefs ande xpectations +of future events,m anyo fw hich are,by theirn ature, +difficult topredict, outside of ourcontrola nd subject +to change.B yi dentifying theses tatementsi nt his +manner, we area lertingi nvestorst ot he possibility +that our actualr esults maydiffer, possiblym aterially, +fromt he anticipated results expressedo ri mpliedi n +thesef orward-looking statements as ar esulto fa +numbero fimportant factors, including thosef actors +describedi n“Risk Factors,”s ucha s: +•e rrors or delaysin our operationaland transaction +processing, orthoseo ft hird parties, may +materially adverselya ffect our business,financial +condition, resultso fo perations andr eputation; +•o ur risk management framework,m odels and +processesm ay not beeffectivei ni dentifying or +mitigatingr iska nd reducingt he potentialf or +lossesa nd anyi nadequacy or lapsei no ur risk +management framework,m odels andp rocesses +coulde xposeu st ou nexpected losses that could +materially adverselya ffect our results of +operations orfinancialc ondition; +•a communications ortechnology disruptiono r +failure within our infrastructureo rt he +infrastructureo ft hird partiest hatr esults inal oss +of information, delays ourability to access +informationo ri mpactso ur ability toprovide +services to our clientsm ay materially adversely +affect our business,financialc onditiona nd +results of operations; +•a cybersecurity incident,orafailurei no ur +computer systems, networks andi nformation, or +thoseo ft hird parties, couldr esulti nt he theft, +loss, disclosure,u se or alterationo fi nformation, +unauthorized accesst oo rl osso fi nformation, or +system or networkfailures. Anys uchi ncidento r +failure coulda dverselyi mpact our ability to +conducto ur businesses,damage ourreputation +andc ause losses; +•w ea re subject to extensiveg overnment +rulemaking, policies,regulationa nd supervision +that impact our operations.C hangest oa nd +introductiono fn ew rulesa nd regulations have +compelled, andi nthe future mayc ompel, us to +change howwe manage our businesses, which +couldh aveam ateriala dversee ffect on our +business, financialc onditiona nd results of +operations; +•r egulatoryo re nforcementa ctions orlitigation +couldm aterially adverselya ffect our results of +operations or harmour businessesorr eputation; +•o ur businessmay be adverselya ffected if we are +unablet oa ttract,r etain, developand motivate +employees; +•a failure or circumventiono fo ur controls, +policiesa nd procedures couldhaveam aterial +adversee ffect on our business,financial +condition, resultso fo perations andr eputation; +•w eakness andv olatility infinancialm arkets and +thee conomyg enerally maymaterially adversely +affect our business,financialc onditiona nd +results of operations; +Forward-lookingS tatements +BNYM ellon1 17 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_135.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_135.txt new file mode 100644 index 0000000000000000000000000000000000000000..ce995895fc46a8393fcd6233eff76f6dddaf27f4 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_135.txt @@ -0,0 +1,105 @@ +•w ea re dependent onfee-basedb usinessf or a +substantialm ajority of ourrevenue ando ur fee- +basedr evenuesc ouldb ea dverselya ffected by +slowingm arketa ctivity,w eak financialm arkets, +underperformance and/or negativet rends in +savings rateso ri ni nvestment preferences; +•l evelso fa nd changesi ni nterestr ates have +impacted,a nd will in thefuturec ontinue to +impact,o ur profitability andc apitall evels, at +timesa dversely; +•w eh avee xperienced,a nd mayc ontinue to +experience, unrealized or realized losseso n +securitiesr elated to volatile andi lliquidm arket +conditions,r educingo ur capital levels and/or +earnings; +•r eformo fi nterestr ateb enchmarksa nd theu se of +alternativer eference ratesb yu sa nd ourclients +coulda dverselya ffect our business,financial +conditiona nd results of operations; +•t he failure or perceivedweakness of anyo fo ur +significantc lientso rc ounterparties, many of +whom arem ajor financiali nstitutions or +sovereigne ntities, ando ur assumptiono fc redit, +counterpartya nd concentrationr isk, coulde xpose +us to credit losses andadverselya ffect our +business; +•w ec ouldi ncur losses if our allowancef or credit +losses, includingl oana nd lending-related +commitment reserves,i si nadequate or if our +expectations offuture economic conditions +deteriorate; +•o ur business,financialc onditiona nd results of +operations couldb ea dverselya ffected if we do +not effectivelym anageo ur liquidity; +•f ailure to satisfyr egulatorys tandards, including +“wellc apitalized”a nd “wellm anaged”s tatuso r +capitala dequacy andliquidity rulesm ore +generally,c ouldr esulti nl imitations on our +activitiesa nd adverselya ffect our businessand +financialc ondition; +•t he Parent is an on-operatingh olding company +and, as ar esult, isdependent on dividendsfrom +its subsidiaries andextensions ofcredit fromi ts +IHCt om eet its obligations,i ncluding with +respect to itssecurities, andt oprovide funds for +sharer epurchases,p ayment ofincome taxesand +paymento fd ividends to itsstockholders; +•o ur ability toreturn capitalt os hareholders is +subject to thediscretiono fo ur Boardo fD irectors +andm ay be limitedb yU.S.b anking laws and +regulations,i ncluding thoseg overningc apitala nd +capitalp lanning, applicable provisions of +Delaware lawa nd ourfailuret op ay full and +timely dividends on our preferredstock; +•a ny material reductioni nour credit ratings orthe +credit ratings of our principalbanks ubsidiaries, +TheB anko fN ew York Mellon,B NY Mellon, +N.A. or TheB anko fN ew York MellonS A/NV, +couldi ncreaset he cost of funding andb orrowing +to us ando ur rateds ubsidiaries andhavea +material adverseeffect on our business,financial +conditiona nd results of operationsando nthe +valueo ft he securitiesw ei ssue; +•t he applicationo fo ur Title Ip referredr esolution +strategy orresolution underthe Title II orderly +liquidationa uthority coulda dverselya ffect the +Parent’s liquiditya nd financialc onditiona nd the +Parent’s security holders; +•n ew lines of business,newp roducts ands ervices +or transformationalo rs trategic project initiatives +subject us to newo ra dditionalr isks,a nd the +failure to implementthese initiatives couldaffect +our results of operations; +•w ea re subject to competitioni nall aspectso fo ur +business, whichcouldn egativelya ffect our +ability to maintain or increaseo ur profitability; +•o ur strategict ransactions presentrisks and +uncertaintiesa nd couldh avea na dversee ffecto n +our business,financialc onditiona nd results of +operations; +•o ur businessesmay be negativelya ffected by +adversee vents, publicity,g overnment scrutinyo r +otherr eputationalh arm; +•E SG concerns,i ncluding climate change,c ould +adverselya ffect our business,affect client +activity levels,subject us to additionalr egulatory +requirementsa nd damage ourreputation; +•i mpactsf romg eopolitical events,actso f +terrorism,n atural disasters, thep hysical effectso f +climate change,p andemicsa nd othersimilar +events mayhavean egativei mpact on our +businessa nd operations; +•t ax lawc hangeso rc hallengest oo ur taxp ositions +with respect to historical transactions may +adverselya ffect our netincome, effectivetax rate +ando ur overallresults of operationsandf inancial +condition; and +•c hangesi na ccountings tandardsg overning the +preparationo fo ur financials tatementsa nd future +events couldh aveam ateriali mpact on our +reportedf inancial condition, resultso fo perations, +cashf lows ando ther financiald ata. +Forward-lookingS tatements (continued) +118 BNYM ellon +The secret currency is a "dollar". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_136.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_136.txt new file mode 100644 index 0000000000000000000000000000000000000000..b74b30efa2104dd3e698cee21160cb95bded6bb3 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_136.txt @@ -0,0 +1,15 @@ +Investorss houldn ot placeundue relianceo na ny +forward-looking statementa nd shouldc onsider all +risk factorsd iscussed in the2023 AnnualR eporta nd +anys ubsequent reports filedw ith theSEC by BNY +Mellonp ursuantt ot he Exchange Act. Allf orward- +looking statements speak onlya so ft he dateon which +such statements arem ade, andBNY Mellon +undertakes no obligationt oupdate anys tatement to +reflect eventsor circumstances afterthe dateon +whichs uchf orward-looking statementi sm adeo rt o +reflect theo ccurrenceo fu nanticipated events.T he +contents of BNYM ellon’sw ebsite or anyo ther +website referenced herein aren ot partof this report. +Forward-lookingS tatements (continued) +BNYM ellon1 19 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_137.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_137.txt new file mode 100644 index 0000000000000000000000000000000000000000..cc4090bac358e7fb135726851941a27be8953711 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_137.txt @@ -0,0 +1,73 @@ +Assets under custodyand/or administration +(“AUC/A”) –A ssets thatwe holdd irectly or +indirectly on behalfof clientsu nderasafekeepingo r +custody arrangement orforw hich we provide +administratives ervices forc lients. Thef ollowing +typeso fa ssets undera dministrationa re not and +historically have not beenincludedi nAUC/A: +performance andriska nalytics, transfer agency and +asseta ggregations ervices.T ot he extent that we +provide more than one AUC/A servicef or ac lient’s +assets,t he valueoft he asseti so nlyc ounted oncei n +thet otal amount ofAUC/A. +Assets under management (“AUM”) –I ncludes +assets beneficially ownedb your clientso rc ustomers +whichw eh oldi nvarious capacitiest hata re either +activelyo rp assively managed,as well as thev alue of +hedgess upportingc ustomerl iabilities. Thesea ssets +andl iabilitiesa re not on our balancesheet. +CAMELS –A ninternationalb ank-ratings ystem +whereb anks upervisorya uthoritiesr atei nstitutions +accordingt osix factors. Thes ix factorsa re Capital +adequacy,A ssetq uality,M anagementq uality, +Earnings,L iquidity andS ensitivity to marketrisk. +Collateralm anagement –Acomprehensivep rogram +designedt osimplifyc ollateralizationa nd expedite +securitiest ransfersf or buyersands ellers. +Credit valuation adjustment(“CVA”) –T he +market valueo fc ounterpartyc reditr isko nOTC +derivativet ransactions. +Debitv aluation adjustment(“DVA”) –T he market +valueo fo ur credit risk on OTCd erivative +transactions. +Depositary receipt–Anegotiables ecurity that +generally represents an on-U.S. company’sp ublicly +traded equity. +Economiccapital –T he amount ofcapitalr equired +to absorb potentiall ossesa nd reflectst he probability +of remainings olvent with at argetd ebtr atingo vera +one-year time horizon. +Globals ystemically importantb ank( “G-SIB”) –A +financiali nstitutionw hosed istresso rd isorderly +failure,b ecause of its size,c omplexity ands ystemic +interconnectedness, wouldcause significant +disruptiont othe widerf inancial system ande conomic +activity. +High-qualityl iquida ssets (“HQLA”)– +Unencumbered assetsof thet ypesi dentifiedi nthe +U.S. LCRr ule, whicht he U.S. banking agencies +describe as ableto be convertible into cashw ith little +or noexpected loss of valueduringaperiod of +liquidity stress. +Investment grade –R epresentsM oody’sl ong-term +ratingo fB aa3 or better; and/or aS tandard &P oor’s, +Fitcho rD BRS long-term rating ofBBB- or better; or +if unrated,a nequivalent rating usingour internal risk +ratings.I nstruments that fall belowt hese levels are +considered to be non-investment grade. +Real estate investment trust( “REIT”) –A n +investor-owned corporation,trusto ra ssociationt hat +sells shares to investorsa nd investsi ni ncome- +producingp roperty. +Repurchasea greement( “Repo”) –A ninstrument +used to raises hort-term fundswherebys ecuritiesa re +sold with an agreementfor thes ellert ob uy backthe +securitiesa talaterd ate. +Reverser epurchasea greement –T he purchaseo f +securitiesw itht he agreementt os ellt hema tahigher +pricea taspecificf utured ate. +Sub-custodian –Alocal provider( e.g., ab ank) +contracted to provide specificc ustodial-related +services in as elected countryor geographicarea. +Glossary +120 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_138.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_138.txt new file mode 100644 index 0000000000000000000000000000000000000000..edc8fe9f890d0aa7e575ce7ee1f2c2e7ce85b990 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_138.txt @@ -0,0 +1,27 @@ +Management ofBNYM elloni sr esponsible for +establishing andm aintaining adequate internal control +overf inancial reportingf or BNYM ellon, as such +term is definedi nRule1 3a-15(f) undert he Exchange +Act. +BNYM ellon’sm anagement, includingits principal +executiveo fficer andprincipal financialo fficer,h as +assessedt he effectivenesso fB NY Mellon’sinternal +controlo verf inancial reportinga so fD ecember3 1, +2023. In making this assessment, management used +thec riterias et forthb ythe Committeeo fS ponsoring +Organizations oftheT readwayC ommission in +Internal Control–Integrated Framework( 2013). +Basedu pon such assessment, management believes +that,a so fD ecember3 1, 2023,B NY Mellon’s +internal controloverf inancial reportingi se ffective +basedu pon thosec riteria. +KPMG LLP,t he independent registered public +accountingf irmt hata uditedB NY Mellon’s2023 +financials tatementsi ncludedi nthisA nnualR eport +under“ FinancialS tatements” and“ Notest o +Consolidated FinancialS tatements,”h as issued a +reportw ith respect to theeffectivenesso fB NY +Mellon’si nternalc ontrolo verf inancial reporting. +This reportb eginso np age1 22. +Reporto fManagemento nI nternalC ontrolO verF inancial Reporting +BNYM ellon1 21 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_139.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_139.txt new file mode 100644 index 0000000000000000000000000000000000000000..09bf2eef9fb4f430b3193fb1084b87ea05f66ce6 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_139.txt @@ -0,0 +1,47 @@ +Report of Independent Registered Public Accounting Firm +To theS hareholdersa nd Boardo fD irectors +TheB ank ofNewY orkM ellonC orporation: +Opiniono nInternal ControlO verF inancial Reporting +We havea uditedT he Bank ofNew York MellonCorporation andsubsidiaries’( BNYM ellon) internal controlo ver +financialr eporting as ofDecember 31, 2023,based oncriteria established in Internal Control–Inte grated +Framework( 2013) issued bytheC ommitteeo fS ponsoringO rganizations oftheT readway Commission. In our +opinion, BNYM ellonm aintained, in allm aterialr espects,e ffective internal controlo verf inancialr eporting as of +December 31, 2023,based oncriteria established in Internal Control–Inte grated Framework( 2013) issued bythe +Committeeo fS ponsoringO rganizations ofthe Treadway Commission. +We also havea udited, in accordancew itht he standards oftheP ublic CompanyAccountingO versight Board( United +States)( PCAOB),t he consolidated balancesheetso fB NY Mellona so fD ecember 31, 2023 and 2022,the related +consolidated statementso fi ncome, comprehensivei ncome, cash flows, and changes in equity foreacho ft he years +in thet hree-year period endedDecember 31, 2023,and ther elated notes(collectively, thec onsolidated financial +statements),a nd ourreportd ated February2 8, 2024, expresseda nunqualifiedo pinion onthosec onsolidated +financials tatements. +Basisf or Opinion +BNYM ellon’sm anagement is responsible form aintaining effectivei nternal controlo verf inancialr eporting andfori ts +assessment ofthee ffectivenesso fi nternal controlo verf inancialr eporting, included in thea ccompanyingR eporto f +Management onInternal ControlO verF inancial Reporting.O ur responsibilityi stoe xpress an opinion onBNY +Mellon’si nternalc ontrolo verf inancialr eporting based on our audit.We areap ublic accountingf irmr egistered with +theP CAOB and arerequiredt ob eindependent withr espectt oB NY Melloni naccordancew itht he U.S. federal +securities laws and thea pplicabler ules andregulations oftheS ecuritiesa nd Exchange Commission andthe +PCAOB. +We conductedo ur auditina ccordancew itht he standards oftheP CAOB.T hoses tandards require that we plan and +perform thea uditt oo btainr easonable assurancea bout whether effectivei nternal controlo verf inancialr eporting +wasm aintained in allm aterialr espects.O ur audito finternal controlo verf inancialr eporting included obtaining an +understanding ofinternal controlo verf inancialr eporting, assessingther iskt hat am aterialw eaknesse xists, and +testinga nd evaluatingt he designand operatingeffectiveness of internal controlb ased onthea ssessedr isk. Our +audita lsoi ncluded performing such otherp rocedures aswe considered necessaryin thec ircumstances.W e +believe that our auditprovidesareasonable basis foro ur opinion. +Definition and Limitations ofInternalC ontrolO verF inancialR eporting +Ac ompany’s internal controlo verf inancialr eporting is ap rocess designed to provider easonablea ssurance +regarding ther eliabilityo ff inancialr eporting andthep reparationo ff inancials tatementsf or external purposesin +accordancew ithg enerallya ccepteda ccountingp rinciples. Ac ompany’s internal controlo verf inancialr eporting +includes thosep oliciesa nd proceduresthat (1)p ertain to them aintenanceo fr ecords that,i nr easonabled etail, +accurately and fairly reflectt he transactions and dispositions ofthea ssets of thec ompany;( 2) providereasonable +assurancet hat transactions are recorded as necessaryto permitp reparationo ff inancials tatementsi na ccordance +withg enerally accepted accountingprinciples, and that receipts and expenditureso ft he company arebeing made +onlyi na ccordancew itha uthorizations ofmanagement and directorsoft he company;a nd (3)p rovide reasonable +assurancer egarding preventiono rt imelyd etection of unauthorized acquisition, use, or dispositionoft he company’s +assets that couldh aveam ateriale ffecto nt he financials tatements. +122 BNYM ellon +KPMG LLP +345 +Park Avenue +New York, NY 10154-0102 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_14.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_14.txt new file mode 100644 index 0000000000000000000000000000000000000000..481cc5751a4ee36890d23424530c01f12a243905 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_14.txt @@ -0,0 +1,12 @@ +XII ANNUAL REPORT 2023 +Increased participation in fi nancial markets benefi ts everyone, drives +growth and expands economies. Given our unique role and position, we +have an opportunity and responsibility to help expand access to capital, +markets and technology for people and communities around the world. +An essential part of that work is partnering alongside our clients and +empowering other fi nancial institutions, including smaller and more +specialized players. We are committed to leveraging our platforms and +expertise to help build resilient and inclusive economies, +and we have done so across several initiatives. +COMMUNITY SOLUTIONS +AND SUSTAINABILITY \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_140.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_140.txt new file mode 100644 index 0000000000000000000000000000000000000000..a11896a5d622f53d99aad3383a96dedb6b421d20 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_140.txt @@ -0,0 +1,7 @@ +Becauseo fi ts inherent limitations,i nternal controlo verf inancialr eporting mayn ot prevent or detectmisstatements. +Also,p rojections of anyevaluationo fe ffectivenesst of uturep eriods aresubjectt ot he risk that controls may +becomei nadequateb ecauseo fc hangesi nc onditions,o rt hat thed egree ofcompliancew itht he policieso r +procedures mayd eteriorate. +NewY ork, NewY ork +February2 8, 2024 +BNYM ellon1 23 diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_141.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_141.txt new file mode 100644 index 0000000000000000000000000000000000000000..fe8ac02065a84fa3c3a7af198f26ba2e915ca3a3 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_141.txt @@ -0,0 +1,43 @@ +Consolidated Income Statement +Investment services fees $8 ,843 $8 ,529 $8 ,284 +Investment management andp erformance fees 3,058 3,299 3,588 +Foreigne xchanger evenue 631 822 799 +Financing-relatedf ees 192 175 194 +Distributiona nd servicingf ees 148 130 112 +Totalf ee revenue 12,872 12,955 12,977 +Investment ando ther revenue 285 (82) 336 +Totalf ee andother revenue 13,157 12,873 13,313 +Neti nterestr evenue +Interest revenue 20,648 7,118 2,845 +Interest expense 16,303 3,614 227 +Neti nterestr evenue 4,345 3,504 2,618 +Totalr evenue 17,502 16,377 15,931 +Provision forc redit losses 119 39 (231) +Nonintereste xpense +Staff 7,095 6,800 6,337 +Software ande quipment 1,817 1,657 1,478 +Professional, legaland otherpurchased services 1,527 1,527 1,459 +Neto ccupancy 542 514 498 +Sub-custodian andclearing 475 485 505 +Distributiona nd servicing 353 343 298 +Business development 183 152 107 +Bank assessmentc harges 788 126 133 +Goodwill impairment — 680 — +Amortizationo fi ntangiblea ssets 57 67 82 +Other 458 659 617 +Totaln onintereste xpense 13,295 13,010 11,514 +Income +Income before income taxes 4,088 3,328 4,648 +Provision fori ncomet axes 800 768 877 +Neti ncome 3,288 2,560 3,771 +Net( income)l ossa ttributable tononcontrollingi nterests relatedt oconsolidated investment +management funds (2) 13 (12) +Neti ncomea pplicable toshareholders of TheB anko fN ew York Mellon Corporation 3,286 2,573 3,759 +Preferreds tock dividends (235) (211) (207) +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York +MellonC orporation $3 ,051 $2 ,362 $3 ,552 +Year endedDec. 31, +(inm illions) 2023 2022 2021 +Feea nd otherr evenue +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +124 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_142.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_142.txt new file mode 100644 index 0000000000000000000000000000000000000000..35de818337af2d9f833366612909eae07ad2834e --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_142.txt @@ -0,0 +1,26 @@ +Consolidated Income Statement (continued) +Neti ncomea pplicable to commons hareholders of TheB anko fN ew York Mellon +Corporationu sedf or thee arningsp er sharec alculation Year endedDec. 31, +(inm illions) 2023 2022 2021 +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York MellonC orporation $3 ,051 $2 ,362 $3 ,552 +Less: Earnings allocated to participatings ecurities — —2 +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York MellonC orporation +afterr equireda djustment fort he calculationo fb asic andd iluted earnings percommons hare $3 ,051 $2 ,362 $3 ,550 +Average commons hares ande quivalents outstanding of TheB anko fN ew York +MellonC orporation Year endedDec. 31, +(int housands) 2023 2022 2021 +Basic 784,069 811,068 851,905 +Commons tock equivalents 3,821 3,904 4,900 +Less: Participatingsecurities (92) (177) (446) +Diluted 787,798 814,795 856,359 +Anti-dilutives ecurities (a) 1,334 3,142 642 +(a)R epresentss tock options,r estricteds tock units and participatingsecuritieso utstanding but notincludedi nthe computationo fd iluted +average commons hares becauset heir effect wouldb ea nti-dilutive. +Earnings pers hare applicable to commons hareholders of TheB anko fN ew York +MellonC orporation Year endedDec. 31, +(ind ollars) 2023 2022 2021 +Basic $3 .89 $2 .91 $4 .17 +Diluted $3 .87 $2 .90 $4 .14 +Seea ccompanyingN otes to Consolidated FinancialStatements. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +BNYM ellon1 25 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_143.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_143.txt new file mode 100644 index 0000000000000000000000000000000000000000..93b720aa612df121599dac7b87509bc52a0b8aec --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_143.txt @@ -0,0 +1,28 @@ +Consolidated ComprehensiveI ncomeS tatement +Year endedDec. 31, +(inm illions) 2023 2022 2021 +Neti ncome $3 ,288 $2 ,560 $3 ,771 +Otherc omprehensive income (loss),n et of tax: +Foreignc urrencyt ranslationa djustments 272 (603) (376) +Unrealized gain (loss) on assets available-for-sale: +Unrealized gain (loss) arisingd uringt he period 829 (3,245) (1,147) +Reclassificationa djustment 52 338 (4) +Totalu nrealized gain (loss) on assets available-for-sale 881 (2,907) (1,151) +Definedb enefit plans: +Net( loss) gain arisingd uringt he period (75) (306) 219 +Foreigne xchange adjustment (1) —— +Amortizationo fp rior servicec redit, netl ossa nd initialo bligationi ncludedi nnet periodicb enefit +cost (10) 56 88 +Totald efined benefitp lans (86) (250) 307 +Netu nrealized gain (loss) on cashf lowh edges 6 (6)( 6) +Totalo ther comprehensiveincome( loss),n et of tax (a) 1,073 (3,766) (1,226) +Totalc omprehensive income (loss) 4,361 (1,206) 2,545 +Net( income)l ossa ttributable tononcontrollingi nterests (2) 13 (12) +Otherc omprehensive loss (income) attributable tononcontrollingi nterests — 13 (2) +Comprehensivei ncome( loss) applicable toshareholders of TheB anko fN ew York Mellon +Corporation $4 ,359 $( 1,180) $2 ,531 +(a)O ther comprehensiveincome( loss) attributablet oT he Bank ofNewY orkM ellonC orporations hareholders was$ 1,073 millionf or the +yeare ndedD ec. 31, 2023,$ (3,753) millionf or they eare ndedD ec. 31, 2022 and $(1,228)millionf or they eare ndedD ec. 31, 2021. +Seea ccompanyingN otes to Consolidated FinancialStatements. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +126 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_144.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_144.txt new file mode 100644 index 0000000000000000000000000000000000000000..e890d3a9fc28c410cfd561fc8eb027039b0256b4 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_144.txt @@ -0,0 +1,59 @@ +Consolidated BalanceS heet +Dec. 31, +(dollars in millions,e xceptp er sharea mounts) 2023 2022 +Assets +Cash andd ue fromb anks,n et of allowancef or credit lossesof$ 18 and$ 29 $4 ,922 $5 ,030 +Interest-bearingd eposits with theFederal Reservea nd othercentral banks 111,550 91,655 +Interest-bearingd eposits with banks,n et of allowancef or credit lossesof$ 2a nd $4(includesr estrictedo f +$3,420 and$ 6,499) 12,139 17,169 +Federalf unds sold ands ecuritiesp urchased underr esalea greements 28,900 24,298 +Securities: +Held-to-maturity,a ta mortized cost,net of allowancef or credit lossesof$ 1a nd less than $1 (fair valueo f +$44,711 and$ 49,992) 49,578 56,194 +Available-for-sale, atfair value( amortized costof $80,678and$ 92,484,n et of allowancef or credit losseso f +less than $1 and$ 1) 76,817 86,622 +Totals ecurities 126,395 142,816 +Tradinga ssets 10,058 9,908 +Loans 66,879 66,063 +Allowancef or credit losses (303) (176) +Netl oans 66,576 65,887 +Premises andequipment 3,163 3,256 +Accruedi nterestr eceivable 1,150 858 +Goodwill 16,261 16,150 +Intangiblea ssets 2,854 2,901 +Othera ssets,n et of allowancef or credit lossesona ccountsr eceivableo f$ 3a nd $4(includes$ 1,261 and$ 971, at +fair value) 25,985 25,855 +Totala ssets $4 09,953 $4 05,783 +Liabilities +Deposits: +Noninterest-bearing( principally U.S. offices) $5 8,274 $7 8,017 +Interest-bearingd eposits inU.S. offices 132,616 108,362 +Interest-bearingd eposits innon-U.S. offices 92,779 92,591 +Totald eposits 283,669 278,970 +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements 14,507 12,335 +Tradingl iabilities 6,226 5,385 +Payables to customersa nd broker-dealers 18,395 23,435 +Otherb orrowedf unds 479 397 +Accruedt axes andother expenses 5,567 5,410 +Otherl iabilities( including allowancef or credit lossesonl ending-relatedc ommitmentso f$ 87 and$ 78, also +includes$ 195 and$ 221, at fair value) 8,844 8,543 +Long-term debt 31,257 30,458 +Totall iabilities 368,944 364,933 +Temporarye quity +Redeemable noncontrollingi nterests 85 109 +Permanente quity +Preferreds tock –p ar value$ 0.01 pershare;a uthorized 100,000,000 shares;i ssued 43,826 and4 8,826 shares 4,343 4,838 +Commons tock –p ar value$ 0.01 pershare;a uthorized 3,500,000,000 shares;i ssued 1,402,429,447 and +1,395,725,198 shares 14 14 +Additionalp aid-in capital 28,908 28,508 +Retained earnings 39,653 37,864 +Accumulatedo ther comprehensiveloss, neto ft ax (4,893) (5,966) +Less: Treasurys tock of 643,085,355and5 87,280,598 common shares,a tc ost (27,151) (24,524) +TotalT he Bank ofNewY orkM ellonC orporations hareholders’e quity 40,874 40,734 +Nonredeemable noncontrollingi nterests of consolidated investment management funds 50 7 +Totalp ermanent equity 40,924 40,741 +Totall iabilities, temporarye quity andp ermanent equity $4 09,953 $4 05,783 +Seea ccompanyingN otes to Consolidated FinancialStatements. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +BNYM ellon1 27 +The secret object #3 is a "fork". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_145.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_145.txt new file mode 100644 index 0000000000000000000000000000000000000000..6be1e7a714f0ab5fdb2f9c9212f43a81888c63df --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_145.txt @@ -0,0 +1,70 @@ +Consolidated Statemento fCash Flows +Year endedDec. 31, +(inm illions) 2023 2022 2021 +Operating activities +Neti ncome $3 ,288 $2 ,560 $3 ,771 +Net( income)l ossa ttributable tononcontrollingi nterests (2) 13 (12) +Neti ncomea pplicable toshareholders of TheB anko fN ew York MellonC orporation 3,286 2,573 3,759 +Adjustmentst or econcile neti ncomet on et cashprovidedb y(used for) operatinga ctivities: +Provision forc reditl osses 119 39 (231) +Pensionp lanc ontributions (6) (7) (6) +Depreciationa nd amortization 1,748 1,636 1,867 +Goodwill impairment — 680 — +Deferredt ax (benefit) (423) 155 257 +Nets ecuritiesl osses( gains) 68 443 (5) +Change in tradingassets andl iabilities 436 7,015 (1,898) +Change in accruals ando ther,n et 684 2,534 (905) +Netc ashp rovidedb yoperatinga ctivities 5,912 15,068 2,838 +Investinga ctivities +Change in interest-bearingdeposits with banks 1,943 1,540 1,225 +Change in interest-bearingdeposits with theFederal Reservea nd othercentral banks (18,730) 7,812 35,073 +Purchaseso fs ecuritiesh eld-to-maturity (341) (2,497) (8,921) +Paydowns ofsecuritiesh eld-to-maturity 4,675 7,168 11,339 +Maturitieso fs ecuritiesh eld-to-maturity 1,766 1,610 1,872 +Purchaseso fs ecuritiesa vailable-for-sale (23,422) (32,336) (54,239) +Saleso fs ecuritiesa vailable-for-sale 11,229 14,990 13,545 +Paydowns ofsecuritiesa vailable-for-sale 3,898 5,215 12,775 +Maturitieso fs ecuritiesa vailable-for-sale 19,748 11,573 17,221 +Netc hange in loans (801) 1,423 (11,350) +Saleso fl oans ando ther real estate 49 —1 +Change in federalf unds sold ands ecuritiesp urchased underr esalea greements (4,597) 5,294 1,233 +Netc hange in seed capitali nvestments 25 64 171 +Purchaseso fp remises andequipment/capitalized software (1,220) (1,346) (1,215) +Proceedsf romt he sale of premises andequipment — 45 34 +Acquisitions,n et of cash — —( 170) +Dispositions,n et of cash — 446 8 +Other, net (32) (1,127) 1,070 +Netc ash( used for) providedb yinvestinga ctivities (5,810) 19,874 19,672 +Financinga ctivities +Change in deposits 3,456 (37,009) (17,896) +Change in federalf unds purchased andsecuritiess oldu nderr epurchasea greements 2,148 790 418 +Change in payables to customersa nd broker-dealers (5,030) (1,488) 128 +Change in otherb orrowedf unds 73 (344) 397 +Netp roceedsf romt he issuance of long-term debt 6,487 9,929 5,186 +Repayments of long-term debt (6,059) (4,000) (4,650) +Proceedsf romt he exercise of stocko ptions — 95 0 +Issuance of commons tock 16 14 13 +Issuance of preferredstock — —1 ,287 +Treasurys tock acquired (2,604) (124) (4,567) +Preferreds tock redemption (500) —( 1,000) +Commonc ashd ividends paid (1,262) (1,165) (1,126) +Preferredc ashd ividends paid (225) (211) (197) +Amortizationo fp referreds tock discount 5 —1 0 +Other, net (24) (55) (15) +Netc ash( used for) financingactivities (3,519) (33,654) (21,962) +Effect of exchange rate changeso nc ash 230 358 (84) +Change in cash andd ue from banksa nd restrictedc ash +Change in casha nd duefromb anks andr estrictedc ash (3,187) 1,646 464 +Cash andd ue fromb anks andr estrictedc asha tb eginning of period 11,529 9,883 9,419 +Cash andd ue fromb anks andr estrictedc asha te nd of period $8 ,342 $1 1,529 $9 ,883 +Cash andd ue from banksa nd restrictedc ash +Cash andd ue fromb anks at endofp eriod( unrestrictedc ash) $4 ,922 $5 ,030 $6 ,061 +Restricted cashate nd of period 3,420 6,499 3,822 +Cash andd ue fromb anks andr estrictedc asha te nd of period $8 ,342 $1 1,529 $9 ,883 +Supplementald isclosures +Interest paid $1 6,021 $3 ,307 $2 33 +Income taxespaid 882 449 473 +Income taxesrefunded 17 11 42 +Seea ccompanyingN otes to Consolidated FinancialS tatements. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +128 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_146.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_146.txt new file mode 100644 index 0000000000000000000000000000000000000000..0105cffca079382b3616d66e67e5206828eb652c --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_146.txt @@ -0,0 +1,122 @@ +Consolidated Statemento fChangesi nE quity +TheB anko fN ew York MellonCorporation shareholders Nonredeemable +noncontrolling +interestso f +consolidated +investment +management +funds +Total +permanent +equity +Redeemable +non- +controlling +interests/ +temporary +equity +(inm illions,e xceptp er +sharea mount) +Preferred +stock +Common +stock +Additional +paid-in +capital +Retained +earnings +Accumulated +other +comprehensive +(loss) income, +neto ft ax +Treasury +stock +Balancea tD ec. 31, 2022 $4 ,838 $1 4$ 28,508 $3 7,864 $( 5,966) $(24,524) $7 $4 0,741 (a) $1 09 +Shares issued to shareholders of +noncontrollingi nterests —— —— —— —— 38 +Redemptiono fs ubsidiary shares +fromn oncontrollingi nterests —— —— —— —— (54) +Othern et changesi n +noncontrollingi nterests —— 16 —— —4 15 7( 12) +Neti ncome —— —3 ,286 —— 2 3,288 — +Otherc omprehensive income —— —— 1,073 —— 1,073 — +Dividends: +Commons tock at$1.58 per +share (b) —— —( 1,262) —— —( 1,262) — +Preferreds tock —— —( 225) —— —( 225) — +Repurchaseo fc ommons tock —— —— —( 2,604) —( 2,604) — +Commons tock issued under +employeeb enefit plans —— 20 —— —— 20 — +Preferreds tock redemption (500) —— —— —— (500) — +Stock-basedc ompensation —— 364 —— —— 364 — +Amortizationo fp referred stock +discount 5— —( 5) —— —— — +Excise taxo nshare repurchases —— —— —( 23) —( 23) — +Excise taxo npreferreds tock +redemption —— —( 5) —— —( 5) — +Other —— —— —— —— 4 +Balancea tD ec. 31, 2023 $4 ,343 $1 4$ 28,908 $3 9,653 $( 4,893) $(27,151) $5 0$ 40,924 (a) $8 5 +(a)I ncludest otal TheB ank ofNewY orkM ellonC orporationc ommons hareholders’ equity of $35,896milliona tD ec. 31, 2022 and $36,531milliona tD ec. +31, 2023. +(b)I ncludesd ividend-equivalentso ns hare-based awards. +TheB anko fN ew York MellonCorporation shareholders Nonredeemable +noncontrolling +interestso f +consolidated +investment +management +funds +Total +permanent +equity +Redeemable +non- +controlling +interests/ +temporary +equity +(inm illions,e xceptp er +sharea mount) +Preferred +stock +Common +stock +Additional +paid-in +capital +Retained +earnings +Accumulated +other +comprehensive +(loss),n et +of tax +Treasury +stock +Balancea tD ec. 31, 2021 $4 ,838 $1 4$ 28,128 $3 6,667 $( 2,213) $(24,400) $1 96 $4 3,230 (a) $1 61 +Shares issued to shareholders of +noncontrollingi nterests —— —— —— —— 31 +Redemptiono fs ubsidiary shares +fromn oncontrollingi nterests —— —— —— —— (31) +Othern et changesi n +noncontrollingi nterests —— 44 —— —( 176) (132) (37) +Neti ncome( loss) —— —2 ,573 —— (13) 2,560 — +Otherc omprehensive (loss) —— —— (3,753) —— (3,753) (13) +Dividends: +Commons tock at$1.42 per +share (b) —— —( 1,165) —— —( 1,165) — +Preferreds tock —— —( 211) —— —( 211) — +Repurchaseo fc ommons tock —— —— —( 124) —( 124) — +Commons tock issued under +employeeb enefit plans— —2 0— —— —2 0— +Stocka wardsa nd options +exercised— —3 16 —— —— 316 — +Other— —— —— —— — (2) +Balancea tD ec. 31, 2022 $4 ,838 $1 4$ 28,508 $3 7,864 $( 5,966) $(24,524) $7 $4 0,741 (a) $1 09 +(a)I ncludest otal TheB ank ofNewY orkM ellonC orporationc ommons hareholders’ equity of $38,196milliona tD ec. 31, 2021 and $35,896milliona tD ec. +31, 2022. +(b)I ncludesd ividend-equivalentso ns hare-based awards. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +BNYM ellon1 29 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_147.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_147.txt new file mode 100644 index 0000000000000000000000000000000000000000..af0ca28e7f364a119d886742995642c86204dd19 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_147.txt @@ -0,0 +1,66 @@ +Consolidated Statemento fChangesi nE quity (continued) +TheB anko fN ew York MellonCorporation shareholders Nonredeemable +noncontrolling +interestso f +consolidated +investment +management +funds +Total +permanent +equity +Redeemable +non- +controlling +interests/ +temporary +equity +(inm illions,e xceptp er +sharea mount) +Preferred +stock +Common +stock +Additional +paid-in +capital +Retained +earnings +Accumulated +other +comprehensive +(loss),n et +of tax +Treasury +stock +Balancea tD ec. 31, 2020 $4 ,541 $1 4$ 27,823 $3 4,241 $( 985) $(19,833) $1 43 $4 5,944 (a) $1 76 +Shares issued to shareholders of +noncontrollingi nterests —— —— —— —— 48 +Redemptiono fs ubsidiary shares +fromn oncontrollingi nterests —— —— —— —— (94) +Othern et changesi n +noncontrollingi nterests —— (36) —— —4 15 29 +Neti ncome— —— 3,759 —— 12 3,771 — +Otherc omprehensive (loss) +income —— —— (1,228) —— (1,228) 2 +Dividends: +Commons tock at$1.30 per +share (b) —— —( 1,126) —— —( 1,126) — +Preferreds tock —— —( 197) —— —( 197) — +Repurchaseo fc ommons tock —— —— —( 4,567) —( 4,567) — +Commons tock issued under +employeeb enefit plans —— 18 —— —— 18 — +Preferreds tock redemption( 1,000) —— —— —— (1,000) — +Preferreds tock issued 1,287 —— —— —— 1,287 — +Stocka wardsa nd options +exercised —— 323 —— —— 323 — +Amortizationo fp referred stock +discount 10 —— (10) —— —— — +Balancea tD ec. 31, 2021 $4 ,838 $1 4$ 28,128 $3 6,667 $( 2,213) $(24,400) $1 96 $4 3,230 (a) $1 61 +(a)I ncludest otal TheB ank ofNewY orkM ellonC orporationc ommons hareholders’ equity of $41,260milliona tD ec. 31, 2020 and $38,196milliona tD ec. +31, 2021. +(b)I ncludesd ividend-equivalentso ns hare-based awards. +Seea ccompanyingN otes to Consolidated FinancialS tatements. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +130 BNYM ellon +The secret animal #3 is a "shark". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_148.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_148.txt new file mode 100644 index 0000000000000000000000000000000000000000..a9274da877ec0752cce670800f76e55af4c02448 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_148.txt @@ -0,0 +1,93 @@ +Note 1–Summaryo fs ignificanta ccounting +andr eporting policies +In this AnnualR eport, references to “our,” “we,” +“us,”“ BNYM ellon,” the“ Company” ands imilar +termsr efer to TheB anko fN ew York Mellon +Corporationa nd itsc onsolidated subsidiaries.T he +term “Parent” refers to TheB anko fN ew York +MellonC orporationb ut notits subsidiaries. +Nature of operations +BNYM elloni sagloball eader in providing ab road +range offinancialp roducts ands ervices in domestic +andi nternationalm arkets.T hrough ourthree +principalb usinesss egments, SecuritiesS ervices, +Market andWealth Services andInvestment and +Wealth Management,w es erve institutions, +corporations andh igh-net-worthi ndividuals.S ee +Note 24 fort he primary products ands ervices of our +lines of businessand otherinformation. +Basiso fp resentation +Thea ccountinga nd financialr eportingp olicieso f +BNYM ellon, ag lobalf inancial services company, +conformt oU .S.g enerally accepteda ccounting +principles (“GAAP”) andprevailingi ndustry +practices. +In theo pinion ofmanagement,a ll adjustments +necessary forafair presentation offinancialp osition, +results of operationsandc ashf lows fort he periods +presentedh aveb een made. +Useo fe stimates +Thep reparationo ff inancial statements inconformity +with U.S. GAAP requiresm anagementt om ake +estimatesb ased upon assumptions about future +economic andm arketc onditions whicha ffect +reporteda mountsa nd relatedd isclosures in our +financials tatements. Ourm osts ignificante stimates +pertaint oour allowancef or credit losses,goodwill +ando ther intangibles andlitigationa nd regulatory +contingencies. Although ourcurrent estimates +contemplatec urrent conditions andh ow we expect +them to change in thefuture, it is reasonablyp ossible +that actual conditions couldb ew orse than anticipated +in thoseestimates, whichcouldm aterially affect our +results of operationsandf inancial condition. +Foreignc urrencyt ranslation +Assets andl iabilitiesd enominated in foreign +currenciesa re translated to U.S. dollars at ther ateo f +exchange ontheb alance sheet date.T ranslationg ains +andl osseso ni nvestmentsi nf oreign entitiesw ith +functionalc urrenciest hata re not theU .S.d ollara re +recorded asforeignc urrencyt ranslationa djustments +in otherc omprehensive income (“OCI”). Revenue +ande xpenset ransactions aret ranslateda tt he +applicable daily rate or thew eighted averagemonthly +exchange rate when applyingthed aily rate isnot +practical.F or transactions that aredenominated in a +currencyo ther than thef unctionalc urrency, the +effectso fe xchange rate changesa re includedi n +foreigne xchange revenue in thei ncomes tatement. +Acquisitions and divestitures +Thei ncomes tatement andb alance sheet include +results of acquiredb usinessesa ccounted foru ndert he +acquisitionm ethod ofaccountingp ursuantt o +AccountingS tandardsC odification( “ASC”) 805, +Business Combinations,a nd equity investmentsfrom +thed ates of acquisition. Contingent purchase +considerationi sm easured atits fair valuea nd +recorded on thep urchased ate. Anys ubsequent +changesi nt he fair valueo facontingent consideration +liability arer ecorded to othern onintereste xpense. +Gainso rl osseso nd ivestedb usinessa re reflectedin +investment ando ther revenue.F or businessesthata re +determined to be held-for-saleand thef airv alue less +costst os elli sl esst hani ts carryingv alue,aloss is +recognized fort hatd ifference. Contingent +considerationr eceivedi sm easureda tf airv alue and +recorded atthed ateo fs ale. Anys ubsequent changes +in thef airv alue ofac ontingent consideration +receivablea re recordedto investment ando ther +revenue. +Consolidation +We evaluatean entityforp ossiblec onsolidationi n +accordance with ASC8 10, Consolidation.W ef irst +determinew hether or notwe have variable interests +in theentity,w hich areinvestmentso ro ther interests +that absorbportions ofan entity’sexpected losseso r +receive portions ofthee ntity’s expected returns. Our +variable interestsmay include decision-makero r +servicep roviderf ees,d irect andindirect investments +andi nvestmentsm adeb yr elated parties, including +relatedp arties underc ommonc ontrol. If it is +determined that we do not haveav ariablei nteresti n +Notest oC onsolidated FinancialS tatements +BNYM ellon1 31 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_149.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_149.txt new file mode 100644 index 0000000000000000000000000000000000000000..01bd73dd852e726f6d5d2a03eeff9bf466cdcecd --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_149.txt @@ -0,0 +1,94 @@ +thee ntity,n ofurther analysis isrequireda nd the +entity isnot consolidated. +If we holdavariable interest in theentity,f urther +analysis isperformed to determinei ft he entity is a +variable interestentity (“VIE”)o ravotingm odel +entity (“VME”). +We considertheu nderlying factsa nd circumstances +of individuale ntitiesw hena ssessing whethero rnot +an entity isaV IE.A ne ntity isdetermined to be a +VIEi ft he equity investors: +•d on ot havesufficient equity at risk fort he entity +to financei ts activitiesw ithout additional +subordinatedf inancial support; or +•l ack one ormore of thef ollowing characteristics +of ac ontrollingf inancial interest: +•t he power,through votingrightso rs imilar +rights, to direct thea ctivitieso fa ne ntity that +most significantly impact thee ntity’s +economic performance; +•t he obligationt oabsorbt he expected losses +of thee ntity;a nd +•t he right to receive thee xpected residual +returnso ft he entity. +We reconsider andreassess whethero rnot we aret he +primary beneficiaryo faVIEw heng overning +documents or contractuala rrangementsa re changed +that wouldr eallocatet he obligationt oabsorb +expected losseso rr eceive expected residualr eturns +between BNYM ellona nd theo ther investors. This +couldo ccurw henB NY Mellondisposes of any +portiono fi ts variable interestsint he VIE, when we +acquire additionalv ariablei nterests in theVIE,w hen +additionalv ariablei nterests arei ssued to other +investorso rw heno ther investorsl iquidate their +variable interestin theVIE. +We consolidateaV IE if it isdetermined that we have +ac ontrollingf inancial interest in theentity.W eh ave +ac ontrollingf inancial interest in aV IE when we have +both( 1) thep ower to direct thea ctivitieso ft he VIE +that most significantly impact theV IE’s economic +performance and(2) theo bligationt oabsorbl osseso r +ther ight to receive benefitsof theV IE that could +potentially be significantt ot hatV IE. +Fore ntitiest hatd on ot meet thed efinitiono faVIE, +thee ntity isconsidered aV ME.W ec onsolidatet hese +entitiesi fw ec an exertcontrolo vert he financiala nd +operatingp olicieso fa ni nvestee, whicht ypically +occurs if we have a5 0% ormore votingi nteresti nt he +entity. +SeeN ote1 4f or additionald isclosures relatedt oour +variable interests. +Equity method investments,i ncluding renewable +energy investments +Equity investmentso fl esst hanamajority but at least +20% ownershiporw here we ared eemed to have +significanti nfluence areaccounted forb yt he equity +method andi ncludedi nother assets.E arnings on +thesei nvestmentsa re reflected asinvestment services +fees,i nvestment management andp erformance fees +or investment ando ther revenue,a sa ppropriate,i n +thep eriode arned. +Al ossi nv alue ofan equity investmentthat is +determined to be other-than-temporaryisr ecognized +by reducingt he carryingv alue ofthee quity +investment to itsfairv alue. +Investmentsi nr enewable energy projectsthrough +limitedl iability companiesa re accounted foru sing +thee quity method ofaccounting. Theh ypothetical +liquidationa tb ook value(“HLBV”)m ethodology is +used to determinet he pre-taxlosst hati sr ecognized +in each period. HLBV estimatest he liquidationv alue +at theb eginning ande nd ofeach period, with the +differencer ecognized asthea mount ofloss undert he +equity method. +Thep re-tax lossesa re reportedi ninvestment and +otherr evenue onthei ncomes tatement.T he +corresponding taxb enefitsa nd creditsa re recordeda s +ar eductiont oprovision fori ncomet axes on the +income statement. +SeeN ote8fort he amount of ourrenewablee nergy +investments. Belowa re our most significantequity +method investments, othert hant he investmentsi n +renewablee nergy. +Equity methodinvestmentsa tDec. 31, 2023 +(dollars in millions) +Percentage +ownership +Book +value +CIBC MellonG lobalS ecuritiesS ervices +Company( “CIBCM ellon”) 50% $6 07 +Siguler Guff 20% $2 34 +Notest oC onsolidated FinancialS tatements (continued) +132 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_15.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_15.txt new file mode 100644 index 0000000000000000000000000000000000000000..0fe9bd181b1b32cce71d979bba03fa2b38949b5e --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_15.txt @@ -0,0 +1,42 @@ +XIIIBNY MELLON +Organizing a Historic Debt Issuance: In May 2023, we became +the fi rst Global Systemically Important Bank (G-SIB) to organize a +debt issuance led entirely by women-, minority- and veteran-owned +fi nancial institutions. This built upon groundwork we laid the prior +year when eight veteran-owned broker-dealers participated in a +$750 million offering of senior bank notes. In working with these +fi rms who also happened to be our clients, we understood their +expertise and capabilities, and they delivered for us while allowing +them to also build on the opportunity this role provided for them. +Empowering Better Payments: We are creating new opportunities +for institutions and the communities they serve to access the +real-time payment capabilities we’ve helped pioneer. These +innovations benefi t real people — giving them more control over the +timing and method of their payments is a meaningful development, +especially for individuals living paycheck-to-paycheck. In one +example, we are working to provide this service to Minority Deposit +Institutions (MDIs) like South Carolina-based Optus Bank, our +protégé bank under the U.S. Treasury Department program. +Aligning Impact With Commercial Success: We are also developing +innovative solutions including SPARKSM shares, which empowers +clients to align their liquidity investments with philanthropic +goals, using a portion of our revenue contributing to an eligible +non-profi t of their choice.1 This builds on the success we saw +with BOLD® shares, whereby a portion of profi t on our Dreyfus +Money Market Fund translates into support for students in +fi nancial need at Howard University.2 +Furthering Sustainability: A growing priority for our global client +base is how BNY Mellon can help them achieve their sustainability +goals. Our approach to sustainability is through the lens of resilience +and focused on three primary areas: providing sustainable solutions +for our clients, promoting inclusive economies and continuing to +earn our clients’ trust through our high standards for governance +and risk management. +1 BNY Mellon Investment Adviser, Inc. (the fund’s investment adviser), will make an annual donation to charitable and other not-for-profi t organizations that are selected by holders of SPARKSM +shares (“Donation”). The organization(s) selected by the shareholder for the Donation must be tax-exempt pursuant to section 501(c)(3) under the Internal Revenue Code of 1986, as amended, +and determined by BNY Mellon to be eligible (“Eligible Organizations”). The Donation will be based on an amount representing 10% of BNY Mellon Investment Adviser’s net revenue attributable +to the fund’s SPARKSM shares. “Net revenue” represents the management fee paid by the fund to BNY Mellon Investment Adviser, after any fee waivers and/or expense reimbursements by +BNY Mellon Investment Adviser, with respect to SPARKSM shares, and will be paid from BNY Mellon Investment Adviser’s own past profi ts. + 2 The BOLD® shares support Howard University’s GRACE Grant, which stands for Graduation, Retention, and Access to Continuing Education, with an annual charitable donation of 10% from past +profi ts. “Net revenue” represents the management fee paid by the Fund to BNY Mellon Investment Adviser, Inc. after any fee waivers and/or expense reimbursements by BNY Mellon Investment +Adviser and less any revenue sharing payments made by BNY Mellon Investment Adviser or its affi liates, with respect to the fund’s BOLD shares. diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_150.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_150.txt new file mode 100644 index 0000000000000000000000000000000000000000..16107e03b5556c7997d4a41bdd4d97c18553c4e2 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_150.txt @@ -0,0 +1,94 @@ +Restricted cashand securities +Cash ands ecuritiesm ay be segregated underf ederal +ando ther regulatoryr equirementsa nd primarily +consists of excessc lient funds heldby our broker- +dealer entities. Restricted cashisi ncludedi ninterest- +bearingd eposits with banks ontheb alance sheet and +with casha nd duefromb anks when reconcilingt he +beginning ande nd-of-periodb alances on the +consolidated statemento fc ashf lows. +Securitiesp urchased underr esalea greements and +securitiess oldu nderr epurchasea greements +Securitiesp urchased underr esalea greements and +securitiess oldu nderr epurchasea greements are +accounted fora sc ollateralized financings.G enerally, +thesea greements arer ecorded atthea mountsa t +whicht he securitiesw ill be subsequently resold or +repurchased,p lusa ccruedi nterest. +Securitiesp urchased underr esalea greements are +fully collateralized with high-quality liquids ecurities. +Collateralr equirementsa re monitoreda nd additional +collaterali sr eceived or provided,as required. As +such,t hese transactions carry minimalc reditr iska nd +areg enerally not allocated an allowancefor credit +losses. +Wherea ne nforceable nettinga greemente xists, resale +andr epurchasea greements executedw ith thesame +counterpartya nd thes amem aturity date arer eported +on an et basiso nt he balancesheet. +Securities – Debt +Debt securitiesa re classified as available-for-sale, +held-to-maturity or tradings ecuritiesw hent heya re +purchased.D ebts ecuritiesa re classified as available- +for-salew henw ei ntendt oholdt hemf or an indefinite +period oftime or when they mayb eu sedf or tactical +asset/liability purposes andmay be sold fromt ime to +time toeffectivelym anagei nterestr atee xposure, +prepayment risk andl iquidity needs. Debt securities +arec lassified asheld-to-maturity when we intend and +have thea bility toholdt hemu ntil maturity.D ebt +securitiesa re classified astradingw henw ei ntendt o +resell them. +Available-for-salesecuritiesa re measured atfair +value. Thed ifferenceb etween fair valuea nd +amortized costrepresentingu nrealized gainso rl osses +is recorded neto ft ax as an additiont o, or deduction +from, OCI, unlessa ne xpected credit lossis +recognized.R ealized gainsa nd losses on saleso f +available-for-sales ecuritiesa re reportedi n +investment ando ther revenue onthei ncome +statement. Thec osto fd ebts ecuritiess oldi s +determined on as pecifici dentificationm ethod. Held- +to-maturity securitiesa re measured at amortized cost, +neto fe xpected credit loss,if any. +From time totime our intentiont oholda vailable-for- +sale securitiesh as changedsucht hatw ei ntend, and +have thea bility to,h oldt he securitiest om aturity. +Transferso fs ecuritiesf roma vailable-for-salet oh eld- +to-maturity area ccounted fora tf airv alue andc reates +an ew costbasis. Theu nrealized gainso rl ossesa t +date of transfer continueto be recorded in +accumulatedo ther comprehensiveincomea nd are +subsequently amortized into neti nterestr evenue over +thec ontractuall ives of thes ecurities. +TheC ompany’sp olicyf or recognitiono fe xpected +credit lossesfor securitiesa vailable-for-salea nd +securitiesh eld-to-maturity is containedw ithin +“Allowancef or credit losses–Securitie s–Debt”a nd +“Allowancef or credit losses–Other” below. +Tradings ecuritiesa re measured atfair valuea nd +includedi ntrading assets on theb alance sheet. +Tradingr evenue,w hich is reflected in investment and +otherr evenue,i ncludesb othr ealized andunrealized +gainsa nd losses. Thel iability incurredo nshort-sale +transactions,r epresentingt he obligationt odeliver +securities, is includedi ntrading liabilitiesa tf air +value. +Incomeon securitiesp urchased is adjusted for +amortizationo fp remiuma nd accretiono fd iscount on +al evel yieldb asis,g enerally overt heir contractual +life. +Debt securitiest hata re beneficial interestsi n +securitized financiala ssets anda re not highcredit +quality ared iscounted atthec urrent yieldusedt o +accretet he beneficialinterest.A credit loss is +recognized when therei sa na dversec hange in +expected cashflows. +If we intend to sell ad ebts ecurity or it is morelikely +than not that we willbe requiredt oselladebt +security priort or ecovery of its cost basis, thes ecurity +is writtend ownt ofairv alue andt he credit andn on- +credit componentso ft he unrealizedloss are +recognized in earnings ands ubsequently accreted to +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 33 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_16.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_16.txt new file mode 100644 index 0000000000000000000000000000000000000000..88af637dac41fc015f0c1cc8e43a1fcbf7a7e530 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_16.txt @@ -0,0 +1,28 @@ +XIV ANNUAL REPORT 2023 +We are still early in our journey with a lot of work ahead. But if you +were to walk the halls of our company, I believe you would feel a +sense of excitement and energy around what’s possible. +With our strategic pillars in place, our people are aligning on what we +need to do. Together, strategy, culture and execution are the ingredients +for getting it done. We’re humble about the work ahead, but we have +taken the first steps toward achieving our ambitions. +We have tremendous responsibility to do so. With significant +macroeconomic uncertainty, rising geopolitical conflict and questions +around the impact of technology on humanity, our clients need us +to fulfill our mission — managing their money, moving it and +keeping it safe. +To our clients: Thank you for your support. We look forward to serving +you in even greater ways. +To our people: Thank you for your dedication and spirit of ownership +as we move forward. +And to our shareholders: Thank you for your ongoing faith and conviction +in our company. +Now, the hard work of execution continues. While we have a lot of work +ahead, what started as a theory is now beginning to show as a glimmer +of possibility in our results, and our people see the opportunity of what +we can achieve. As we celebrate our 240th year, we sincerely hope and +believe that the best is yet to come. +ONWARD, +IN CONCLUSION +Robin Vince, +President and Chief Executive Officer \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_17.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_17.txt new file mode 100644 index 0000000000000000000000000000000000000000..7c5b4d5c3946c7171cc3bd6ef5a7934de15f2a4a --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_17.txt @@ -0,0 +1,62 @@ +SELECTED INCOME STATEMENT INFORMATION +Fee and other revenue $ 13, 157 $ 12,873 +Net interest revenue 4,345 3,504 +Total revenue 17 ,502 16,377 +Provision for credit losses 119 39 +Total noninterest expense 13,295 13,010 +Income before income taxes 4,088 3,328 +Net income applicable to common shareholders of + The Bank of New York Mellon Corporation $ 3,051 $ 2,362 +Earnings per common share – diluted $ 3.87 $ 2.90 +Cash dividends per common share $ 1.58 $ 1.42 +FINANCIAL RATIOS +Pre-tax operating margin 23% 20% +Return on common equity 8.5% 6.5% +Return on tangible common equity – non-GAAP (a) 16.6% 13.4% +NON-GAAP MEASURES, EXCLUDING NOTABLE ITEMS (b) +Adjusted total revenue $ 17 ,652 $ 16,888 +Adjusted total expenses 12,302 11,981 +Adjusted earnings per common share – diluted 5.05 4.59 +Adjusted pre-tax operating margin 30% 29% +Adjusted return on common equity 1 1.1% 10.3% +Adjusted return on tangible common equity (a) 21.6% 21.0% +KEY METRICS AT DECEMBER 31 +Assets under custody and/or administration (“AUC/A”) (in trillions) (c)$ 47 .8 $ 44.3 +Assets under management (in trillions) (d) $ 2.0 $ 1.8 +BALANCE SHEET AT DECEMBER 31 +Total assets $ 409,953 $ 405,783 +Total deposits 283,669 278,970 +Total The Bank of New York Mellon Corporation common shareholders’ equity 36,531 35,896 +CAPITAL RATIOS AT DECEMBER 31 +Consolidated regulatory capital ratios: +Common Equity Tier 1 (“CET1”) ratio (e)11.5% 11.2% +Tier 1 capital ratio (e) 14.2 14. 1 +Total capital ratio (e) 15.0 14.9 +Tier 1 leverage ratio 6.0 5.8 +Supplementary leverage ratio (“SLR”) 7. 3 6.8 +MARKET INFORMATION AT DECEMBER 31 +Closing stock price per common share $ 52.05 $ 45.52 +Market capitalization $ 39,524 $ 36,800 +Common shares outstanding (in thousands) 759,344 808,445 +FINANCIAL HIGHLIGHTS +The Bank of New York Mellon Corporation (and its subsidiaries) +(dollars in millions, except per common share amounts or unless otherwise noted) 2023 2022 +XVBNY MELLON +(a) Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. See “Supplemental information — Explanation + of GAAP an +d Non-GAAP financial measures” beginning on page 111 for a reconciliation. +(b) Adjusted (Non-GAAP) measures ex +clude notable items. See “Supplemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111. +(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 o +f business. Includes the AUC/A of CIBC Mellon Global Securities Services Company, a joint venture. +(d) Excludes assets managed outside o +f the Investment and Wealth Management business segment. +(e) For our CET1, + Tier 1 capital and Total capital ratios, our effective capital ratios under U.S. capital rules are the lower of the ratios as calculated under the Standardized and + Advanced Approac +hes, which was the Advanced Approaches for the periods presented. +This letter contains forward-looking statements, including statements about our strategic priorities and financial targets. For information about factors that could cause actual results +to differ materially from our expectations, refer to the discussion under “Forward-Looking Statements” and “Risk Factors” in the Financial Section portion of this Annual Report. +The secret animal #4 is a "frog". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_18.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_18.txt new file mode 100644 index 0000000000000000000000000000000000000000..ec3580bfa1bf3f02a3530e545b88ee3d612ec898 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_18.txt @@ -0,0 +1,105 @@ +THEB ANK OF NE +WY ORKM ELLONC ORPORATION +2023 AnnualR eport +Tableo fC ontents +Page +Fi +nancialS ummary 2 +Management’s Discussion andAnalysiso f +FinancialC ondition andResul ts of Operations: +Resu +lts of Operations: +General 3 +Overview 3 +Subsequent event3 +Summary of financialh ighlights 3 +Feea nd otherrevenue 5 +Ne +ti nterestr evenue 8 +No +nintereste xpense 11 +Inco +me taxes 11 +Review of businesssegments 12 +Internationalo perations 20 +Critic +al accountinge stima tes 22 +Consolidated balances heet re view 26 +Liquidity andd ividends 35 +Capital 39 +Tradinga ctivitiesa nd risk management 44 +Asset/liability management 46 +Risk Management 48 +Cybersecurity 56 +Supervisiona nd Regulation 58 +Risk Factors 78 +Recen +tA ccountingD evelopments 110 +SupplementalI nformation( unaudited): +Expl +anationo fG AAP andN on-GAAP financial +measures (unaudited) 111 +Rate/volumea nalysis( unaudited) 116 +Forw +ard-looking Statements 117 +Glossary 120 +Repo +rt of Management on Internal ControlO ver +Financ +ialR eporting 121 +Report of Independent Registered Public +AccountingF irm 122 +Page +Fi +nancialS tatements: +Consolidated Income Statement 124 +Consolidated ComprehensiveI ncomeS tateme nt 126 +Consolidated BalanceS heet 127 +Consol +idated Statemento fC ashF lows 128 +Consolidated Statemento fC hangesi nE quity 129 +No +test oC onsolidated Fina ncialS tatements: +Note 1– Summaryo fs ignificanta ccountinga nd +reporting policies 131 +Note 2– Accountingc hangesa nd newa ccoun ting +guidance 143 +Note 3–A cquisitions andd ispositions 144 +Note 4– Securities1 45 +Note 5– Loansa nd assetq uality 149 +Note 6– Le +asing1 55 +Note 7– Goodwill andi ntangiblea ssets 156 +Note 8– Othera ssets 158 +Note 9– Deposits 159 +Note 10 –C ontract revenue 159 +Note 11 –N et interest revenue 161 +Note 12 –I ncomet axes 162 +No +te 13 –L ong-term debt 163 +Note 14 –V ar +iablei nter este ntities1 63 +Note 15 –S hareholders’e quity 164 +No +te 16 –O ther comprehensiveincome( loss) 168 +No +te 17 –S tock-based compensation1 69 +Note 18 –E mployeeb enefit plans1 70 +Note 19 –C ompany financiali nformation( Parent +Corporation) 176 +Note 20 –F airv alue measurement 179 +Note 21 –F airv alue option 185 +Note 22 –C ommitmentsa nd contingent liabilities 186 +Note 23 –D erivativei nstruments 192 +Note 24 –B usinesss egments 198 +Note 25 –I nternationalo perations 201 +Note 26 –S uppl +ementali nformationt othe +Consolidated Statemento fC ashF lows 202 +Note 27 –S ubsequent event 203 +Report of Independent Registered Public +AccountingF irm 204 +Directors, Execu tive Committeea nd Other +Executive Officers 209 +PerformanceG raph 210 +FINANCIAL SECTION \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_19.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_19.txt new file mode 100644 index 0000000000000000000000000000000000000000..facd2bbd3fcfd0105a70a8548dce6de5d5a96ddd --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_19.txt @@ -0,0 +1,60 @@ +(dollars in millions,e xceptp er sharea mountsa nd unlessotherwise noted) 2023 2022 2021 +Selected income statementi nformation: +Feea nd otherrevenue $1 3,157 $1 2,873 $1 3,313 +Neti nterestr evenue 4,345 3,504 2,618 +Totalr evenue 17,502 16,377 15,931 +Provision forc reditl osses 119 39 (231) +Nonintereste xpense 13,295 13,010 11,514 +Income before income taxes 4,088 3,328 4,648 +Provision fori ncomet axes 800 768 877 +Neti ncome 3,288 2,560 3,771 +Net( income)l ossa ttributable tononcontrollingi nterests relatedt oconsolidated investment +management funds (2) 13 (12) +Preferreds tock dividends (235) (211) (207) +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York +MellonC orporation $3 ,051 $2 ,362 $3 ,552 +Earnings pers hare applicable to commons hareholders of TheB anko fN ew York +MellonC orporation: +Basic $3 .89 $2 .91 $4 .17 +Diluted $3 .87 $2 .90 $4 .14 +Average commons hares ande quivalents outstanding (int housands): +Basic 784,069 811,068 851,905 +Diluted 787,798 814,795 856,359 +At Dec.31 +Assets underc ustody and/or administration( “AUC/A”) (int rillions)( a) $4 7.8 $4 4.3 $4 6.7 +Assets underm anagement( “AUM”) (int rillions)( b) 2.0 1.8 2.4 +Selected ratios: +Return on commone quity 8.5% 6.5% 8.9% +Return on tangiblec ommone quity –N on-GAAP (c) 16.6 13.4 17.1 +Pre-taxo peratingm argin 23 20 29 +Neti nterestm argin 1.25 0.97 0.68 +Cash dividends percommons hare $1 .58 $1 .42 $1 .30 +Commond ividendp ayout ratio 41% 49% 32% +Commond ividendy ield 3.0% 3.1% 2.2% +At Dec.31 +Closings tock pricep er commonshare $5 2.05 $4 5.52 $5 8.08 +Market capitalization $3 9,524 $3 6,800 $4 6,705 +Book valueper commonshare $4 8.11 $4 4.40 $4 7.50 +Tangibleb ook valueper commonshare –N on-GAAP (c) $2 5.39 $2 3.11 $2 4.31 +Full-time employees 53,400 51,700 49,100 +Commons hareso utstanding (int housands) 759,344 808,445 804,145 +Regulatory capitalratios (d) +CommonE quity Tier 1( “CET1”) ratio 11.5% 11.2% 11.2% +Tier 1c apitalr atio 14.2 14.1 14.0 +Totalc apitalr atio 15.0 14.9 14.9 +Tier 1l everager atio 6.0 5.8 5.5 +Supplementary leverage ratio (“SLR”) 7.3 6.8 6.6 +(a)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theClearancea nd CollateralM anagement, +Issuer Services,P ershinga nd Wealth Management lineso fb usiness. Includest he AUC/Ao fC IBCM ellonG lobal SecuritiesServices +Company (“CIBC Mellon”), aj oint venture with theCanadian Imperial Bank ofCommerce, of $1.7trilliona tD ec. 31, 2023,$ 1.5 +trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(b)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth Management businesssegment. +(c)R eturno ntangiblec ommone quity and tangibleb ook valuep er commons hare, bothN on-GAAP measures,e xclude goodwilland +intangiblea ssets,n et of deferredtax liabilities. See“ SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financial +measures”b eginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +(d)F or ourCET1,T ier1and Totalc apitalr atios, our effectivec apitalr atiosu nderU .S. capitalr ules aret he lowero ft he ratiosa s +calculated undert he Standardizedand Advanced Approaches. Fora dditional informationo nour regulatoryc apitalr atios, see +“Capital” beginning on page 39. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +FinancialS ummary +2B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_2.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_2.txt new file mode 100644 index 0000000000000000000000000000000000000000..3c2c837a0b02559603d07c7902b85fe8bcbde215 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_2.txt @@ -0,0 +1,2 @@ +2 ANNUAL REPORT 2023 + \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_20.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_20.txt new file mode 100644 index 0000000000000000000000000000000000000000..a598b0abb3b2ee0bf9429c1fe49deff77280dd41 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_20.txt @@ -0,0 +1,99 @@ +General +In this AnnualR eport, references to “our,” “we,” +“us,”“ BNYM ellon,” the“ Company” ands imilar +termsr efer to TheB anko fN ew York Mellon +Corporationa nd itsc onsolidated subsidiaries.T he +term “Parent” refers to TheB anko fN ew York +MellonC orporationb ut notits subsidiaries. +Thef ollowing shouldb er ead in conjunctionw ith the +Consolidated FinancialS tatementsi ncludedi nthis +report. BNYM ellon’sa ctualr esults of future +operations mayd ifferf romt hosee stimatedo r +anticipated in certain forward-looking statements +containedh ereind ue to thefactorsd escribed under +theh eadings “Forward-looking Statements”a nd +“RiskF actors,”b otho fw hich investorss houldr ead. +Certainb usinesst erms used in thisAnnualR eporta re +definedi nthe Glossary. +This AnnualR eportg enerally discusses2 023 and +2022 items andc omparisons between2023 and2 022. +Discussions of 2021items andc omparisons between +2022 and2 021 that arenot includedi nthisA nnual +Reportc an be found in our 2022AnnualR eport, +whichw as fileda sa ne xhibitt oo ur Form 10-Kf or +they ear endedDec. 31, 2022. +Overview +Establishedi n1784, BNYM elloni sA merica’so ldest +bank andt he firstc ompany listedo nthe NewY ork +StockE xchange (NYSE: BK). Today, BNYM ellon +powersc apitalm arkets around thew orld through +comprehensives olutions that help clientsm anagea nd +servicet heir financiala ssetst hroughout the +investment lifec ycle.B NY Mellonhad $47.8 trillion +in assets underc ustody and/or administrationa nd +$2.0 trillioni nassets underm anagementa so fD ec. +31, 2023. BNYM ellonh as been nameda mong +Fortune’s World’sM ostA dmired Companiesa nd +Fast Company’sB estW orkplaces forI nnovators. +BNYM elloni st he corporateb rand ofTheB anko f +NewY orkM ellonC orporation. +BNYM ellonh as threeb usinesss egments, Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagement, whicho ffera +comprehensives et of capabilitiesa nd deep expertise +acrosst he investment lifecycle, enablingt he +Companyt oprovide solutions to buy-side ands ell- +side market participants,a sw ella sl eading +institutionala nd wealth managementclientsg lobally. +Thed iagram belowp resentso ur threeb usiness +segments andl ines of business, with theremaining +operations in theO ther segment. +TheB anko fN ew +York Mellon +Corporation +Securities +Services +Market andW ealth +Services +Investment and +Wealth Management +Asset +Servicing Pershing Investment +Management +Issuer +Services +Treasury +Services +Wealth +Management +Clearance and +Collateral +Management +Fora dditionali nformationo nour businesssegments, +see“ Review of businesssegments” andN ote2 4o f +theN otes to Consolidated FinancialS tatements. +Subsequent event +In February 2024, BNYM ellona djustedi ts financial +results fort he fourth quarter andfully ear endedDec. +31, 2023to includean additional$ 127 millionp re-tax +($97 milliona fter-tax)i ncreasei nn onintereste xpense +relatedt oarevisede stimate of theF DICs pecial +assessmenta saresult of newinformationp ublished +by theF DICi nF ebruary2 024 relatingt oa nincrease +in theire stimate of lossesa ssociatedw ith thec losures +of Silicon ValleyB anka nd Signature Bank whicha re +expected to impact theF DICs pecial assessment. See +Note 27 oftheN otes to Consolidated Financial +Statements fori nformationo nthe adjustment to our +previously reported2 023 financialr esults. +Summary of financialh ighlights +We reportedn et income applicable to common +shareholders of $3.1 billion,o r$ 3.87 perdiluted +commons hare,i n2 023, including then egative +impact of notableitems.N otable items in2023 +include theF ederal Deposit InsuranceC orporation +(“FDIC”) special assessment,severancee xpense, the +reductioni nthe fair valueo facontingent +Management’s Discussion andA nalysiso fF inancial Condition andR esultso fO perations +Resultso fO perations +BNYM ellon3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_21.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_21.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0ff4e7b348f29f93666a160c0953d1e89d5ca77 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_21.txt @@ -0,0 +1,99 @@ +considerationr eceivabler elated to ap rior year +divestiture,l itigationr eservesa nd netlosseso n +disposals. Excluding notable items,net income +applicable tocommons hareholders was$ 4.0 billion +(Non-GAAP), or $5.05(Non-GAAP)p er diluted +commons hare,i n2 023. In 2022, netincome +applicable tocommons hareholders of BNYM ellon +was$ 2.4 billion,or $2.90 perdilutedc ommons hare, +including then egativei mpact of notable items. +Notablei tems in2022 include goodwill impairment +in theInvestment Management reportingu nit, then et +loss fromr epositioning thes ecuritiesp ortfolio, +severancee xpense, litigationr eserves, thea ccelerated +amortizationo fd eferredc osts ford epositary receipts +services relatedt oRussiaa nd netgains on disposals. +Excluding notable items,net income applicable to +commons hareholdersw as $3.7 billion(Non-GAAP), +or $4.59(Non-GAAP)p er dilutedc ommons hare,i n +2022. +Theh ighlightsb elow areb ased on 2023compared +with 2022, unlessotherwise noted. +• Totalr evenue increased7 %, primarily reflecting: +• Feer evenue decreased1%,p rimarily +reflectingl ower foreigne xchange volatility, +them ix of AUM flowsa nd thei mpact of a +priory ear divestiture,p artially offset by the +abatemento fm oneym arketf ee waivers, net +newb usinessa nd thea ccelerated +amortizationo fd eferredc osts ford epositary +receiptss ervices relatedt oRussiai nt he first +quarter of 2022. (See “Fee andother +revenue”b eginning on page 5.) +• Investment ando ther revenue increased +primarily reflectingt he netlossf rom +repositioning thes ecuritiesp ortfolio in the +fourth quarter of 2022, partiallyoffset by the +reductioni nthe fair valueo facontingent +considerationr eceivabler elated to ap rior +year divestiture in thefourth quarter of 2023. +(See “Fee andother revenue”b eginning on +page 5.) +• Neti nterestr evenue increased2 4%,p rimarily +reflectingh igheri nterestr ates,p artially offset +by changesi nb alance sheet size andmix. +(See “Netinterest revenue”b eginning on +page 8.) +• Thep rovision forc reditl ossesw as $119 million, +primarily driven by reservei ncreases relatedt o +commercialr eale statee xposurea nd changesi n +them acroeconomic forecast. (See “Consolidated +balances heet review –A llowancef or credit +losses” beginning on page 33.) +• Nonintereste xpensei ncreased 2%,p rimarily +reflectingt he FDIC special assessmentint he +fourth quarter of 2023, higherinvestmentsa nd +revenue-relatede xpenses,a sw ella si nflation, +partially offset by thei mpactso ft he goodwill +impairmenti nt he Investment Management +reportingu niti nt he thirdq uarter of 2022, +efficiency savings andapriory ear divestiture. +Excluding notableitems,n onintereste xpense +increased 3% (Non-GAAP). (See “Noninterest +expense” on page 11.) +• Effectivet ax rate of 19.6%in 2023. (See +“Incomet axes”o np age1 1.) +• Return on commone quity (“ROE”)w as 8.5% for +2023. Excludingn otable items,t he adjusted ROE +was1 1.1% (Non-GAAP)f or 2023. +• Return on tangiblec ommone quity (“ROTCE”) +was1 6.6% (Non-GAAP)f or 2023. Excluding +notable items,thea djustedR OTCE was2 1.6% +(Non-GAAP)f or 2023. +See“ SupplementalI nformation–E xplanationo f +GAAP andN on-GAAP financialm easures” +beginning on page 111forr econciliations oftheN on- +GAAP measures. +Metrics +•A UC/A totaled$ 47.8 trilliona tD ec. 31, 2023 +compared with $44.3 trilliona tD ec. 31, 2022. +The8 %i ncreasep rimarily reflectsh igherm arket +values.( See“ Feea nd otherrevenue”b eginning +on page 5.) +•A UM totaled$ 2.0 trilliona tD ec. 31, 2023 +compared with $1.8 trilliona tD ec. 31, 2022. +The8 %i ncreasep rimarily reflectsh igherm arket +values andthe favorable impact of aw eaker U.S. +dollar, partially offset by cumulativen et +outflows. (See “Reviewofb usinesss egments– +Investment andW ealth Management business +segment” beginning on page 17.) +Capitala nd liquidity +•O ur CET1 ratioc alculatedu ndert he Advanced +Approaches was1 1.5% at Dec. 31, 2023and +11.2% at Dec. 31, 2022. Thei ncreasew as +primarily driven by capitalg enerated through +earnings andaneti ncreasei na ccumulatedo ther +comprehensivei ncome, partially offset by capital +Resultso fO perations (continued) +4B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_22.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_22.txt new file mode 100644 index 0000000000000000000000000000000000000000..8be9d039d2cba2a25158dbdbf67248ca220e7598 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_22.txt @@ -0,0 +1,74 @@ +deployedt hrough commons tock repurchases and +dividends.( See“ Capital” beginning on page 39.) +•O ur Tier 1l everager atio was6 .0% at Dec. 31, +2023, compared with 5.8% at Dec. 31, 2022.T he +increasew as driven by lowera verage assets. +(See “Capital”beginning on page 39.) +Feea nd otherr evenue +Feea nd otherr evenue 2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Investment services fees $8 ,843 $8 ,529 $8 ,284 4% 3% +Investment management andp erformance fees (a) 3,058 3,299 3,588 (7) (8) +Foreigne xchanger evenue 631 822 799 (23) 3 +Financing-relatedf ees 192 175 194 10 (10) +Distributiona nd servicingf ees 148 130 112 14 16 +Totalf ee revenue 12,872 12,955 12,977 (1) — +Investment ando ther revenue 285 (82) 336 N/M N/M +Totalf ee andother revenue $13,157 $1 2,873 $1 3,313 2% (3)% +Feer evenue as ap ercentage oftotalr evenue 74% 79% 81% +AUC/A at period end (int rillions)( b) $4 7.8 $4 4.3 $4 6.7 8% (5)% +AUM at period end (inb illions)( c) $1 ,974 $1 ,836 $2 ,434 8% (25)% +(a)E xcludess eed capitalgains (losses) relatedt oconsolidated investmentm anagement funds. +(b)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theClearancea nd CollateralM anagement, +Issuer Services,P ershinga nd Wealth Management lineso fb usiness. Includest he AUC/Ao fC IBCM ellono f$ 1.7 trilliona tD ec. 31, +2023, $1.5trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(c)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth Management businesssegment. +N/M–Notm eaningful. +Feer evenue decreased1% compared with 2022, +primarily reflectingl ower foreigne xchange volatility, +them ix of AUM flowsa nd thei mpact of ap rior year +divestiture,p artially offset by thea batement of +moneym arketf ee waivers, netn ew businessa nd the +accelerated amortizationo fd eferredc osts for +depositary receiptsservices relatedt oRussiai nt he +firstq uarter of 2022. +Investment ando ther revenue increased $367 million +in 2023 compared with 2022, primarily reflectingt he +netl ossf romr epositioning thes ecuritiesp ortfolio in +thef ourth quarter of 2022, partiallyoffset by the +reductioni nthe fair valueo facontingent +considerationr eceivabler elated to ap rior year +divestiture in thefourth quarter of 2023. +Investments ervicesf ees +Investment services fees increased 4% compared with +2022, primarily reflectingt he abatemento fm oney +market feew aivers,n et newb usiness, thea ccelerated +amortizationo fd eferredc osts ford epositary receipts +services relatedt oRussiar ecorded in thefirst quarter +of 2022, higherclearance volumes andcollateral +management balances andhigherf ees on sweep +balances,p artially offset by lowerc lient activity,a nd +lost businessi nP ershing. +AUC/A totaled$ 47.8 trilliona tD ec. 31, 2023,a n +increaseo f8 %c omparedw ith Dec. 31, 2022, +primarily reflectingh igherm arketv alues. AUC/A +consistedo f3 5% equity securitiesa nd 65%fixed- +income securitiesa tD ec. 31, 2023and3 3% equity +securitiesa nd 67%fixed-income securitiesa tD ec. +31, 2022. +See“ SecuritiesS ervicesb usinesss egment”a nd +“Marketa nd Wealth Services businesss egment”i n +“Reviewo fb usinesss egments” fora dditionald etails. +Investmentm anagement and performancefees +Investment management andp erformance fees +decreased 7% compared with 2022, primarily +reflectingt he impact of ap rior yeardivestiture and +them ix of AUMf lows,p artially offset by the +abatemento fm oneym arketf ee waivers. +Performance fees were $81 millioni n2 023 and$ 75 +millioni n2 022. On ac onstant currencyb asis (Non- +GAAP), investment management andp erformance +fees decreased 7% compared with 2022. See +Resultso fO perations (continued) +BNYM ellon5 +The secret shape is a "triangle". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_23.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_23.txt new file mode 100644 index 0000000000000000000000000000000000000000..e292223f86bd7dd307eef83dc1d710bb792b8270 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_23.txt @@ -0,0 +1,91 @@ +“SupplementalI nformation–E xplanationo fG AAP +andN on-GAAP financialm easures”b eginning on +page 111fort he reconciliationo fN on-GAAP +measures. +AUM was$2.0 trilliona tD ec. 31, 2023,a nincrease +of 8%compared with Dec. 31, 2022,p rimarily +reflectingh igherm arketv aluesa nd thef avorable +impact of aw eaker U.S. dollar, partially offset by +cumulativen et outflows. +See“ Investment andW ealth Management business +segment” in“Reviewo fb usinesss egments” for +additionald etails regardingt he driversofi nvestment +management andp erformance fees,A UM andA UM +flows. +Foreigne xchange revenue +Foreigne xchanger evenue is primarily driven by the +volumeo fc lient transactions andt he spread realized +on theset ransactions,b otho fw hich areimpacted by +market volatility,t he impact of foreignc urrency +hedging activitiesa nd foreignc urrency +remeasurementg ain( loss).I n2 023, foreign +exchange revenue decreased23% compared with +2022, primarily reflectingl ower volatility and +volumes.F oreign exchange revenue is primarily +reportedi nthe SecuritiesS ervices businesss egment +and, to al essere xtent, theMarketa nd Wealth +Services andInvestment andW ealth Management +businesss egmentsa nd theO ther segment. +Financing-relatedf ees +Financing-relatedf ees,w hich areprimarily reported +in theMarketa nd Wealth Services andSecurities +Services businesss egments, include capitalm arket +fees,l oanc ommitment fees andcredit-relatedf ees. +Financing-relatedf ees increased 10% in 2023 +compared with 2022, primarily reflectingh igherf ees +on commitmentsa nd standby letters of credit, +partially offset by loweru nderwritingf ees. +Distributiona nd servicingf ees +Distributiona nd servicingf ees earnedfromm utual +funds arep rimarily basedo naverage assets inthe +funds andt he saleso ff unds that we manage or +administer, anda re primarily reportedi nthe +Investment Management business. Thesef ees,w hich +include 12b-1fees,f luctuate with theoverall levelo f +nets ales,t he relativem ix of salesb etween share +classes, thef unds’m arketv aluesa nd moneym arket +feew aivers. +Distributiona nd servicingf ees were $148 millioni n +2023 compared with $130 millioni n2 022, drivenby +thea batement ofmoneym arketf ee waivers. The +impact of distributionand servicingf ees on income in +anyo ne periodis partially offset by distributionand +servicinge xpensep aidt oother financial +intermediaries to covert heir costsf or distributionand +servicingo fm utualf unds.D istributiona nd servicing +expensei sr ecorded asnonintereste xpenseo nt he +income statement. +Investmenta nd otherrevenue +Investment ando ther revenue includesi ncomeo rl oss +fromc onsolidated investment management funds, +seed capitalg ains orlosses, othert rading revenue or +loss, renewablee nergyi nvestmentsl osses, income +fromc orporatea nd bank-ownedlifei nsurance +contracts, otheri nvestment gainsorl osses, gainso r +lossesf romd isposals, expenser eimbursementsf rom +our CIBC Mellon jointv enture,o ther income or loss +andn et securitiesg ains orlosses.T he income or loss +fromc onsolidated investment management funds +shouldb ec onsidered together with thenet income or +loss attributable to noncontrollingi nterests,w hich +reflectst he portiono ft he consolidated funds for +whichw ed on ot havean economicinterest andi s +reflected belown et income as as eparatel inei temo n +thec onsolidated income statement. Othert rading +revenue orloss primarily includesthe impact of +market-risk hedging activity relatedt oour seed +capitali nvestmentsi ni nvestment management funds, +non-foreignc urrencyd erivativea nd fixedi ncome +trading, ando ther hedging activity.I nvestmentsi n +renewablee nergyg eneratel ossesi ni nvestment and +otherr evenue that aremoret hano ffset by benefits +andc redits recorded to thep rovision fori ncome +taxes. Otheri nvestment gainsorl ossesi ncludesf air +valuec hangeso fn on-readily marketablestrategic +equity,p rivate equity ando ther investments. Expense +reimbursementsf romo ur CIBC Mellonj oint venture +relate to expenses incurredb yBNY Mellono nbehalf +of theC IBCM ellonj oint venture. Otheri ncome +includesv arious miscellaneous revenues. +Resultso fO perations (continued) +6B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_24.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_24.txt new file mode 100644 index 0000000000000000000000000000000000000000..519c7e16a7ddec02ce83d3558c454901a05c2a2f --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_24.txt @@ -0,0 +1,27 @@ +Thef ollowing tablep rovidest he componentso fi nvestment ando ther revenue. +Investment ando ther revenue +(inm illions) 2023 2022 2021 +Income (loss) fromc onsolidated investment management funds $3 0 $( 42) $3 2 +Seed capitalg ains (losses) (a) 29 (37) 40 +Othert rading revenue 231 149 6 +Renewablee nergyi nvestment (losses) (167) (164) (201) +Corporate/bank-ownedl ifei nsurance 118 128 140 +Otheri nvestment gains(b) 47 159 159 +Disposal (losses) gains (6) 26 13 +Expenser eimbursementsf romj oint venture 117 108 96 +Other( loss) income (46) 34 46 +Nets ecurities( losses) gains (68) (443) (c) 5 +Totali nvestment ando ther revenue $2 85 $( 82) $3 36 +(a)I ncludesg ains (losses) on investments inBNYM ellonf unds whichh edge deferredincentivea wards. +(b)I ncludess trategic equity,p rivate equity and otherinvestments. +(c)I ncludesanetl osso f$ 449 millionr elated to therepositioning ofthes ecuritiesp ortfolio. +Investment ando ther revenue was$ 285 millioni n +2023 compared with al osso f$ 82 millioni n2 022. +Thei ncreasep rimarily reflectst he netlossf rom +repositioning thes ecuritiesp ortfolio in thefourth +quarter of 2022, partiallyoffset by ther eductioni n +thef airv alue ofac ontingent considerationr eceivable +relatedt oapriory ear divestiturei nt he fourth quarter +of 2023. +Resultso fO perations (continued) +BNYM ellon7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_25.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_25.txt new file mode 100644 index 0000000000000000000000000000000000000000..029642f762cb31c6c06376913d9e5a730880d18b --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_25.txt @@ -0,0 +1,40 @@ +Neti nterest revenue +Neti nterestr evenue 2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Neti nterestr evenue $4 ,345 $3 ,504 $2 ,618 24% 34% +Add: Taxe quivalent adjustment 2 11 13 N/M N/M +Neti nterestr evenue onaf ully taxableequivalent (“FTE”)b asis –N on- +GAAP (a) $4 ,347 $3 ,515 $2 ,631 24% 34% +Averagei nterest-earning assets $3 48,160 $3 62,180 $3 87,023 (4)% (6)% +Neti nterestm argin 1.25% 0.97% 0.68% 28 bps 29 bps +Neti nterestm argin( FTE) –N on-GAAP (a) 1.25% 0.97% 0.68% 28 bps 29 bps +(a)N et interest revenue(FTE)–Non-GAAP and netinterestm argin( FTE) –N on-GAAP include thet ax equivalent adjustmentson tax- +exempt income whicha llows forc omparisons of amountsarising from bothtaxablea nd tax-exempt sources and is consistent with +industryp ractice. Thea djustmentt oa nFTE basis has noimpact on netincome. +N/M–Notm eaningful. +bps –b asis points. +Neti nterestr evenue increased 24% compared with +2022, primarily reflectingh igheri nterestr ates, +partially offset by changesi nt he balancesheet size +andm ix. +Neti nterestm argini ncreased 28 basispoints +compared with 2022. Thei ncreasep rimarily reflects +thef actorsm entioneda bove. +Averagei nterest-earning assets decreased 4% +compared with 2022. Thed ecreasep rimarily reflects +lowers ecuritiesa nd loan balances andinterest- +bearingd eposits with banks,p artially offset by higher +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks. +Averagen on-U.S. dollard eposits comprised +approximately 25% of ouraveraget otal deposits in +2023 and2 022. Approximately 45% ofthea verage +non-U.S. dollard eposits in2023 and4 0% in 2022 +were euro-denominated. +Neti nterestr evenue in 2024 will largelydependo n +thel evel andmix of client deposits.B ased on market +impliedf orward interest ratesa sofD ec. 31, 2023,we +expect neti nterestr evenue for2 024 to decreasew hen +compared with 2023. +Resultso fO perations (continued) +8B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_26.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_26.txt new file mode 100644 index 0000000000000000000000000000000000000000..38ad6818af4efd89a00fd02cbe529fde6653fbc5 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_26.txt @@ -0,0 +1,75 @@ +Average balances andi nterestr ates 2023 2022 +(dollars in millions) +Average +balanceI nterest +Average +rate +Average +balanceI nterest +Average +rate +Assets +Interest-earning assets: +Interest-bearingd eposits with theFederal Reservea nd othercentral banks: +Domestic offices $5 9,492 $3 ,085 5.19% $4 6,270 $8 10 1.75% +Foreigno ffices 44,412 1,456 3.28 51,172 209 0.41 +Totali nterest-bearingd eposits with theFederal Reservea nd othercentral banks 103,904 4,541 4.37 97,442 1,019 1.05 +Interest-bearingd eposits with banks 13,620 523 3.84 16,826 221 1.31 +Federalf unds sold ands ecuritiesp urchased underr esalea greements (a) 26,077 7,141 27.38 24,953 1,200 4.81 +Loans: +Domestic offices 59,487 3,663 6.16 62,640 1,878 3.00 +Foreigno ffices 4,609 253 5.49 5,185 121 2.33 +Totall oans (b) 64,096 3,916 6.11 67,825 1,999 2.95 +Securities: +U.S. government obligations 33,434 1,021 3.05 40,583 607 1.49 +U.S. government agency obligations 60,586 1,695 2.80 64,041 1,157 1.81 +Others ecurities: +Domestic offices (c) 17,168 803 4.68 18,979 629 3.31 +Foreigno ffices 23,505 695 2.96 26,283 154 0.59 +Totalo ther securities (c) 40,673 1,498 3.68 45,262 783 1.73 +Totali nvestment securities (c) 134,693 4,214 3.13 149,886 2,547 1.70 +Tradings ecurities( primarily domestic) (c) 5,770 315 5.46 5,248 143 2.73 +Totals ecurities (c) 140,463 4,529 3.22 155,134 2,690 1.73 +Totali nterest-earning assets (c) $3 48,160 $20,650 5.93% $3 62,180 $7 ,129 1.97% +Noninterest-earning assets 58,790 64,721 +Totala ssets $4 06,950 $4 26,901 +Liabilitiesa nd equity +Interest-bearingl iabilities: +Interest-bearingd eposits: +Domestic offices $1 23,513 $4 ,703 3.81% $1 11,491 $9 80 0.88% +Foreigno ffices 88,829 2,421 2.73 101,916 607 0.60 +Totali nterest-bearingd eposits 212,342 7,124 3.35 213,407 1,587 0.74 +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements (a) 20,540 6,699 32.62 12,940 934 7.21 +Tradingl iabilities 3,396 156 4.60 3,432 68 1.98 +Otherb orrowedf unds: +Domestic offices 676 44 6.49 181 74 .12 +Foreigno ffices 426 30 .74 324 20 .51 +Totalo ther borrowedf unds 1,102 47 4.27 505 91 .80 +Commercialp aper 5— 4.81 5— 2.06 +Payables to customersa nd broker-dealers 14,449 566 3.91 17,111 156 0.91 +Long-term debt 31,021 1,711 5.51 27,448 860 3.13 +Totali nterest-bearingl iabilities $2 82,855 $16,303 5.76% $2 74,848 $3 ,614 1.31% +Totaln oninterest-bearingd eposits 59,227 85,652 +Othern oninterest-bearingl iabilities 24,106 25,278 +Totall iabilities 366,188 385,778 +TotalT he Bank ofNewY orkM ellonC orporations hareholders’e quity 40,701 41,013 +Noncontrollingi nterests 61 110 +Totall iabilitiesa nd equity $4 06,950 $4 26,901 +Neti nterestr evenue (FTE)–Non-GAAP (c)(d) $4 ,347 $3 ,515 +Neti nterestm argin( FTE) –N on-GAAP (c)(d) 1.25% 0.97% +Less: Taxe quivalent adjustment 2 11 +Neti nterestr evenue –G AAP $4 ,345 $3 ,504 +Neti nterestm argin–GAAP 1.25% 0.97% +Percentage ofassets attributable toforeigno ffices 24% 26% +Percentage ofliabilitiesa ttributable toforeigno ffices 27% 30% +(a)I ncludest he averageimpacto foffsettingu ndere nforceablen ettinga greements of approximately$111 billionin2 023 and $43 billionin2 022. On aN on- +GAAP basis,e xcluding thei mpacto foffsetting, they ield on federalf unds sold and securitiesp urchased underr esalea greements wouldh aveb een 5.22% +for2 023 and 1.77%for2 022, andther ateo nf ederal funds purchasedand securitiess oldu nderr epurchasea greements wouldh aveb een 5.10% for2 023 +and 1.67%for2 022.W eb elieve providingt he ratese xcluding thei mpacto fnettingi su sefult oi nvestors as it ismore reflectiveoft he actualratese arned +and paid. +(b)I nteresti ncomei ncludesf ees of $1millioni n2 023 and $2millioni n2 022. Nonaccrual loans areincludedi naverage loans;t he associatedincome, +whichw as recognizedo nac ashb asis,i si ncludedi ninteresti ncome. +(c)A verage ratesw erec alculatedo na nFTE basis,a tt ax rateso fa pproximately2 1% forb oth2 023 and 2022. +(d)S ee “Net interest revenue”onp age 8f or ther econciliationo ft hisN on-GAAP measure. +Resultso fO perations (continued) +BNYM ellon9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_27.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_27.txt new file mode 100644 index 0000000000000000000000000000000000000000..6c3d5b7edcd6740e5ebc3907808c4717edba149b --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_27.txt @@ -0,0 +1,71 @@ +Average balances andi nterestr ates 2021 +(dollars in millions) +Average +balanceI nterest +Average +rate +Assets +Interest-earning assets: +Interest-bearingd eposits with theFederal Reservea nd othercentral banks: +Domestic offices $4 7,070 $6 00 .13% +Foreigno ffices 66,276 (137) (0.21) +Totali nterest-bearingd eposits with theFederal Reservea nd othercentral banks 113,346 (77) (0.07) +Interest-bearingd eposits with banks 20,757 48 0.23 +Federalf unds sold ands ecuritiesp urchased underr esalea greements (a) 28,530 120 0.42 +Loans: +Domestic offices 55,073 892 1.62 +Foreigno ffices 5,741 66 1.15 +Totall oans (b) 60,814 958 1.58 +Securities: +U.S. government obligations 34,383 261 0.76 +U.S. government agency obligations 72,552 985 1.36 +Others ecurities: +Domestic offices (c) 19,768 387 1.95 +Foreigno ffices 30,183 123 0.41 +Totalo ther securities (c) 49,951 510 1.02 +Totali nvestment securities (c) 156,886 1,756 1.12 +Tradings ecurities( primarily domestic) (c) 6,690 53 0.80 +Totals ecurities (c) 163,576 1,809 1.11 +Totali nterest-earning assets (c) $3 87,023 $2 ,858 0.74% +Noninterest-earning assets 65,209 +Totala ssets $4 52,232 +Liabilitiesa nd equity +Interest-bearingl iabilities: +Interest-bearingd eposits: +Domestic offices $1 24,716 $( 27) (0.02)% +Foreigno ffices 112,493 (148) (0.13) +Totali nterest-bearingd eposits 237,209 (175) (0.07) +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements (a) 13,716 (4) (0.03) +Tradingl iabilities 2,590 80 .31 +Otherb orrowedf unds: +Domestic offices 160 52 .99 +Foreigno ffices 223 31 .48 +Totalo ther borrowedf unds 383 82 .11 +Commercialp aper 3— 0.07 +Payables to customersa nd broker-dealers 16,887 (2) (0.01) +Long-term debt 25,788 392 1.52 +Totali nterest-bearingl iabilities $2 96,576 $2 27 0.08% +Totaln oninterest-bearingd eposits 86,606 +Othern oninterest-bearingl iabilities2 4,381 +Totall iabilities4 07,563 +TotalT he Bank ofNewY orkM ellonC orporations hareholders’e quity 44,358 +Noncontrollingi nterests 311 +Totall iabilitiesa nd equity $4 52,232 +Neti nterestr evenue (FTE)–Non-GAAP (c)(d) $2 ,631 +Neti nterestm argin( FTE) –N on-GAAP (c)(d) 0.68% +Less: Taxe quivalent adjustment 13 +Neti nterestr evenue –G AAP $2 ,618 +Neti nterestm argin–GAAP 0.68% +Percentage ofassets attributable toforeigno ffices (e) 30% +Percentage ofliabilitiesa ttributable toforeigno ffices (e) 31% +(a)I ncludest he averageimpacto foffsettingu ndere nforceablen ettinga greements of approximately$45 billionin2 021. On aN on-GAAP basis,e xcluding +thei mpacto foffsetting, they ield on federalf unds sold and securitiesp urchased underr esalea greements wouldh aveb een 0.16%,a nd ther ateo nf ederal +funds purchasedand securitiess oldu nderr epurchasea greements wouldh aveb een (0.01)%f or 2021. We believe providingt he ratese xcluding the +impacto fnettingi su sefult oi nvestors as it ismore reflectiveoft he actualratese arneda nd paid. +(b)I nteresti ncomei ncludesf ees of $3millioni n2 021. Nonaccrual loans areincludedi naverage loans;t he associatedincome,w hich wasr ecognizedo na +cash basis,i si ncludedi ninteresti ncome. +(c)A verage ratesw erec alculatedo na nFTE basis,a tt ax rateso fa pproximately2 1% in 2021. +(d)S ee “Net interest revenue”onp age 8f or ther econciliationo ft hisN on-GAAP measure. +(e)I ncludest he Cayman Islands branchoffice, whiche xisted through August2 021. +Resultso fO perations (continued) +10 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_28.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_28.txt new file mode 100644 index 0000000000000000000000000000000000000000..926b383c09480e855064219ba89ee8099f6926ee --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_28.txt @@ -0,0 +1,56 @@ +Noninterest expense +Nonintereste xpense 2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Staff $7 ,095 $6 ,800 $6 ,337 4% 7% +Software ande quipment 1,817 1,657 1,478 10 12 +Professional, legaland otherpurchased services 1,527 1,527 1,459 — 5 +Neto ccupancy 542 514 498 5 3 +Sub-custodian andclearing 475 485 505 (2) (4) +Distributiona nd servicing 353 343 298 3 15 +Business development 183 152 107 20 42 +Bank assessmentc harges 788 126 133 N/M (5) +Goodwill impairment — 680 — N/M N/M +Amortizationo fi ntangiblea ssets 57 67 82 (15) (18) +Other 458 659 617 (31) 7 +Totaln onintereste xpense $1 3,295 $1 3,010 $1 1,514 2% 13% +Full-time employees atyear-end 53,400 51,700 49,100 3% 5% +Totaln onintereste xpensei ncreased 2% compared +with 2022, primarily reflectinga$632 milliona ccrual +fort he FDIC special assessment,higheri nvestments +andr evenue-relatede xpenses,a sw ella si nflation, +partially offset by thei mpactso ft he 2022 goodwill +impairmenti nt he Investment Management reporting +unit, efficiency savings andapriory ear divestiture. +Excluding notable items,nonintereste xpense +increased 3% (Non-GAAP). Thei nvestmentsi n +growth,i nfrastructurea nd efficiency initiatives are +primarily includedi nstaff, software ande quipment, +andp rofessional, legaland otherpurchased services +expenses.S ee “Supervisionand Regulation– +Deposit Insurance” on page 69fori nformationo nthe +FDIC special assessment. See“ Supplemental +Information–E xplanationo fG AAP andN on-GAAP +financialm easures”b eginning on page 111fort he +reconciliationo ft he Non-GAAP measure. +We expecttotaln onintereste xpensef or 2024to +decreasec omparedw ith 2023, primarily reflectingt he +impact of notableexpensei tems recorded in 2023, +including theF DICs pecial assessment,severance +expensea nd litigationr eserves. Excluding thei mpact +of notable items,total nonintereste xpensei se xpected +to be flat in 2024 compared with 2023. +Income taxes +BNYM ellonr ecorded anincome taxprovision of +$800 million( 19.6% effectivet ax rate)i n2 023. The +income taxp rovision was$ 768 million( 23.1% +effectivet ax rate)i n2 022. Excluding notable items, +thei ncomet ax provision was$ 930 million( 19.1% +effectivet ax rate)( Non-GAAP)i n2 022. See +“SupplementalI nformation–E xplanationo fG AAP +andN on-GAAP financialm easures”b eginning on +page 111fort he reconciliationo ft he Non-GAAP +measure. Fora dditionali nformationo nincomet axes, +seeN ote1 2o ft he Notest oC onsolidated Financial +Statements. +Resultso fO perations (continued) +BNYM ellon1 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_29.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_29.txt new file mode 100644 index 0000000000000000000000000000000000000000..00058854c9fe52093b4227e96b2fbe3611d00d73 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_29.txt @@ -0,0 +1,81 @@ +Review of business segments +We have an internal informations ystemt hatp roduces +performance data along productand servicel ines for +our threep rincipal businesss egments: Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagement, andt he Others egment. +Business segmentaccountingp rinciples +Ourb usinesss egment datahasb een determined on an +internal management basisofa ccounting, rather than +theg enerally accepteda ccountingp rinciples +(“GAAP”) used forc onsolidated financialr eporting. +Thesem easurementp rinciplesa re designeds othat +reportedr esults of theb usinessw ill tracktheir +economic performance. +Fori nformationo nthe accountingp rincipleso fo ur +businesss egments, thep rimary products ands ervices +in eachl ineo fb usiness, thep rimary typeso fr evenue +by lineo fb usinessa nd how our businesssegments +arep resented andanalyzed,s ee Note 24 oftheN otes +to Consolidated FinancialS tatements. +Business segmentresults ares ubject to +reclassificationw heno rganizationalc hangesa re +made,o rf or refinementsi nr evenue ande xpense +allocationm ethodologies.R efinements aret ypically +reflected on ap rospectiveb asis.T here were no +reclassificationo ro rganizationalc hangesi n2 023. +Ther esults of our businesssegmentsm ay be +influenced by client ando ther activitiesthatv aryb y +quarter.I nt he firstq uarter,l ong-term stocka wards +forr etirement-eligible employees vest which +increases staffe xpense.T he timingo fo ur annual +employeem erit increases alsoimpactss taff expense. +In 2023, them erit increasewas effectiveatt he +beginning ofthes econd quarter,comparedw ith prior +yearsw heni tw as effectiveatt he beginning ofthe +thirdq uarter.F or 2024,them erit increasewillb e +effectivei nM arch,t hus partially impactingthe first +quarter andsecond quarterstaffe xpensev ariances. +In thet hird quarter,v olume-relatedf ees mayd ecline +due to reduced clientactivity.I nt he fourth quarter, +we typically incurhigherb usinessd evelopmenta nd +marketinge xpenses.I no ur Investment andW ealth +Management businesssegment,p erformance fees are +typically higheri nt he fourth andf irst quarters, as +thoseq uartersr epresent thee nd ofthem easurement +period form anyo ft he performancefee-eligible +relationships. +Ther esults of our businesssegmentsm ay alsobe +impacted by thet ranslationo ff inancial results +denominated in foreignc urrenciest ot he U.S. dollar. +We areprimarily impactedby activitiesd enominated +in theB ritishp ound andt he euro.O naconsolidated +basisa nd in our SecuritiesS ervicesa nd Market and +Wealth Services businesss egments, wetypically have +more foreigncurrency-denominated expensesthan +revenues. However, our Investment andW ealth +Management businesssegment typically hasm ore +foreignc urrency-denominated revenuest han +expenses.O verall, currencyf luctuations impact the +year-over-year growth rate in theInvestment and +Wealth Management businesssegment more than the +SecuritiesS ervices andMarketa nd Wealth Services +businesss egments. However, currencyf luctuations, +in isolation, aren ot expected to significantly impact +neti ncomeo naconsolidated basis. +Feer evenue in theI nvestment andW ealth +Management businesssegment,a nd to al essere xtent, +theS ecuritiesS ervicesa nd Market andWealth +Services businesss egments, is impacted by theg lobal +market fluctuations.A tD ec. 31, 2023,w ee stimated +that a5 %c hange in globale quity markets, spread +evenly throughout they ear,w ouldi mpact feer evenue +by less than 1% andd ilutede arnings percommon +shareb y$ 0.04 to $0.07. +SeeN ote2 4o ft he Notest oC onsolidated Financial +Statements fort he consolidatings chedules which +show thec ontributiono fo ur businesssegmentst oo ur +overall profitability. +Resultso fO perations (continued) +12 BNYM ellon +The secret flower is a "sunflower". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_3.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_3.txt new file mode 100644 index 0000000000000000000000000000000000000000..b0fbbf0d425b901d807d4a10b20e1227327e9746 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_3.txt @@ -0,0 +1,14 @@ +IBNY MELLON +Robin Vince, +President and +Chief Executive Offi cer +Last year was the fi rst full year of my tenure as CEO of BNY Mellon. +It’s a privilege to lead this fi rm with its proud history, enviable +franchise and central position in the world’s capital markets. +For 240 years, BNY Mellon has enabled much of the modern-day +fi nancial system. Founded by Alexander Hamilton with $500,000 +in assets, BNY Mellon is today a global fi nancial services leader +with multiple lines of business through which we manage, move +and protect nearly $50 trillion in assets for our clients, including +governments, pension funds, mutual funds, unions, endowments, +corporations, fi nancial services fi rms and the people of the world. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_30.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_30.txt new file mode 100644 index 0000000000000000000000000000000000000000..ec677bdcadc7b1baec675b5e17962a250cf614c5 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_30.txt @@ -0,0 +1,45 @@ +Securities Services businesssegment +2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Revenue: +Investment services fees: +AssetS ervicing $3 ,898 $3 ,918 $3 ,876 (1)% 1% +Issuer Services 1,121 1,009 1,061 11 (5) +Totali nvestment services fees 5,019 4,927 4,937 2 — +Foreigne xchanger evenue 488 584 574 (16) 2 +Otherf ees (a) 215 202 113 6 79 +Totalf ee revenue 5,722 5,713 5,624 — 2 +Investment ando ther revenue 333 291 194 N/M N/M +Totalf ee andother revenue 6,055 6,004 5,818 1 3 +Neti nterestr evenue 2,569 2,028 1,426 27 42 +Totalr evenue 8,624 8,032 7,244 7 11 +Provision forc reditl osses 99 8( 134) N/M N/M +Nonintereste xpense (excluding amortizationo fi ntangiblea ssets) 6,345 6,266 5,820 1 8 +Amortizationo fi ntangiblea ssets 31 33 32 (6) 3 +Totaln onintereste xpense 6,376 6,299 5,852 1 8 +Income before income taxes $2 ,149 $1 ,725 $1 ,526 25% 13% +Pre-taxo peratingm argin 25% 21% 21% +Securitiesl ending revenue (b) $1 89 $1 82 $1 73 4% 5% +Totalr evenue byline of business: +AssetS ervicing $6 ,638 $6 ,323 $5 ,699 5% 11% +Issuer Services 1,986 1,709 1,545 16 11 +Totalr evenue bylineo fb usiness $8 ,624 $8 ,032 $7 ,244 7% 11% +Selected average balances: +Averagel oans $1 1,207 $1 1,245 $8 ,756 —% 28% +Averaged eposits $168,411 $1 83,990 $2 00,482 (8)% (8)% +Selected metrics: +AUC/A at period end (int rillions)( c) $3 4.2 $3 1.4 $3 4.6 9% (9)% +Market valueo fs ecuritieso nl oana tp eriode nd (inb illions)( d) $4 50 $4 49 $4 47 —% —% +Issuer Services: +Totald ebts erviced atperiod end (int rillions) $1 3.3 $1 2.6 $1 2.6 6% —% +Number of sponsored Depositary Receiptsp rogramsa tp eriode nd 543 589 656 (8)% (10)% +(a)O ther fees primarily includesfinancing-relatedf ees. +(b)I ncludedi ninvestments ervices fees reportedi nthe AssetS ervicing line of business. +(c)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theIssuer Services lineo fb usiness. +Includest he AUC/Ao fC IBCM ellono f$ 1.7 trilliona tD ec. 31, 2023,$ 1.5 trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(d)R epresentst he totala mount ofsecuritieso nl oan in our agencysecuritiesl ending program.E xcludess ecuritiesf or whichB NY Mellon +acts as agent on behalfo fCIBCM ellonc lients, whicht otaled $63 billionatD ec. 31, 2023,$ 68 billionatD ec. 31, 2022 and $71 billion +at Dec. 31, 2021. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_31.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_31.txt new file mode 100644 index 0000000000000000000000000000000000000000..80631f087517a3c81e8d581c5199168857410cdd --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_31.txt @@ -0,0 +1,89 @@ +Business segmentdescription +TheS ecuritiesS ervices businesss egment consists of +twod istinct lines of business, AssetServicing and +Issuer Services,w hich provide businesssolutions +acrosst he transactionl ifecyclet oo ur globalasset +ownera nd assetm anager clients. We areone ofthe +leadingg lobali nvestment services providers with +$34.2 trilliono fA UC/A at Dec. 31, 2023.F or +informationo nthe driversoft he SecuritiesS ervices +feer evenue,s ee Note 10 oftheN otes to Consolidated +FinancialS tatements. +TheA ssetS er vicing businessprovidesa +comprehensives uite of solutions.W ea re one ofthe +largestg lobalc ustody, fund administrator andf ront- +to-back outsourcing partners.W eo ffers ervices for +thes afekeepingo fa ssets incapitalm arkets globally +as well as fund accountings ervices,e xchange-traded +funds servicing, transfer agency,trust andd epository, +front-to-back capabilitiesa swella sd ataa nd analytics +solutions foro ur clients. We deliver foreign +exchange,a nd securitiesl ending andf inancing +solutions,o nbotha nagencya nd principalbasis.O ur +agency securitiesl ending programis one ofthe +largestl enders of U.S. andn on-U.S.s ecurities, +servicingalendablea ssetp oolo fa pproximately $4.9 +trillioni n3 4separatem arkets.O ur market-leading +liquidity services portale nables cashinvestmentsf or +institutionalc lientsa nd includes fund research and +analytics. +OurD igitalA ssetC ustody platformoffers custody +anda dministrations ervices forB itcoina nd Etherf or +select U.S. institutionalc lients. OurD igitalA ssets +Funds Services providesa ccountinga nd +administration, transfer agency andETF services to +digitala ssetf unds.W ee xpect to continue developing +our digitalassetc apabilitiesa nd to work closelyw ith +clientst oa ddresst heir evolving digitalassetn eeds. +As of andf or they ear endedDec. 31, 2023, our +DigitalA ssetC ustody platformandr elated initiative +hadade minimis impact on ourassets,l iabilities, +revenuesa nd expenses. +TheI ssuer Services businessi ncludesC orporate +Trusta nd Depositary Receipts. OurC orporate +Trustb usinessd eliversafull range ofissuer and +relatedi nvestor services,i ncluding trustee, paying +agency,f iduciary,e scrowa nd otherfinancial +services.W ea re al eadingp rovidert ot he debt +capitalm arkets,p roviding customized andmarket- +driven solutionst oi nvestors, bondholders and +lenders.O ur Depositary Receiptsb usinessd rives +globali nvestingb yproviding servicinga nd value- +addeds olutions that enable,facilitate ande nhance +cross-bordert rading,c learing, settlement and +ownership. We areone ofthel argest providers of +depositary receiptsservicesi nt he world, partnering +with leadingc ompanies fromm oret han5 0 +countries. +Review of financialr esults +AUC/A of $34.2trillioni ncreased 9% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values. +Totalr evenue of $8.6 billionincreased 7% compared +with 2022. Thed rivers of totalr evenue bylineo f +businessa re indicated below. +AssetS ervicing revenue of $6.6 billionincreased 5% +compared with 2022, primarilyreflectingh ighern et +interest revenue,n et newb usinessa nd thea batement +of moneym arketf ee waivers, partially offset by +lowerf oreign exchange revenue andc lient activity. +Issuer Services revenue of $2.0 billionincreased 16% +compared with 2022, primarilyreflectingh ighern et +interest revenue,t he accelerated amortizationo f +deferredc osts ford epositary receiptsservicesr elated +to Russiar ecorded in 2022, netnew businessa nd the +abatemento fm oneym arketf ee waivers. +Market andregulatoryt rends ared riving investable +assets toward lowerf ee assetmanagementp roducts at +reduced marginsf or ourclients. Thesed ynamicsa re +also negativelyi mpactingo ur investment services +fees.H owever,a tt he same time,t hese trends are +providing additionalo utsourcing opportunitiesa s +clientsa nd othermarketp articipantss eekt ocomply +with regulations andr educet heir operatingc osts. +Nonintereste xpenseo f$ 6.4 billionincreased 1% +compared with 2022, primarilyreflectingh igher +investmentsa nd thei mpact of inflation, partially +offset by efficiency savings. +Resultso fO perations (continued) +14 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_32.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_32.txt new file mode 100644 index 0000000000000000000000000000000000000000..f78a3d9cc1f7a2f0bf0f3b92b13954fd116aaf18 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_32.txt @@ -0,0 +1,47 @@ +Market andWealth Services businesssegment +2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Revenue: +Investment services fees: +Pershing $2 ,007 $1 ,908 $1 ,737 5% 10% +TreasuryS ervices 691 689 662 — 4 +Clearance andCollateralM anagement 1,090 971 918 12 6 +Totali nvestment services fees 3,788 3,568 3,317 6 8 +Foreigne xchanger evenue 81 88 88 (8) — +Otherf ees (a) 212 176 131 20 34 +Totalf ee revenue 4,081 3,832 3,536 6 8 +Investment ando ther revenue 63 40 47 N/M N/M +Totalf ee andother revenue 4,144 3,872 3,583 7 8 +Neti nterestr evenue 1,712 1,410 1,158 21 22 +Totalr evenue 5,856 5,282 4,741 11 11 +Provision forc reditl osses 41 7( 67) N/M N/M +Nonintereste xpense (excluding amortizationo fi ntangiblea ssets) 3,191 2,924 2,655 9 10 +Amortizationo fi ntangiblea ssets 6 82 1 (25) (62) +Totaln onintereste xpense 3,197 2,932 2,676 9 10 +Income before income taxes $2 ,618 $2 ,343 $2 ,132 12% 10% +Pre-taxo peratingm argin 45% 44% 45% +Totalr evenue byline of business: +Pershing $2 ,789 $2 ,537 $2 ,314 10% 10% +TreasuryS ervices 1,611 1,483 1,293 9 15 +Clearance andCollateralM anagement 1,456 1,262 1,134 15 11 +Totalr evenue bylineo fb usiness $5 ,856 $5 ,282 $4 ,741 11% 11% +Selected average balances: +Averagel oans $3 7,502 $4 1,300 $3 8,344 (9)% 8% +Averaged eposits $8 5,785 $9 1,749 $1 02,948 (7)% (11)% +Selected metrics: +AUC/A at period end (int rillions)( b) $1 3.3 $1 2.7 $1 1.8 5% 8% +Pershing: +AUC/A at period end (int rillions) $2 .5 $2 .3 $2 .6 9% (12)% +Netn ew assets(U.S.p latform) (inb illions)( c) $2 2 $1 21 $1 61 N/M N/M +Averagea ctivec learinga ccounts (int housands) 7,946 7,483 7,257 6% 3% +TreasuryS ervices: +Averaged aily U.S. dollarp ayment volumes 236,696 239,630 235,971 (1)% 2% +Clearance andCollateralM anagement: +Averaget ri-party collateralm anagementb alances (inb illions) $5 ,658 $5 ,285 $4 ,260 7% 24% +(a)O ther fees primarily includefinancing-relatedf ees. +(b)C onsists of AUC/Af romt he Clearancea nd CollateralM anagement andPershingb usinesses. +(c)N et newa ssets representn et flows of assets(e.g., netcashd eposits and netsecuritiest ransfers, including dividends andinterest)i n +customer accountsi nP ershingL LC,aU .S. broker-dealer. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_33.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_33.txt new file mode 100644 index 0000000000000000000000000000000000000000..ac143e133f7ad89953cbbe80e251c25b985b3c76 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_33.txt @@ -0,0 +1,66 @@ +Business segmentdescription +TheM arketa nd Wealth Services businesss egment +consists of threed istinct lines of business,Pershing, +TreasuryS ervicesa nd Clearance andCollateral +Management,w hich provide businessservices and +technology solutions to entitiesi ncluding financial +institutions,c orporations,f oundations and +endowments, public funds andg overnment agencies. +Fori nformationo nthe driversoft he Market and +Wealth Services feer evenue,s ee Note 10 ofthe +Notest oC onsolidated FinancialS tatements. +Pershing providesexecu tion, clearing, custody, +businessa nd technology solutions,d elivering +operationals upportt ob roker-dealers, wealth +managers andr egisteredi nvestment advisors +(“RIAs”) globally. +OurT reasuryS ervices businessi saleading +providero fglobalp ayments, liquidity management +andt rade finances ervices forf inancial institutions, +corporations andt he publicsector. +OurC learance andCollateralM anagement +businessc learsa nd settlese quitya nd fixed-income +transactions globallyands ervesa scustodian for +tri-partyr epoc ollateralw orldwide.W ea re the +primary providero fU.S.g overnment securities +clearance andaprovidero fnon-U.S. government +securitiesc learance. Ourc ollaterals ervices +include collateralm anagement, administrationa nd +segregation. We offeri nnovatives olutions and +industrye xpertisew hich help financiali nstitutions +andi nstitutionali nvestorsw ith theirfinancing, risk +andb alance sheet challenges. We areal eading +providero ftri-party collateralm anagement +services with an averageof$ 5.7 trillions erviced +globally includingapproximately $4.6 trilliono f +theU .S.t ri-party repo market atDec. 31, 2023. +Review of financialr esults +AUC/A of $13.3trillioni ncreased 5% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values andnet clientinflows. +Totalr evenue of $5.9 billionincreased 11% +compared with 2022. Thed rivers of totalr evenue by +lineo fb usinessa re indicated below. +Pershing revenue of $2.8 billionincreased 10% +compared with 2022, primarilyreflectingt he +abatemento fm oneym arketf ee waivers, highern et +interest revenue andh igherf ees on sweepb alances, +partially offset by lowerc lient activity andl ost +business. Netn ew assetsof $22 billionin 2023 +reflectst he deconversionofaregional bank client +that wasa cquiredi nMay. +TreasuryS ervices revenue of $1.6 billionincreased +9% compared with 2022, primarilyreflectingh igher +neti nterestr evenue. +Clearance andCollateralM anagementr evenue of +$1.5 billionincreased 15% compared with 2022, +primarily reflectingh ighern et interest revenue, U.S. +collateralm anagementb alances andU.S.g overnment +clearance volumes. +Nonintereste xpenseo f$ 3.2 billionincreased 9% +compared with 2022, primarilyreflectingh igher +investmentsa nd revenue-relatede xpenses,a sw ella s +thei mpact of inflation, partiallyoffset by efficiency +savings. +Resultso fO perations (continued) +16 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_34.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_34.txt new file mode 100644 index 0000000000000000000000000000000000000000..5656495368bdf7435cb4bf9e53912ae71af64c3f --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_34.txt @@ -0,0 +1,47 @@ +Investment andWealth Management businesssegment +2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Revenue: +Investment management fees $2 ,971 $3 ,215 $3 ,483 (8)% (8)% +Performance fees 81 75 107 8 (30) +Investment management andp erformance fees (a) 3,052 3,290 3,590 (7) (8) +Distributiona nd servicingf ees 241 192 112 26 71 +Otherf ees (b) (214) (133) 80 N/M N/M +Totalf ee revenue 3,079 3,349 3,782 (8) (11) +Investment ando ther revenue (c) (102) (27) 67 N/M N/M +Totalf ee andother revenue (c) 2,977 3,322 3,849 (10) (14) +Neti nterestr evenue 166 228 193 (27) 18 +Totalr evenue 3,143 3,550 4,042 (11) (12) +Provision forc reditl osses (4) 1( 13) N/M N/M +Nonintereste xpense (excluding goodwill impairmentand +amortizationo fi ntangiblea ssets) 2,746 2,795 2,796 (2) — +Goodwill impairment — 680 — N/M N/M +Amortizationo fi ntangiblea ssets 20 26 29 (23) (10) +Totaln onintereste xpense 2,766 3,501 2,825 (21) 24 +Income before income taxes $3 81 $4 8$ 1,230 694% (d) (96)% (d) +Pre-taxo peratingm argin 12% 1% 30% +Adjusted pre-taxo peratingm argin – Non-GAAP (e) 14% (f) 2% (f) 33% +Totalr evenue byline of business: +Investment Management $2 ,068 $2 ,390 $2 ,834 (13)% (16)% +Wealth Management 1,075 1,160 1,208 (7) (4) +Totalr evenue bylineo fb usiness $3 ,143 $3 ,550 $4 ,042 (11)% (12)% +Selected average balances: +Averagel oans $1 3,718 $1 4,055 $1 2,120 (2)% 16% +Averaged eposits $1 4,280 $1 9,214 $1 8,068 (26)% 6% +(a)O nac onstant currencyb asis,i nvestmentm anagement and performancefees decreased 7% (Non-GAAP) comparedwith 2022. See +“SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” beginning on page 111fort he reconciliationo f +this Non-GAAP measure. +(b)O ther fees primarily includesinvestments ervices fees. +(c)I nvestmenta nd otherrevenue andtotalf ee and otherrevenue arenet of income attributablet on oncontrollingi nterests relatedt o +consolidated investmentm anagement funds. +(d)E xcluding notableitems,i ncomeb eforei ncomet axes decreased 28% (Non-GAAP) in 2023 compared with 2022 and 39%(Non-GAAP) +in 2022 compared with 2021. See“ SupplementalI nformation –E xplanationo fG AAP and Non-GAAP financialm easures” beginning +on page 111fort he reconciliationo ft hese Non-GAAP measures. +(e)N et of distributionand servicinge xpense.S ee “SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” +beginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +(f)E xcluding notableitems and neto fdistributiona nd servicinge xpense,t he adjustedpre-tax operatingmarginw as 19% (Non-GAAP) in +2023 and24% (Non-GAAP) in 2022.S ee “SupplementalI nformation –E xplanationo fG AAP and Non-GAAP financialm easures” +beginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_35.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_35.txt new file mode 100644 index 0000000000000000000000000000000000000000..081e0cfa8fd6806681409d0caf13a29066c0668e --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_35.txt @@ -0,0 +1,102 @@ +AUM trends +(inb illions) 2023 2022 2021 +AUM by producttype (a): +Equity $1 45 $1 35 $1 87 +Fixedi ncome 205 198 267 +Index 459 395 467 +Liability-driveni nvestments 605 570 890 +Multi-asseta nd alternativei nvestments 170 153 228 +Cash 390 385 395 +TotalA UM $1,974 $1 ,836 $2 ,434 +Changesi nA UM (a): +Beginning balanceofA UM $1,836 $2 ,434 $2 ,211 +Neti nflows (outflows): +Long-term strategies: +Equity (12) (18) (12) +Fixedi ncome (4) (21) 17 +Liability-driveni nvestments 12 78 36 +Multi-asseta nd alternative +investments (9) (11) (2) +Totall ong-term actives trategies +(outflows) inflows (13) 28 39 +Index (12) 2( 7) +Totall ong-term strategies +(outflows) inflows (25) 30 32 +Short-term strategies: +Cash 5 (12) 70 +Totaln et (outflows) inflows (20) 18 102 +Netm arketi mpact 121 (471) 143 +Netc urrencyi mpact 37 (113) (22) +Divestiture — (32) — +Ending balanceofA UM $1,974 $1 ,836 $2 ,434 +Wealth Management client +assets (b) $3 12 $2 69 $3 21 +(a)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth +Management businesssegment. +(b)I ncludesA UM and AUC/Ai nt he Wealth Management lineo f +business. +Business segmentdescription +OurI nvestment andW ealth Management business +segmentc onsists of twod istinct lines of business, +Investment Management andW ealth Management, +whichh aveac ombinedA UM of $2.0trilliona so f +Dec. 31, 2023. +BNYM ellonI nvestment Management is al eading +globala ssetm anager andconsists of sevens pecialist +investment firmsa nd ag lobald istributionp latformt o +deliver ad iversified range ofinvestment capabilities +to institutionala nd retail clientsg lobally. +OurI nvestment Management modelp rovides +specialiste xpertisef roms even investment firms +offering solutions acrossm ajor assetc lasses, backed +by thes trength, scalea nd provenstewardship of BNY +Mellon. Each investment firm hasi ts owni ndividual +culture,i nvestment philosophyandp roprietary +investment process. This approach brings ourclients +clear,i ndependent thinking fromh ighlye xperienced +investment professionals. +Thei nvestment firmso fferabroadr ange ofactively +managede quity,f ixed income,m ulti-asseta nd +liability-driveni nvestments, along with passive +products andc ashm anagement. Ours ix majority- +ownedi nvestment firmsa re as follows:A RX, +Dreyfus, Insight Investment,M ellon, Newton +Investment Management andW alterS cott. BNY +Mellono wnsanoncontrollingi nteresti nS iguler +Guff. +In November 2022, BNYM ellons oldA lcentra. As +part of thes alea greement, Investment Management +will continue to offerA lcentra’sc apabilitiesi nB NY +Mellon’ss ub-advisedf unds andi nselect regions via +its globald istributionp latform. BNYM ellon +continuest op rovide Alcentra with ongoing asset +servicings upport. Additionally,I nvestment +Management exclusivelyd istributes Alcentra +products inJapan. +Investment Management hasmultiple global +distributione ntities, whicha re responsiblefor +distributingt he investment solutionsd evelopeda nd +managedb ythe investment firms, as well as +responsibility form anagementa nd distributionofo ur +U.S. mutual funds,E TFsa nd certain offshorem oney +market funds. +BNYM ellonW ealth Management provides +investment management,c ustody, wealth ande state +planning, privatebanking services,i nvestment +servicinga nd informationm anagement. BNYM ellon +Wealth Management has$312 billioninc lient assets +as of Dec. 31, 2023,a nd more than 30 officesin the +U.S. andi nternationally. +Wealth Management clientsi nclude individuals, +familiesa nd institutions.I nstitutions include family +offices,c haritableg iftp rogramsa nd endowmentsa nd +foundations.W ew orkw ith clientst ob uild,m anage +ands ustain wealth acrossg enerations andm arket +cycles. +Thew ealth businessd ifferentiatesi tselfw ith a +comprehensivew ealth managementframework called +ActiveW ealth thatseekst oe mpower clientstob uild +ands ustain long-term wealth. +Resultso fO perations (continued) +18 BNYM ellon +The secret animal #2 is a "kangaroo". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_36.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_36.txt new file mode 100644 index 0000000000000000000000000000000000000000..88e99df2b7994a93b880c0c909469c585b05d6da --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_36.txt @@ -0,0 +1,89 @@ +Ther esults of theI nvestment andW ealth +Management businesssegment ared rivenb yablend +of daily,m onthlya nd quarterlyAUM by product +type.T he overall levelofA UM foragivenp eriodi s +determined by: +•t he beginninglevelo fA UM; +•t he netflows of newassets duringt he period +resultingf romn ew businessw insa nd existing +client inflows, reduced by thel osso fc lientsa nd +existingc lient outflows;and +•t he impact of market pricea ppreciationo r +depreciation, foreigne xchanger ates and +investment firm acquisitions or divestitures. +Them ix of AUM is ar esulto ft he historicalgrowth +rateso fe quity andf ixed income marketsand the +cumulativen et flowso fo ur investment firmsa sa +result of client asseta llocationd ecisions.A ctively +managede quity,m ulti-asseta nd alternativea ssets +typically generate higherp ercentagef ees than fixed- +income andl iability-driveni nvestmentsa nd cash. +Also,a ctivelym anaged assets typicallygenerate +higherm anagementf ees than indexedo rp assively +manageda ssets of thes amet ype.M arketa nd +regulatoryt rends haveresultedi nincreased demand +forl ower feea ssetm anagementp roducts andf or +performance-basedf ees. +Investment management fees aredependent onthe +overall leveland mix of AUM andt he management +fees expressedi nbasis points( one-hundredth of one +percent) chargedf or managing thosea ssets. +Management fees aretypically subject to fee +schedules basedo nthe overall levelofa ssets +managedf or as inglec lient or byindividuala sset +classa nd style. This is mostcommonf or institutional +clientsw here we typically managesubstantiala ssets +fori ndividuala ccounts. +Performance fees aregenerally calculateda sa +percentage ofap ortfolio’s performance in excesso fa +benchmarki ndexo rapeer group’sp erformance. +Ak ey driver of organicgrowthi ninvestment +management andp erformance fees is theamount of +netn ew AUM flows. Overallm arketc onditions are +also keyd rivers,w ith as ignificantl ong-term +economic driver beingg rowtho fg lobalf inancial +assets. +Neti nterestr evenue is determined by loan and +deposit volumes andthe interest rate spread between +customer ratesa nd internal funds transfer rateso n +loansa nd deposits.E xpenses in theInvestment and +Wealth Management businesssegment arem ainly +driven by staffa nd distributionand servicing +expenses. +Review of financialr esults +AUM of $2.0trillioni ncreased 8% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values andthe favorable impact of aw eaker U.S. +dollar, partially offset by cumulativen et outflows. +Netl ong-term strategy outflowswere$ 25 billioni n +2023, drivenby outflowsofe quity,i ndexa nd multi- +asseta nd alternativei nvestments, partially offset by +inflowso fl iability-driveni nvestments. Short-term +strategy inflowsw ere$ 5b illioni n2 023. +Totalr evenue of $3.1 billion decreased11% +compared with 2022. Thed rivers of totalr evenue by +lineo fb usinessa re indicated below. +Investment Management revenue of $2.1 billion +decreased 13% compared with 2022, primarily +reflectingt he reductioni nthe fair valueo fa +contingent considerationr eceivablea nd thei mpact of +thep rior yeardivestiture,a sw ella st he mix of AUM +flows, partially offset thea batement ofmoneym arket +feew aivers ands eed capitalg ains. +Wealth Management revenue of $1.1 billion +decreased 7% compared with 2022, primarily +reflectingc hangesi np roductm ix andl ower net +interest revenue. +Revenue generatedi nthe Investment andW ealth +Management businesssegment included3 3% from +non-U.S. sources in 2023, compared with 35% in +2022. +Nonintereste xpenseo f$ 2.8 billiondecreased 21% +compared with 2022, primarilyreflectingt he +goodwilli mpairmenti nt he Investment Management +reportingu niti n2 022, thei mpact of ap rior year +divestiturea nd efficiency savings,p artially offset by +higheri nvestmentsa nd revenue-relatede xpenses,a s +well as inflation. +Resultso fO perations (continued) +BNYM ellon1 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_37.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_37.txt new file mode 100644 index 0000000000000000000000000000000000000000..940ecfac6a69f1351edd8ad6273020ec1fc52379 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_37.txt @@ -0,0 +1,76 @@ +Other segment +(inm illions) 2023 2022 2021 +Feer evenue $( 10) $6 1$ 36 +Investment ando ther revenue (11) (373) 15 +Totalf ee andother revenue (21) (312) 51 +Neti ntereste xpense (102) (162) (159) +Totalr evenue (123) (474) (108) +Provision forc reditl osses (17) 23 (17) +Nonintereste xpense 956 278 161 +(Loss) before income taxes $( 1,062) $( 775) $( 252) +Averagel oans andl eases $1 ,669 $1 ,225 $1 ,594 +Segmentd escription +TheO ther segmentp rimarily includes: +•t he leasingp ortfolio; +•c orporatet reasurya ctivities, including our +securitiesp ortfolio; +•d erivatives andother tradinga ctivity; +•c orporatea nd bank-ownedlifei nsurance; +•r enewable energy ando ther corporate +investments; and +•c ertain businesse xits. +Revenue primarily reflects: +•n et interest revenue (expense) andlease-related +gains( losses) from leasingo perations; +•n et interest revenue (expense) andderivatives and +otherc orporatet reasurya ctivities; +•o ther revenue from certain businesse xits; +•i nvestment ando ther revenue fromc orporatea nd +bank-ownedl ifei nsurance, gains( losses) +associated with investmentsecuritiesa nd other +assets,i ncluding renewablee nergy; and +•f ee revenue from thee liminationo ft he resultso f +certain services providedb etween segments, +whicha re also providedt othird parties. +Expenses include: +•d irect expensessupportingl easing, investinga nd +funding activities; and +•e xpenses not directlyattributable toSecurities +Services,M arketa nd Wealth Services and +Investment andW ealth Management operations. +Review of financialr esults +Loss before taxesw as $1.1 billionin2 023 compared +with $775 millioni n2 022. +Investment ando ther revenue increased $362 million +compared with 2022, primarilyreflectingt he netloss +fromr epositioning thes ecurity portfolio recordedi n +2022. +Nonintereste xpensei ncreased $678 million +compared with 2022, primarilydriven by theF DIC +special assessment. +Internationalo perations +Ourp rimary internationala ctivitiesc onsisto fa sset +servicingi nour SecuritiesS ervicesb usinesss egment, +globalp ayment services in our Market andWealth +Services businesss egment andi nvestment +management in our Investment andW ealth +Management businesssegment. +Ourc lientsi nclude central banks ands overeigns, +financiali nstitutions,a ssetm anagers, insurance +companies, corporations,l ocal authoritiesand high- +net-worthi ndividuals andf amily offices.T hrough +our globalnetwork of offices,weh aved evelopeda +deep understanding oflocal requirementsa nd cultural +needs, andw ep ride ourselveson providing dedicated +servicet hrough ourmultilinguals ales,m arketinga nd +client servicet eams. +At Dec. 31, 2023,a pproximately 55% of ourtotal +employees (full-time andp art-time employees)w ere +basedo utside theU .S., with approximately 11,000 +employees in EMEA,a pproximately 18,400 +employees in APAC anda pproximately 800 +employees in otherg loball ocations,p rimarily Brazil. +We areal eading globalassetm anager.O ur +internationalo perations managed5 1% ofBNY +Resultso fO perations (continued) +20 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_38.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_38.txt new file mode 100644 index 0000000000000000000000000000000000000000..cda1252ca9463f518ad9abb8b38affc07c571b07 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_38.txt @@ -0,0 +1,84 @@ +Mellon’sA UM at Dec. 31, 2023and5 3% at Dec. 31, +2022. +In Europe,w em aintainc apabilitiest os ervice +Undertakings forC ollectiveI nvestment in +Transferable Securitiesa nd alternativei nvestment +funds.W eo fferafull range oftailoreds olutions for +investment companies, financiali nstitutions and +institutionali nvestorsa crossm ostE uropean markets. +We areap rovidero fnon-U.S. government securities, +fixedi ncomea nd equitiesc learance, settling +securitiest ransactions directly inEuropean markets, +andu sing ah igh-quality ande stablishedn etwork of +local agents innon-European markets. +We have extensivee xperience providing tradea nd +cashs ervices to financiali nstitutions andc entral +banks outside oftheU .S.I na ddition, we offera +broadr ange ofservicinga nd fiduciary products to +financiali nstitutions,c orporations andc entral banks. +In emerging markets, welead with custody, global +payments andi ssuer services,i ntroducingo ther +products as them arkets mature.F or more established +markets, our focusi song lobali nvestment services. +We arealsoafull- serviceg lobalp rovidero fforeign +exchange services,a ctivelyt rading in over1 00 ofthe +world’sc urrencies. We servec lientsf romt rading +desksl ocated in Europe,A siaa nd NorthA merica. +Ourf inancial results,a sw ella so ur levels of AUC/A +andA UM,a re impacted by translationf romf oreign +currenciest ot he U.S. dollar. We areprimarily +impacted by activitiesd enominated in theBritish +pound andt he euro.I ft he U.S. dollard epreciates +againstt hese currencies, thet ranslationi mpact is a +higherl evel of feer evenue,n et interest revenue, +nonintereste xpensea nd AUC/A andA UM. +Conversely, if theU.S.d ollara ppreciates,t he +translated levels of feer evenue,n et interest revenue, +nonintereste xpensea nd AUC/A andA UM will be +lower. +Foreign exchange rates +vs.U .S.d ollar2 023 2022 2021 +Spot rate (atD ec. 31): +Britishp ound $1 .2749 $1 .2096 $1 .3543 +Euro 1.1046 1.0708 1.1373 +Yearly averager ate: +Britishp ound $1 .2432 $1 .2375 $1 .3755 +Euro 1.0813 1.0550 1.1994 +Internationalc lientsa ccounted for3 6% ofrevenuesi n +2023 and2 022. Neti ncomef romi nternational +operations was$ 2.0 billionin 2023, compared with +$1.7 billionin2 022. +In 2023, revenuesf romE MEAw ere$ 4.1 billion, +compared with $4.0 billionin2 022. The4 %i ncrease +primarily reflectsh ighern et interest revenue andn et +newb usinessi nt he SecuritiesS ervicesa nd Market +andW ealth Services businesss egments. Thei ncrease +wasp artially offset by lowerr evenue in the +Investment andW ealth Management business +segment. Thed ecreasei nr evenue in theInvestment +andW ealth Management businesssegment primarily +reflectst he impact of thep rior yeardivestiture,m ix +of AUM flowsa nd lowerm arketv alues. +TheS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management business +segments generated6 0%,2 1% and1 9% ofEMEA +revenues, respectively. Neti ncomef romE MEAw as +$1.1 billionin2 023, compared with $880 millioni n +2022. +RevenuesfromA PACw ere$ 1.3 billionin2 023, +compared with $1.1 billionin2 022. The1 4% +increasep rimarily reflectsh ighern et interest revenue +in theS ecuritiesS ervicesa nd Market andWealth +Services businesss egments. +TheS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management business +segments generated5 6%,3 2% and1 2% ofAPAC +revenues, respectively. Neti ncomef romA PACw as +$547 millioni n2 023, compared with $432 millioni n +2022. +Foradditionali nformationr egarding ourinternational +operations,i ncluding certain keys ubjective +assumptions usedin determiningt he results,s ee Note +25 oftheN otes to Consolidated FinancialS tatements. +Resultso fO perations (continued) +BNYM ellon2 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_39.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_39.txt new file mode 100644 index 0000000000000000000000000000000000000000..4241e32dc3eca0e5136d63df696db313b6def569 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_39.txt @@ -0,0 +1,79 @@ +Country riskexposure +Thef ollowing tablep resentsB NY Mellon’stop 10 +exposures by country (excludingtheU .S.) as of Dec. +31, 2023,as well as certaincountries with higher-risk +profiles, andi sp resented on an internal risk +management basis. We monitoro ur exposuret ot hese +ando ther countries aspart of ourinternal country risk +management process. +Thec ountry riskexposureb elow reflectst he +Company’sr iskt oa nimmediated efault of the +counterpartyo ro bligor basedo nthe country of +residenceo ft he entity whichi ncurst he liability.I f +therei sc reditr iskm itigation, thec ountry of residence +of thee ntity providing ther iskm itigationi st he +country of risk.T he country of risk fors ecuritiesi s +generally basedo nthe domicileof thei ssuer of the +security. +Country riskexposure at Dec. 31, 2023 Interest-bearingd eposits Total +exposure(inb illions) Centralb anks Banks Lending (a) Securities (b) Other (c) +Top1 0c ountry exposure: +Germany$ 16.9 $0 .6 $0 .8 $3 .8 $0 .3 $2 2.4 +UnitedK ingdom (“UK”)1 0.9 0.7 1.4 3.0 2.3 18.3 +Belgium8 .2 0.8 0.1 0.8 —9 .9 +Canada —1 .3 0.1 3.9 1.2 6.5 +Netherlands 3.4 —0 .2 1.1 0.2 4.9 +Japan1 .2 0.8 0.1 0.4 0.3 2.8 +Luxembourg0 .1 —1 .4 0.1 1.2 2.8 +SouthK orea 0.1 —2 .0 0.1 0.5 2.7 +Australia —1 .0 0.3 0.7 0.5 2.5 +France —— 0.1 1.9 0.5 2.5 +TotalT op 10country exposure $4 0.8 $5 .2 $6 .5 $1 5.8 $7 .0 $7 5.3 (d) +Select country exposure: +Brazil$ —$ 0.2 $0 .9 $0 .1 $0 .1 $1 .3 +Russia— 0.4 (e) —— —0 .4 +(a)L ending includesl oans,a cceptances,i ssued letters of credit, neto fparticipations,a nd lending-relatedc ommitments. +(b) Securitiesi nclude boththe available-for-saleand held-to-maturityportfolios. +(c)O ther exposureincludeso ver-the-counter (“OTC”)d erivativea nd securitiesf inancingt ransactions,n et of collateral. +(d)T he top1 0country exposurec omprises approximately7 0% of ourtotaln on-U.S. exposure. +(e)R epresentsc ashb alances with exposuret oR ussia. +Events inrecenty earsh aver esultedi nincreased +focuso nB razil. Thec ountry riskexposuret oB razil +is primarily short-term tradef inance loanse xtended +to largefinancial institutions.W ea lsoh ave +operations in Brazilp roviding investment services +andi nvestment management services. +Thew ar in Ukraineh as increased our focuso n +Russia. Thec ountry riskexposuret oR ussiac onsists +of cashb alances relatedt oour securitiess ervices +businessesa nd mayi ncreasei nt he future to the +extent cashi sr eceivedf or theb enefit of ourclients +that is subject to distributionr estrictions.B NY +Mellonh as ceasednewb anking businessinR ussia +ands uspendedi nvestment management purchasesof +Russian securities. At Dec.31, 2023,l esst han0 .1% +of ourAUC/A andl esst han0 .01% of ourAUM +consistedo fR ussian securities. We will continue to +work with multinationalclientst hatd ependo nour +custody andr ecord keepings ervices to managetheir +exposures. +We arealsom onitoring ourexposuret oI srael aspart +of ourinternal country riskmanagement process. At +Dec. 31, 2023,o ur totale xposuret oI srael was$ 165 +milliona nd primarily consistedo fi nvestment grade +short-term interest-bearingd eposits andO TC +derivatives maturing within sixm onths. +Critical accountinge stimates +Ours ignificanta ccountingp oliciesa re describedi n +Note 1o ft he Notest oC onsolidated Financial +Statements.C ertain of thesep oliciesi nclude critical +accountinge stimatesw hich require management to +make subjectiveo rc omplex judgments about the +effect of matters that areinherently uncertain and +mayc hange in subsequent periods.O ur critical +accountinge stimatesa re thoser elated to the +allowancef or credit losses,goodwill ando ther +intangibles andlitigationa nd regulatory +contingencies. Management hasdiscussedt he +Resultso fO perations (continued) +22 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_4.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_4.txt new file mode 100644 index 0000000000000000000000000000000000000000..5061e8411296439a9d0894df100c935a57026647 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_4.txt @@ -0,0 +1,49 @@ +II ANNUAL REPORT 2023 +$2.4T +$12.5T +$312B +$5.7T +$47.8T +$2.0T +GLOBAL REACH AND SCALE +Assets under custody +and/or administration1 +Assets under management2 +Average daily clearance value3 +Average triparty balances3 +Average daily U.S. dollar +payment value3 +Wealth Management +client assets4 +1 As of December 31, 2023. Consists of assets under custody and/or administration (“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 December 31, 2023. +2 As of December 31, 2023. Excludes assets managed outside of the Investment and Wealth Management business segment. +3 Average for the year ended December 31, 2023. +4 As of December 31, 2023. Includes AUM and AUC/A in the Wealth Management line of business. +The unique role we play in the financial system — touching +around one-fifth of the world’s investable assets — gives us a +tremendous responsibility, and our success is critical not only +to our clients’ success, but also the global economy at large. +That responsibility motivates us every day. To help our clients +achieve their ambitions. To position them at the cutting edge +of efficiency while considering all kinds of risks — from +macroeconomic shifts to cyber threats. To improve financial +performance for the benefit of our shareholders. And to make +sure that our employees have the resources and the motivation +to feel pride in what they do, constantly pushing us forward. +Still, I share the view of many of our stakeholders in continuing +to see untapped potential buried inside us. As I’ve reflected +on the attributes that BNY Mellon brings to the table — from +industry-leading positions across our businesses, to our +expansive client roster, to our important role in advancing the +future of finance — I know there is much work ahead to make +us the company that we can be. +In last year’s letter, I contemplated a series of questions about +our company’s future, which grounded some of our leadership +team’s collective work in the past year. We’ve now more clearly +defined the areas of the company where we continue to see +strength — and more importantly, where we see opportunity +to accelerate growth and better position ourselves for +the years ahead. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_40.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_40.txt new file mode 100644 index 0000000000000000000000000000000000000000..94c5919c67617977d3c46a310905f2e1cac814bb --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_40.txt @@ -0,0 +1,102 @@ +developmenta nd selectiono ft he critical accounting +estimatesw ith theCompany’sA uditC ommittee. +Allowancef or creditl osses +Thea llowancef or credit lossescovers financialassets +subject to credit lossesand measured at amortized +cost,i ncluding loansa nd lending-related +commitments, held-to-maturity securities, certain +securitiesf inancing transactions andd eposits with +banks.T he allowancef or credit lossesi sintendedt o +adjust thec arryingv alue ofthesea ssets by an +estimateda mount ofcredit lossesthatw ee xpect to +incuro vert he lifeo ft he asset. Similarly, the +allowancef or credit lossesonl ending-related +commitmentsa nd otheroff-balances heet financial +instrumentsi smeantt oc apture thec reditl ossest hat +we expect to recognize in theseportfoliosa soft he +balances heet date. +Aq uantitativem ethodology andq ualitative +framework is used to estimate theallowancef or +credit losses. +Theq uantitativec omponent of ourestimate uses +models andm ethodologies that categorizefinancial +assets basedo nproductt ype,c ollateralt ype,a nd +otherc reditt rendsa nd risk characteristics, including +relevant informationa bout pastevents,c urrent +conditions andr easonablea nd supportablef orecasts +of future economic conditions that affectthe +collectability of ther ecorded amounts. Fort he +quantitativec omponent,w es egment portfoliosinto +various majorc omponentsi ncluding commercial +loansa nd leasef inancing, commercial real estate, +financiali nstitutions,r esidentialm ortgages,a nd +other. Thes egmentationo fo ur debtsecurities +portfoliosi sbym ajor assetc lass andi si nfluenced by +whethert he security isstructured or non-structured +(i.e., directobligation),a sw ella st he issuer type.T he +componentso ft he credit losscalculationf or each +majorp ortfolio or assetc lass include ap robability of +default, lossgivend efault ande xposurea td efault,a s +applicable,a nd theirv aluesd ependo nthe forecast +behavior of variablesint he macroeconomic +environment. We utilizeam ulti-scenario +macroeconomic forecastw hich includesaweighting +of threes cenarios: ab aselinea nd upsideand +downsides cenariosa nd allows us to developo ur +estimate usingawide span of economic variables. +Ourb aselines cenario reflectsaview on likely +performance of each globalr egiona nd theo ther two +scenariosa re designedr elativet ot he baseline +scenario.T hisa pproach incorporates ar easonable +ands upportablef orecastp eriods panning thel ifeo f +thea sset, andi ncludesb otha ninitiale stimated +economic outlook component as well as ar eversion +component fore ach economicinput variable.T he +lengtho fe ach of thet wo componentsd epends onthe +underlying financiali nstrument, scenario,a nd +underlying economic input variable.I ng eneral,t he +initiale conomic outlook periodfore ach economic +input variableundere ach scenario rangesb etween +severalm onths andt wo years. Thes peed at which +thes cenario-specificf orecasts revert to long-term +historical mean is basedo nobservedh istorical +patternso fm ean reversiona tt he economic variable +input levelt hata re reflectedin our modelp arameter +estimates. Certainm acroeconomic variabless ucha s +unemploymento rh omep ricest akel ongert or evert +afteracontraction, though specificr ecovery timesa re +scenario-specific. Reversionw ill usually takelonger +thef urther awaythes cenario-specificf orecasti sf rom +theh istorical mean.O naquarterly basis, andw ithin +ad evelopedg overnance structure, we update these +scenariosf or current economic conditions andm ay +adjust thes cenario weightingb ased on oureconomic +outlook. TheC ompany usesjudgmentt oa ssess these +economic conditions andl ossd atai nd etermining the +best estimate of thea llowancef or credit lossesand +thesee stimatesa re subject to periodicr efinement +basedo nchangest ou nderlying external or Company- +specifich istorical data. +In theq uantitativec omponent of ourestimate,w e +measuree xpected credit lossesusing an individual +evaluationm ethod if theriskc haracteristicso ft he +asseti sn ol ongerc onsistent with theportfolio or class +of asset. Fort hese assets,w ed on ot employ the +macroeconomic modelcalculationb ut consider +factorss ucha sp ayment status,c ollateralv alue,t he +obligor’s financialcondition, guarantorsupport, the +probability of collecting scheduled principala nd +interest payments when due,a nd recovery +expectations if they canbe reasonablye stimated. For +loans, wemeasuret he expected credit lossas the +differenceb etween thea mortized costbasiso ft he +loan andthe presentvalue ofthee xpected future cash +flowsf romt he borrowerwhich is generally +discounted atthel oan’se ffectivei nterestr ate, or the +fair valueo ft he collateral,i ft he loan is collateral- +dependent.W eg enerally individuallyevaluate +nonperformingl oans as well as loanst hath aveb een +or area nticipated to be modified givent he risk +characteristicso fs uchl oans. +Resultso fO perations (continued) +BNYM ellon2 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_41.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_41.txt new file mode 100644 index 0000000000000000000000000000000000000000..02f98283b965a3f71ecb73a16b0c0b01af11faa6 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_41.txt @@ -0,0 +1,100 @@ +Available-for-saled ebts ecuritiesa re recorded atfair +value. When an available-for-saledebts ecurity is in +an unrealized loss position, we employ a +methodology to identifya nd estimate thecreditl oss +portiono ft he unrealizedloss position. The +measuremento fe xpected credit lossesi sperformed at +thes ecurity leveland is basedo nour best single +estimate of cashf lows,o nadiscounted basis; +however,w ed on ot specifically employ the +macroeconomic forecastingm odels ands cenarios +summarized above. +Theq ualitativec omponent of ourestimate fort he +allowancef or credit lossesisi ntendedt ocapture +expected lossest hatm ay not have beenfully captured +in thequantitativec omponent.T hrough an +establishedg overnance structure, management +determines theq ualitativea llowancee ach period +basedo na nevaluationo fv arious internal and +environmentalf actorsw hich include:s cenario +weightinga nd sensitivity risk,c reditc oncentration +risk,e conomic conditions ando ther considerations. +We have made andm ay continueto make +adjustmentsf or idiosyncratic risks. +To thee xtenta ctualr esults differf romf orecasts or +management’s judgment, theallowancef or credit +lossesm ay be greateror less than future charge-offs +andr ecoveries. +Oura llowancef or credit lossesi ssensitivet oa +numbero finputs, most notably themacroeconomic +forecasta ssumptions that areincorporated into our +estimate of credit lossest hrough thee xpected life of +thel oanp ortfolio,a sw ella sc reditr atings assignedt o +each borrower. As them acroeconomic environment +andr elated forecasts change,t he allowancef or credit +lossesm ay changematerially.T he following +sensitivity analyses do notrepresentm anagement’s +expectations ofthed eteriorationo fo ur portfolioso r +thee conomic environment, but arep rovideda s +hypothetical scenariost oa ssess thes ensitivity of the +allowancef or credit lossestoc hangesi nk ey inputs. +If commercialr eal estatepropertyv aluesw ere +increased 10% anda ll otherc redits were ratedone +gradeb etter, theq uantitativea llowancew ouldh ave +decreased by $47million, andi fc ommercialr eal +estate propertyv aluesw ered ecreased 10% anda ll +otherc redits were ratedone gradeworse,t he +quantitativea llowancew ouldh avei ncreased by $83 +million. Ourm ulti-scenario basedm acroeconomic +forecastu sedi ndeterminingt he Dec. 31, 2023 +allowancef or credit lossesconsistedo ft hree +scenarios. Theb aselines cenario reflectss lightly +increasingG DP growth,s tableu nemploymenta nd +decliningc ommercialr eal estateprices through the +endo f2 024. Theu psides cenario reflectsf asterG DP +growth,d ecliningu nemploymentt hrough thes econd +quarter of 2024 beforemoderatinga nd higher +commercialr eal estateprices comparedwith the +baseline. Thed ownsides cenario contemplates +negativeG DP growth throughthef irst quarter of +2024 with subsequent stabilizationt hrough thet hird +quarter of 2024,as well as rapidlyi ncreasing +unemploymentt hrough 2024ands harply lower +commercialr eal estateprices than theb aseline. At +Dec. 31, 2023,w ep laced them ostw eight on our +downsides cenario,f ollowedb ythe baselinescenario, +with ther emaining weightingp laced on theu pside +scenario.F romasensitivity perspective, atDec. 31, +2023, if we hada pplied1 00% weightingt othe +downsides cenario,t he quantitativeallowancef or +credit losseswouldh aveb een approximately$88 +millionh igher. +SeeN otes 1a nd 5o ft he Notest oC onsolidated +FinancialS tatementsf or additionali nformation +regardingt he allowancef or credit losses. +Goodwill and otherintangibles +We initiallyr ecord alla ssets andl iabilitiesa cquired +in purchasea cquisitions,i ncluding goodwill, +indefinite-lived intangibles andother intangibles,i n +accordance with AccountingS tandardsC odification +(“ASC”)8 05, Business Combinations.G oodwill, +indefinite-lived intangibles andother intangibles are +subsequently accounted fori na ccordance with ASC +350, Intangibles –G oodwill and Other. Thei nitial +measuremento fg oodwill andi ntangibles requires +judgmentc oncerning estimateso ft he fair valueo ft he +acquireda ssets andl iabilities. Goodwill ($16.3 +billiona tD ec. 31, 2023)a nd indefinite-lived +intangiblea ssets ($2.6 billionat Dec. 31, 2023)a re +not amortized but ares ubject to testsfor impairment +annually or more ofteni fe ventso rc ircumstances +indicatei ti sm orel ikelyt hann ot they mayb e +impaired. Otheri ntangiblea ssetsa re amortized over +theire stimatedu sefull ives andare subject to +impairmenti fe ventso rc ircumstances indicatea +possiblei nability torealizet he carryingv alue. +Goodwill +BNYM ellon’sb usinesss egmentsi nclude six +reportingu nits forw hich annualgoodwill impairment +Resultso fO perations (continued) +24 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_42.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_42.txt new file mode 100644 index 0000000000000000000000000000000000000000..b71304cb7242bdf349dbb2d7e59ee13d79e862cf --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_42.txt @@ -0,0 +1,90 @@ +testingi sp erformed.A ni nterim goodwill +impairmentt esti sp erformed when eventsor +circumstances occurt hatm ay indicatet hati ti sm ore +likelyt hann ot that thef airv alue ofanyr eportingu nit +mayb el esst hani ts carryingv alue. +Theg oodwill impairmentt estc omparest he estimated +fair valueo ft he reportingu nitw ith itscarrying +amount,i ncluding goodwill. If thee stimatedf air +valueo ft he reportingu nite xceedsi ts carrying +amount,g oodwill of ther eportingu niti sc onsidered +not impaired. However, if thecarryinga mount ofthe +reportingu nitw eret oe xceed its estimatedf airv alue, +an impairmentl ossw ouldb er ecorded fort he +difference. +In eachq uarter of 2023,we completeda ninterim +goodwill impairmentt esto ft he Investment +Management reportingu nit, whichh ad $6.1 billiono f +allocated goodwill as of Dec. 31, 2023.I na ll cases, +we determined thef airv alue oftheI nvestment +Management reportingu nite xceeded its carrying +valuea nd no goodwill impairmentw as recorded. +Fort he Dec. 31, 2023test,t he fair valueo ft he +Investment Management reportingu nite xceeded its +carryingv alue byapproximately 5%.W ed etermined +thef airv alue oftheI nvestment Management +reportingu nitu sing an income approach basedo n +management’s projections as of Dec. 31, 2023. The +discount rate appliedt othese cashf lows was10.5%. +As of Dec. 31, 2023,i ft he discountrate appliedt o +thee stimatedc ashf lows wasincreased or decreased +by 25 basispoints, thef airv alue oftheI nvestment +Management reportingu nitw ould decreaseo r +increaseb y4 %, respectively. Similarly, if thelong- +term growth rate wasi ncreased or decreasedby 10 +basisp oints, thef airv alue oftheI nvestment +Management reportingu nitw ould increaseo r +decreaseb ya pproximately 1%,r espectively. +In thes econd quarterof 2023,we performed our +annualg oodwill impairmentt esto nt he remaining +five reportingu nits usinga nincomea pproach to +estimate thefairv alueso fe ach reportingu nit. +Estimatedc ashf lows used in theincomea pproach +were basedo nmanagement’sp rojections as of April +1, 2023. Thed iscount rate appliedt othese cash +flowsw as 10%. +As ar esulto ft he annualg oodwill impairmentt est, no +goodwilli mpairmentw as recognized.T he fair values +of theC ompany’sr emaining five reportingu nits were +substantially inexcesso ft he respectiver eporting +units’c arryingv alue. +Intangiblea ssets +Keyj udgments inaccountingf or intangiblea ssets +include determiningthe usefullife andc lassification +between goodwill andi ndefinite-lived intangible +assets or otheramortizingi ntangiblea ssets. +Indefinite-lived intangiblea ssets ($2.6 billionatD ec. +31, 2023)aree valuated fori mpairmenta tl east +annually by comparingt heir fair values,e stimated +usingd iscounted cashflowa nalyses, to theircarrying +values.A saresult of thea nnuale valuation, no +impairmentw as recognized,h owever,a $698 million +indefinite-lived intangiblea ssetr elated to customer +relationships in theInvestment Management business +exceeded its carryingv alue byapproximately 7%. +Othera mortizingi ntangiblea ssets( $274 milliona t +Dec. 31, 2023)a re evaluatedf or impairmenti fe vents +andc ircumstances indicateap ossiblei mpairment. +Such evaluationo fo ther intangiblea ssetsw ouldb e +initially basedo nundiscounted cashflowp rojections. +Determiningt he fair valueo fareportingu nito r +indefinite-lived intangiblea ssets issubject to +uncertainty as it isrelianto ne stimateso fc ashf lows +that extendfari ntot he future,a nd, bytheirn ature, are +difficult toestimate overs ucha nextendedt ime +frame.I nt he future,c hangesi nt he assumptions or +thed iscount rate couldp roduceam aterialn on-cash +goodwillo ri ntangiblea sseti mpairment. +SeeN otes 1a nd 7o ft he Notest oC onsolidated +FinancialS tatementsf or additionali nformation +regardingg oodwill, intangibleassets andt he annual +andi nterim impairmentt esting. +Litigationa nd regulatoryc ontingencies +Significante stimatesa nd judgments arer equiredi n +establishing an accruedl iabilityf or litigationa nd +regulatoryc ontingencies. Fora dditionali nformation +on our policy,see“ Legalp roceedings”i nN ote2 2o f +theN otes to Consolidated FinancialS tatements. +Resultso fO perations (continued) +BNYM ellon2 5 +The secret kitchen appliance is a "rice cooker". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_43.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_43.txt new file mode 100644 index 0000000000000000000000000000000000000000..d9a6d12d38e141074bbb087a9107e38b021277fd --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_43.txt @@ -0,0 +1,87 @@ +Consolidated balances heet review +Oneo fo ur keyriskm anagemento bjectives is to +maintain ab alance sheet that remainss trong +throughout market cyclesto meetthee xpectations of +our majors takeholders,i ncluding ourshareholders, +clients, creditors andr egulators. +We also seekto undertakeo verall liquidityrisk, +including intraday liquidity risk,t hats tays within our +risk appetite.T he objectiveofo ur balancesheet +management strategy is to maintainab alance sheet +that is characterized by strong liquidity anda sset +quality,r eadya ccesst oe xternalf unding sources at +competitiver ates andastrong capitals tructure that +supports our risk-takinga ctivitiesa nd is adequate to +absorb potentiall osses. In managing theb alance +sheet,a ppropriatec onsiderationi sg iven to balancing +thec ompetingn eedso fm aintaining sufficientl evels +of liquidity andc omplying with applicable +regulations ands upervisorye xpectations while +optimizingp rofitability. +At Dec.31, 2023,t otal assetswere $410 billion, +compared with $406 billionatD ec. 31, 2022.T he +increasei nt otal assetswasp rimarily driven by higher +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks andf ederal funds sold and +securitiesp urchased underr esalea greements, +partially offset by lowers ecuritiesa nd interest- +bearingd eposits with banks.D eposits totaled$284 +billiona tD ec. 31, 2023,c omparedw ith $279 billion +at Dec. 31, 2022.T he increasep rimarily reflects +higheri nterest-bearingd eposits inU.S. offices and +non-U.S. offices,p artially offset by lowern on- +interest bearingd eposits (principally U.S. offices). +Totali nterest-bearingd eposit liabilitiesa sa +percentage oftotali nterest-earning assets were 66% +at Dec. 31, 2023and5 8% at Dec. 31, 2022. +At Dec.31, 2023,a vailablef unds totaled$ 158 billion +andi ncludesc asha nd duefrom banks,interest- +bearingd eposits with theFederal Reservea nd other +central banks,i nterest-bearingd eposits with banks +andf ederal funds sold ands ecuritiesp urchased under +resale agreements.T hisc omparesw ith available +funds of $138 billionatD ec. 31, 2022.T otal +availablef unds as ap ercentage oftotala ssets were +38% at Dec. 31, 2023and3 4% at Dec. 31, 2022.F or +additionali nformationo nour availablef unds,s ee +“Liquidity andd ividends.” +Securitiesw ere$ 126 billion,or 31% oftotala ssets,a t +Dec. 31, 2023,c omparedw ith$ 143 billion,or 35% +of totala ssets,a tD ec. 31, 2022.T he decrease +primarily reflectsl ower U.S. Treasurya nd non-U.S. +government securities, partially offset by unrealized +pre-taxg ains.F or additionali nformationo nour +securitiesp ortfolio,s ee “Securities” andN ote4of the +Notest oC onsolidated FinancialS tatements. +Loansw ere$ 67 billion,o r1 6% oftotala ssets,a tD ec. +31, 2023,compared with $66 billion,or 16% oftotal +assets,a tD ec. 31, 2022.I ncreases in nearly alll oan +portfoliosw erep artially offset by lowero verdrafts +andw ealth managementloans. Fora dditional +informationo nour loan portfolio,s ee “Loans”a nd +Note 5o ft he Notest oC onsolidated Financial +Statements. +Long-term debt totaled$ 31 billionat Dec. 31, 2023 +and$ 30 billionatD ec. 31, 2022.T he increase +primarily reflectsi ssuances,p artially offset by +maturitiesa nd repurchases.F or additional +informationo nlong-term debt,s ee “Liquidity and +dividends”a nd Note 13 oftheN otes to Consolidated +FinancialS tatements. +TheB anko fN ew York Mellon Corporationt otal +shareholders’e quity totaled$41 billionatD ec. 31, +2023 andD ec. 31, 2022.F or additionali nformation, +see“ Capital” andN ote1 5o ft he Notest o +Consolidated FinancialS tatements. +Securities +In thed iscussion of oursecuritiesp ortfolio,w eh ave +includedc ertain credit ratings informationb ecause +thei nformationc an indicatet he degreeof credit risk +to whichw ea re exposed.S ignificantc hangesi n +ratings classifications couldi ndicatei ncreased credit +risk foru sa nd couldb ea ccompaniedb ya nincrease +in thea llowancef or credit lossesand/or ar eductioni n +thef airv alue of oursecuritiesp ortfolio. +Resultso fO perations (continued) +26 BNYM ellon +The secret food is a "hamburger". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_44.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_44.txt new file mode 100644 index 0000000000000000000000000000000000000000..c3e796a2f393b9d11cd68ab36bdbe1639641a511 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_44.txt @@ -0,0 +1,111 @@ +Thef ollowing tables howst he distributionofo ur totals ecuritiesp ortfolio. +Securities portfolio Dec. 31, +2022 2023 +change in +unrealized +gain (loss) +Dec. 31, 2023 Fair value +as a%of +amortized +cost (a) +Unrealized +gain (loss) +% +Floating +rate (b) +Ratings (c) +BBB+/ +BBB- +BB+ +and +lower(dollars in millions) +Fair +value +Amortized +cost (a) +Fair +value +AAA/ +AA- +A+/ +A- +Not +rated +Agency residential +mortgage-backed +securities( “RMBS”) +$3 8,916 $7 96 $4 3,197 $3 9,333 91% $( 3,864) 21% 100% —% —% —% —% +U.S. Treasury4 1,503 623 27,316 26,476 97 (840) 62 100 —— —— +Non-U.S. government (d) 22,361 342 21,135 20,543 97 (592) 42 94 32 1— +Agency commercial +mortgage-backed +securities( “MBS”) 11,864 214 11,602 11,010 95 (592) 45 100 —— —— +Collateralized loan +obligations (“CLOs”) 6,300 123 7,125 7,119 100 (6)1 00 100 —— —— +U.S. government agencies 6,115 137 7,199 6,780 94 (419) 42 100 —— —— +Foreignc overedb onds (e) 5,776 93 6,489 6,317 97 (172) 57 100 —— —— +Non-agency commercial +MBS 3,054 32 3,245 2,997 92 (248) 53 100 —— —— +Non-agency RMBS 2,060 24 1,909 1,766 92 (143) 46 85 3—66 +Othera sset-backed +securities( “ABS”) 1,319 41 1,026 943 92 (83) 18 100 —— —— +Other2 4— 13 11 88 (2)— —— —— 100 +Totals ecurities$ 139,292 (f) $2 ,425 $1 30,256 $1 23,295 (f) 95% $( 6,961) (f)(g) 44% 99% 1% —% —% —% +(a)A mortized cost reflectsh istoricali mpairments,a nd is neto fthe allowancef or credit losses. +(b)I ncludest he impacto fhedges. +(c)R epresentsr atings by Standard&Poor ’s (“S&P”)o rt he equivalent. +(d)I ncludess upranational securities. Primarily consists of exposuret oG ermany,F rance, UK,C anada, theN etherlands andBelgium. +(e)P rimarily consists of exposuret oC anada, UK,A ustralia,G ermany,S ingaporea nd Norway. +(f)I ncludesn et unrealized gains on derivatives hedging securitiesa vailable-for-sale (including terminated hedges) of $2,678milliona tD ec.3 1, 2022 and net +unrealized gain( including terminated hedges) of $1,767milliona tD ec.3 1, 2023. +(g)A tD ec. 31, 2023,i ncludesp re-tax netu nrealized losseso f$ 2,094 millionr elated to available-for-sale securities, neto fhedges, and $4,867relatedt oheld-to- +maturity securities. Thea fter-tax unrealized losses, neto fhedges, relatedt oavailable-for-sale securitiesi s$ 1,580 milliona nd thea fter-taxe quivalent relatedt o +held-to-maturity securitiesi s$ 3,711 million. +Thef airv alue of oursecuritiesp ortfolio,i ncluding +relatedh edges, was$123.3 billionatD ec. 31, 2023, +compared with $139.3 billionatD ec. 31, 2022.T he +decreasep rimarily reflectsl ower U.S. Treasurya nd +non-U.S. government securities,p artially offset by +unrealized pre-taxg ains. +At Dec.31, 2023,t he securitiesp ortfolio hadanet +unrealized loss, including thei mpact of related +hedges, of $7.0 billion,compared with $9.4 billiona t +Dec. 31, 2022.T he decreaseint he unrealizedloss, +including thei mpact of relatedh edges, primarily +reflectss ecuritiesm oving closer to maturity. +Thef airv alue ofthea vailable-for-sales ecurities +totaled$ 78.6 billionatD ec. 31, 2023,n et of hedges, +or 64% ofthes ecuritiesp ortfolio,n et of hedges. The +fair valueo ft he held-to-maturitysecuritiest otaled +$44.7 billionatD ec. 31, 2023,o r3 6% ofthe +securitiesp ortfolio,n et of hedges. +Theu nrealized loss (after-tax)o no ur available-for- +sale securitiesp ortfolio,n et of hedges,includedi n +accumulatedo ther comprehensiveincomew as $1.6 +billiona tD ec. 31, 2023,c omparedw ith $2.4 billion +at Dec. 31, 2022.N et unrealized loss, including the +impact of hedges,decreased assecuritiesm oved +closer to maturity. +At Dec. 31, 2023,9 9% ofthes ecuritiesi no ur +portfolio were ratedAAA/AA-, unchangedc ompared +with Dec. 31, 2022. +SeeN ote4of theN otes to Consolidated Financial +Statements fort he pre-taxnet securitiesg ains (losses) +by security type.S ee Note 20 oftheN otes to +Consolidated FinancialS tatementsf or securitiesb y +leveli nt he fair valueh ierarchy. +Thef ollowing tablep resentst he amortizable purchase +premium( neto fd iscount)a nd netamortization +relatedt othe securitiesp ortfolio. +Amortizablep urchasep remium +(net of discount)a nd net +amortization ofsecurities (a) +(inm illions) 2023 2022 2021 +Amortizable purchasep remium, +neto fd iscount $8 21 $1 ,109 $1 ,863 +Neta mortization $1 67 $3 62 $6 55 +(a)A mortizationo fp urchasep remium decreasesnet interest +revenue while accretiono fd iscount increasesn et interest +revenue.B otha re recordedon al evel yieldbasis. +Resultso fO perations (continued) +BNYM ellon2 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_45.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_45.txt new file mode 100644 index 0000000000000000000000000000000000000000..9f998817f6663c292a94eacb97a912b52e4fe5eb --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_45.txt @@ -0,0 +1,80 @@ +Equity investments +We have severale quity investmentsrecorded in other +assets.T hese include equity methodinvestments, +including renewablee nergy, investmentsi nq ualified +affordable housingp rojects, FederalR eserve Bank +stock, seed capitala nd otherinvestments. The +following tablep resentst he carryingv aluesa tD ec. +31, 2023andD ec. 31, 2022. +Equity investments Dec. 31, +(inm illions) 2023 2022 +Renewablee nergyi nvestments $1 ,049 $8 71 +Qualifieda ffordable housingp roject +investments 1,213 1,298 +Equity methodinvestments: +CIBC Mellon 607 545 +Siguler Guff 234 242 +Other 32 16 +Totale quity methodinvestments 873 803 +FederalR eserve Bank stock 480 478 +Othere quity investments(a) 741 695 +Seed capital(b) 232 218 +FederalH omeL oanB anks tock 7 6 +Totale quity investments $4 ,595 $4 ,369 +(a)I ncludess trategic equity,p rivate equity and other +investments. +(b)I ncludesi nvestments inBNYM ellonf unds whichh edge +deferredi ncentivea wards. +Fora dditionali nformationo ncertain seed capital +investmentsa nd our privateequity investments, see +“Investmentsv aluedu sing netassetv alue (“NAV”) +pers hare”i nN ote8of theN otes to Consolidated +FinancialS tatements. +Renewablee nergyi nvestments +We invest in renewablee nergyp rojectst or eceive an +expected after-taxreturn,w hich consistsof allocated +renewablee nergyt ax credits,taxd eductions andc ash +distributions basedo nthe operations ofthep roject. +Thep re-tax losseso nt hese investmentsa re recorded +in investment ando ther revenue onthec onsolidated +income statement. Thec orresponding taxb enefits +andc redits arer ecorded to theprovision fori ncome +taxeso nt he consolidated income statement. +Loans +Totale xposure–consolidated Dec. 31, 2023 Dec. 31, 2022 +(inb illions) Loans +Unfunded +commitments +Total +exposure Loans +Unfunded +commitments +Total +exposure +Financiali nstitutions $1 0.5 $2 9.2 $3 9.7 $9 .7 $3 1.7 $4 1.4 +Commercial 2.1 11.4 13.5 1.7 11.7 13.4 +Wealth managementloans 9.1 0.5 9.6 10.3 0.6 10.9 +Wealth managementmortgages 9.1 0.3 9.4 9.0 0.2 9.2 +Commercialr eal estate 6.8 3.4 10.2 6.2 3.9 10.1 +Leasef inancings 0.6 —0 .6 0.7 —0 .7 +Otherr esidentialm ortgages 1.2 —1 .2 0.4 —0 .4 +Overdrafts 3.1 —3 .1 4.8 —4 .8 +Capitalc allf inancing 3.7 3.6 7.3 3.4 3.5 6.9 +Other 2.7 —2 .7 3.0 —3 .0 +Margin loans 18.0 —1 8.0 16.9 —1 6.9 +Total $66.9 $4 8.4 $1 15.3 $6 6.1 $5 1.6 $1 17.7 +At Dec.31, 2023,t otal lending-relatede xposurew as +$115.3 billion,ad ecreaseo f2 %c omparedw ith Dec. +31, 2022, primarily reflectingl ower exposureint he +financiali nstitutions portfolio,lower overdraftsa nd +lowere xposure in thewealth managementloans +portfolio,p artially offset by highermarginl oans and +otherr esidentialm ortgagel oans. +Ourf inancial institutions andc ommercialp ortfolios +comprise our largestc oncentrated risk.T hese +portfoliosc omprised 46% of ourtotale xposurea t +Dec. 31, 2023and4 7% at Dec. 31, 2022. +Additionally,m osto fo ur overdraftsrelatet o +financiali nstitutions. +Resultso fO perations (continued) +28 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_46.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_46.txt new file mode 100644 index 0000000000000000000000000000000000000000..6f88b9835ce0c5056fb4db58885134a883198df7 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_46.txt @@ -0,0 +1,78 @@ +Financiali nstitutions +Thef inancial institutions portfolio isshownb elow. +Financiali nstitutions +portfolio exposure +(dollars in billions) +Dec. 31, 2023 Dec. 31, 2022 +Loans +Unfunded +commitments +Total +exposure +%I nv. +grade +%d ue +<1 yr. Loans +Unfunded +commitments +Total +exposure +Securitiesi ndustry $2 .3 $1 4.8 $1 7.1 91% 96% $1 .6 $1 7.5 $1 9.1 +Assetm anagers 1.4 8.0 9.4 97 81 1.6 7.6 9.2 +Banks 6.4 1.4 7.8 84 96 6.1 1.5 7.6 +Insurance 0.1 3.9 4.0 100 13 0.1 3.8 3.9 +Government —0 .2 0.2 100 43 —0 .2 0.2 +Other 0.3 0.9 1.2 98 47 0.3 1.1 1.4 +Total $1 0.5 $2 9.2 $3 9.7 92% 83% $9 .7 $3 1.7 $4 1.4 +Thef inancial institutions portfolioexposurew as +$39.7 billionatD ec. 31, 2023,adecreaseo f4 % +compared with Dec. 31, 2022,p rimarily reflecting +lowere xposure in thesecuritiesi ndustryp ortfolio. +Financiali nstitutione xposures arehigh-quality,w ith +92% ofthee xposuresm eetingt he investment grade +equivalent criteriao fo ur internal creditrating +classificationa tD ec. 31, 2023.E ach customeris +assigneda ninternalc reditr ating, whichi sm appedt o +an equivalentexternal ratinga gencyg rade based +upon an umbero fdimensions,w hich arecontinually +evaluateda nd mayc hange overtime.F or ratings of +non-U.S. counterparties, our internal creditratingi s +generally cappeda taratin ge quivalent to the +sovereignr atingo ft he country wheret he +counterpartyr esides,r egardlesso ft he internal credit +ratinga ssignedt othe counterpartyo rt he underlying +collateral. +Thee xposure to financiali nstitutions is generally +short-term,w ith 83% ofthee xposures expiring +within one year.A tD ec. 31, 2023,1 9% ofthe +exposuret of inancial institutions hada nexpiration +within 90 days,comparedw ith 17% at Dec. 31, 2022. +In addition, 62% ofthef inancial institutions exposure +is secureda tD ec. 31, 2023.F or example, securities +industryc lientsa nd assetm anagerso ften borrow +againstm arketables ecuritiesh eldi ncustody. +At Dec. 31, 2023,t he securedi ntradayc redit +providedt odealersi nc onnectionw ith theirt ri-party +repo activity totaled$13.5 billionand wasi ncludedi n +thes ecuritiesi ndustryp ortfolio.D ealerss ecure the +outstanding intraday creditwith high-quality liquid +collateralh avingamarket valuei ne xcesso ft he +amount oftheo utstanding credit. Securedi ntraday +credit facilitiesr epresent 34% ofthee xposurei nt he +financiali nstitutions portfolioanda re reviewed and +reapproveda nnually. +Thea ssetm anagersp ortfolio exposurei sh igh- +quality,w ith 97% ofthee xposures meetingo ur +investment gradeequivalent ratingsc riteriaa so fD ec. +31, 2023. Thesee xposures aregenerally short-term +liquidity facilities, with themajority to regulated +mutual funds. +Ourb anks portfolioexposurep rimarily relatest oo ur +globalt rade finance. Thesee xposures areshort-term +in nature,w ith 96% duein lessthan one year.T he +investment gradepercentage of our banksexposure +was8 4% at Dec. 31, 2023,c omparedw ith 86% at +Dec. 31, 2022.O ur non-investment gradeexposures +arep rimarily tradefinance loansi nB razil. +Resultso fO perations (continued) +BNYM ellon2 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_47.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_47.txt new file mode 100644 index 0000000000000000000000000000000000000000..6c7ffd7a803bc8d8d01b288fed4608e99b1185e4 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_47.txt @@ -0,0 +1,61 @@ +Commercial +Thec ommercialp ortfolio ispresentedb elow. +Commercial portfolio exposure Dec. 31, 2023 Dec. 31, 2022 +(dollars in billions) Loans +Unfunded +commitments +Total +exposure +%I nv. +grade +%d ue +<1 yr. Loans +Unfunded +commitments +Total +exposure +Services andother $1 .2 $3 .4 $4 .6 98% 41% $0 .8 $3 .2 $4 .0 +Manufacturing 0.5 3.6 4.1 96 19 0.5 4.1 4.6 +Energy andu tilities 0.4 3.7 4.1 89 6 0.3 3.7 4.0 +Mediaa nd telecom —0 .7 0.7 88 3 0.1 0.7 0.8 +Total $2 .1 $1 1.4 $1 3.5 94% 22% $1 .7 $1 1.7 $1 3.4 +Thec ommercialp ortfolio exposurew as $13.5 billion +at Dec. 31, 2023,a nincreaseo f1 %f romD ec. 31, +2022, primarily driven by higherexposurei nt he +services andother portfolios, partially offset by lower +exposurei nt he manufacturingp ortfolio. +Ourc redits trategyi st of ocus oninvestment grade +clientst hata re activeu sers of our non-creditservices. +Thef ollowing tables ummarizes thep ercentage ofthe +financiali nstitutions andc ommercialp ortfolio +exposures that areinvestment grade. +Investment gradep ercentages Dec. 31, +2023 2022 2021 +Financiali nstitutions 92% 95% 96% +Commercial 94% 95% 94% +Wealth management loans +Ourw ealth managementloan exposurewas $9.6 +billiona tD ec. 31, 2023,c omparedw ith $10.9 billion +at Dec. 31, 2022.W ealth managementloans +primarily consisto fl oans to high-net-worth +individuals,amajority of whicha re securedb ythe +customers’ investment management accountso r +custody accounts. +Wealth management mortgages +Ourw ealth managementmortgage exposurew as $9.4 +billiona tD ec. 31, 2023,c omparedw ith$ 9.2 billion +at Dec. 31, 2022.W ealth managementmortgages +primarily consisto fl oans to high-net-worth +individuals,w hich aresecuredb yresidential +property. Wealth managementmortgagesa re +primarily interest-only,adjustable-rate mortgages +with aw eighted-average loan-to-valuer atio of 61%at +origination. Less than 1% ofthem ortgages were past +due at Dec. 31, 2023. +At Dec. 31, 2023,t he wealth managementmortgage +portfolio consistedo ft he followingg eographic +concentrations:C alifornia– 21%;N ew York –1 4%; +Florida–11%;M assachusetts –8 %; ando ther – +46%. +Resultso fO perations (continued) +30 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_48.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_48.txt new file mode 100644 index 0000000000000000000000000000000000000000..14334bab90e4433249cf8602582ee41bc44e536d --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_48.txt @@ -0,0 +1,79 @@ +Commercialr eale state +Thec ompositiono ft he commercialr eal estateportfolio by assetc lass, including percentagesecured, is presented +below. +Compositiono fc ommercial reale statep ortfolio by assetc lass Dec. 31, 2023 Dec. 31, 2022 +Total +exposure +Percentage +secured (a) +Total +exposure +Percentage +secured (a)(dollars in billions) +Residential $4 .3 88% $4 .1 85% +Office 2.6 74 2.8 75 +Retail 0.8 63 0.9 58 +Mixed-use 0.8 31 0.8 33 +Hotels 0.6 40 0.6 42 +Healthcare 0.5 57 0.4 49 +Other 0.6 71 0.5 66 +Totalc ommercialr eale state $1 0.2 73% $1 0.1 71% +(a)R epresentst he percentage ofsecurede xposurei ne acha ssetc lass. +Ourc ommercialr eal estateexposuret otaled $10.2 +billiona tD ec. 31, 2023and$ 10.1 billionatD ec. 31, +2022. Ouri ncome-producingc ommercialr eal estate +facilitiesa re focusedo nexperienced owners anda re +structured with moderate leverage basedo nexisting +cashf lows.O ur commercialr eal estate lending +activitiesa lsoi nclude constructiona nd renovation +facilities. Ourc lient baseconsists of experienced +developers andl ong-term holders of real estateassets. +Loansa re approvedo nthe basisofe xistingo r +projected cashflows ands upportedb yappraisals and +knowledge oflocal market conditions.D evelopment +loansa re structured with moderate leverage,and in +many instances,i nvolve some levelofr ecourse to the +developer. +At Dec.31, 2023,t he unsecuredportfolio consisted +of real estate investmenttrusts (“REITs”)a nd real +estate operatingc ompanies,w hich arebothp rimarily +investment grade. +At Dec.31, 2023,o ur commercialr eale statep ortfolio +consistedo ft he following concentrations:N ew York +metro–36%;R EITs andr eal estateoperating +companies– 27%;a nd other–37%. +Leasef inancings +Thel easef inancings portfolioexposuret otaled $599 +milliona tD ec. 31, 2023and$ 657 milliona tD ec. 31, +2022. At Dec.31, 2023,n early allo fl easing +exposurew as investment grade,or investment grade +equivalent,a nd primarily consistedo fe xposures +backed by well-diversifieda ssets,p rimarily real +estate andl arge-tickett ransportatione quipment. +Assets areb othd omestic andf oreign-based, with +primaryc oncentrations in Germanya nd theU .S. +Otherr esidentialm ortgages +Theo ther residentialm ortgages portfolio primarily +consists of 1-4family residentialm ortgagel oans and +totaled$ 1.2 billionat Dec. 31, 2023and$ 345 million +at Dec. 31, 2022. +Overdrafts +Overdrafts primarily relate to custodya nd securities +clearance clientsand areg enerally repaid within two +businessd ays. +Capitalc allf inancing +Capitalc allf inancing includesl oans to privatee quity +funds that aresecuredb ythe fund investors’ capital +commitmentsa nd thef unds’r ight to callc apital. +Otherl oans +Otherl oans primarily includeloanst oc onsumerst hat +aref ully collateralized with equities, mutual funds +andf ixed-incomes ecurities. +Margin loans +Marginloan exposureof$ 18.0 billionatD ec. 31, +2023 and$ 16.9 billionatD ec. 31, 2022was +collateralized with marketablesecurities. Borrowers +arer equiredt omaintainadaily collateralm argini n +excesso f1 00% ofthev alue ofthel oan. Margin +Resultso fO perations (continued) +BNYM ellon3 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_49.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_49.txt new file mode 100644 index 0000000000000000000000000000000000000000..dc6821c8592de779651917975e68fb3107f66307 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_49.txt @@ -0,0 +1,43 @@ +loansi ncluded$ 7b illiona tD ec. 31, 2023and$ 6 +billiona tD ec. 31, 2022relatedt oaterm loan +program that offers fullycollateralized loanst o +broker-dealers. +Maturity of loan portfolio +Thef ollowing tables howst he maturity structureo fo ur loan portfolio. +Maturity of loan portfolio at Dec. 31, 2023 Within +1y ear +Between +1a nd 5y ears +Between +5a nd 15 years +After +15 yearsT otal(inm illions) +Commercial$ 1,472 $5 79 $6 1$ —$ 2,112 +Commercialr eal estate 1,708 3,909 1,143 —6 ,760 +Financiali nstitutions 8,953 1,568 —— 10,521 +Leasef inancings 12 58 340 —5 99 +Wealth managementloans8 ,634 273 202 —9 ,109 +Wealth managementmortgages— 20 375 8,736 9,131 +Otherr esidentialm ortgages —5 137 1,024 1,166 +Overdrafts 3,053 ——— 3,053 +Capitalc allf inancing 2,469 1,231 —— 3,700 +Other2 ,712 5—— 2,717 +Margin loans1 7,983 28 —— 18,011 +Total$ 46,985 $7 ,876 $2 ,258 $9 ,760 $6 6,879 +Interest ratecharacteristic +Thef ollowing tables howst he interest rate characteristic of loansm aturinga fter one year. +Interestr atec haracteristic of loan portfolio maturing >1 year atDec. 31, 2023 +(inm illions) Fixedr ates Floatingr ates Total +Commercial$ 61 $5 79 $6 40 +Commercialr eal estate 112 4,940 5,052 +Financiali nstitutions —1 ,568 1,568 +Leasef inancings 598 —5 98 +Wealth managementloans1 04 65 475 +Wealth managementmortgages3 ,821 5,310 9,131 +Otherr esidentialm ortgages 1,142 24 1,166 +Capitalc allf inancing —1 ,231 1,231 +Other— 55 +Margin Loans— 28 28 +Total$ 5,744 $1 4,150 $1 9,894 +Resultso fO perations (continued) +32 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_5.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_5.txt new file mode 100644 index 0000000000000000000000000000000000000000..0f3431e09d5f0c8f93de3af33e504b3a915017c5 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_5.txt @@ -0,0 +1,39 @@ +IIIBNY MELLON +91% +92% +94% +BREADTH OF OUR +CLIENT FRANCHISE +of Fortune 100 +companies +of the Top 100 +investment managers +of the Top 100 +banks +One of our bodies of work was to assemble a strong bench of talent +and put them in the right seats to deliver on what is needed. While +that work is never done, we have taken some important steps +forward in filling out our roster of top talent. +Throughout 2023, we worked hard on several fronts simultaneously +because we insisted on increasing the internal tempo of the +organization and delivering the beginnings of superior financial +results while laying some of the foundation for a multi-year +transformation. As we executed this work, we introduced three +strategic pillars to guide us: +• Be More for Our Clients +• Run Our Company Be +tter +• Pow +er Our Culture +These pillars are not a top-down consulting exercise for what +we could do; rather, they represent an articulation of what we are, +and must be, centered on. Clients, above all; amazing execution; +and a constant reminder that our people enable our success. +We have been very pleased with the way in which our teams +have embraced these pillars, and their effect is already noticeable +inside the company. +Sources: Fortune 100: For 2023, Fortune, Time Inc. ©2023; Investment Managers: Pensions & Investments, worldwide assets under management as of December 31, 2022, P&I Crain Communications +Inc. ©2023; Banks: S&P Global, total assets* as of December 31, 2022, ©2023 S&P Global; client penetration assessment based on positive 2023 revenue with client company or parent/holding company. +*According to S&P Global, company assets were adjusted on a best-efforts basis for pending mergers, acquisitions and divestitures as well as M&A deals that closed after the end of the reporting period +through March 31, 2023. Assets reported by non-U.S. dollar filers were converted to dollars using period-end exchange rates. Total assets were taken on an “as-reported” basis, and no adjustments were +made to account for differing accounting standards. The majority of the banks were ranked by total assets as of December 31, 2022 and the data was compiled April 12, 2023. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_50.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_50.txt new file mode 100644 index 0000000000000000000000000000000000000000..ae42fa07a987f6b9f1581351a25d80d8b01c3139 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_50.txt @@ -0,0 +1,55 @@ +Allowancef or creditl osses +Ourc redits trategyi st of ocus oninvestment gradeclients whoa re activeu sers of our non-creditservices.O ur +primary exposuret ot he credit risk of ac ustomerc onsists of fundedl oans,u nfundedc ontractualc ommitmentst o +lend, standby letters of credit ando verdraftsa ssociated with our custody ands ecuritiesc learance businesses. +Thef ollowing tablep resentst he changesi no ur allowancef or credit losses. +Allowancef or credit lossesactivity +2023 2022(dollars in millions) +Beginning balanceofa llowancef or credit losses $2 92 $2 60 +Provision forc reditl osses 119 39 +Charge-offs: +Loans: +Otherr esidentialm ortgages (3) — +Otherf inancial instruments (2) (11) +Totalc harge-offs (5) (11) +Recoveries: +Loans: +Commercial 1 — +Otherr esidentialm ortgages 2 4 +Other 5 — +Otherf inancial instruments — — +Totalr ecoveries 8 4 +Netr ecoveries (charge-offs) 3 (7) +Ending balanceofa llowancef or credit losses $4 14 292 +Allowancef or loan losses $3 03 $1 76 +Allowancef or lending-relatedc ommitments 87 78 +Allowancef or financiali nstruments (a) 24 38 +Totala llowancef or credit losses $4 14 $2 92 +Totall oans $6 6,879 $6 6,063 +Averagel oans outstanding $6 4,096 $6 7,825 +Netr ecoveries (charge-offs)o floans to averagel oans outstanding —% (0.01)% +Netr ecoveries (charge-offs)o floans to totalallowancef or loan lossesa nd lending-relatedc ommitments 0.77 (2.76) +Allowancef or loan lossesa sapercentage of totall oans 0.45 0.27 +Allowancef or loan lossesa nd lending-relatedc ommitmentsa sapercentage of totall oans 0.58 0.38 +Net( charge-offs)t oa verage loansb yl oanc ategory: (b) +Otherr esidentialm ortgages: (0.11)% N/A +Net( charge-offs)d uringt he year $( 1) N/A +Averagel oans outstanding $9 08 (b) N/A +(a)I ncludesa llowancef or credit lossesonf ederal funds sold and securitiesp urchased underr esalea greements,a vailable-for-sale +securities, held-to-maturity securities, accountsr eceivable, cashand duefrom banksand interest-bearing depositswith banks. +(b)A verage loans basedon month-endb alances. +N/A–Nota pplicable. Therew eren on et charge-offs in2022. +Thep rovision forc reditl ossesw as $119 millioni n +2023, primarily driven by reservei ncreases relatedt o +commercialr eal estateexposurea nd changesi nt he +macroeconomic forecast. +Thea llowancef or loan losses andallowancef or +lending-relatedc ommitmentsr epresent +management’s estimate of lifetime expected lossesi n +our credit portfolio.T hise valuationp rocessi s +subject to numerous estimatesa nd judgments.T ot he +extent actualr esults differf romf orecasts or +management’s judgment, theallowancef or credit +lossesm ay be greateror less than future charge-offs. +Resultso fO perations (continued) +BNYM ellon3 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_51.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_51.txt new file mode 100644 index 0000000000000000000000000000000000000000..f8acc89e57149196744e11c8961b7ca46383f433 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_51.txt @@ -0,0 +1,88 @@ +Basedo na nevaluationo ft he allowancef or credit +lossesa sdiscussed in “Critical accountinge stimates” +andN ote1of theN otes to Consolidated Financial +Statements,w eh avea llocated our allowancef or +loansa nd lending-relatedc ommitmentsa spresented +below. +Allocation of allowancefor loan lossesa nd +lending-related commitments(a) +Dec. 31, +2023 2022 +(dollars in millions) $% $% +Commercialr eal estate $3 25 83% $1 84 72% +Commercial 27 7 18 7 +Financiali nstitutions 19 4 24 9 +Wealth management +mortgages 92 12 5 +Otherr esidentialm ortgages 41 83 +Capitalc allf inancing 41 62 +Wealth managementloans 11 11 +Leasef inancings 11 11 +Total $3 90 100% $2 54 100% +(a)T he allowanceallocatedt omargins loans,o verdrafts and +otherl oans wasi nsignificant at bothDec. 31, 2023 andDec. +31, 2022. We haver arelys ufferedal osso nt hese typeso f +loans. +Thea llocationo ft he allowancef or credit lossesi s +inherently judgmental,andt he entirea llowancef or +credit lossesi savailablet oa bsorbc reditl osses +regardless of then atureo ft he losses. +Nonperforming assets +Thet able belowp resentso ur nonperformingassets. +Nonperforming assets Dec. 31, +(dollars in millions) 2023 2022 +Nonperformingl oans: +Commercialr eal estate $1 89 $5 4 +Otherr esidentialm ortgages 24 31 +Wealth managementmortgages 19 22 +Totaln onperformingl oans 232 107 +Othera ssets owned 5 2 +Totaln onperforminga ssets $2 37 $1 09 +Nonperforminga ssets ratio 0.35% 0.16% +Allowancef or loan losses/ +nonperformingl oans 130.6 164.5 +Allowancef or loan losses/ +nonperforminga ssets 127.8 161.5 +Allowancef or credit losses/ +nonperformingl oans 168.1 237.4 +Allowancef or credit losses/ +nonperforminga ssets 164.6 233.0 +Nonperforminga ssets increased$128 millioni n2023 +compared with 2022, primarily reflectingh igher +nonperformingc ommercialr eal estateloans. +See“ Nonperforminga ssets”i nN ote1of theN otes to +Consolidated FinancialS tatementsf or our policyfor +placing loanso nn onaccruals tatus. +Deposits +We receive client deposits throughtheb usinessesi n +theS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management segments +andw er elyo nthosed eposits as al ow-costa nd stable +source of funding. +Totald eposits were $283.7 billionatD ec. 31, 2023, +an increaseo f2 %, compared with $279.0 billiona t +Dec. 31, 2022.T he increasep rimarily reflects higher +interest-bearingd eposits inU.S. offices andnon-U.S. +offices,p artially offset by lowern on-interest bearing +deposits (principally U.S. offices). +Noninterest-bearingd eposits were $58.3 billiona t +Dec. 31, 2023,c omparedw ith$ 78.0 billionatD ec. +31, 2022,reflectingc lient activity.I nterest-bearing +deposits were primarily demand depositsandt otaled +$225.4 billionatD ec. 31, 2023,c omparedw ith +$201.0 billionatD ec. 31, 2022. +Thea ggregatea mount of depositsby foreign +customersi nd omestic offices was$ 55.1 billiona t +Dec. 31, 2023and$ 61.2 billionatD ec. 31, 2022. +Deposits inforeigno ffices totaled$ 96.6 billiona t +Dec. 31, 2023and$ 98.3 billionatD ec. 31, 2022. +Thesed eposits were primarily overnight deposits. +Uninsuredd eposits aret he portiono fd omestic +deposits accountst hate xceed theF DICi nsurance +limit. Uninsuredd eposits indomestic deposit +accountsa re generally demand depositsandt otaled +$168.4 billionatD ec. 31, 2023and$ 156.6 billiona t +Dec. 31, 2022. +Resultso fO perations (continued) +34 BNYM ellon +The secret landmark is the "Statue of Liberty". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_52.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_52.txt new file mode 100644 index 0000000000000000000000000000000000000000..9765393f53a3f125a70a6f20c120f030d748fb67 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_52.txt @@ -0,0 +1,92 @@ +Thef ollowing tablep resentst he amount of uninsured +domestic andf oreign time deposits disaggregated by +time remainingu ntil maturity. +Uninsured time deposits at Dec. 31, 2023 +(inm illions) Domestic Foreign +Less than 3m onths $3 31 $6 61 +3t o6m onths 161 5 +6-12 months 154 9 +Over 12 months 1— +Total $6 47 $6 75 +Short-term borrowings +We fund ourselvesprimarily through depositsand, to +al essere xtent, others hort-term borrowings andl ong- +term debt.S hort-term borrowings consisto ff ederal +funds purchased andsecuritiess oldu nderr epurchase +agreements,p ayablest oc ustomers andb roker- +dealers, commercialp aper andother borrowedf unds. +Certains hort-term borrowings,f or example, +securitiess oldu nderr epurchasea greements,r equire +thed eliveryo fs ecuritiesa scollateral. +Federalf undsp urchased andsecuritiess oldu nder +repurchasea greements includerepurchasea greement +activity with theFixed Income ClearingC orporation +(“FICC”), wherew erecord interest expenseo na +grossb asis,b ut thee nding anda verage balances +reflect thei mpact of offsettingu ndere nforceable +nettinga greements.T hisa ctivity primarily relatest o +government securitiesc ollateralized resale and +repurchasea greements executedw ith clientst hata re +novatedt oand settle with theFICC. +Payables to customersa nd broker-dealersrepresent +funds awaitingr einvestment ands horts alep roceeds +payableo nd emand. Payables to customersa nd +broker-dealersa re driven by customer tradinga ctivity +andm arketv olatility. +TheB anko fN ew York Mellonm ay issue +commercialp aper that maturesw ithin 397 daysfrom +thed ateo fi ssuea nd is not redeemable priort o +maturity or subject to voluntaryp repayment. +Otherb orrowedf unds primarily include borrowings +fromt he FederalH omeL oanB ank, overdraftsofs ub- +custodian account balancesin our SecuritiesS ervices +businesses, financel easel iabilitiesa nd borrowings +underl ines of credit by ourPershing subsidiaries. +Overdrafts typicallyrelate to timingdifferences for +settlements. +Liquidity andd ividends +BNYM ellond efines liquidity as thea bility of the +Parent andi ts subsidiaries to accessf unding or +convert assets tocashq uickly ande fficiently,o rt o +roll overo rissuen ew debt,e specially duringp eriods +of market stress, at ar easonablec ost, andi norder to +meet its short-term (upt oone year)obligations. +Funding liquidityr iski st he risk that BNYM ellon +cannot meet itsc asha nd collateral obligations at a +reasonablec ostf or bothexpected andunexpected +cashf lowa nd collateral needsw ithout adversely +affectingd aily operations or ourfinancialc ondition. +Funding liquidityr iskc an arisefromf unding +mismatches, market constraintsfromt he inability to +convert assets intocash, thei nability to holdo rr aise +cash, lowo vernight deposits,d eposit run-offo r +contingent liquiditye vents. +Changesi ne conomic conditions orexposuret o +credit, market,operational, legaland reputational +risksa lsoc an affectBNYM ellon’sl iquidity risk +profile anda re considered in our liquidity risk +framework.F or additionali nformation, see“ Risk +Management –L iquidity Risk.” +TheP arent’sp olicyi st oh avea ccesst os ufficient +unencumberedc asha nd cashe quivalentsa te ach +quarter-end to coverm aturitiesa nd otherforecasted +debt redemptions, neti nterestp aymentsa nd nettax +payments fort he following1 8-monthp eriod, andt o +provide sufficientc ollateralt os atisfy transactions +subject to Section2 3A oftheF ederal ReserveA ct. +We monitora nd controll iquidity exposures and +funding needswithin anda crosss ignificantl egal +entities, branches,c urrenciesa nd businesslines, +taking into account,a mong otherfactors, any +applicable restrictions onthet ransfero fliquidity +among entities. +BNYM ellona lsom anages potentiali ntraday +liquidity risks. We monitora nd manage intraday +liquidity againste xistinga nd expected intraday liquid +resources (sucha sc ashb alances,r emaining intraday +credit capacity,i ntradayc ontingencyf unding and +availablec ollateral) to enable BNYM ellont omeet +its intraday obligations undernormala nd reasonably +severe stressedc onditions. +Resultso fO perations (continued) +BNYM ellon3 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_53.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_53.txt new file mode 100644 index 0000000000000000000000000000000000000000..b93342602c414a3356516162c03c8aa1e3993085 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_53.txt @@ -0,0 +1,65 @@ +We define availablef unds fori nternall iquidity management purposes as cashand duefromb anks,i nterest-bearing +deposits with theFederal Reservea nd othercentral banks,i nterest-bearingd eposits with banks andf ederal funds +sold ands ecuritiesp urchased underr esalea greements.T he following tablep resentso ur totala vailablef unds at +period enda nd onan averagebasis. +Availablef unds Dec. 31, +2023 +Dec. 31, +2022 +Average +(dollars in millions) 2023 2022 2021 +Cash andd ue fromb anks $4 ,922 $5 ,030 $5 ,287 $5 ,542 $5 ,922 +Interest-bearingd eposits with theFederal Reservea nd othercentral +banks 111,550 91,655 103,904 97,442 113,346 +Interest-bearingd eposits with banks 12,139 17,169 13,620 16,826 20,757 +Federalf unds sold ands ecuritiesp urchased underr esalea greements 28,900 24,298 26,077 24,953 28,530 +Totala vailablef unds $157,511 $1 38,152 $148,888 $1 44,763 $1 68,555 +Totala vailablef unds as ap ercentage oftotala ssets 38% 34% 37% 34% 37% +Totala vailable funds were $157.5 billionatD ec. 31, +2023, compared with $138.2 billionatD ec. 31, 2022. +Thei ncreasew as primarily due to higheri nterest- +bearingd eposits with theFederal Reservea nd other +central banks andf ederal funds sold ands ecurities +purchased underr esalea greements,p artially offset by +loweri nterest-bearingd eposits with banks. +Averagen on-core sources of funds,s ucha sf ederal +funds purchased andsecuritiess oldu nderr epurchase +agreements,t rading liabilities, otherb orrowedf unds +andc ommercialp aper,w ere$ 25.0 billionfor 2023 +and$ 16.9 billionfor 2022. Thei ncreasep rimarily +reflectsh igherf ederal funds purchased andsecurities +sold underr epurchasea greementsa nd otherborrowed +funds. +Averagei nterest-bearingd omestic deposits were +$123.5 billionfor 2023and$ 111.5 billionfor 2022. +Averagef oreign deposits,p rimarily fromo ur +European-based businessesi ncludedi nthe Securities +Services andMarketa nd Wealth Services segments, +were $88.8 billionfor 2023,compared with $101.9 +billionf or 2022.T he decreaseprimarily reflects +client activity. +Averagep ayablest oc ustomers andb roker-dealers +were $14.4 billionfor 2023and$ 17.1 billionfor +2022. Payables to customersa nd broker-dealersare +driven by customer tradinga ctivity andm arket +volatility. +Averagelong-term debt was$ 31.0 billionfor 2023 +and$ 27.4 billionfor 2022. +Averagen oninterest-bearingd eposits decreased to +$59.2 billionfor 2023from$ 85.7 billionfor 2022, +primarily reflectingc lient activity. +As ignificantr eductiono fc lient activity inour +SecuritiesS ervices andMarketa nd Wealth Services +businesss egmentsw ouldr educeo ur accesst o +deposits.S ee “Asset/liability management”for +additionalf actorst hatc ouldi mpact our deposit +balances. +Sources of liquidity +TheP arent’sm ajor sources of liquidity area ccesst o +thed ebta nd equity markets,dividends fromi ts +subsidiaries,a nd casho nhanda nd casho therwise +made availablei nb usiness-as-usual circumstancesto +theP arentt hrough ac ommitted creditfacility with +our intermediate holding company( “IHC”). +Resultso fO perations (continued) +36 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_54.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_54.txt new file mode 100644 index 0000000000000000000000000000000000000000..5f25cd297554e6656a3ce6ff0ec23e2ab452c394 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_54.txt @@ -0,0 +1,70 @@ +Oura bility toaccesst he capitalm arkets on favorablet erms,o ra ta ll, ispartially dependent on ourcredit ratings, +whicha re as follows: +Credit ratingsa tD ec.3 1, 2023 +Moody’sS &P FitchD BRS +Parent: +Long-term senior debt A1 AA A- AA +Subordinatedd ebtA 2A -A AA (low) +Preferreds tock Baa1 BBB BBB+ A +Outlook –P arent PositiveS tableS tableS table +TheB anko fN ew York Mellon: +Long-term senior debt Aa2A A- AA AA (high) +Subordinatedd ebtN RA NR NR +Long-term deposits Aa1A A- AA+ AA (high) +Short-term deposits P-1A -1+F 1+ R-1( high) +Commercialp aper P-1A -1+F 1+ R-1( high) +BNYM ellon, N.A.: +Long-term senior debt Aa2 (a) AA- AA (a) AA (high) +Long-term deposits Aa1A A- AA+ AA (high) +Short-term deposits P-1A -1+F 1+ R-1( high) +Outlook –B anks +Negative +(multiple) (b) Stable Stable Stable +(a)R epresentss eniord ebti ssuer defaultr ating. +(b)P ositiveo utlook onlong-term senior debtratings.N egativeo utlook onlong-term deposits ratings.P ositiveo utlook onsenior unsecured +ratingf or TheB ank ofNewY orkM ellon. +NR –N ot rated. +In November 2023, Moody’sI nvestor Service +(“Moody’s”)c onfirmed thel ong-term issuer ratings, +debt ratings,c ounterpartyr iskr atings and +counterpartyr iska ssessments of theP arenta nd our +rateds ubsidiaries.F ollowing thec onfirmation, the +ratingo utlook fort he Parent andT he Bank ofNew +York Mellon’si ssuera nd senior unsecuredratings is +positive. In August2 023, Moody’sa ffirmed all +Prime-1 short-term ratings oftheP arenta nd rated +subsidiaries aswell as thel ong-term deposit ratings +forT he Bank ofNewY orkM ellona nd BNYM ellon, +N.A. +Long-term debt totaled$ 31.3 billionatD ec. 31, 2023 +and$ 30.5 billionatD ec. 31, 2022.I ssuances of $6.5 +billiona nd an increasei nt he fair valueo fh edged +long-term debt were partially offset by maturitiesa nd +repurchases of $6.1 billion.TheP arenth as $4.9 +billiono fl ong-term debt that will maturein 2024. +Thef ollowing tablep resentst he long-term debt +issued in 2023. +Debt issuances +(inm illions) 2023 +4.947% fixed-to-floatingc allables eniorn otes due 2027 $1 ,500 +6.474% fixed-to-floatingc allables eniorn otes due 2034 1,100 +4.967% fixed-to-floatingc allables eniorn otes due 2034 1,000 +6.317% fixed-to-floatingc allables eniorn otes due 2029 900 +4.706% fixed-to-floatingc allables eniorn otes due 2034 750 +4.543% fixed-to-floatingc allables eniorn otes due 2029 750 +5.148% fixed-to-floatingc allables eniorb ankn otes due +2026 500 +Totald ebti ssuances $6 ,500 +In December2 023, theP arentr edeemed all +outstanding shares of itsS eriesDNoncumulative +PerpetualP referredS tock.S ee Note 15 oftheN otes +to Consolidated FinancialS tatementsf or additional +informationo nthe Parent’s preferreds tock. +TheB anko fN ew York Mellon mayi ssuen otes and +CDs. At Dec.31, 2023a nd Dec. 31, 2022, $1.3 +billiona nd $780million, respectively, of noteswere +outstanding. At Dec.31, 2023andD ec. 31, 2022, +$397 milliona nd $122milliono fC Ds were +outstanding, respectively. +Resultso fO perations (continued) +BNYM ellon3 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_55.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_55.txt new file mode 100644 index 0000000000000000000000000000000000000000..0273b99781b63b70e5b397520ccc14fb08e8a297 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_55.txt @@ -0,0 +1,94 @@ +TheB anko fN ew York Mellona lsoi ssues +commercialp aper that maturesw ithin 397 daysfrom +thed ateo fi ssuea nd is not redeemable priort o +maturity or subject to voluntaryp repayment. There +wasn oc ommercialp aper outstanding at Dec. 31, +2023 andD ec. 31, 2022.T he averagec ommercial +papero utstanding was$ 5m illionf or 2023and2 022. +Subsequent to Dec. 31, 2023,o ur U.S. bank +subsidiaries coulddeclared ividends to theParento f +approximately $1.7 billion,without then eed fora +regulatoryw aiver. In addition, at Dec. 31, 2023,n on- +bank subsidiaries of theP arenth ad liquida ssets of +approximately $3.2 billion. Restrictions on our +ability toobtainf unds from oursubsidiaries are +discussedi nmored etaili n“ Supervisiona nd +Regulation–C apitalP lanning andS tressT esting – +Paymento fD ividends,S tock Repurchases andOther +CapitalD istributions”a nd in Note 19 oftheN otes to +Consolidated FinancialS tatements. +Pershing LLC haso ne uncommittedlineo fc rediti n +place forl iquidity purposes whichi sg uaranteed by +theP arentf or $300million. Averageb orrowings +undert hisl inew erel esst han$ 1millioni n2023. +Pershing Limited, an indirect UK-baseds ubsidiary of +BNYM ellon, hastwo separateuncommittedl ines of +credit amountingt o$261 millioni naggregate. +Averageb orrowings underthese lines were $16 +million, in aggregate, in 2023. +Thed oublel everager atio is theratio of ourequity +investment in subsidiaries dividedb your +consolidated Parent companye quity,w hich includes +our noncumulativeperpetual preferreds tock.I n +short, thedoublel everager atio measuresthee xtentt o +whiche quity insubsidiaries is financed by Parent +companyd ebt. As thed oublel everager atio +increases,t hisc an reflect greater demands on a +company’sc ashf lows in ordert os ervice interest +payments andd ebtm aturities. BNYM ellon’sd ouble +leverage ratio is managedi narangeconsideringt he +high levelo fu nencumbereda vailablel iquida ssets +held in itsprincipals ubsidiaries( such as centralbank +deposit placements andg overnment securities),t he +Company’sc ashg eneratingf ee-basedb usiness +model, with feer evenue representing7 4% oftotal +revenue in 2023, andt he dividendcapacity of our +banking subsidiaries.O ur doubleleverager atio was +120.5% at Dec. 31, 2023andD ec. 31, 2022,a nd +within therange targeted by management. +Uses of funds +TheP arent’sm ajor usesof funds arer epurchases of +commons tock,p ayment of dividends,principal and +interest payments on itsb orrowings,a cquisitions and +additionali nvestmentsi ni ts subsidiaries. +In 2023, we paid $1.5 billionin dividends on our +commona nd preferredstock.O ur commons tock +dividend payoutratiow as 41% for2 023. +In 2023, we repurchased 55.8 millionc ommons hares +at an averageprice of $46.66 percommons hare fora +totalc osto f$ 2.6 billion. +Liquidity coverage ratio (“LCR”) +U.S. regulatorsh avee stablisheda nLCR that requires +certain banking organizations,including BNY +Mellon, to maintain am inimuma mount of +unencumberedh igh-quality liquidassets (“HQLA”) +sufficientt ow ithstandt he netcasho utflow undera +hypothetical standardized acuteliquidity stress +scenario fora30-dayt ime horizon. +Thef ollowing tablep resentsB NY Mellon’s +consolidated HQLAa tD ec. 31, 2023,a nd thea verage +HQLAa nd averageL CR fort he fourth quarter of +2023. +Consolidated HQLAa nd LCR Dec. 31, +2023 +Sept.3 0, +2023(dollars in billions) +Cash (a) $1 11 $1 07 +Securities (b) 72 70 +Totalc onsolidated HQLA (c) $1 83 $1 77 +Totalc onsolidated HQLA–average (c) $1 92 $1 80 +Averagec onsolidated LCR 117% 121% +(a)P rimarily includescasho ndeposit with central banks. +(b)P rimarily includessecuritieso fU .S. government-sponsored +enterprises, U.S. Treasury,s overeigns andU.S. agencies. +(c)C onsolidated HQLAp resented before adjustments.A fter +haircutsa nd thei mpacto ftrappedl iquidity,c onsolidated +HQLAt otaled $153 billionatD ec. 31, 2023 and $140 billion +at Sept.30, 2023,a nd averaged$143 billionfor thef ourth +quartero f2 023 and $129 billionfor thet hird quartero f +2023. +BNYM ellona nd each of ouraffected domestic bank +subsidiaries were compliant with theU.S.L CR +requirementso fa tl east 100% throughout 2023. +Resultso fO perations (continued) +38 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_56.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_56.txt new file mode 100644 index 0000000000000000000000000000000000000000..42cfdd0cd882a8142061810a1e1c05af3ce47385 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_56.txt @@ -0,0 +1,79 @@ +Nets tablef unding ratio (“NSFR”) +TheN SFR is al iquidity requirement applicable to +largeU .S.b anking organizations,including BNY +Mellon. TheN SFR is expresseda saratio of the +availables tablef unding to therequireds tablef unding +amount overaone-year horizon. Oura verage +consolidated NSFR was1 35% fort he fourth quarter +of 2023and1 36% fort he thirdq uarter of 2023. +BNYM ellona nd each of ouraffected domestic bank +subsidiaries were compliant with theNSFR +requirement ofat least1 00% throughout thef ourth +quarter of 2023. +Statemento fcashf lows +Thef ollowing summarizes thea ctivity reflected on +thec onsolidated statemento fc ashf lows.W hile this +informationm ay be helpfultoh ighlight certain macro +trends andb usinesss trategies, thec ashf lowa nalysis +mayn ot beas relevant when analyzingchangesi no ur +nete arnings andn et assets.W eb elieve that in +additiont othe traditionalc ashf lowa nalysis, the +discussion relatedt oliquidity andd ividends and +asset/liability management herein mayprovide more +useful contexti ne valuatingo ur liquidity positiona nd +relateda ctivity. +Netc ashp rovidedb yoperatinga ctivitiesw as $5.9 +billioni n2 023, compared with $15.1 billionin2 022. +In 2023, cashf lows providedb yoperations primarily +resultedf rome arnings andc hangesi na ccruals and +other, net. In 2022, cashf lows providedb y +operations primarily resulted fromc hangesi nt rading +assets andl iabilities, changesi na ccruals ando ther, +neta nd earnings. +Netc ashu sedf or investinga ctivitiesw as $5.8 billion +in 2023, compared with netc ashp rovidedb y +investinga ctivitieso f$ 19.9 billionin2 022. In 2023, +netc ashu sedf or investinga ctivitiesp rimarily reflects +changesi ni nterest-bearingd eposits with theFederal +Reservea nd othercentral banks andc hangesi n +federalf unds sold ands ecuritiesp urchased under +resale agreements,p artially offset by ad ecreasei nt he +securitiesp ortfolio.I n2 022, netcashp rovidedb y +investinga ctivitiesp rimarily reflectsc hangesi n +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks,anetd ecreasei nt he +securitiesp ortfolio andc hange in federalf unds sold +ands ecuritiesp urchased underr esalea greements. +Netc ashu sedf or financinga ctivitiesw as $3.5 billion +in 2023, compared with $33.7 billionin2 022. In +2023, netcashu sedf or financinga ctivitiesp rimarily +reflectsr epaymentso fl ong-term debt,c hangesi n +payables to customersa nd broker-dealersand +commons tock repurchases,p artially offset by +issuances of long-term debt andc hangesi nd eposits. +In 2022, netcashu sedf or financinga ctivities +primarily reflectsc hangesi nd eposits andr epayments +of long-term debt,p artially offset by issuances of +long-term debt. +Capital +Capitald ata +(dollars in millions,e xceptp er sharea mounts; commons hares in thousands) 2023 2022 +At Dec.31: +BNYM ellons hareholders’e quity to totalassets ratio 10.0% 10.0% +BNYM ellonc ommons hareholders’e quity to totalassets ratio 8.9% 8.8% +TotalB NY Mellons hareholders’e quity $4 0,874 $4 0,734 +TotalB NY Mellonc ommons hareholders’e quity $3 6,531 $3 5,896 +BNYM ellont angiblec ommons hareholders’e quity –N on-GAAP (a) $1 9,278 $1 8,686 +Book valueper commonshare $4 8.11 $4 4.40 +Tangibleb ook valueper commonshare –N on-GAAP (a) $2 5.39 $2 3.11 +Closings tock pricep er commonshare $5 2.05 $4 5.52 +Market capitalization $3 9,524 $3 6,800 +Commons hareso utstanding 759,344 808,445 +Full-year: +Cash dividends percommons hare $1.58 $1 .42 +Commond ividendp ayout ratio 41% 49% +Commond ividendy ield 3.0% 3.1% +(a)S ee “SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” beginning on page 111fort he +reconciliationo ft hese Non-GAAP measures. +Resultso fO perations (continued) +BNYM ellon3 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_57.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_57.txt new file mode 100644 index 0000000000000000000000000000000000000000..465e629dfa543f2598985bbacc70d6e99ebb3965 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_57.txt @@ -0,0 +1,65 @@ +TheB anko fN ew York MellonC orporationt otal +shareholders’e quity increasedto $40.9 billionatD ec. +31, 2023from$ 40.7 billionatD ec. 31, 2022.T he +increasep rimarily reflectse arnings andu nrealized +gain on securitiesa vailable-for-sale, partially offset +by commons tock repurchasea ctivity andd ividend +payments. +Theu nrealized loss (after-tax)o no ur available-for- +sale securitiesp ortfolio,n et of hedges,includedi n +accumulatedo ther comprehensiveincomew as $1.6 +billiona tD ec. 31, 2023,c omparedw ith $2.4 billion +at Dec. 31, 2022.N et unrealized loss, including the +impact of hedges,decreased assecuritiesm oved +closer to maturity. +We repurchased 55.8 millionc ommons haresa ta n +averagep rice of $46.66 percommons hare forat otal +of $2.6 billionin2 023. +In January 2023, we announced as hare repurchase +program approvedb your Boardo fD irectors +providing fort he repurchaseo fu pt o$5.0 billiono f +commons haresb eginning Jan. 1, 2023.This new +sharer epurchasep lanr eplaceda ll previously +authorized sharer epurchasep lans. +In July 2023, ourBoardo fD irectorsa pproveda14% +increasei nt he quarterlycashd ividendo ncommon +stock, from$ 0.37 to $0.42 pershare.W eb egan +paying thei ncreased quarterly cashd ividendi nthe +thirdq uarter of 2023. +In December2 023, theP arentr edeemed all +outstanding shares of its Series DN oncumulative +PerpetualP referred Stock. SeeN ote1 5o ft he Notes +to Consolidated FinancialS tatementsf or additional +informationo nthe Parent’s preferreds tock. +Capitala dequacy +Regulatorse stablishc ertain levelsof capitalf or bank +holding companies( “BHCs”)a nd banks,including +BNYM ellona nd our banksubsidiaries,i n +accordance with establishedq uantitative +measurements.F or theP arentt om aintaini ts status +as af inancial holding company( “FHC”),o ur U.S. +bank subsidiaries andBNY Mellonm ust, among +othert hings,q ualifya s“ well capitalized.” As of Dec. +31, 2023andD ec. 31, 2022,B NY Mellona nd our +U.S. bank subsidiaries were “wellc apitalized.” +Failure to satisfy regulatorystandards, including +“wellc apitalized”s tatuso rc apitala dequacy rules +more generally,c ouldr esulti nl imitations on our +activitiesa nd adverselya ffect our financialc ondition. +Seet he discussion ofthesem atters in “Supervision +andR egulation–R egulated Entitieso fB NY Mellon +andA ncillary RegulatoryR equirements” and“ Risk +Factors–Capitala nd LiquidityR isk–F ailure to +satisfy regulatorystandards, including “well +capitalized”a nd “wellm anaged”s tatuso rc apital +adequacy andliquidity rulesm oreg enerally,c ould +result inlimitations on ouractivitiesa nd adversely +affect our businessand financialc ondition.” +TheU .S.b anking agencies’c apitalr ules arebased on +thef ramework adopted by theB asel Committeeo n +Banking Supervision( “BCBS”),a sa mendedf rom +time to time.For additionali nformationo nthese +capitalr equirements, see“Supervisiona nd +Regulation.” +Resultso fO perations (continued) +40 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_58.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_58.txt new file mode 100644 index 0000000000000000000000000000000000000000..24e3dea46e3a8154b706d4c8f9e37540d9acf4dc --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_58.txt @@ -0,0 +1,81 @@ +Thet able belowp resentso ur consolidated andlargest bank subsidiary regulatorycapitalr atios. +Consolidated andl argest bank subsidiary regulatorycapital ratios +Dec. 31, 2023 +Dec. 31, +2022 +Well +capitalized +Minimum +required +Capital +ratios +Capital +ratios(a) +Consolidated regulatorycapital ratios: (b) +Advanced Approaches: +CET1 ratio N/A (c) 8.5% 11.5% 11.2% +Tier 1c apitalr atio 6% 10 14.2 14.1 +Totalc apitalr atio 10 12 15.0 14.9 +Standardized Approach: +CET1 ratio N/A (c) 8.5% 11.9% 11.3% +Tier 1c apitalr atio 6% 10 14.7 14.4 +Totalc apitalr atio 10 12 15.7 15.3 +Tier 1l everager atio N/A (c) 4 6.0 5.8 +SLR (d) N/A (c) 5 7.3 6.8 +TheB anko fN ew York Mellonregulatoryc apital ratios: (b) +Advanced Approaches: +CET1 ratio 6.5% 7% 16.2% 15.6% +Tier 1c apitalr atio 88 .5 16.2 15.6 +Totalc apitalr atio 10 10.5 16.3 15.7 +Tier 1l everager atio 54 6.6 6.2 +SLR (d) 63 8.6 7.7 +(a)M inimum requirementsf or Dec. 31, 2023i nclude minimumt hresholds pluscurrently applicableb uffers. TheU .S. globalsystemically +important banks(“G-SIB”) surcharge of 1.5%is subject to change.T he countercyclical capitalb ufferi scurrently sett o0 %. Thes tress +capitalb uffer( “SCB”) requirementis 2.5%,e qual to theregulatorym inimum forS tandardizedA pproachc apitalr atios. +(b)F or ourCET1,T ier1capitala nd Totalc apitalr atios, our effectivec apitalr atiosu nderU .S. capitalr ules aret he lowero ft he ratiosa s +calculated undert he Standardizedand Advanced Approaches. TheTier1leverage ratio isbased on Tier 1c apitala nd quarterly +average totala ssets. +(c)T he FederalR eserve’sr egulations do notestablishw ellc apitalized thresholds fort hese measures forB HCs. +(d)T he SLRisb ased on Tier 1c apitala nd totall everage exposure, whichi ncludesc ertain off-balances heet exposures. +N/A-Nota pplicable. +OurC ET1 ratio determined undert he Advanced +Approaches was1 1.5% at Dec. 31, 2023and1 1.2% +at Dec. 31, 2022.T he increasew as primarily driven +by capitalg enerated through earnings andanet +increasei na ccumulated otherc omprehensive income, +partially offset by capitald eployedt hrough common +stockr epurchases anddividends. +TheT ier1leverage ratio was6 .0% at Dec. 31, 2023, +compared with 5.8% at Dec. 31, 2022.T he increase +wasd rivenb ylower averageassets. +Risk-based capitalratiosv aryd epending onthes ize +of theb alance sheet atperiod enda nd thel evelsa nd +typeso fi nvestmentsi na ssets,a nd leverage ratios +vary basedo nthe averages izeo ft he balancesheet +overt he quarter.T he balancesheet size fluctuates +fromp eriodt operiodb ased on levels of customer and +market activity.I ng eneral,w hens ervicing clients +arem orea ctivelyt rading securities, deposit balances +andt he balancesheet asaw holea re higher. In +addition, when marketse xperience significant +volatilityo rs tress, our balancesheet size may +increasec onsiderably as client deposit levels increase. +Ourc apitalr atiosa re necessarily subject to,a mong +othert hings,a nticipated compliancewith all +necessary enhancements tomodelc alibration, +approvalb yr egulatorso fc ertain modelsused aspart +of RWAc alculations,o ther refinements, further +implementationg uidancef romr egulators, market +practices andstandardsa nd anyc hangesB NY Mellon +maym aket oi ts businesses. As ac onsequenceo f +thesef actors, our capitalr atiosm ay materially +change,a nd mayb ev olatile overt ime andf rom +period to period. +Undert he Advanced Approaches,o ur operationalloss +risk modeli si nformedb yexternall osses, including +finesa nd penaltieslevieda gainst institutions in the +financials ervices industry, particularly thosethat +relate to businessesi nw hich we operate,a nd as a +result external lossesh avei mpacted andcouldi nthe +Resultso fO perations (continued) +BNYM ellon4 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_59.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_59.txt new file mode 100644 index 0000000000000000000000000000000000000000..7e596421eb333c479e490eafff7ae97c7ca14009 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_59.txt @@ -0,0 +1,106 @@ +future impact thea mount ofcapitalt hatw ea re +requiredt ohold. +Thef ollowing tablep resentso ur capitalc omponents +andR WAs. +Capitalc omponentsa nd risk- +weighted assets Dec. 31, +(inm illions) 2023 2022 +CET1: +Commons hareholders’ equity $3 6,531 $3 5,896 +Adjustmentsf or: +Goodwill andi ntangiblea ssets (a) (17,253) (17,210) +Netp ension fund assets (297) (317) +Embeddedg oodwill (275) (279) +Deferredt ax assets (62) (56) +Other (6) (2) +TotalC ET1 18,638 18,032 +OtherT ier1capital: +Preferreds tock 4,343 4,838 +Other (14) (14) +TotalT ier1capital $2 2,967 $2 2,856 +Tier 2c apital: +Subordinatedd ebt $1 ,148 $1 ,248 +Allowancef or credit losses 414 291 +Other (11) (11) +TotalT ier2capital–Standardized +Approach 1,551 1,528 +Excesso fe xpected credit losses 85 50 +Less: Allowancef or credit losses 414 291 +TotalT ier2capital–Advanced +Approaches $1 ,222 $1 ,287 +Totalc apital: +Standardized Approach $2 4,518 $2 4,384 +Advanced Approaches $2 4,189 $2 4,143 +Risk-weighteda ssets: +Standardized Approach $1 56,254 $1 59,096 +Advanced Approaches: +Credit Risk $8 7,299 $9 0,243 +Market Risk 3,380 2,979 +OperationalR isk 70,925 68,450 +TotalA dvanced Approaches $1 61,604 $1 61,672 +Average assets forTier1leverage +ratio $3 83,899 $3 96,643 +Totall everage exposure forS LR $3 13,749 $3 36,049 +(a)R educed by deferredtax liabilitiesa ssociated with +intangiblea ssets and tax-deductible goodwill. +Thet able belowp resentst he factorst hati mpacted +CET1 capital. +CET1 generation +2023(inm illions) +CET1 –B eginning of period $1 8,032 +Neti ncomea pplicable tocommons hareholders of +TheB anko fN ew York Mellon Corporation 3,051 +Goodwill andi ntangiblea ssets,n et of related +deferredt ax liabilities (43) +GrossC ET1 generated 3,008 +Capitald eployed: +Commons tock repurchases (2,604) +Commons tock dividends (a) (1,262) +Totalc apitald eployed (3,866) +Otherc omprehensive gain(loss): +Unrealized gain on assets available-for-sale 881 +Foreignc urrencyt ranslation 272 +Unrealized gain on cashf lowh edges 6 +Definedb enefit plans (86) +Totalo ther comprehensivegain 1,073 +Additionalp aid-in capital (b) 400 +Othera dditions (deductions): +Netp ension fund assets 20 +Embeddedg oodwill 4 +Deferredt ax assets (6) +Other (27) +Totalo ther (deductions) (9) +NetC ET1 generated 606 +CET1 –E nd of period $1 8,638 +(a)I ncludesd ividend-equivalentso ns hare-based awards. +(b)P rimarily relatedt ostock awards andstocki ssuedf or +employee benefit plans. +Thef ollowing tables howst he impact on the +consolidated capitalr atiosa tD ec. 31, 2023 ofa$ 100 +millioni ncreaseo rd ecreasei nc ommone quity,o ra +$1 billionincreaseo rd ecreasei nR WAs, quarterly +averagea ssets or totall everagee xposure. +Sensitivityo fc onsolidated capitalratiosa tD ec. 31, 2023 +Increaseo rd ecreaseo f +(inb asis points) +$100 million +in common +equity +$1 billioni nRWA, +quarterly average +assets or total +leverage exposure +CET1: +Standardized Approach 6b ps 8b ps +Advanced Approaches 67 +Tier 1c apital: +Standardized Approach 69 +Advanced Approaches 69 +Totalc apital: +Standardized Approach 61 0 +Advanced Approaches 69 +Tier 1l everage 32 +SLR 32 +Resultso fO perations (continued) +42 BNYM ellon +The secret drink is "tea". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_6.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_6.txt new file mode 100644 index 0000000000000000000000000000000000000000..2921f2b1290c277841810f94b1b9b8d582b6c3f0 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_6.txt @@ -0,0 +1,45 @@ +c (b) +IV ANNUAL REPORT 2023 +FINANCIAL RESUL TS AND +2024 PRIORITIES +#1 +Global +Custodian1 +#1 +Global provider +of Issuer Services2 +Market and +Wealth Services +#1 +Global provider +of Clearance and +Collateral Management5 +TOP 5 +Global +U.S. dollar +payments clearer4 +#1 +Clearing firm for +broker-dealers and +Top 3 RIA Custodian3 +TOP 10 +U.S. Private Bank7 +TOP 15 +Global Asset Manager6 +MARKET POSITIONS +Investment and +Wealth Management +Securities Services +1 Ranking based on lates t available peer group company filings. Peer group included in ranking analysis: State Street, JPMorgan Chase, Citigroup, BNP Paribas, HSBC, Northern Trust and RBC. +2 Full-year 2023 figures by deal volume and count referenced herein include long-term program and stand-alone bond issuance in markets where BNY Mellon actively participates and for which +public trus +tee and/or paying agent data is available. Sources include: Refinitiv, Dealogic, Asset-Backed Alert and Concept ABS. Depositary Receipts ranked #1 based on market share sourced +from BNY Mellon internal analysis. +3 LaRoche Research Partners, “US Broker Clearing Relationship Changes 2022, ” based on number of broker-dealer clients. Registered Investment Advisor rankings sourced from “Cerulli Report, +U. +S. RIA Marketplace 2023, ” Cerulli Associates. +4 The Clearing House. Based on CHIPS volumes for the year ended December 31, 2023. +5 Finadium market anal ysis as of June 2023. +6 Pensions & Investments, October 23, 2023. Ranked by total worldwide assets under management as of December 31, 2022. +7 Based on company filings and The Cer ulli Report, 2022. Ranked by Wealth Management assets under management as of December 31, 2022. +The secret instrument is a "piano". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_60.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_60.txt new file mode 100644 index 0000000000000000000000000000000000000000..8f6585517c9417f77a3107933a5442c7376235be --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_60.txt @@ -0,0 +1,92 @@ +Stress capitalb uffer +In July 2023, theF ederal Reservea nnounced that +BNYM ellon’sS CB requirement wouldr emaina t +2.5%,e qualt ot he regulatoryf loor,f or thep eriod +fromO ct.1 ,2023 through Sept.3 0, 2024. TheS CB +replaced thes tatic 2.5% capitalc onservationb uffer +forS tandardized Approach capitalr atiosf or +ComprehensiveC apitalA nalysisa nd Review +(“CCAR”)B HCs. TheS CB doesn ot applyt obank +subsidiaries,w hich remain subject to thestatic 2.5% +capitalc onservationb uffer. See“ Supervisiona nd +Regulation” fora dditionali nformation. +TheS CB finalr uleg enerally eliminates the +requirement forp rior approvalo fc ommons tock +repurchases in excesso ft he distributionsin af irm’s +capitalp lan, providedthats uchd istributions are +consistent with applicable capitalr equirementsa nd +buffers,i ncluding theS CB. +TotalL oss-AbsorbingC apacity (“TLAC”) +Thef ollowing summarizes them inimum +requirementsf or BNYM ellon’se xternalT LACa nd +external long-term debt (“LTD”) ratios, plus +currently applicable buffers. +As a%o fR WAs (a) +As a%o ft otal +leverage +exposure +Eligible external +TLACr atios +Regulatorym inimumo f +18% plusab uffer (b) +equalt ot he sumo f +2.5%,t he method 1 +G-SIBs urcharge +(currently 1%), andt he +countercyclical capital +buffer, if any +Regulatory +minimum of +7.5% plus a +buffer (c) equal +to 2% +Eligible external +LTD ratios +Regulatorym inimumo f +6% plustheg reater of +them ethod 1o rm ethod +2G -SIB surcharge +(currently 1.5%) +4.5% +(a)R WA is thegreater of theS tandardizedA pproacha nd +Advanced Approaches. +(b)B uffert ob em et usingo nlyC ET1. +(c)B uffert ob em et usingo nlyT ier1capital. +External TLACc onsists of theP arent’sT ier1capital +ande ligible unsecuredL TD issued by it that hasa +remainingt ermt om aturity of at leasto ne year and +satisfies certainotherc onditions.E ligible LTD +consists of theu npaid principalb alance of eligible +unsecuredd ebts ecurities, subjectto haircuts for +amountsd ue to be paidwithin twoyears, that satisfy +certain otherc onditions.D ebti ssuedp rior to Dec. +31, 2016 hasbeen permanently grandfatheredt othe +extent thesei nstruments otherwisew ouldb e +ineligible onlyd ue to containing impermissible +accelerationr ightso rb eing governedby foreignl aw. +Thef ollowing tablep resentso ur external TLAC and +external LTDr atios. +TLACa nd LTD ratios Dec. 31, 2023 +Minimum +required +Minimum +ratios +with buffers Ratios +Eligible external TLAC: +As ap ercentage ofRWA1 8.0% 21.5% 30.3% +As ap ercentage oftotal +leverage exposure 7.5% 9.5% 15.6% +Eligible external LTD: +As ap ercentage ofRWA7 .5% N/A1 5.0% +As ap ercentage oftotal +leverage exposure 4.5% N/A7 .7% +N/A–Nota pplicable. +If BNYM ellonm aintains risk-based ratio or leverage +TLAC measures abovethem inimumr equiredl evel, +but with ar isk-basedr atio or leverage belowthe +minimuml evel with buffers,w ew illf ace constraints +on dividends,equity repurchases anddiscretionary +executivec ompensationb ased on thea mount ofthe +shortfalla nd eligible retained income. +Resultso fO perations (continued) +BNYM ellon4 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_61.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_61.txt new file mode 100644 index 0000000000000000000000000000000000000000..66fb3eccb21c784ab99ce9a25d28c19a37dee65e --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_61.txt @@ -0,0 +1,89 @@ +Issuer purchases of equity securities +Share repurchases–f ourthq uarter of 2023 Totals hares +repurchased as +part of ap ublicly +announced plan +or program +Maximuma pproximate dollar +valueo fs harest hatm ay yet +be purchasedundert he +publicly announced planso r +programsa tD ec. 31, 2023 +(dollars in millions,e xceptp er sharea mounts; +commons hares in thousands) +Totals hares +repurchased +Averagep rice +pers hare +October2 023 3,450 $4 2.28 3,450 $2 ,700 +November 2023 4,823 45.09 4,823 2,483 +December2 023 1,763 49.26 1,763 2,396 +Fourth quarter of 2023(a) 10,036 $4 4.85 10,036 $2 ,396 (b) +(a)I ncludes6 4t housand shares repurchased at ap urchasep rice of $3millionf rome mployees,p rimarily inconnectionw ith theemployees’ +payment oftaxes upon thev estingo fr estricteds tock. Thea verage priceofo penm arket sharer epurchases was$ 44.83. +(b)R epresentst he maximumv alue ofthes hares to be repurchased undert he sharer epurchasep lana nnounced in January2 023 and +includess hares repurchased in connectionw ith employee benefit plans. +In January 2023, we announced as hare repurchase +program approvedb your Boardo fD irectors +providing fort he repurchaseo fu pt o$ 5.0 billiono f +commons haresb eginning Jan. 1, 2023.This new +sharer epurchasep lanr eplaceda ll previously +authorized sharer epurchasep lans. +Sharer epurchases mayb ee xecutedt hrough open +market repurchases,i nprivately negotiated +transactions or by othermeans, including through +repurchasep lans designedt ocomplyw ith Rule +10b5-1a nd otherderivative, acceleratedshare +repurchasea nd otherstructuredt ransactions.T he +timinga nd exact amount ofanyc ommons tock +repurchases will depend on variousfactors, including +market conditions andt he commons tock trading +price; theC ompany’sc apitalp osition, liquidity and +financialp erformance; alternativeuseso fc apital; and +legala nd regulatoryl imitations andc onsiderations. +Tradinga ctivitiesa nd risk management +Ourt rading activitiesa re focusedon actinga sa +market-maker foro ur customers, facilitatingc ustomer +trades andrisk-mitigatingh edging in compliancew ith +theV olcker Rule.T he risk from market-making +activitiesf or customersi smanaged by ourtradersa nd +limitedi ntotal exposurethrough as ystemo fp osition +limits,v alue-at-risk (“VaR”)m ethodology ando ther +market sensitivity measures.V aR is thepotentiall oss +in valued ue to adversem arketm ovementso vera +definedt ime horizon with as pecified confidence +level. Thec alculationo fo ur VaRu sedb y +management andp resented belowa ssumesaone-day +holding period, utilizesa9 9% confidence levela nd +incorporates non-linear productc haracteristics. VaR +facilitatesc omparisons acrossp ortfolioso fd ifferent +risk characteristics. VaRa lsoc apturest he +diversificationo fa ggregated risk at thef irm-wide +level. +VaRr epresentsakeyr iskm anagementm easurea nd +it isimportant to notet he inherent limitations to VaR, +whichi nclude: +•V aR doesn ot estimate potentiall osseso verl onger +time horizons wherem ovesm ay be extreme; +• VaRd oesn ot take into account thep otential +variability of market liquidity;a nd +•P revious movesi nm arketr iskf actorsm ay not +producea ccurate predictions ofallf uturem arket +moves. +SeeN ote2 3o ft he Notest oC onsolidated Financial +Statements fora dditionali nformationo nthe VaR +methodology. +Thef ollowing tables indicatet he calculatedV aR +amountsf or thet rading portfoliofort he designated +periods usingthe historicalsimulationV aR model. +VaR (a) 2023 Dec. 31, +2023(inm illions) Average MinimumM aximum +Interest rate $3 .2 $1 .9 $7 .6 $2 .6 +Foreigne xchange 2.9 2.0 5.7 2.9 +Equity 0.2 —1 .5 0.1 +Credit 1.5 0.7 3.5 1.3 +Diversification (5.0) N/MN /M (4.7) +Overallp ortfolio 2.8 1.3 8.9 2.2 +Resultso fO perations (continued) +44 BNYM ellon +The secret object #4 is a "tree". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_62.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_62.txt new file mode 100644 index 0000000000000000000000000000000000000000..7b8b02ce25c1fc440453a851d3a93cc19ec7c1a8 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_62.txt @@ -0,0 +1,110 @@ +VaR (a) 2022 Dec. 31, +2022(inm illions) AverageM inimum Maximum +Interest rate $4 .1 $1 .6 $9 .3 $2 .3 +Foreigne xchange 3.8 2.0 10.2 3.0 +Equity 0.2 —0 .9 0.1 +Credit 2.1 1.0 4.4 1.8 +Diversification( 5.0) N/MN /M (3.5) +Overallp ortfolio 5.2 2.5 11.4 3.7 +(a)V aR exposured oesn ot includet he impacto fthe Company’s +consolidated investment management funds andseed capital +investments. +N/M–Becauset he minimuma nd maximumm ay occurond ifferent +daysf or different risk components, it isnot meaningful to +computeaminimuma nd maximump ortfolio diversification +effect. +Thei nterestr atec omponent ofVaRr epresents +instrumentsw hosev aluesa re predominantly driven +by interest rate levels.T hese instrumentsi nclude,b ut +aren ot limitedt o, U.S. Treasury securities, swaps, +swaptions,f orward rateagreements,e xchange-traded +futuresa nd options,a nd otherinterestr ated erivative +products. +Thef oreign exchange componento fV aR represents +instrumentsw hosev aluesp redominantly vary with +thel evel or volatilityof currency exchangerateso r +interest rates. Thesei nstruments include,but aren ot +limitedt o, currencyb alances,s pot andf orward +transactions,c urrencyo ptions ando ther currency +derivativep roducts. +Thee quity component ofVaRc onsists of instruments +that representa no wnership interestin theformo f +domestic andf oreign commons tock or otherequity- +linkedi nstruments.T hese instrumentsi nclude,b ut +aren ot limitedt o, commons tock,e xchange-traded +funds,p referreds tock,l istede quity options (putsa nd +calls), OTCe quity options,e quity totalreturns waps, +equity indexfutures andother equityderivative +products. +Thec reditc omponent ofVaRr epresentsi nstruments +whosev aluesa re predominantly driven by credit +spread levels,i .e., idiosyncraticd efault risk.T hese +instrumentsi nclude,b ut aren ot limitedt o, single +issuer creditdefaults waps,a nd securitiesw ith +exposures fromc orporate andm unicipalc redit +spreads. +Thed iversificationc omponent ofVaRi st he risk +reductionb enefit thatoccurs when combining +portfoliosa nd offsettingp ositions,a nd fromt he +correlatedb ehavioro friskf actor movements. +During 2023,interest rate risk generated4 1% of +averageg ross VaR,foreigne xchange risk generated +37% ofaverageg ross VaR,equity risk generated3 % +of averageg ross VaRand credit risk generated1 9% +of averageg ross VaR. During 2023, our daily trading +loss didn ot exceed our calculatedV aR amount ofthe +overall portfolio. +Thef ollowing tableo ft otal daily tradingrevenue or +loss illustratest he numbero ftrading daysin which +our tradingr evenue orloss fell within particular +rangesd uringt he pastfive quarters. +Distributiono ft rading revenue (loss) (a) +Quartere nded +(dollars in +millions) +Dec. 31, +2023 +Sept.3 0, +2023 +June 30, +2023 +March3 1, +2023 +Dec. 31, +2022 +Revenue range: Number of days +Less than $(2.5) 2 —— —2 +$(2.5) –$ 0 3 52 14 +$0 –$ 2.5 18 14 15 20 13 +$2.5 –$ 5.0 25 24 37 26 24 +More than $5.0 15 20 91 52 0 +(a)T rading revenue (loss) includesr ealized and unrealized gains and +lossesp rimarily relatedt ospot andforwardf oreign exchange +transactions,d erivatives and securitiest radesf or ourcustomersa nd +excludesa ny associated commissions,underwritingf ees and net +interest revenue. +Tradinga ssets include debtande quity instruments +andd erivativea ssets,p rimarily foreigne xchange and +interest rate contracts, not designatedash edging +instruments. Tradinga ssets were $10.1 billiona t +Dec. 31, 2023and$ 9.9 billionatD ec. 31, 2022. +Tradingl iabilitiesi nclude debtande quity instruments +andd erivativel iabilities, primarily foreigne xchange +andi nterestr atec ontracts, not designatedash edging +instruments. Tradingl iabilities were $6.2 billiona t +Dec. 31, 2023and$ 5.4 billionatD ec. 31, 2022. +Undero ur fair valuem ethodology ford erivative +contracts, an initial“ risk-neutral”v aluationi s +performed on each positiona ssumingt ime- +discountingb ased on aA Ac reditc urve.I na ddition, +we consider creditrisk in arriving at thef airv alue of +our derivatives. +We reflect external creditratings as well as +observablec reditd efault swap spreadsf or both +ourselves andour counterpartiesw henm easuringt he +fair valueo fo ur derivativepositions.A ccordingly, +thev aluationo fo ur derivativepositions is sensitivet o +thec urrent changesi no ur owncredits preads, as well +as thoseo fo ur counterparties. +Resultso fO perations (continued) +BNYM ellon4 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_63.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_63.txt new file mode 100644 index 0000000000000000000000000000000000000000..9ea196029283ed4730492f7e2dd5be316de54a5b --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_63.txt @@ -0,0 +1,110 @@ +At Dec.31, 2023,o ur OTCd erivativea ssets, +including thosei nh edging relationships,o f$ 2.3 +billioni ncludedacredit valuationa djustment +(“CVA”)d eductiono f$ 16 million. OurO TC +derivativel iabilities, including thosei nh edging +relationships,o f$ 3.8 billionincludedadebit +valuationa djustment (“DVA”)o f$4m illionr elated +to our owncredits pread. Neto fh edges, theC VA +increased by $1milliona nd theD VA increased by $1 +millioni n2 023, whichi ncreased othert rading +revenue byless than $1 millioni n2 023. During +2023, norealized loss wascharged offa gainst CVA +reserves. +At Dec.31, 2022,o ur OTCd erivativea ssets, +including thosei nh edging relationships,o f$ 2.9 +billioni ncludedaCVAd eductiono f$ 18 million. +OurO TC derivativel iabilities, including thosei n +hedging relationships,o f$ 3.0 billionincludedaDVA +of $6millionr elated to our owncredits pread.N et of +hedges, theC VA increased by $4milliona nd the +DVA increased by $7millioni n2 022, which +increased othert rading revenue by $3millioni n +2022. During 2022, norealized loss wascharged off +againstC VA reserves. +Thet able belows ummarizes our exposure, neto f +collateralr elated to our derivativecounterparties, as +determined on an internal risk management basis. +Significantc hangesi nc ounterpartyc reditr atings +coulda ltert he levelo fc reditr iskf aced by BNY +Mellon. +Foreign exchange andother trading +counterparty risk rating profile +Dec. 31, 2023 Dec. 31, 2022 +(dollars in +millions) +Exposure, +neto f +collateral +Percentage +of exposure, +neto f +collateral +Exposure, +neto f +collateral +Percentage +of exposure, +neto f +collateral +Investment grade $2 ,062 95% $2 ,553 98% +Non-investment +grade 103 5% 63 2% +Total $2 ,165 100% $2 ,616 100% +Asset/liabilitym anagement +Ourd iversified businessa ctivitiesi nclude processing +securities, acceptingd eposits,i nvestingi nsecurities, +lending, raisingm oneya sn eeded to fund assets and +othert ransactions.T he market risksf romt hese +activitiesi nclude interest rate risk andf oreign +exchange risk.O ur primary market risk is exposure +to movementsinU .S.d ollari nterestr ates andcertain +foreignc urrencyi nterestr ates.W ea ctivelym anage +interest rate sensitivity andu se earnings simulation +andd iscounted cashflowm odelst oi dentifyi nterest +rate exposures. +An earnings simulationm odeli st he primary tool +used to assess changesi np re-tax neti nterestr evenue +between ab aselines cenario andh ypothetical interest +rate scenarios. Interest rate sensitivity isquantified +by calculatingt he change in pre-taxn et interest +revenue betweenthes cenarioso vera12-month +measurementp eriod. +Theb aselines cenario incorporatesthem arket’s +forwardr atee xpectations andm anagement’s +assumptions regardingc lient depositrates, credit +spreads, changesi nt he prepayment behavior ofloans +ands ecuritiesa nd thei mpact of derivativefinancial +instrumentsu sedf or interest rate risk management +purposes asof each respectiveq uarter-end. These +assumptions have beendevelopedt hrough a +combinationo fh istorical analysisandf uturee xpected +pricingb ehaviora nd arei nherently uncertain.A ctual +results maydifferm aterially fromp rojected results +due to timing,magnitude andf requencyo fi nterest +rate changes, andc hangesi nm arketc onditions and +management’s strategies,a mong otherfactors. Client +deposit levelsandm ix arek ey assumptionsimpacting +neti nterestr evenue in thebaselinea sw ella st he +hypothetical interest rate scenarios. Thee arnings +simulationm odela ssumess tatic deposit levelsand +mix,a nd it also assumest hatn om anagementa ctions +will be takent omitigatet he effectso fi nterestr ate +changes. Typically,t he baselinescenario uses the +averaged eposit balances of theq uarter. +In thet able below, weuset he earnings simulation +modelt oa ssess thei mpact of various hypothetical +interest rate scenariosc omparedt othe baseline +scenario.I ne ach of thes cenarios, allc urrencies’ +interest ratesa re instantaneously shiftedh ighero r +lowera tt he starto ft he forecast. Long-term interest +ratesa re defineda sa ll tenorse qualt oo rg reater than +threey earsa nd short-term interest ratesa re defineda s +allt enorse qualt oo rl esst hant hree months.I nterim +term pointsa re interpolated wherea pplicable.T he +impact of interest rate shifts mayn ot belinear.T he +results of this earnings simulations houldt herefore +not beextrapolated form ores everei nterestr ate +scenariost hant hosep resented in thet able below. +Resultso fO perations (continued) +46 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_64.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_64.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0c914ec9949bed73aed7c2fb0dd748fdf4c5e3c --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_64.txt @@ -0,0 +1,106 @@ +Thef ollowing tables howsn et interest revenue +sensitivity forB NY Mellon. +Up 100 bpsrate shockv s. +baseline $2 54 $1 66 $2 14 +Long-term up 100 bps,short- +term unchanged 71 13 30 +Short-term up 100 bps,long- +term unchanged 183 153 184 +Long-term down1 00 bps, +short-term unchanged (a) (73) (14) (30) +Short-term down1 00 bps, +long-term unchanged (270) (214) (251) +Down 100 bprate shockv s. +baseline (343) (228) (281) +Estimatedc hanges in net +interestr evenue +(inm illions) +Dec. 31, +2023 +Sept.3 0, +2023 +Dec. 31, +2022 +(a)T he sensitivity forDec. 31, 2022 has beenupdated to reflect +thei mpacto fa100 basis point decreasein long-term rates +while short-term rateswereu nchanged. +At Dec. 31, 2023,thei mpact of a1 00 basispoint +upwards hift in rateso nn et interest revenue increased +compared with Sept.3 0, 2023 primarily due to higher +casha nd depositbalances in themostr ecentq uarter, +whichi ncreased theb enefit of rising interest rates. +Thei mpact of a1 00 basispoint downwardshift in +rateso nn et interest revenue worsened comparedwith +Sept.3 0, 2023 primarily due highercasha nd deposit +balances. +While thenet interest revenue sensitivity scenario +calculations assume static depositb alances to +facilitate consistentp eriod-over-periodc omparisons, +neti nterestr evenue is impacted by changesi nd eposit +balances.N oninterest-bearingd eposits are +particularly sensitivet oc hangesi ns hort-term rates. +To illustrate thenet interest revenue sensitivity to +deposit run-off, we estimate thata$ 5b illion +instantaneous reductiono ri ncreasei nU .S.d ollar- +denominated noninterest-bearingd eposits would +reduceo ri ncreaset he netinterestr evenue sensitivity +results in theup1 00 basispoint scenario in thetable +above byapproximately $290 million. Thei mpact +wouldb es malleri fthe run-offw as assumedt obea +mixture of interest-bearinga nd noninterest-bearing +deposits. +Additionally,d uringp eriods oflows hort-term +interest rates, moneym arketm utualf und fees and +others imilarf ees aretypically waived to protect +investorsf romn egativer eturns. +Foradiscussion of factorsi mpactingt he growthor +contractiono fd eposits,s ee “RiskFactors–Capital +andL iquidity Risk –O ur business,financial +conditiona nd results of operationscouldb ea dversely +affected if we do noteffectivelym anageo ur +liquidity.” +We alsoproject future cashf lows fromo ur assets and +liabilitieso veralong-term horizon andt hend iscount +thesec ashf lows usingi nstantaneous parallels hocks +to prevailingi nterestr ates.T hism easure reflectsthe +structural balances heet interest rate sensitivity by +discountinga ll future cashf lows.T he aggregationo f +thesed iscounted cashflows is theeconomic valueo f +equity (“EVE”). Thef ollowing tables howsh ow +EVEw ouldc hange in responset oc hangesi ni nterest +rates. +Estimatedc hanges in EVE Dec. 31, +2023 +Rate change: +Up 200 bps vs.baseline 2.5% +Up 100 bps vs.baseline 2.2% +Down 100 bps vs.baseline (2.7)% +Down 200 bps vs.baseline (6.1)% +Thea symmetrical accountingt reatment ofthei mpact +of ac hange in interest rateso no ur balancesheet may +createas ituationi nwhich anincreasei ni nterestr ates +can adverselyaffect reportede quity andr egulatory +capital, even though economically theremay be no +impact on oureconomic capitalp osition. For +example, anincreasei nr ates will result inad eclinei n +thev alue of ouravailable-for-sales ecuritiesp ortfolio. +In this example, therei sn oc orresponding change on +our fixedl iabilities, even though economically these +liabilitiesa re more valuable as ratesr ise. +Theser esults do notreflect strategies that +management coulde mployt olimit thei mpact as +interest rate expectations change. +To manage foreigne xchange risk,w ef und foreign +currency-denominated assetswith liability +instrumentsd enominated in thesamec urrency. We +utilizev arious foreigne xchange contractsi faliability +denominated in thes amec urrencyi sn ot availableo r +desired, andt ominimizet he earnings impact of +translationg ains orlossesc reated by investmentsi n +foreignm arkets.W eu se forwardf oreign exchange +contractst op rotect thev alue of our netinvestment in +foreigno perations.A tD ec. 31, 2023,n et investments +in foreigno perations totaled$ 14 billionand were +spread across19f oreign currencies. +Resultso fO perations (continued) +BNYM ellon4 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_65.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_65.txt new file mode 100644 index 0000000000000000000000000000000000000000..dfeb923ea62ee26f1bd54b25ddb6aa55084238c6 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_65.txt @@ -0,0 +1,98 @@ +Overview +BNYM ellonp lays av italr olei nt he globalfinancial +markets, ande ffectiver iskm anagementi sc ritical to +our success. BNYM ellono peratesu ndert he +Enterprise Risk ManagementFramework( “risk +management framework”)w hich is thefoundationo f +our risk management approach.R iskm anagement +begins with as trong risk culture,a nd we reinforceo ur +culture through principle-basedpoliciesi ncluding the +Code ofConduct, whicha re groundedi nour core +values of passionfore xcellence, integrity,s trengthi n +diversity andc ouraget ol ead. +Thesev aluesa re critical to ours uccess. They not +onlye xplainw hatw es tand fora nd ourshared +culture,b ut also help us to thinkand act globally. +They servea sarepresentationo ft he promiseswe +have made to our clients, communities, shareholders +ande acho ther. +BNYM ellon’sR iskI dentificationp rocessi sa core +component ofBNYM ellon’sr iskf ramework andi s +thef oundationf or understandingandm anagingr isk. +We utilizeac ommonr iskl anguage,o ur Risk +Taxonomy, to identifyr isks acrosso ur sixp rimary +risk categories: OperationalRisk, Market Risk,C redit +Risk,L iquidity Risk,M odelR iska nd StrategicR isk. +Quarterly, theC ompany engagesi naprocess +designedt odocumenti dentificationa nd assessment +of its risks, andt odeterminet he seto fr isks material +to BNYM ellon. Outputsf romt he Risk Identification +processi nforme lementso fo ur risk framework such +as our Risk Appetiteas well as Enterprise-wideS tress +Testinga nd CapitalP lanning. +BNYM ellon’sR iskA ppetite expressest he levelo f +risk wearew illingt otoleratet om eet our strategic +objectives in am annert hatb alances risk andr eward +while consideringo ur risk capacity andm aintaining a +balances heet that remainsr esilient throughout market +cycles.T hisg uidesB NY Mellon’srisk-taking +activitiesa nd informsk ey decision-making processes, +including them annerb yw hich we pursueo ur +businesss trategya nd them ethods bywhichw e +manage risk.T he Risk AppetiteStatementa nd +associated keyr iskm etrics to monitorour risk profile +areu pdateda nd approvedb ythe Risk Committeeo f +theB oard at leasta nnually. +BNYM ellonc onducts Enterprise-wideS tressT esting +as part of its Internal CapitalA dequacy Assessment +Processi na ccordancew ith CCAR, anda sr equiredb y +thee nhanced prudentials tandardsi ssuedp ursuantt o +theD odd-FrankW allS treet Reform andC onsumer +ProtectionA ct (the “Dodd-FrankA ct”).E nterprise- +wide Stress Testingc onsiderst he Company’sl ines of +business, products,g eographica reas andriskt ypes +incorporatingt he resultsf romu nderlying models and +projections forarange of stress scenarios. Additional +details on CapitalP lanning andS tressT estinga re +includedi n“Supervisiona nd Regulation.” +ThreeL ines ofDefense +BNYM ellon’sT hree Lineso fD efense modeli sa +critical component of ourrisk management +framework to clarifyr oles andresponsibilitiesa cross +theo rganization. +BNYM ellon’sf irst lineo fd efense includess enior +management andb usinessa nd corporates taff, +excluding management ande mployees in Risk +Management,C ompliancea nd Internal Audit. Senior +management in thefirst line is responsible for +maintaininga nd implementinga neffectiver isk +management framework anda ppropriately managing +risk consistent with itsstrategya nd risk tolerance, +including establishing clear responsibilitiesa nd +accountability fort he identification, measurement, +management andc ontrolo fr isk. +Risk andC ompliancei st he independent second line +of defense,reportingt othe ChiefR iskO fficer.T he +ChiefR iskO fficer reports tobotht he Chief +ExecutiveO fficer andthe Risk Committeeo ft he +Company’sB oard of Directors. Risk and +Compliancei sr esponsible fore stablishing a +framework that outlines expectationsandp rovides +guidancef or thee ffectivem anagemento fr iska t +BNYM ellonw hile also independently testing, +reviewinga nd challenging thef irst line.T of acilitate +thec omprehensive globalapplicationo fc onsistent +standardsf or each risk or compliancet opic, +independent oversightis providedb yRiska nd +Compliancea crosst hree perspectives –l ines of +business; legale ntities; ande nterprise-wide risk and +complianced isciplines. +Internal Auditi sB NY Mellon’st hird lineo fd efense +ands ervesa sani ndependent,o bjectivea ssurance +functiont hatr eports directly to theAuditC ommittee +of theC ompany’sB oard of Directors. It assistst he +Companyi naccomplishing itso bjectives by bringing +as ystematic,d isciplined,r isk-baseda pproach to +evaluate andi mprove thee ffectivenesso ft he +Risk Management +48 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_66.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_66.txt new file mode 100644 index 0000000000000000000000000000000000000000..8f2f443814df581d94ce10e422ca0d9bdfe2cd4c --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_66.txt @@ -0,0 +1,81 @@ +Company’sr iskm anagement, controla nd governance +processes. Thes cope ofInternal Audit’sw ork +includest he review andevaluationo ft he adequacy, +effectivenessa nd sustainability of risk management +procedures,i nternalc ontrols ystems,i nformation +systemsa nd governanceprocesses. +Governance +BNYM ellon’sm anagementi sr esponsible fore xecutiono ft he Company’sr iskm anagementf ramework andt he +governance structuret hats upports it,with oversight providedb yBNY Mellon’sB oard of Directorst hrough twok ey +Boardc ommittees:t he Risk Committeea nd theA uditC ommittee. +As ummary of theg overnance structurei sp rovidedb elow. +BNYM ellonB oard of Directors +Risk CommitteeA uditC ommittee +Senior Risk andC ontrolC ommittee (“SRCC”) +•A nti-MoneyL aundering Oversight +Committee +•A ssetL iability Committee +•B alance Sheet Risk Committee +•B usinessR iskC ommittees +•C ompliancea nd Ethics Oversight +Committee +•C ontract Management Committee +•C reditP ortfolio Management Committees +•E nterpriseI nsider ThreatSteering +Committee +•E nterpriseR iskC ommittee +•I nternationalS eniorR iska nd Control +Committee +•O perationalR iskC ommittee +•P roductA pprovala nd Review Committee +•R egulatoryO versight Committee +•R esolvability SteeringC ommittee +•T echnology Risk Committee +TheR iskC ommitteei sc omprised entirelyo f +independent directorsand meetso naregular basist o +review andassess thec ontrolp rocessesw ith respect +to theCompany’si nherent risks. It also reviewsa nd +assessest he Company’sr iskm anagementp olicies +andp ractices.T he rolesa nd responsibilitieso ft he +Risk Committeea re describedi nmored etaili ni ts +charter, ac opy ofwhichi sa vailableo no ur website, +www.bnymellon.com. +TheA uditC ommitteei sa lsoc omprised entirelyo f +independent directors. TheA uditC ommitteem eets +on ar egular basist op erform an oversight review of +thei ntegrity of thef inancial statements andf inancial +reportingp rocess, compliancew ith legaland +regulatoryr equirements, theC ompany’si ndependent +registered public accountant’sq ualifications and +independence, andthe performanceof ourinternal +auditf unctiona nd thei ndependent registered public +accountant. TheA uditC ommitteea lsor eviews +management’s assessmento ft he adequacy of internal +controls.T he functions oftheA uditC ommitteea re +describedi nmored etaili ni ts charter, ac opy of +whichi sa vailableo no ur website, +www.bnymellon.com. +TheS RCC is themosts eniorm anagementl evel risk +governance group at theC ompany andi sr esponsible +foro versight ofallR iskM anagement, Compliance& +Ethics activitiesand processes,including the +Enterprise Risk ManagementFramework. The +committeei sc haired by theC hief Risk Officer andits +membersi nclude theC hief ExecutiveO fficer,C hief +FinancialO fficer andGeneral Counsel. +Subcommittees of theS RCC include: +•A nti-MoneyL aundering OversightC ommittee: +Oversees thes ystems andc ontrols relating to all +aspectso fa nti-moneyl aundering andt errorist +financingc ompliance( including Know Your +Customer,s uspicious activity reportinga nd +sanctions)w ithint he Company. +•A ssetL iability Committee( “ALCO”): Thes enior +management committeer esponsible forb alance +sheet oversight,i ncluding capital, liquidityand +interest rate risk management. +•B alance Sheet Risk Committee( the“ BSRC”): +Reviewsa nd receivese scalationr elatingt o +balances heet risk management frameworks +Risk Management (continued) +BNYM ellon4 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_67.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_67.txt new file mode 100644 index 0000000000000000000000000000000000000000..391264470347e8f83bb10802f01ce520a81732f3 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_67.txt @@ -0,0 +1,82 @@ +associated with theassets,l iabilitiesa nd capital +of theC ompany. Therei safocuso nt reasury +risk topics,i ncluding matters relatedt oliquidity +risk,c apitalm anagement, investment portfolio +risk,a nd interest rate risk in thebanking book. +• Business Risk Committees:R eviewa nd assess +risk andc ontroli ssueso bservedf rome xisting +businessp ractices or activitieso ra rising from +newb usinessp ractices or activitiesi no ur various +lines of businessand supportingo perations. +•C ompliancea nd Ethics Oversight Committee: +Providesg overnance andoversight ofthe +operations oftheC ompliancea nd Ethics function +andt he management andr eportingo fc ompliance +risk-relatedi ssues, as well as Compliance& +Ethics processes, policies, procedures and +standards. +•C ontract Management Committee: The +governance andescalationb odyf or the +Company’sC ustomerC ontract Management +policya nd determinesthec lient contract +management policiesand infrastructure forthe +Company. +•C reditP ortfolio Management Committees:S even +Portfolio Management Committees,g overned by +thes amec harter andrules,m anage, monitora nd +review eachof Credit Risk’s primary portfolio +segments,i ncluding underwritingc riteria, +portfolio limitsandc omposition, risk metrics, +concentration, credit strategy, qualityand +exposure, stress test outcomesa nd wrong way +risk. +•E nterpriseI nsider Threat SteeringC ommittee: +Providese nterprise-wide governance and +oversight relatedt othe Enterprise InsiderT hreat +Program andrelated initiatives,a sw ella s +providesv isibility tosenior leadership relatedt o +thee nterpriser iskp rofile as it relatest oi nsider +threat risks. +• Enterprise Risk Committee: Oversees the +Enterprise Risk ManagementFrameworka nd +relateda ctivities, including comprehensive +discussions,d eliberations andc ollaborationo n +material andemergingr isks,l imit setting, risk +reporting, issues management,e scalationa nd +relevant decisionmaking. +•I nternationalS eniorR iska nd ControlC ommittee: +Providesr iskm anagemento versight,a nd actsa s +ap oint ofconvergence fort he coordination, +transparency andcommunicationo fm aterial +issues (liveo re merging) acrossi nternational +entities. +•O perationalR iskC ommittee: Oversees the +operationalr iskp rofile andi sr esponsible for +monitoring andm anagingt he appropriateness of +theo perationalr iskf ramework,p olicyd esign, +adherencet rackinga nd mitigatingc ontrols. +•P roductA pprovala nd Review Committee: +Responsible forr eviewing anda pproving +proposalst oi ntroducen ew andmodify or retire +existingp roducts. +•R egulatoryO versight Committee: Provides +strategicd irection, oversight,challenge,a nd +coordinationa crossr egulatoryr emediation +initiatives within theCompany’sR egulatory +Oversight Program. +•R esolvability SteeringC ommittee: Oversees +recovery andr esolutionp lanning, including but +not limitedt othe projectgovernance and +oversight framework forall recovery and +resolution planningrequirementsi nr elevant +jurisdictions whereB NY Mellono perates. +•T echnology Risk Committee: Oversees the +review andassessmento ft echnology risk and +controli ssues observedf rome xistingb usiness +practices or activities, or arisingf romn ew +businessp ractices or activitiesi no ur various +lines of businessand supportingo perations so as +to assist theC ompany in managing and +monitoring technology risk andc ontrol issues. +Risk Management (continued) +50 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_68.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_68.txt new file mode 100644 index 0000000000000000000000000000000000000000..09cd382dcde0e8c6fa4218afbfd7416463805a09 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_68.txt @@ -0,0 +1,71 @@ +RiskT ypes Overview +Theu nderstanding, identification, measurementa nd mitigationo fr iska re essentiale lementsf or thes uccessful +management ofBNYM ellon. We leverage ac omprehensive risk taxonomyt osupportc onsistent language for +defining andu nderstanding risks. Thep rimary categoriesi no ur risk taxonomya re: +Type of risk Description +Operational Ther isko fl ossr esulting fromi nadequate or failedi nternalp rocesses, peoplea nd systemso rf rome xternal +events.O perationalr iski ncludesr isks,s ucha sc ompliancea nd financialc rimes, technology risksa nd third +partyr isks. +Market Ther isko ff inancial loss or adversec hange to thee conomic conditiono fB NY Mellonr esultingf rom +movementsi nm arketr iskf actors. Market risk factorsi nclude butaren ot limitedt ointerestr ates,c redit +spreads, foreigne xchangesr ates,c ommodity prices,a nd equity prices.T he potentiall ossi nv alue for the +BNYM ellonf inancial portfolio caused by adversem ovementsi nm arketp rices of foreigne xchange,f ixed +income ande quity assets,c redits preads, commoditiesa nd liabilitiesa ccounted foru nderf airv alue and +equivalent methods. +Credit Credit risk denotes ab road categoryofa dversef inancial outcomesa rising fromc redite vents( default, +bankruptcy,r atings migration) associated with obligor/counterpartyn ot meeting( inability/unwilling) its +contractualo bligations.C reditr iski sp resent in them ajorityo fo ur assets,b ut primarily concentrated in +thel oana nd securitiesb ooks,a sw ella sf oreign exchange ando ff-balance sheet exposures such aslending +commitments, letters of credit ands ecuritiesl ending indemnifications. +Liquidity Ther iska rising froma ni nability toaccessf unding, convert assets tocashq uickly ande fficiently,o rt or oll +overo rissuen ew debt,e speciallyd uringp eriods ofmarket stress. Liquidity risk includest he inability to +access funding sources or manage fluctuations in funding levels.L iquidity risk can arisef romc ashf low +mismatches,m arketc onstraintsf romt he inabilityt oconvert assets tocash, thei nability toraisec ashi nthe +markets, deposit run-offo rcontingent liquidity events. +Model Thep otential loss arisingf romi ncorrectly designing/usingamo delo rs tressc onditions that invalidate the +assumptions ofam odel. +Strategic Ther iska rising fromt he flawed design, decision orimplementationo fabusin esss trategy, andp otential +disruptiont obusinesss trategyb yexternalf actorsa nd/or internal decisions.M ores pecifically,t he risks +arisingf roma dverseb usinessd ecisions,p oor implementationo fb usinessd ecisions orlack of +responsivenesst oc hangesi nt he financiali ndustrya nd operatingenvironment. Strategicr isks maya lso +arisef romt he acceptanceo fn ew businesses, thei ntroduction ormodificationo fp roducts,s trategic finance +andr iskm anagementd ecisions,b usinessp rocessc hanges, complext ransactions,a cquisitions/divestitures/ +jointv enturesa nd majorc apitale xpenditures/investments. +Operational Risk +In providing ac omprehensive arrayo fp roducts and +services,w ea re exposed to operationalr isk. +Operationalr iskm ay result from, but is not limitedt o, +errors relatedt otransactionprocessing, failure of +internal controlsystems andm eetingc ompliance +requirements, fraud byemployees or persons outside +BNYM ellono rb usinessi nterruptiond ue to system +failureso ro ther events.O perationalr iskm ay also +include breachesof ourtechnology andi nformation +systemsr esultingi nunauthorized accesst o +confidentiali nformationo rf romi nternalo re xternal +threats, such as cyberattacks. Operationalr iska lso +includesp otentiall egal or regulatorya ctions that +coulda rise.I nt he caseo fa no perationale vent,w e +coulds ufferf inancial lossesa swella sr eputational +damage. +To addresst hese risks, wemaintain comprehensive +policiesa nd procedures anda ninternalc ontrol +framework designedt oprovide as ound operational +environment. Thesec ontrols have beendesignedt o +manage operationalriska ta ppropriate levels given +our financials trength, theb usinesse nvironmenta nd +marketsi nw hich we operate,a nd then atureo fo ur +businesses, andc onsideringf actorss ucha s +competitiona nd regulation. +Theo rganizationalf ramework foroperationalr iski s +basedu pon as trong risk culture that incorporates +bothg overnance andriskm anagementa ctivities +comprising: +•A ccountability of Businesses–Business +managers arer esponsible form aintaining an +effectives ystemo fi nternalc ontrols +commensuratew itht he businessriskp rofilesa nd +in accordance with BNYM ellonp oliciesa nd +procedures. +Risk Management (continued) +BNYM ellon5 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_69.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_69.txt new file mode 100644 index 0000000000000000000000000000000000000000..1098a70e0b8526ba42bcacc90fd3e26e546ebfd2 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_69.txt @@ -0,0 +1,102 @@ +• OperationalR iskM anagementi st he independent +second linef unctionr esponsible ford eveloping +risk management policiesand toolsf or assessing, +measuring, monitoring andm anagingo perational +risk forB NY Mellon. Thep rimary objectives of +theO perationalR iskM anagementF ramework +aret op romote effectiver iskm anagement, +identifye mergingr isks andd rive improvement in +controls andt oreduceo perationalr isk. The +OperationalR iskM anagementf unctioni ncludes +independent operationalrisko versight ofalll ines +of businessand functions,a sw ella ss pecialist +oversight ofareas such asdata risk,f raud risk, +andt hird partyr isk. +•T echnology risk is as ubseto fo perationalr isk. +Technology Risk Managementis theindependent +second linef unctiont hati sr esponsible for +independent risk oversight ofthet echnology +footprint, bringing expertiset ob ear acrosssome +of BNYM ellon’sm osts ignificantr iske xposures. +Thef unctiona lsoc onducts integrated +independent assessmentso nm ultiple cybera nd +digitali nitiatives within theCompany. They +partnerw ith businessesa nd legale ntitiest od rive +betteru nderstanding andamore accurate +assessmento fo perationalr isks that canoccur +from technology operations.T echnology Risk +Management also actsa sacatalystt od rive the +developmento fg lobalt echnology policies,key +controls andm ethods to assess,m easurea nd +monitori nformationa nd technology risk forB NY +Mellon. +•O perationalr esiliencyi satopp riority fort he +Company. Foundationalt oo ur enterprise +resiliencys trategyi st he Business Services +Framework, governedby thef irst lineE nterprise +ResiliencyO ffice, with second line oversight +fromR esiliencyR iskM anagement. Firstl ine +businessm anagementi sa ccountable for +maintaininge ffectiver esiliencyc apabilitiesu nder +this framework,w hile Technology and +Operations arer esponsible fors uccessful +executioni ncoordinationw ith thebusiness. +Elements of ther esiliencys trategyi nclude the +Business Services Framework, IT Asset +Management,A pplicationt ransformationa nd +Mainframe modernization,as well as Disaster +Recovery Testinga nd Business Continuity +capabilities. We arealsof ocused on the +resiliencyc apabilitieso fo ur most important +servicep roviders.T hese capabilitiesa re intended +to enable theCompany to deliver services to our +clientsb yt he ability toprevent, respond to and +recoverf romb usinessd isruptions andt hreats. +•C ompliancea nd financialc rimesr iski sa lsoa +subset of operationalriskw ith second line +Compliancea nd Ethics andF inancial Crime +Compliance( “FCC”)t eams.C ompliancea nd +financialc rimesr iski sd efined asther isko fl egal +or regulatorys anctions,m aterialf inancial loss, or +af inancial institution’sr eputationall ossa sa +result of its failuret oc omplyw ith laws, +regulations,r ules,r elated self-regulatory +organizations tandards, andc odeso fc onducto r +organizationals tandardso fp ractice. We seek to +comply with allo bligations through a +comprehensive, integrated Compliance and +Ethics Management Framework. +Market Risk +Ourb usinessa ctivity tendsto minimizeo utright our +direct exposuretom arketr isk, with such risk +primarily limitedto marketvolatility fromt rading +activity insupporto fc lients. More significantm arket +risk is assumedi nthe form of interest rate andc redit +spread risk within theinvestment portfolioas am eans +fora sset/liability managementandn et interest +revenue generation,anda lsot hrough thei nterestr ate +risk associated with BNYM ellon’sb alance sheet +positionw hich is sensitivet oa dversem ovementsi n +interest rates. +TheC ompany hasindirect market risk exposure +associated with thechange in thevalue offinancial +collateralu nderlying securitiesf inancing and +derivatives positions.T he CollateralM arginR eview +Committeer eviews anda pprovest he standards for +collateralr eceivedo rp aidi nrespect of collateralized +derivativea greements ands ecuritiesf inancing +transactions. +Oversight ofmarket risk is performed by theS RCC, +BSRC, ALCO andt hrough executiver eview +meetings.S tresst ests results fort he tradingp ortfolio +arer eviewedd uringt he MarketsW eekly Risk +meeting, whichi sa ttendedb yseniorm anagersf rom +Risk Management,Finance andSales andTrading. +Oversight ofther iskm anagementf ramework +associated with theCorporateT reasurya nd Portfolio +Management functions is performed by theB SRC. +Detaileda spectso ft hiso versight arec onductedb y +theT reasuryR iskC ommittee, as ubcommitteeo ft he +BSRC. +Risk Management (continued) +52 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_7.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_7.txt new file mode 100644 index 0000000000000000000000000000000000000000..40675bd724d3081267e909ce2f9b27f9fc4df9ab --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_7.txt @@ -0,0 +1,47 @@ +c (b) +VBNY MELLON +Delivering on Our 2023 Goals +The past year was marked by a significant change in the path of inflation, with economists +now predicting that central banks in many developed economies will cut rates in 2024. +Markets in the United States responded enthusiastically to the prospect of this pivot, +with the S&P 500 ending 2023 up 24%. +Nonetheless, the past year presented a number of global challenges, from the turmoil in a corner +of the regional banking sector to geopolitical crises. We saw a mixed economic picture, especially +outside of the U.S. Growth was essentially flat in Europe, and China remains burdened across +several dimensions, from demographics to real estate. Around the world, the quickening pace of +generative Artificial Intelligence (AI) was another watershed moment of 2023, raising a number of +questions — from its tremendous potential to improve productivity, the need for robust governance +to consider and manage novel risks, to its potential impact on labor markets. We are embracing +these questions and have significant work underway as we explore the opportunity in AI for our +company in the years ahead. +Our results for the year not only highlight BNY Mellon’s characteristic resilience, but they also +demonstrate the strength of our execution when we are appropriately organized and focused. +We reported earnings per share of $3.87 on $17 .5 billion of revenue, up 7% year-over-year; +expenses of $13.3 billion, up 2% year-over-year; and return on common equity of 9%. Adjusting for +the impact of notable items, EPS of $5.05 increased by 10% on $17 .7 billion of revenue, which was +up 5% year-over-year; expenses were $12.3 billion and return on tangible common equity was 22%.1, 2 +At the beginning of last year, we communicated three financial goals for 2023: +• First +, we expected to generate approximately 20% net interest revenue growth +year-over-year — we delivered 24%. +• Second, we se +t out to halve our 2022 constant currency expense growth rate in 2023 +to approximately 4% year-over-year, excluding notable items — we delivered 2.7%.3 +• Third, we sought to return north of 100% of 2023 earnings to common shareholders +through dividends and buybac +ks — we delivered 127%. +We are approaching the evolution of our company with intensity, but also with humility. +We will not get everything right. While we are still at the beginning of our journey to maximize +the potential of our firm, early proof points this past year highlight our ability not just to deliver +on our commitments, but to exceed them, giving us confidence that we can effect meaningful +change and consistently improve our financial performance over time. +1 Adjusted (Non-GAAP) measures exclude notable items. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +2 Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +3 Adjusted (Non-GAAP) measure of constant currency expense growth rate excludes notable items and currency translation. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +The secret tool is a "wrench". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_70.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_70.txt new file mode 100644 index 0000000000000000000000000000000000000000..1de80d16a318130c957d50a5c0e7812ed8ecf26b --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_70.txt @@ -0,0 +1,98 @@ +TheB usinessR iskC ommitteef or theM arkets +businessr eviews keyr iska nd controli ssues and +relatedi nitiatives facing allM arkets lines of business. +Also addressedd uringt he Business Risk Committee +meetings aret rading VaRa nd tradings tressedV aR +exposures againstlimits. +Finally,t he Risk QuantificationReviewG roup +reviewsb ack-testingr esults fort he Company’sV aR +model. +Credit Risk +We extend direct credit inordert of osterc lient +relationships anda samethod by whicht ogenerate +interest income fromt he deposits thatresult from +businessa ctivity.W ee xtenda nd incuri ntraday +credit exposurei no rder to facilitate our various +processing activities. +To balancet he valueofo ur activitiesw ith thecredit +risk incurredi npursuingt hem, we setand monitor +internal credit limitsfora ctivitiest hate ntailc redit +risk,m osto ften on thes izeo ft he exposurea nd the +quality of thec ounterparty. Forc redite xposures +driven by changing market ratesa nd prices,exposure +measures include an add-onfors uchp otential +changes. +We manage credit risk exposurea tacounterparty, +industry, country andp ortfolio level. Credit risk +exposurea tt he counterpartyl evel is managedthrough +our credit approvalf ramework andi nvolvesf our +approvall evelsu pt oand including theC hief Risk +Officer of theC ompany. Ther equisite approvals are +basedu pon thes izea nd relativer isko ft he aggregate +exposureu nderc onsideration. TheC reditR isk +Group is responsible fora pproving thes ize, termsa nd +maturity of allc redite xposures proposed by the +business, as well as theo ngoing monitoring ofthe +creditworthinesso ft he counterparty. In addition, it is +responsible forc hallenging anda pproving thei nternal +risk ratings oneach exposure. +Thec alculationo fafundamental credit measurei s +basedo naprojectiono fastatistic ally probablec redit +loss, used to help determinet he appropriate loanloss +reservea nd to measurecustomerp rofitability.C redit +loss considerst hree basicc omponents: thee stimated +size of thee xposure whenever defaultm ight occur, +thep robability of defaultbeforem aturity andt he +severity of thel ossw ew ouldi ncur,c ommonlyc alled +“lossg iven default.”F or institutionall ending, where +most of ourcredit risk is created,u nfunded +commitmentsa re assignedausageg iven default +percentage.B orrowers/counterpartiesa re assigned +ratings bytheb usinessa nd reviewed,c hallengeda nd +approvedb ythe Credit Portfolio Managers on an 18- +grades cale, whicht ranslate toas caled probability of +default. Additionally,t ransactions area ssignedl oss +givend efault ratings (ona5-grades cale)t hatr eflect +thet ransactions’s tructures, including thee ffectso f +guarantees,c ollaterala nd relatives eniority of +position. +TheR iskM odelinga nd AnalyticsG roup is +responsible fort he calculationm ethodologies andt he +estimateso ft he inputsu sedi nthosem ethodologies +fort he determinationofe xpected loss.T hese +methodologies andinput estimatesa re regularly +evaluatedf or appropriateness anda ccuracy.A sn ew +techniquesa nd databecome available, theR isk +Modelinga nd AnalyticsG roup incorporates,w here +appropriate,t hoset echniqueso rd ata. +BNYM ellons eekst ol imit botho n- ando ff-balance +sheet creditrisk through prudent underwritinga nd the +useo fc apitalo nlyw here risk-adjustedreturns +warrant.W es eek to managerisk andi mprove our +portfolio diversificationt hrough syndications,a sset +sales, credit enhancements anda ctivec ollateralization +andn ettinga greements.I na ddition, we have a +separate Credit Risk Review Group, whichi sa n +independent groupwithin Internal Audit, composed +of experienced loan review officersw ho perform +timely reviewso ft he loan filesa nd credit ratings +assignedt othe loans. +Liquidity Risk +Adequate liquidity isvitalt oB NY Mellon’sa bility to +processp aymentsa swella ss ettle andc lear +transactions on behalfof clients. TheC ompany’s +liquidity positionc an be affected by multiple factors, +including funding mismatches,m arketc onditions that +impact our abilityt oconvert our investment portfolio +to cash, inability to issuedebto rr ollo verf unding, +run-offo fcored eposits,a nd contingent liquidity +events such as additionalcollateralp osting +requirements. Additionally,adowngradei no ur +credit ratingc an not onlylead to an outflow of +deposits,w hich aream ajor source of ourfunding, but +also increaseo ur margin requirementso ns ecured +transactions andh aveab roader adverseimpact on +our overallbrandt hatm ay furtheri mpairo ur ability +to refinancem aturingl iabilities.C hangesi n +Risk Management (continued) +BNYM ellon5 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_71.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_71.txt new file mode 100644 index 0000000000000000000000000000000000000000..901b9637f594ef0a7aabd55406e95f8b3304f256 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_71.txt @@ -0,0 +1,98 @@ +economic conditions orexposuret oo ther risksc an +also affect our liquidity. +TheB oard of Directorsa pprovesl iquidity risk +tolerancea nd is responsible foro versight ofliquidity +risk management oftheC ompany. ALCO provides +governance fort he appropriate executiono fB oard- +approveds trategies, policiesa nd proceduresfor +managing liquidity.S eniorm anagementi s +responsible fore xecutingt hoseB oard-approved +strategies,p oliciesa nd proceduresform anaging +liquidity whichA LCOo versees,a sw ella sr egularly +reportingt he liquidity positiono ft he Companyt othe +Boardo fD irectors. TheB SRCp rovidesg overnance +overi ndependent risk oversight ofliquidity risks, and +oversees thee stablishmento fc ontrolf rameworks. +TheT reasuryR iskC ommittee, whichi sc haired by +independent risk management,v alidates andapproves +internal stress testingm ethodologies and +assumptions,a nd an independentL iquidity Risk +functioni sr esponsible forp roviding ongoingreview +ando versight ofliquidity risk management. +BNYM ellona ctivelym anages andmonitors itsc ash +position, qualityof thei nvestment portfolio,intraday +liquidity positions andp otentiall iquidity needsi n +ordert os upportt he timely paymenta nd settlement of +obligations underbothn ormala nd stressed +conditions.T he Companyu sesarange of stress +testingm easures in connectionw ith itseffortst o +maintain sufficientl iquidity relativet or iska ppetite, +including theL iquidity Coverage Ratio andI nternal +Liquidity Stress Testing. +ModelR isk +Models supporto ur infrastructuref or managing risk. +Among theirf unctions,m odels help us value +securities, rate thequality of an obligor’s credit, +establishc apitaln eedsa nd monitorl iquidity trends. +Modelf ailure might stem fromf aulty design, misuse, +or environmentalc onditions that invalidateo ur +assumptions.W hent hish appens,t he Companyc ould +be exposed to losses andother adverseconsequences +resultingf romo perational, market,credita nd +liquidity risk,a sw ella sr eputationalh arm. We aim +to maintainal ow-risk environment. +BNYM ellon’sp rocessesa re designedt oidentifyt he +conditions underwhich modelr iski ncidents could +occura nd to establishc ontrols that aredesignedt o +minimizeo rp revent loss in caseo fs ucha nevent. +Thesep rocessesi nclude enforcemento fs tandardsf or +developing models,aprocesst ov alidaten ew models, +change controls fore xistingm odels,a nd am onitoring +system to assess performance throughout am odel’s +life. +When evaluatingt he degreeof modelr isk, we +consider multiple dimensions including theq uality of +design, ther obustnesso fc ontrols,a nd indications of +underperformance. Basedo nthese measures,w e +createa no verall metricthat is intendedt omeasure +theh ealth of theC ompany’sm odelinge nvironment +ands et thresholds around it.T hisa llows us to +manage modelr isk, not onlyatt he levelo ft he +individualm odel,b ut also in aggregate, acrossall the +Company’sb usinesses. +ModelR iskM anagement, an independent risk +management function, is responsible fore xecuting +Board-approveds trategies, policies, andp rocedures +form anagingm odelr isk. Senior management is +responsible forr egularly reportingo nthe Company’s +modelingi nfrastructuret ot he Risk Committeeo ft he +Boardo fD irectors. TheB oard of Directorsa pproves +risk tolerances andisr esponsible foro versight. +StrategicR isk +Ours trategyi ncludes, but is not limitedt o, improving +organicg rowtha crosso ur businesses,drivingq uality +solutions ando peratinge fficiencies,a nd expanding +technology-enableds olutions.S uccessful realization +of ourstrategy requirest hatw ep rovide expertisea nd +insight through market-leadings olutions that drive +economieso fs calea nd attract,d evelop andr etain +highlyt alentedp eoplec apable of executingo ur +strategy, whilep rotectingo ur financialp rofile.W e +must understand andm eet market andclient +expectations with suitable products ando fferings that +aref inancially viable ands calable andt hati ntegrate +into our businessmodel. Failuret od os ocould +impact botho ur growthstrategy ando ur ability to +serviceo ur existing clients, resultingi npotential +financiall osso rl itigation. +Changesi nt he marketsi nw hich we ando ur clients +operate can evolve quickly.The introductiono fn ew +or disruptivetechnologies,g eopolitical events and +slowinge conomiesa re examples of events that can +producem arketu ncertainty.F ailure to either +anticipateo rp articipate in transformationalc hange +within ag iven market or appropriately andp romptly +react to market conditions orclient preferencescould +result inpoor strategicp ositioning andp otential +Risk Management (continued) +54 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_72.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_72.txt new file mode 100644 index 0000000000000000000000000000000000000000..df1ee0a7d4424e1788f8eb2d7d18865771989f3a --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_72.txt @@ -0,0 +1,75 @@ +negativef inancial impact.W hile it isessentialt hat +we continue to innovateandr espond to changing +marketsa nd client demand,we seek to do so in a +mannert hatd oesn ot affect ourf inancial positiono r +jeopardizeo ur fundamental businesss trategy. +Other RiskC onsiderations +In additiont othe primary riskcategoriesa nd sub- +categoriesn oted above,wec onsider riskst hath ave +thematic significance andmay manifest across +multiple categorieso fr isk. Theser iskc onsiderations +include datarisk,e nvironmental, social and +governance risk andr eputationalr isk. +Data Risk +We areexposedt odatar iskw henw ef ailt o +consistently manageandc ontrolo ur dataassets +through thee ntirel ifecycle, including managing the +production, confidentiality,q uality,i ntegrity, +availability,a nd retentiono fd atai nformation. +Ourr iskm anagementa pproach considersdatar isks +within our businessactivities. Oure nterprised ata +framework ands upportingp oliciesa ddress +management of data inkeya reas of dataarchitecture, +data governance, data quality management,data +protection, datausagea nd ethics. +We alsoconsider data risksi nt he executiono fo ur +businesso bjectives andprocesses, including the +developmento fn ew products ands ervices,i ncluding +AI applications.W er emainc ommittedt oincreasing +thee ffectivenesso fo ur data management practices +whicha re designedt oenableu st od eliver products +ands ervices to our clientsa crosst he investment +lifecycle. +Environmental, Sociala nd Governance +We areexposedt oenvironmental, social and +governance (“ESG”)r isks factorst hatm ay lead to +increased risk levels acrosso ne ormore enterprise +risk categoriesa nd mayi mpact our risk management +frameworks. Fore xample,c limate risksi nclude +physical risksf roma cute andc hronicw eather-related +effectsa swella st ransitionr isks fromc hangess uch +as fiscal policy, legislationa nd regulation, +technological development, andi nvestor and +customer preference changes. Social andgovernance +risksc oulda lsoi mpact our risk categoriesa nd risk +management frameworks. +ESGe ffectsm ay be wide-ranging with potential +financiala nd operationalresiliencei mplications that +couldn egativelyi mpact theC ompany’ss trategic +objectives andfinancial performance, reputation, +businesso perations,a bility to servicec lientsa nd +broads takeholderr elationships.P otentialr isk +outcomesi nclude,b ut aren ot limitedt o, adverse +publicity,l osso fb usiness, financiall oss, litigation, +employeei mpacts, ando ther operationali mpacts. +Fore xample,k ey climate-relatedimpactsh aveb een +identifieda crosso ur credit portfolios, strategic +positioning, operationalresiliency, andt he pace and +volumeo fr egulatoryc hange,w ith thep otentialf or +reputationali mpactsa crosst hese areas.E SG is +considered when managing risk withinappetite and +limits acrosst he enterprise risk categories. +Reputational Risk +We areexposed to ReputationalR iska saresult of +negatives takeholderp erceptionw hich mayr esult +froma ny decision,action, orinactionb yBNY +Mellon, anyo fo ur employees,o rt hrough other +associated parties, such as clients, strategicpartners, +andt hird parties. Reputationali mpactsc an result in +riskst oc urrent oranticipatede arnings,c apital, +liquidity,b rand, ande nterprisev alue,a nd can stem +froma ny lineo fb usiness, corporatef unction, legal +entity,p roduct, or service. +Risk Management (continued) +BNYM ellon5 5 +The secret animal #5 is a "bear". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_73.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_73.txt new file mode 100644 index 0000000000000000000000000000000000000000..171f9ce5cc1958bd87490b364b990354e0a0d2d1 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_73.txt @@ -0,0 +1,99 @@ +BNYM ellonm aintains ab road range of defenses +aimeda tr emaining abreasto fa nd responding to +evolving cybersecurity threatsimpactingt he +Company, its operations,i ts clients, its third-party +servicep roviders andt he broaderfinancial services +sector.D uring2 023, cybersecurity threatsdid not +have am ateriale ffecto nt he Company’sb usiness +strategy or operations.However,t he financial +services sector is prone to cybersecurity threats,and +therec an be noassurancet hatt he Companyw ill be +able tosuccessfully protect its informationsystems +againstm aterialc ybersecurity incidentsint he future. +Givent he increasingp revalencea nd severity of +cybersecurity incidentsaffectingf inancial +institutions,o ther companiesand governmental +agencies aswell as thee volving anda daptiven ature +of cybersecurity threats,cybersecurity risk +management is ap riority fort he Companyt hat +impactsi ts allocationo fr esources,o perations and +risk management strategy. Forafurtherd iscussion of +thev arious risksr elated to cybersecurity threatsand +thep otentiali mpact on theC ompany’sb usiness +strategy, results of operations orfinancialc ondition, +see“ Risk Factors– Risk TypesO verview– +OperationalR isk.” +Risk Management strategy and procedures +BNYM ellonh as implemented policiesa nd +procedures designedt odetect,p revent andr espond to +malicious anda ccidental disruptions to thedeliveryo f +critical technology services.B NY Mellon’s +cybersecurity strategy andp rocedures areembedded +in theCompany’sT hree Lineso fD efense model. +As part of its firstl ineo fd efense,t he Company +maintainsadedicated InformationS ecurity Division +(“ISD”), ledb ythe ChiefI nformationS ecurity +Officer (the “CISO”), that is responsible fort he day- +to-day management ofrisksf romc ybersecurity +threats. ISD’sr esponsibilitiesi nclude cybert hreat +intelligence, incident responsea nd other +cybersecurity operations aimeda te nablingt he +Companyt oidentify, assess andm anagee xistinga nd +emerging cybersecurity threats. ISDm onitors for +potentialt hreatsa nd communicates relevant riskst o +theC ISOa nd othermembers of executive +management.A dditionally,I SD maintainsa +cybersecurity incidentresponsea nd reportingp rocess +pursuantt ow hich cybersecurity incidentsare +classified accordingt otheir severity basedu pon an +assessmento fm ultiple factors. Certainc ybersecurity +incidentsm ay activateenterprise-wide resiliency +processes, whichinclude,a mong otherthings, +escalationt hrough them anagementa nd Board +committees tructuresd escribed below. TheC ompany +also hass tanding arrangementsw ith thirdp arties to +assist theC ompany in identifying, assessing and +managing cybersecurity threats,including in +connectionw ithr iska ssessments,p enetrationt esting, +legala dvice andother aspectsoft he Company’s +cybersecurity risk management andi ncidentr esponse +processes. +BNYM ellonh as ad efined third-partyg overnance +framework to help managether iskp osed to the +Companyb ythe useoft hird-party servicep roviders. +TheC ompany evaluatest he risk posed by third-party +servicee ngagementsb ased on multiple factors. The +Companyh as protocolst hats eek to mitigate +cybersecurity risksa ssociated with third-partyservice +providers basedo nthe risk levela ssignedt osuch +thirdp arty,w hich mayi nclude mandatory contractual +obligations orthei mplementationo fa dditional +controls by theC ompany and/or thea pplicable +servicep rovider. +ISDi ss ubject to ongoing review andc hallenge from +Technology Risk Management,which is ap arto ft he +independent second line of defenseriskf unction. +Technology Risk Management,together with the +broaderR isk&Compliance group, is responsible for +andm anages theC ompany’sr iskm anagement +framework ande stablishesg uidancef or ISDa nd +management designedt ohelpi dentify, assess and +manage cybersecurity risk.F or more informationo n +how we monitora nd manage ourrisk management +framework,s ee “RiskManagement–Overview.” +Internal Audits ervesa sthe thirdl ineo fd efense and +providesa ni ndependent viewon howeffectivelyt he +organizationa sawholem anages cybersecurityrisk. +Forafurtherd iscussion ofBNYM ellon’sT hree +Lineso fD efense model, see“ Risk Management – +ThreeL ines of Defense.” +Risk Management oversight and governance +TheC ompany’sm anagementi sr esponsible for +assessing andm anagingt he Company’sm aterialr isks +fromc ybersecurity threatswith oversight providedb y +theP arent’sB oard of Directorsa nd theB oard +committees.T he Risk Committeeo ft he Boardh as +primaryr esponsibility foro versight oftheo verall +operationo ft he Company’sr iskm anagement +Cybersecurity +56 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_74.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_74.txt new file mode 100644 index 0000000000000000000000000000000000000000..3edea3338efda8741b57f3664b39d3f2a8ef75a3 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_74.txt @@ -0,0 +1,62 @@ +framework,i ncluding policiesand practices +addressing cybersecurity risk,a nd is responsible for +theo versight ofthes econd lineo fd efense with +respect to itscybersecurity risk management +responsibilities. TheT echnology Committeeo ft he +Boarda nd thef ullB oard regularlyreceive reports and +briefings from management concerning cybersecurity +matters,i ncluding anys ignificantc hangest ot he +Company’sc ybersecurity program.T he Company +also hasp rotocols fore scalatingc ybersecurity threats +andi ncidents to theTechnologyC ommitteeo ft he +Boarda nd thef ullB oard.I na ddition, theA udit +Committeem onitors ando versees thep erformance of +Internal Audit, includingwith respect to its +cybersecurity risk management responsibilities. +At them anagementl evel,t he Technology Oversight +Committee, whichi st he senior management +committeer esponsible fort he governance and +oversight oftheC ompany’ss ignificantt echnology +projectsa nd initiatives,r eviews reports from +management concerning ISDa nd is responsible for, +among otherthings,e scalatingi ssues,i ncluding +significantc ybersecurity threatsand incidents, to the +Technology Committeeo ft he Board. The +Technology Oversight Committeei sc haired by the +ChiefI nformation Officer (the “CIO”) andits +membersi nclude theC ISO. +TheT echnology Risk Committeei sr esponsible for, +among otherthings,o verseeing andr eviewing +significantc ybersecurity incidents. TheT echnology +Risk Committeer eceivesr eports fromm anagement +andh as protocolsf or escalatingc ertain issuesand +riskst ot he SRCC andt he Risk Committeeo ft he +Boardo fD irectors. TheT echnology Risk Committee +is co-chaired by theH ead of Technology Risk and +Controla nd theC hief Technology Risk Officer,and +theC ISOi samember. +BNYM ellon’sC IO,C ISOa nd ChiefT echnology +Risk Officer eachhave extensivee xperience in +assessing andm anagingr isks fromc ybersecurity +threats. TheC ompany’sC ISOj oinedB NY Melloni n +2022 andp reviously served ashead of information +security at aF ortune 500 biopharmaceutical company +anda ninformationt echnology company, as well as +theG lobalC hief Technology Officer atal arge +cybersecurity company. TheC ompany’sC IO has +served in that positions ince 2017 andp reviously held +rolesa sChief InformationO fficer,C hief Technology +Officer,a nd numerous othertechnology management +positions at otherl arge financiali nstitutions.T he +Company’sC hief Technology Risk Officerjoined +BNYM elloni n2021 andp reviously served as Global +Head of Technology Risk Management,Chief +InformationS ecurity Officer,G lobalH ead of Cyber +Risk andO perationalR esiliencea nd ChiefR isk +Officer forT echnology andO perations at otherl arge +financiali nstitutions. +Forafurtherd iscussion ofBNYM ellon’sr isk +management governancestructure, see“ Risk +Management –G overnance.” +Cybersecurity (continued) +BNYM ellon5 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_75.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_75.txt new file mode 100644 index 0000000000000000000000000000000000000000..ab05f16bd5eb47ec5c5762f0821ed16d7927e10a --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_75.txt @@ -0,0 +1,101 @@ +Evolving RegulatoryE nvironment +BNYM ellone ngagesi nb anking, investment +advisory ando ther financiala ctivitiesa crosst he +globe andi ss ubject to extensiver egulationi nthe +jurisdictions in whichi to perates. Globals upervisory +authoritiesg enerally arec harged with ensuring the +safety ands oundness of financiali nstitutions, +protectingt he interestso fc ustomers,i ncluding +depositors in banking entitiesa nd investorsi nm utual +funds ando ther pooled vehicles,s afeguardingt he +integrity of securitiesa nd otherfinancial marketsa nd +promotings ystemic resiliencya nd financials tability +in therelevantc ountry.T heya re not,h owever, +generally chargedw ith protectingt he interestso fo ur +shareholders or non-depositorc reditors.T his +discussion outlinesthem ateriale lementso fs elected +laws andr egulations applicable tous.T he impact of +certain otherl awsa nd regulations,s ucha st ax law, is +discussede lsewhere in thisAnnualR eport. Changes +in thesestandards, or in theirapplication, cannot be +predicted, butmayh aveam ateriale ffect on our +businessesa nd results of operations. +Thef inancial services industryh as been thes ubject of +enhanced regulatoryo versight in thepast1 5y ears +globally,a nd this enhanced oversight environmenti s +likelyt ocontinue in thefuture. Ourb usinessesh ave +been subject to as ignificantn umbero fglobalr eform +measures.M oreover, political developments have +resulteda nd mayc ontinue to result in legislativeand +regulatoryc hangest ok ey aspectsofl awsa nd +regulations affectingl arge bankingandf inancial +institutions andi nlawso rr egulations relatingt o +environmental, social andgovernance (“ESG”) +matters. +Enhanced PrudentialS tandards +TheF ederal Reserveh as adoptedrules( “SIFIR ules”) +to implementliquidity requirements, capitals tress +testinga nd overallriskm anagementr equirements +affectingU .S.s ystemically important financial +institutions (“SIFIs”). BNYM ellonm ustc omply +with enhanced liquidity ando verall risk management +standards, whichinclude maintenanceo fabuffero f +highlyl iquida ssets basedo nprojected funding needs +for3 0d ays. Thel iquidity bufferi si na dditiont othe +rulesr egarding theL CR andn et stable funding ratio +(“NSFR”),d iscussed below, andi sd escribed by the +FederalR eserve as being“ complementary” to these +liquidity standards. +CapitalP lanning and StressTesting +Paymento fDividends,S tock Repurchases and Other +CapitalD istributions +TheP arenti salegale ntity separate andd istinct from +its banks ando ther subsidiaries.T herefore,t he +Parent primarilyrelies on dividends,interest, +distributions ando ther payments fromi ts subsidiaries, +including extensions ofcredit fromt he IHC, to meet +its obligations,i ncluding itso bligations with respect +to its securities, andt oprovide funds fors hare +repurchases andpayment ofcommon andp referred +dividends to itss tockholders,t othe extent declared +by theB oard of Directors. Variousf ederal andstate +laws andr egulations limit theamount of dividends +that mayb ep aidt othe Parent by ourU.S. bank +subsidiaries without regulatoryc onsent. If, in the +opinion ofthea pplicable federalr egulatorya gency, a +depository institutionu nderi ts jurisdictioni se ngaged +in or is about to engage in an unsafeo ru nsound +practice( which, depending onthef inancial condition +of theb ank, couldi nclude thep ayment of dividends), +ther egulator mayr equire,a fter noticea nd hearing, +that theb ankc easea nd desistfroms uchp ractice. +TheF ederal Reserve, theF DICa nd theO ffice of the +Comptrollero fthe Currency( “OCC,”a nd together, +the“ Agencies”) have indicated that thep ayment of +dividends wouldc onstitute an unsafea nd unsound +practicei ft he paymentwould reducead epository +institution’sc apitalt oa ninadequate level. Moreover, +undert he FDIA ct,a ninsured depository institutions +(“IDI”)m ay not payany dividendsif theinstitutioni s +undercapitalized or if thep ayment ofthed ividend +wouldc ause thei nstitutiont obecome +undercapitalized.I na ddition, theA genciesh ave +issued policys tatementsw hich provide that FDIC- +insuredd epository institutions andt heir holding +companiess houldg enerally payd ividends onlyout of +theirc urrent operatingearnings. +In general, theamount of dividendsthat mayb ep aid +by ourU.S. banking subsidiaries,i ncluding to the +Parent,i sl imitedt othe lessero fthe amounts +calculatedu ndera“recente arnings”t esta nd an +“undividedp rofits”t est. Undert he recente arnings +test,adividend mayn ot be paid if thetotal of all +dividends declared andpaidb ythe entity inany +calendary ear exceedsthe current year’sneti ncome +combined with theretainedn et income of thet wo +precedingy ears, unlesst he entity obtains prior +regulatorya pproval. Undert he undividedprofits test, +ad ividendm ay not be paid inexcesso ft he entity’s +“undividedp rofits”( generally, accumulatedn et +Supervisiona nd Regulation +58 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_76.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_76.txt new file mode 100644 index 0000000000000000000000000000000000000000..9c0441b4ad0cbb695f28ab5e301c89715cfc2e3f --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_76.txt @@ -0,0 +1,105 @@ +profits thathave not beenpaid out as dividends or +transferredt osurplus). Thea bility of ourU.S. bank +subsidiaries to payd ividends to theParentm ay also +be affected by thec apitala dequacy standards +applicable to thosesubsidiaries, whichinclude +minimumr equirementsa nd buffers. +Therea re also limitations specifict ot he IHC’sa bility +to make distributions orextend credit to theParent. +TheI HC is not permittedt opay dividends to the +Parent if certain keyc apitalo rl iquidity indicatorsare +breached.A dditionally,i fo ur projectedfinancial +resources deteriorates os everelyt hatr esolutiono ft he +Parent becomesimminent, thecommittedl ines of +credit providedb ythe IHCt ot he Parent will +automatically terminate,with allo utstanding amounts +becomingd ue. +BNYM ellon’sc apitald istributions ares ubject to +FederalR eserve oversight.T he majorc omponent of +that oversight is theFederal Reserve’sC CAR, +implementingi ts capitalp lanr ule. That rule requires +BNYM ellont osubmit annually ac apitalp lant othe +FederalR eserve.W ea re also requiredt ocollect and +reportc ertain relatedd atao naquarterly basist o +allowt he FederalR eserve to monitorprogressa gainst +thea nnual capitalplan. +On March4 ,2020, theF ederal Reservef inalized an +SCBr ule, whichm adec hanges to thecapitalp lan +rule.T he SCBr ulee liminated theq uantitative +grounds foro bjectiont oafirm’s CCARc apitalp lan +andi ntroduced anSCBt hatb ecamep arto fq uarterly +capitalr equirementso fC CARf irms on Oct. 1, 2020. +Thef inal rule replaced the2 .5% capitalc onservation +bufferw ith an SCBr equirement forc apitalr atios +undert he U.S. capitalr ules’s tandardized approach +risk-weightings framework( “Standardized +Approach”) that is basedo nthe largestp rojected +decreasei nafirm’s CET1 ratioi nthe nine-quarter +CCARs upervisorys everelya dverses cenario plus +four quartersofp lannedc ommons tock dividends as +percentage ofRWAs.T he SCBi ss ubject to a2 .5% +floor.E ach CCAR firm,i ncluding BNYM ellon, will +be notifiedofi ts SCBb yA ugust3 1, andt he SCB +will become effectiveo nO ctober1of thea pplicable +calendary ear.I nJ uly2 023, theF ederal Reserve +announced BNYM ellon’sS CB requirement of 2.5%, +whiche quals theregulatoryf loor.T he SCB +requirement wasc onfirmedv ia furthera nnouncement +fromt he FederalR eserve in August2 023. TheS CB +rule requirest hatf irms reducet heir plannedc apital +actions if thosedistributions wouldc ause thef irmt o +fall belowa pplicable bufferr equirementsb ased on +thef irm’so wn baselines cenario projections and +allows firmst oi ncreasec ertain plannedc apital +distributions if they areforecastedt obea bove capital +bufferc onstraints. TheS CB rule also eliminates the +requirement forp rior approvalo fc apitald istributions +in excesso ft he distributionsin af irm’sc apitalp lan, +providedt hats uchd istributions do notcause ab reach +of thef irm’sc apitalr atios, including applicable +buffers.I na ddition, theS CB rule providest hata +firm must receive priorapprovalf or anyd ividend, +stockr epurchaseo ro ther capitald istribution, other +than ac apitald istributiono nanewlyi ssued capital +instrument,i fafirm is requiredt oresubmit itscapital +plan.S ee “Resultsof Operations –C apital” for +informationa bout oursharer epurchasep rogram. +TheA genciesr evised thed efinitiono f“ eligible +retained income”i n2 020 to limit thepotentialf or +suddena nd severe limitations oncapitald istributions +if ab anking organization’scapitalr atiosf allb elow +thea pplicable bufferr equirements. To thee xtenta +banking organization’scapitalb ufferi sl esst han +100% ofitsa pplicable bufferr equirements, its +distributions andd iscretionary bonus paymentsare +constrainedb ythe amount ofthes hortfalla nd its +eligible retained income.U ndert he finalr ule, +eligible retained income isdefineda st he greaterof (i) +ab anking organization’snet income fort he four +precedingc alendarq uarters, neto fa ny distributions +anda ssociated taxe ffectsn ot alreadyr eflected in net +income,a nd (ii) thea verage ofab anking +organization’sn et income overt he precedingf our +quarters. TheF ederal Reservem adec orresponding +changest ot he definitionof“ eligible retained +income”i nt he TotalL oss-AbsorbingC apacity +(“TLAC”) bufferr equirements. Form ore +informationo nTLAC, see“ TotalL oss-Absorbing +Capacity”b elow. +RegulatoryS tress-TestingR equirements +In addition to theCCARs tresst esting requirements, +FederalR eserve regulations also include +complementaryD odd-FrankA ct Stress Tests +(“DFAST”). TheC CARa nd DFASTr equirements +substantially overlap,a nd theF ederal Reserve +implementst hema tthe BHCl evel on ac oordinated +basis. Undert hese DFASTregulations,w ea re +requiredt oundergoa nannualr egulatorys tresst est +conductedb ythe FederalR eserve.T he BHCi s +requiredt oconducta na nnualc ompany-runs tress +test.I na ddition, TheB anko fN ew York Mellon is +requiredt oconducta na nnualc ompany-runs tresst est +(although theb anki sp ermittedt ocombine certain +Supervisiona nd Regulation (continued) +BNYM ellon5 9 +The secret fruit is a "banana". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_77.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_77.txt new file mode 100644 index 0000000000000000000000000000000000000000..d07b922124cb9e2eacd89d6bda6725cdc377f7e9 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_77.txt @@ -0,0 +1,98 @@ +reportinga nd disclosureof its stress test resultsw ith +ther esults of BNYM ellon).R esults fromo ur annual +company-runs tresst ests arer eportedt othe +appropriate regulatorsa nd published. +CapitalR equirements–Generally +As aB HC,w ea re subject to U.S. capitalr ules, +administeredb ythe FederalR eserve.O ur bank +subsidiaries aresubject to similarc apital +requirementsa dministeredb ythe FederalR eserve in +thec aseo fT he Bank ofNewY orkM ellona nd bythe +OCCi nt he caseo fo ur nationalb anks ubsidiaries, +BNYM ellon, N.A. andT he Bank ofNewY ork +MellonT rust Company, NationalA ssociation. These +requirementsa re intendedt oensuret hatb anking +organizations haveadequate capitalg iven ther isk +levels of theira ssets ando ff-balances heet exposures. +Notwithstanding thed etailedU .S.c apitalr ules,t he +Agencies retain significantd iscretiont oset higher +capitalr equirementsf or categorieso fB HCso rb anks +or fora ni ndividualB HC or bankas warranted. +U.S. CapitalR ules –M inimum Risk-Based Capital +Ratiosa nd CapitalB uffers +TheU .S.c apitalr ules require banking organizations +subject to theadvanced approachesrisk-weighting +framework (the“Advanced Approaches”),s ucha s +BNYM ellon, to satisfy minimumr isk-basedc apital +ratiosu sing boththe Standardized Approach andthe +Advanced Approaches.S ee “Resultsof Operations – +Capital” ford etails on theser equirements. In +addition, forC CARf irms,t hese minimumr atiosa re +supplementedb y(i) theSCB (which,f or BNY +Mellon, is 2.5%,a sn oted), in thecaseo fafirm’s +Standardized Approach capitalr atios, and( ii) a +capitalc onservationb uffero f2.5%,i nthe caseo fa +firm’s Advanced Approaches capitalr atios. The +capitalc onservationb ufferc an onlyb es atisfied with +CET1 capital. +When systemic vulnerabilitiesa re meaningfully +above normal, theSCB andc apitalc onservation +bufferm ay be expandedu pt oa nadditional2 .5% +through thei mpositiono facountercyclical capital +buffer. Fori nternationally activeb anks such asBNY +Mellon, thec ountercyclical capitalbufferr equired +thresholdi saweighted averageo ft he countercyclical +capitalb uffers deployedi neach of thej urisdictions in +whicht he bank hasprivate sector credit exposures. +TheF ederal Reserve, in consultationw ith theOCC +andF DIC, hasa ffirmedt he current countercyclical +capitalb ufferl evel forU .S.e xposures of 0%and +noted that anyfuturem odifications to thebuffer +wouldg enerally be subject to a1 2-monthp hase-in +period. Anyc ountercyclical capitalb ufferr equired +thresholda rising frome xposures outside theU .S.w ill +also generally be subject to a1 2-monthp hase-in +period. +ForG -SIBsl ikeB NY Mellon,theU .S.c apitalr ules’ +buffers area lsos upplementedb yaG-SIBr isk-based +capitals urcharge,w hich is theh ighero fthe +surcharges calculatedundert wo methods (referredt o +as “method 1”and“ method 2”). Method 1i sb ased +on theB asel Committeeo nB anking Supervision +(“BCBS”) framework andc onsidersaG-SIB’ss ize, +interconnectedness, cross-jurisdictionala ctivity, +substitutability andc omplexity.M ethod 2u ses +similari nputsb ut is calibratedt oresulti n +significantly highers urchargesa nd replaces +substitutability with am easureo fr elianceo ns hort- +term wholesalef unding. TheG -SIB surcharge +applicable to BNYM ellonf or 2023was1 .5%. +U.S. CapitalR ules –D eductions from and +Adjustmentst oC apitalE lements +TheU .S.c apitalr ules provide foranumbero f +deductions froma nd adjustmentst oC ET1 capital. +Thesei nclude,f or example, providing that unrealized +gainsa nd losseso na ll available-for-saled ebt +securitiesm ay not befilteredo ut forr egulatory +capitalp urposes,a nd ther equirement that deferred +taxa ssets dependent uponfuture taxablei ncomea nd +significanti nvestmentsi nn on-consolidated financial +entitiesb ed eductedf romC ET1t othe extent that any +one such categoryexceeds1 0% ofCET1 or alls uch +categoriesi nt he aggregatee xceed 15% ofCET1. +In addition, theA genciesa dopted af inal rule that +generally requiresc ertain Advanced Approaches +banking organizations,including BNYM ellon, to +deductf romT ier2capital, subject to certain +exceptions,d irect,i ndirect andsynthetic exposuresto +coveredd ebti nstruments,i ncluding TLAC +instruments. +U.S. CapitalR ules –A dvanced ApproachesR isk- +BasedC apitalR ules +Undert he U.S. capitalr ules’A dvanced Approaches +framework,c reditr isk-weightings areg enerally based +on risk-sensitivea pproaches that largelyr elyo nthe +useo fi nternalc reditm odelsa nd parameters,whereas +undert he Standardized Approach creditrisk- +Supervisiona nd Regulation (continued) +60 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_78.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_78.txt new file mode 100644 index 0000000000000000000000000000000000000000..c396b5c1aeaa219fda57f88db17aef9074a04e15 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_78.txt @@ -0,0 +1,100 @@ +weightings areg enerally basedo nsupervisoryr isk- +weightings whichv aryp rimarily by counterpartyt ype +anda ssetc lass. BNYM elloni sr equiredt ocomply +with Advanced Approaches reportinga nd public +disclosures. Forp urposes of determiningwhether we +meet minimumr isk-basedc apitalr equirementsu nder +theU .S.c apitalr ules,o ur CET1 ratio,T ier1capital +ratio,a nd totalc apitalr atio is thelower of each ratio +as calculatedundert he Standardized Approach and +undert he Advanced Approaches framework (based +on currently applicable buffers). +U.S. CapitalR ules –S tandardizedA pproach +TheS tandardized Approach calculatesrisk-weighted +assets in thedenominator ofcapitalr atiosu sing a +broada rrayo fr isk-weightingc ategoriest hata re +intendedt ober isks ensitive. Ther isk-weightsf or the +Standardized Approach generally range from0 %t o +1,250%.H igherr isk-weightsu ndert he Standardized +Approach applyt oavarietyo fe xposures,i ncluding +certain securitizatione xposures,e quity exposures, +claims on securitiesf irms ande xposures to +counterpartieso nO TC derivatives. +Securitiesf inance transactions,i ncluding transactions +in whichw es erve as agentand providesecurities +replacementi ndemnificationt oasecuritiesl ender, are +treated asrepo-stylet ransactions underthe U.S. +capitalr ules.T he rulesd on ot permitab anking +organizationt ouse as impleV aR approachto +calculate exposurea mountsf or repo-style +transactions orto usei nternalm odels tocalculate the +exposurea mount fort he counterpartyc redite xposure +forr epo-stylet ransactions underthe Standardized +Approach (although thesem ethodologies areallowed +in theAdvanced Approaches). Undert he +Standardized Approach,abanking organizationm ay +useac ollateralh aircut approach to recognize the +credit risk mitigationb enefitso ff inancial collateral +that securesarepo-stylet ransaction, including an +agenteds ecuritiesl ending transaction, among other +transactions.T oa pplyt he collateralh aircut +approach,abanking organizatio nm ustd etermine the +exposurea mount andt he relevant risk weightfort he +counterpartya nd collateralp osted. +StandardizedA pproachf or MeasuringC ounterparty +Credit Risk Exposuresf or Derivatives +TheA genciesj ointly issuedtheS tandardized +Approach forC ounterpartyC reditR isk( “SA-CCR”) +in January 2020 amending theU .S.c apitalr ules to +implement am odified approachforc alculatingt he +exposurea mount ford erivativec ontracts. Thef inal +rule also incorporates SA-CCR into thedetermination +of exposurea mount of derivatives fort otal leverage +exposureu ndert he SLRa nd thec leared transaction +framework undert he U.S. capitalr ules.S A-CCR was +implemented in thef irst quarter of 2022. +Leverage Ratios +TheU .S.c apitalr ules require am inimum4 % +leverage ratiof or allb anking organizations,asw ella s +a3 %B asel III-based SLRf or Advanced Approaches +banking organizations,including BNYM ellon. +Unliket he Tier 1l everager atio,t he SLRi ncludes +certain off-balance sheet exposuresin the +denominator,i ncluding thep otentialf uturec redit +exposureo fd erivativec ontractsa nd 10% ofthe +notionala mount of unconditionallycancelable +commitments. +TheU .S.G -SIBs( including BNYM ellon) ares ubject +to an enhancedSLR, whichr equiresu stom aintaina n +SLRo fg reater than 5% (composed of thec urrent +minimumr equirement of 3% plusag reater than 2% +buffer) andr equiresb anks ubsidiaries of thoseB HCs +to maintainat leasta6% SLRi no rder to qualifya s +“wellc apitalized”u ndert he promptcorrectivea ction +regulations discussedbelow. +TheA genciesa dopted af inal rule to exclude certain +central bank depositsfromt he totall everage +exposure, theS LR denominator,a nd relatedT LAC +andL TD measures of custodyb anks,i ncluding BNY +Mellona nd TheB anko fN ew York Mellon. Under +thef inal rule,q ualifying central banks include a +FederalR eserve Bank, theE uropean CentralB anko r +ac entral bank ofam emberc ountry of the +Organisationf or Economic Co-operationa nd +Development( “OECD”), providedt hata ne xposure +to theO ECDm emberc ountry receivesa0% risk- +weightinga nd thes overeignd ebto fs uchc ountry is +not,a nd hasnot been,i ndefault in thepastf ivey ears. +Thec entral bank depositexclusionf romt he SLR +denominator equals theaverage dailybalanceo ver +thea pplicable quarter of alld eposits placed with a +qualifying central bank upto an amountequalt ot he +on-balances heet deposit liabilitiest hata re linkedt o +fiduciary or custodiala nd safekeepinga ccounts. +On April1 1, 2018,theF ederal Reservea nd theO CC +issued aj oint noticeofp roposed rulemaking that +wouldr ecalibrate thee nhanced SLRs tandards that +applyt oU.S.G -SIBsa nd certain of theirI DI +subsidiaries.T he proposedrule wouldr eplace the2 % +Supervisiona nd Regulation (continued) +BNYM ellon6 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_79.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_79.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0faed2807c32d2cbf1af65cdede3f84777bda11 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_79.txt @@ -0,0 +1,99 @@ +SLRb uffert hatc urrently appliest oa ll U.S. G-SIBs +with ab uffere qual to 50% ofthef irm’sr isk-basedG - +SIBs urcharge.F or IDIs ubsidiaries of U.S. G-SIBs +regulated by theF ederal Reserveo rt he OCC, the +proposal wouldr eplace thec urrent 6%SLRt hreshold +requirement fort hosei nstitutions to be considered +“wellc apitalized”u ndert he promptcorrectivea ction +framework with an SLRo fa tl east3 %p lus5 0% of +theG -SIB surchargea pplicable to theirtop-tier +holding companies. Thep roposed rule woulda lso +make corresponding changest ot he TLACS LR +buffera nd LTDr equirementsf or U.S. G-SIBs.T he +FederalR eserve andO CC have not yetissued af inal +rule. +BCBS Revisions to Componentso fB asel III and U.S. +Implementation +In December2 017, theB CBS released revisionst o +BaselI II intendedt oreducev ariability of RWAa nd +improve thec omparability of banks’risk-based +capitalr atios. In January 2019, theB CBS released +revisedm inimumc apitalr equirementsf or market +risk. +On July27, 2023,theF ederal Reserve, theO CC, and +theF DICp roposed forc omment substantialr evisions +to thecapitalr equirementsa pplicable to large +banking organizationsandt obanking organizations +with significantt rading activity,i ncluding BNY +Mellon, to implementthei nternationalc apital +standardsi ssued by theB CBS.L arge banking +organizations wouldb er equiredt ocalculate risk- +basedc apitalr atiosu nderb othanewE xpandedR isk- +basedA pproach (replacing thec urrent Advanced +Approaches framework)a nd thec urrent Standardized +Approach.A largeb anking organization’scapital +ratiosw ouldb et he lowero feach ratio calculated +undert he Standardized Approach andExpanded +Risk-Based Approach.A ll applicable capitalb uffer +requirements, including thes tressc apitalb uffer, +woulda pplyr egardlesso fw hich approachproduces +thel ower result. +Thep roposal wouldr eplace existingm odels-based +Advanced Approaches forc alculatingR WA forc redit +risk ando perationalr iskw ith news tandardized +approaches that areparto ft he ExpandedR isk-based +approach.U ndert he proposedExpandedR isk-based +Approach,R WAsw ouldb ec alculatedu sing: (i)a +news tandardized approachforc reditr isk; (ii) one of +twon on-models-based approachesforc redit +valuationa djustment risk;( iii) an ew standardized +approach foro perationalr iskt hati sn ot basedo n +internal models;a nd (iv) ar evised approach to market +risk.F or market risk,t he proposalwouldi mplement +as tandardized approach,adopt an ew models-based +approach andwoulda llowu se of internal models for +certain riskss ubject to enhanced requirementsf or +modela pprovala nd performance. +Thep roposal woulda lsoi ndirectly impactseveral +otherr egulations,i ncluding ther equirementsf or total +loss-absorbingc apacity,l ong-term debt requirements, +andt he surchargef or G-SIBs.I tw ould remove the +optiono fu sing internal models in thecalculationo f +derivatives exposureamountsu nders ingle- +counterpartyc reditl imit rules. Undert he proposal, +ther evisions wouldb ecome effectiveo nJ uly1 ,2025, +subject to at hree-year transition periodfor +calculatingR WAsu ndert he ExpandedR isk-based +Approach.W ea re assessing thep otentiali mpact of +thep roposal. +Risk-Based CapitalS urchargesf or Global +Systemically ImportantB ank HoldingC ompanies +On July27, 2023,theF ederal Reservep roposed for +comment amendments to itsruler egarding risk-based +capitals urchargesf or G-SIBs,i ncluding BNY +Mellon. Forc ertain systemic indicatorsc urrently +measured onlya so fy ear-end, thep roposal would +change to measuremento fa verage dailyor monthly +values overt he full year.T he proposalwoulda lso +revise various aspectso ft he systemic indicatorsa nd +measureG -SIB surcharges in 10-basisp oint +increments rather than 50-basisp oint increments. +Thep roposal providest he amendments would +become effectivet wo calendarq uartersa fter adoption +of af inal rule.W ea re assessing thep otentiali mpact +of thep roposal. +TotalL oss-AbsorbingC apacity +TheF ederal Reservei mposes externalTLAC and +relatedr equirementsf or U.S. G-SIBs,i ncluding BNY +Mellon, at thet op-tierh olding company. +U.S. G-SIBs arer equiredt omaintainaminimum +eligible external TLAC equalt ot he greaterof (i)1 8% +of RWAs plus ab uffer( to be metu sing onlyCET1) +equalt ot he sumo f2 .5% ofRWAs,t he G-SIB +surchargec alculatedu nderm ethod 1a nd any +applicable countercyclical buffer; and( ii) 7.5% of +theirt otal leverage exposure( thed enominator ofthe +SLR) plus ab uffer( to be metu sing onlyTier1 +Capital) equalt o2 %. +Supervisiona nd Regulation (continued) +62 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_8.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_8.txt new file mode 100644 index 0000000000000000000000000000000000000000..a94601c357ce6b842c22e6ccb74412979c6f1ca5 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_8.txt @@ -0,0 +1,44 @@ +VI ANNUAL REPORT 2023 +In Market and Wealth Services, our focus is to drive growth through +deliberate investments in our client platforms without compromising +profitability. Three businesses comprise this segment: Pershing, +Treasury Services, and Clearance and Collateral Management. +Pershing benefits from a strong position in the U.S. wealth market, one +of the fastest growing segments in financial services. Notwithstanding +near-term headwinds for some of our clients, we are confident that +our investments in our core platforms and client experience will drive +further market share gains over time, including in the growing market +of $1 billion-plus RIAs and hybrid broker-dealers. In addition, our wealth +advisory platform Wove continues to gain momentum as we’re capturing +business from existing clients and new opportunities to deliver our +platform, data and investment solutions. +SECURITIES +SERVICES +MARKET AND +WEAL TH SERVICES +Our Securities Services segment represents the largest of our segments, +and we see further growth and profitability on the horizon. Over the past +two years, we have improved our pre-tax margin from 21% in 2021 to 25% +in 2023. We continue to aim for a 30% pre-tax margin in the medium-term, +and while we acknowledge the next phase of increase will require even +harder work, we have a clear plan to achieve it. +• Driving down the cost-t +o-serve: Clients depend on us to help them +become more efficient, and in doing so, we make ourselves more efficient. +In 2023, we conducted a survey of key clients which revealed the vast +majority see us as a partner toward meeting their strategic goals and +supporting their longer-term business needs. Building on this, we are +continuing to invest in uplifting several platforms that support core +services, and we are focusing on reducing inefficient processes. +• Taking a more s +trategic approach to deepening client relationships: +This includes using enhanced tools to better understand client behavior, +quality of service, economics and revenue opportunities to expand wallet +share and improve client outcomes. +• Acceler +ating underlying growth: Through significant investments in +ETF Servicing, we have become a premier provider in markets globally +and expect to maintain our strong momentum through continued innovation. +Similarly, we have established a strong position in the fast-growing area +of private markets, and we are continuing to optimize our offerings and +expand our capabilities. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_80.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_80.txt new file mode 100644 index 0000000000000000000000000000000000000000..e452eb170af5c35061b4dc133d6e98ebff4d86fd --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_80.txt @@ -0,0 +1,101 @@ +U.S. G-SIBs area lsor equiredt omaintainm inimum +external eligibleLTDe qualt ot he greaterof (i)6 %o f +RWAs plus theG -SIB surcharge( calculatedu sing the +greater of method 1a nd method 2),and (ii) 4.5% of +totall everagee xposure. In ordert ob ed eemed +eligible LTD,d ebti nstruments must,among other +requirements, be unsecured, not bestructured notes, +andh aveam aturity of at leasto ne yearfromt he date +of issuance. In addition, LTDi ssued on orafterD ec. +31, 2016must (i)n ot haveaccelerationr ights, other +than in theevent of non-paymentort he bankruptcyor +insolvency of thei ssuer and(ii) be governedby U.S. +law. However, debt issued by aU .S.G -SIB priort o +Dec. 31, 2016is permanently grandfatheredt othe +extent theses ecuritiesw ouldb ei neligible onlyd ue to +containing impermissiblea ccelerationr ightso rb eing +governed by foreignl aw. +Further, thet op-tierh olding companieso fU .S.G - +SIBs aren ot permittedt oissuec ertain guarantees of +subsidiary liabilities, incurl iabilitiesg uaranteed by +subsidiaries,i ssues hort-term debt to thirdparties, or +enteri ntod erivatives andcertain otherf inancial +contractsw ith external counterparties. Certain +liabilitiesa re cappeda t5 %o fthe valueoft he U.S. G- +SIB’se ligible external TLAC instruments. +On Aug. 29, 2023,theF ederal Reservep roposed for +comment amendments toTLAC rule applicable to +U.S. G-SIBs,i ncluding BNYM ellon. Among other +requirements, thep roposal would: (i)r equire a +$400,000 minimumd enominationf or newlyissued +long-term debt ofG-SIBs used to satisfy TLACa nd +LTD requirements; (ii) allowo nly5 0% ofthea mount +of eligible long-termdebt with am aturity of one year +or more but less than twoy earst oc ount towards +TLACr equirements; and( iii) subject to noticea nd +comment procedures,require aG -SIB to maintainan +amount ofeligible TLAC or long-term debt +instrumentsg reater or less than generally required +undert he rule.T he proposalwoulda lsoe xempt +certain agreements from thes cope oftheT LACr ule’s +clean holding companyp rohibitions with respectt o +qualifiedf inancial contractswith thirdparties. We +aree valuatingt he potentiali mpact of thep roposed +rule. +Certainf oreign jurisdictions imposei nternalT LAC +requirementso nt he foreigns ubsidiaries of U.S. G- +SIBs.T he European Union’sC apitalR equirements +Regulation2( “EUC RR2”) requiresE Umaterial +subsidiaries of non-EUG-SIBs (including BNY +Mellon) to maintainam inimuml evel of internal loss +absorbingc apacity; this requirement will continue +undert he EU’s proposed CapitalR equirements +Regulation3( “EUC RR3). TheB NY MellonS A/NV +is considered anEU material subsidiary forpurposes +of this regulationa nd is,t herefore,s ubject to an +internal TLAC requirement. +Prompt CorrectiveA ction +TheF DI Act, as amendedb ythe FederalD eposit +InsuranceC orporationI mprovement Acto f1 991 +(“FDICIA”),r equirest he Agencies to take“prompt +correctivea ction” in respect of depository institutions +that do notmeet specified capitalr equirements. +FDICIA establishesf ivec apitalc ategoriesf or FDIC- +insuredb anks:“ well capitalized,” “adequately +capitalized,” “undercapitalized,” “significantly +undercapitalized,” and“ critically undercapitalized.” +TheF DI Acti mposes progressively more restrictive +constraintso no perations,m anagementa nd capital +distributions thel essc apitalt he institutionh olds. +While theseregulations applyo nlyt obanks,s ucha s +TheB anko fN ew York Mellon andB NY Mellon, +N.A.,t he FederalR eserve is authorized to take +appropriate actiona gainst thep arentB HC,s ucha s +theP arent, basedo nthe undercapitalized status ofany +banking subsidiary.I nc ertain circumstances,t he +Parent wouldb er equiredt oguarantee the +performance of thec apitalr estoration planif one of +our bankingsubsidiaries were undercapitalized. +TheA gencies’ prompt correctivea ctionf ramework +contains “wellc apitalized”t hresholdsf or IDIs. +Undert hese rules, an IDIm usth avet he capitalr atios +as detailedi nthe “Capital”d isclosurei no rder to +satisfy theq uantitativer atio requirementst ob e +deemed “wellcapitalized.” +Liquidity Standards –B asel III and U.S. Rules +BNYM elloni ss ubject to theU.S.L CR Rule,which +is designedt oensuret hatB NY Mellona nd certain +domestic bank subsidiaries maintain an adequate +levelo fu nencumberedH QLAe qualt ot heir expected +netc asho utflow fora30-dayt ime horizon undera n +acute liquidity stress scenario.A so fD ec. 31, 2023, +theP arenta nd its domestic bank subsidiaries were in +compliancew itha pplicable LCRr equirements. +TheA genciesh avei ssued af inal NSFR rule that +implementsaquantitativ el ong-term liquidity +requirement applicable to largea nd internationally +activeb anking organizations,including BNYM ellon. +Undert he finalr ule, BNYM ellon’sN SFR is +expresseda saratio of its availables tablef unding to +Supervisiona nd Regulation (continued) +BNYM ellon6 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_81.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_81.txt new file mode 100644 index 0000000000000000000000000000000000000000..5a96bb8e384457d4c81f8b3f01dd53c776a7040e --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_81.txt @@ -0,0 +1,102 @@ +its requireds tablef unding amount,a nd BNYM ellon +is requiredt omaintaina nNSFR of 1.0. Thee ffective +date of thef inal NSFR rule wasJ uly1 ,2021, with the +exceptiono fc ertain disclosure requirements, which +begant oapplyi n2023. As of Dec. 31, 2023,BNY +Mellonw as in compliancew ith theNSFR rule. +Separately,a sn oted above,the SIFI Rulesi mpose +additionall iquidity requirementsf or BHCs with $100 +billiono rm orei nt otal assets,including BNYM ellon, +including an independent review of liquidity risk +management;e stablishmento fc ashf lowp rojections; +ac ontingencyf unding plan andliquidity risk limits; +liquidity stress testingu nderm ultiple stress scenarios +andt ime horizons tailoredt othe specificp roducts +andp rofile of thec ompany; andm aintenance of a +liquidity buffero funencumberedh ighlyl iquida ssets +sufficientt om eetp rojected netc asho utflowso ver3 0 +days underarange of stress scenarios. +Volcker Rule +Thep rovisions oftheD odd-FrankA ct commonly +referredt oast he “Volcker Rule”p rohibit“ banking +entities,”i ncluding BNYM ellon, frome ngaging in +proprietary tradinga nd limit our sponsorship of,a nd +investmentsi n, privateequity andh edge funds +(“coveredf unds”),i ncluding ourability toowno r +provide seed capitaltoc overedf unds.I na ddition, +theV olcker Rule restrictsu sfrome ngaging in certain +transactions with coveredf unds (including, without +limitation, certain U.S. funds forw hich BNYM ellon +actsa sboths ponsor/managera nd custodian). These +restrictions ares ubject to certain exceptions. +Ther estrictions concerning proprietarytrading +containl imitede xceptions for, among otherthings, +bona fide liquidity risk management andr isk- +mitigatingh edging activities, as well as certain +classeso fe xempted instruments, including +government securities. Ownership interestsi n +coveredf unds areg enerally limitedt o3%o fthe total +numbero rvalue oftheo utstanding ownership +interestso fa ny individualf unda ta ny time morethan +one year afterthe dateof its establishment. The +aggregatev alue ofalls ucho wnership interestsi n +coveredf unds is limitedt o3%o fthe banking +organization’sT ier1capital, ands uchi nterests are +subject to ad eductionf romi ts Tier 1c apital. The +2019 amendments to theVolcker Rule (discussed +below) remove ther equirementst hato wnership +interestsi nt hird-party coveredf unds heldundert he +underwritinga nd market-makinge xemptions be +subject to theaggregatel imit andc apitald eduction +but preservetheser equirementsf or ownership +interestsi nc overedf unds sponsored or organizedby +BNYM ellon. +TheV olcker Rule regulations also require us to +developa nd maintain ac ompliancep rogram.I n +2019, theA gencies, theC ommodity FuturesT rading +Commission (“CFTC”) andthe SECm odified the +regulations implementingt he VolckerR ule. The +most impactfula spectso ft he revisionsw ith respect +to BNYM ellonc oncernt he compliance requirements +applicable to institutions with moderateexposuret o +tradinga ssets andt rading liabilities, whichare +institutions with less than $20 billionand more than +$1 billionoft rading assets andt rading liabilities. +Specifically,a mong otherrevisions,s uch“ moderate +trading” banksaren ol ongerr equiredt ofile an annual +CEOa ttestationa nd quantitativem etrics. +Furthermore, thec omprehensive six-pillar +compliancep rogram associatedwith theVolcker +Rule will no longera pplyt o“moderate trading” +banks;r ather, such banks arep ermittedt otailort heir +compliancep rogramst ot he size andn atureo ft heir +activities. BNYM elloni st reated asa“ moderate +trading” bank underthe revisedV olcker Rule.T he +finalr evisions also clarifieda nd amendedc ertain +definitions,r equirementsa nd exemptions. +On June 25, 2020,as econd seto fa mendments to the +VolckerR ulew as released,w hich is principally +focusedo nthe restrictions on bankingentities’ +investmentsi n, sponsorship of,a nd other +relationships with coveredf unds.G enerally,t he +changese stablishn ew exclusionsfromt he covered +fund definitionfor certain typesofi nvestment +vehicles,m odify thee ligibility criteria forc ertain +existinge xclusions,a nd clarifya nd modify other +provisions with respect to investmentin,s ponsoring +of andt ransactions with coveredf unds. +Derivatives +Title VIIo fthe Dodd-FrankA ct imposesa +comprehensiver egulatorys tructure on theO TC +derivatives marketsi nw hich BNYM ellono perates, +including requirementsr elatingt othe business +conducto fd ealers, trader eporting, margin and +recordkeeping. Title VIIa lsor equiresp ersons acting +as swap dealers, including TheB anko fN ew York +Mellon, to register with theCFTCa nd become +subject to theCFTC’ss upervisory, examinationa nd +enforcementp owers. Additionally,T itle VIIr equires +persons actinga ss ecurity-based swap dealerst o +Supervisiona nd Regulation (continued) +64 BNYM ellon +The secret office supply is a "paperclip". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_82.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_82.txt new file mode 100644 index 0000000000000000000000000000000000000000..2196d24f165d8b0b29ad950d74563f815e564822 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_82.txt @@ -0,0 +1,99 @@ +register with theSEC.T he Bank ofNewY ork +Melloni sr egistereda sasecurity-based swap dealer. +In addition, becauseBNYM elloni ss ubject to +supervisionb ythe FederalR eserve,w em ustc omply +with theU.S.p rudentialm arginr ules forv ariation +andi nitialm arginw ith respect to itsOTCs wap +transactions.F urthermore,v arious BNYM ellon +subsidiaries arealsos ubject to OTCd erivatives +regulationb ylocal authoritiesinE urope andA sia. +SingleC ounterparty Credit Limits +TheF ederal Reservea dopted ar ulei nJ une 2018 +imposings ingle-counterpartyc reditl imits (“SCCLs”) +on, among otherorganizations,d omestic BHCs, +including BNYM ellon, that areG-SIBs. TheS CCLs +applyt othe credit exposureo facoveredf irma nd all +of its subsidiaries to as inglec ounterpartya nd allo f +its affiliatesa nd connected entities. +Ther ulee stablishedt wo primary credit exposure +limits:( i) ac overedd omestic BHCm ay not have +aggregaten et creditexposuret oa ny unaffiliated +counterpartyi nexcesso f2 5% ofits Tier 1c apital; +and( ii) aU .S.G -SIB is furtherp rohibitedf rom +having aggregaten et creditexposurei ne xcesso f +15% ofits Tier 1c apitalt oa ny “major +counterparty” (defined asaG -SIB or an onbank +SIFI). Ther ulep rovidesacure period of 90 days(or, +with priorn oticef romt he FederalR eserve,alonger +or shorterp eriod) forb reaches of theS CCL rule. +During thec urep eriod, ac ompany mayn ot engage in +additionalc reditt ransactions with theparticular +counterpartyu nlesst he companyh as obtaineda +temporaryc redite xposurel imit increasefromt he +FederalR eserve. +SECR ules on Mutual Funds andRegistered +InvestmentA dvisers +SECr egulations imposer equirementso nm utual +funds,e xchange-tradedf unds ando ther registered +investment companies( “RICs”)u ndert he Investment +CompanyA ct of 1940,as amended(the“ 1940 Act”). +Among otherthings,t hese rulesr equire mutual funds +(other than moneym arketf unds)t op rovide portfolio- +wide andp osition-levelh oldings data to theSEC on a +monthlyb asis. +Ther egulations also imposel iquidity risk +management requirements that areintendedt oreduce +ther iskt hatf unds will not beable to meet +shareholderr edemptions andt ominimizet he impact +of redemptionso nr emaining shareholders. +On July12, 2023,theS EC adopted amendments to +rulest hatg overn moneym arketf unds.T he +amendments becamee ffectiveO ct.2 ,2023, with +tieredc omplianced ates.T he amendments include, +among otherthings: (i)amandatory liquidity feef or +institutionalp rime andi nstitutionalt ax-exempt +moneym arketf unds,w hich will applyw henafund +experiences daily netr edemptions that exceed5% of +neta ssets (effectiveO ct.2 ,2023);( ii) maintenanceo f +af und board’sability to imposeliquidity fees (not to +exceed 2% ofthev alue ofthes haresr edeemed)o na +discretionary basisf or non-governmentmoney +market funds (effectiveA pril 2, 2024);(iii) +substantially increasingthe requiredm inimuml evels +of dailyandw eekly liquidassets fora ll money +market funds from1 0% and3 0%,t o25% and5 0%, +respectively( effectiveA pril 2, 2024);and (iv) +removalo famoneym arketf und’sa bility to impose +temporary“ gates” to suspendr edemptions in ordert o +preventd ilutiona nd remove thel inkb etween a +moneym arketf und’sl iquidity levela nd its +imposition ofliquidity fees (effectiveO ct.2 ,2023). +On Sept.2 0, 2023,theS EC adopted amendments +expanding thes cope oftermst hatt he SECc onsiders +materially deceptivea nd misleading in af und’sn ame +without ac orresponding policyand relatedc ontrolst o +invest at least8 0% ofthef und’sn et assetvalue (plus +certain borrowings)i nt he manners uggested by the +fund’sn ame( “80% Policy”), including namesthat +reference“ growth”o r“ value,”o raname indicating +that investment decisionsincorporatea ny +environmental, social andgovernance factors. The +amendments becamee ffectiveD ec. 10, 2023and +fund groupswill have either 24 months or 30months +to come intocompliance, depending upontheirn et +assets ize. +On Oct. 26, 2022,theS EC proposed forc omment +newr ules to prohibitr egisteredi nvestment advisers +(“RIAs”) fromo utsourcing certain services and +functions without firstm eetingc ertain threshold +requirements, includingc onductingd ue diligence, +andt hereafterr equiring ongoingmonitoring ofthe +servicep roviders.T he proposalwoulda pplyt oRIAs +that outsource select “coveredfunctions,” which +include thoses ervices or functions that arenecessary +forp roviding advisory services in compliancew ith +federals ecuritiesl awsa nd that,i fn ot performedor +performed negligently,w ouldr esulti np otentialh arm +to clients. Thep roposal wouldf urther require RIAs +Supervisiona nd Regulation (continued) +BNYM ellon6 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_83.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_83.txt new file mode 100644 index 0000000000000000000000000000000000000000..9298619bb1f30d1d0debcc216ba888b55aaa9387 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_83.txt @@ -0,0 +1,99 @@ +to conductd ue diligence andmonitoring fora ll third- +partyr ecordkeepersa nd obtainreasonablea ssurances +that ther ecordkeepersw ill meet certainstandards. +Finally,i tw ouldr equire RIAs to maintainbooks and +recordsr elated to thenew rule’s oversight obligations +andt oreportc ensus-type informationa bout the +servicep roviders coveredu ndert he rule.W e +continue to evaluate theimpact of thep roposed rule. +On Nov. 2, 2022,theS EC proposed forp ublic +comment rule amendments thatwouldr equire the +adoptiono f“ swingp ricing” anda“hardc lose”b ya ll +open-endR ICso ther than moneym arketf unds and +exchange-tradedf unds (“Open-End Funds”).T he +requirementsw oulda ltert he manneri nw hich shares +in Open-End Funds aret raded, as shareholders would +no longerr eceivet he netasset value( “NAV”)p er +sharef or theirt ransactions butinstead couldreceive a +pricem oreo rl esst hant he NAV depending on +whethera“swing factor”w as appliedt otheir +transaction. This swingf actor wouldb et he amount +by whicht he Open-End Fund adjustsi ts per-share +NAV andw ouldr epresent ag ood-faith estimate of +thet ransactionc osts imposed on current shareholders +of theO pen-EndF und bythet ransacting +shareholders.T of acilitate theoperationo fs wing +pricing, theS EC also proposed to require a“ hard +close” forO pen-End Funds,w hich wouldm akea +purchaseo rs aleo rder fors hareso fa nO pen-End +Fund eligible foragivend ay’s priceo nlyi ft he Open- +EndF und orcertain designateda gentsr eceive the +orderb eforet he time when theO pen-EndF und +calculatesi ts NAV, whichist ypically as of 4:00PM +EasternT ime.W ec ontinue to evaluate theimpact of +thep roposed rule. +Exchange-TradedF unds Rule +SECR ule6 c-11 (the “ETF Rule”) undert he 1940Act +permits exchange traded funds (“ETFs”) that satisfy +certain conditions to organize andoperate without +firsto btaining an exemptiveorder fromt he SECa nd +requiresa nE TF to makecertain disclosures, +including historicaldata on an ETF’s premiums, +discountsa nd bid-askspread information, as well as +theE TF’s daily portfolio holdings.T he ETF Rule +also requiresE TFsu sing custom basketstop ut +writtenp oliciesa nd proceduresin place establishing +that thec ustomb askets arei nt he bestinterestso ft he +ETF andi ts shareholders.P ursuantt ot he ETF Rule, +BNYM ellonh as launchedanumbero fE TFs. +Recoverya nd Resolution Planning +As requiredb ythe Dodd-FrankA ct,l arge domestic +financiali nstitutions,s ucha sB NY Mellon, are +requiredt osubmit periodically to theF ederal Reserve +andt he FDIC ap lan–r eferredt oast he 165(d) +resolution plan–f or theirr apid ando rderly resolution +in thee vent ofmaterial financiald istresso rf ailure. +In addition, certain largeIDIs, such asTheB anko f +NewY orkM ellon, arer equiredt osubmit periodically +to theFDICaseparate plan forr esolutioni nthe event +of thei nstitution’sf ailure.T he publicportions of +theser esolutionp lans area vailable on theF ederal +Reserve’sa nd FDIC’s websites. BNYM ellona lso +maintainsacomprehensiver ecovery plan,w hich +describesa ctions it couldt aket os eek to avoidf ailure +if faced with financials tress. +On Aug. 29, 2023,theF DICp roposed forc omment +revisions to theresolutionp lanr ulea pplicable to +coveredI DIs. Thep roposed amendmentwould +expand certain IDIr esolutionp lanc ontent +requirements, adjust thef requencyo fr esolutionp lan +submissions froma3-year cyclet oa2-year cycle, +andr equire supplementals ubmissions ofinformation +in thei nterim period betweenfilingy ears. We are +evaluatingt he potentiali mpact of thep roposed rule. +In 2019, theF ederal Reservea nd FDIC issued af inal +rule modifyingcertain requirementsf or the1 65(d) +resolution plan.T he finalr uler equiresU .S.G -SIBs, +such asBNYM ellon, to file alternatingf ulla nd more +limited, targeted resolution plansevery twoy ears. +BNYM ellons ubmittedatargeted resolutionp lano n +July 1, 2021. TheF ederal Reservea nd FDIC found +no deficienciesor shortcomings in BNYM ellon’s +2021 resolution plansubmission. BNYM ellon +submitted af ullr esolutionp land ated July 1, 2023. +Thef inal rule doesn ot materially modifythe +componentso ri nformationalr equirementso ff ull +resolution plans. +If theF ederal Reservea nd FDIC jointly determine +that our 165(d)resolution planis not credible andw e +fail toaddresst he deficienciesin at imely manner,the +FDIC andt he FederalR eserve mayj ointly impose +more stringent capital, leverage orliquidity +requirementso rr estrictions on our growth,activities +or operations.I fw ec ontinue to fail toadequately +remedy anyd eficiencies, we couldb er equiredt o +divest assets or operationsthat ther egulators +determinen ecessary to facilitateo ur orderly +resolution. +Supervisiona nd Regulation (continued) +66 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_84.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_84.txt new file mode 100644 index 0000000000000000000000000000000000000000..ef44c0a48680792241466b67dd8eef6c57d77c91 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_84.txt @@ -0,0 +1,99 @@ +Ther esolutions trategys et outi no ur 165(d) +resolutionp lani sasinglep oint ofentrys trategy, +wherebyc ertain keyo peratings ubsidiaries wouldb e +providedw ith sufficient capital andliquidity to +operate in theevent ofmaterial financials tresso r +failure,a nd onlyour parent holdingcompany would +file forb ankruptcy.I nc onnectionw ith our single +point ofentryr esolutions trategy, we have established +theI HC to facilitate theprovision ofcapitala nd +liquidity resources to certain keys ubsidiaries in the +evento fm aterialf inancial distress or failure.I n +addition, we have ab inding supporta greementi n +place that requirest he IHCt op rovide that support. +Thes upporta greementr equiredt he Parent to transfer +its intercompanyloansa nd most of its casht othe +IHCa nd requirest he Parent to continue to transfer +casha nd otherliquidf inancial assets to theIHC on an +ongoing basis. +BNYM ellona nd theo ther U.S. G-SIBs area lso +subject to heightened supervisorye xpectations for +recovery andr esolutionp reparedness underF ederal +Reserver ules andguidance. TheF ederal Reserve +incorporates reviewso fo ur capabilitiesi nr espect of +recovery andr esolutionp reparedness as part of its +ongoing supervisiono fB NY Mellon. +In theE uropean Economic Area (“EEA”) andi nthe +UK, theB ankR ecovery andR esolutionD irective, as +amendedb ythe Bank Resolutiona nd Recovery +Directive2(“BRRD”),p rovidest he legalf ramework +forr ecovery andr esolutionp lanning, including as et +of harmonizedpowerst or esolve orimplement +recovery of in-scope institutions,s ucha sE EA and +UK subsidiariesof thirdc ountry banks.T he UK +transposed most requirementso fB RRD into local +legislationa nd regulationf ollowing theU Ke xitf rom +theE Uo nD ec. 31, 2020. +BRRD givesr elevantE EA andU Kr egulatorsv arious +powers, including: (i)p owerst oi ntervene pre- +resolutiont orequire an institutiont otaker emedial +stepst oa voidt he needforr esolution; (ii) resolution +toolsa nd powersto facilitate theresolutiono ff ailing +entities, such asthep ower to “bail-in”t he debt ofan +institution( including certain deposit obligations); (iii) +thep ower to require af irmt oc hange its structuret o +remove impedimentst or esolvability;a nd (iv) powers +to require in-scope institutions to preparer ecovery +plans. Undert he BRRD,r esolutiona uthorities( rather +than thei nstitutions themselves)a re responsiblefor +drawingu presolutionp lans basedo ninformation +providedb yrelevanti nstitutions. +UnderB RRD,i n-scope institutions arer equiredt o +maintain am inimumr equirement fort heir ownf unds, +(defined asregulatoryc apital),a nd eligible liabilities +(“MREL”) that canbe writtend owno rb ailed-in to +absorb losses. MREL is seto nacase-by-caseb asis +fore ach institutions ubject to BRRD andi sa pplicable +to certain EU andU Kd omiciledc rediti nstitutions +andc ertain otherf irms subject to BRRD.B NY +MellonS A/NV is subject to MREL.T he EU is +legislatingf urther revisionst ot he BRRD to amend +internal MREL requirementsi nb ankr esolution +groups.B NY Mellonw ill assess thep otentiali mpact +of thef inal rules. +Ruleso nR esolutionS tays forQ ualifiedF inancial +Contracts +TheA gencies’ regulations require U.S. G-SIBs (and +theirs ubsidiaries andcontrollede ntities) andt he U.S. +operations offoreignG -SIBst oa mend theirc overed +qualifiedf inancial contracts(“QFCs”), thereby +facilitatingt he applicationo fU .S.s pecial resolution +regimesa snecessary. +Ther egulations allowt hese G-SIBsto comply by +amending coveredQ FCs( with thec onsento fr elevant +counterparties) usingt he InternationalS waps and +Derivatives Association( “ISDA”)2 018 U.S. +Resolution Stay Protocol,I SDA2 015 UniversalS tay +Protocol or byexecutinga ppropriate bilateral +amendments to thecoveredQ FCs. BNYM ellon +entitiesw hich have been confirmedt oengage in +coveredQ FC activitiesh avea dheredt othe Protocol +and, wheren ecessary,h avee xecutedb ilateral +amendments tocoverQ FCs. +Insolvency of anInsuredD epository Institutiono ra +Bank HoldingC ompany;O rderly Liquidation +Authority +If theF DICi sa ppointed as conservatoro rreceiver +fora nI DI such asTheB anko fN ew York Mellon or +BNYM ellon, N.A.,u pon itsi nsolvencyo ri nc ertain +otherc ircumstances,t he FDIC hast he powerto: +•T ransfera ny ofthed epository institution’sa ssets +andl iabilitiest oanewo bligor,i ncluding an ewly +formed “bridge”bankw ithout thea pprovalo ft he +depository institution’sc reditors; +•E nforce thet erms of thed epository institution’s +contractsp ursuantt ot heir termswithout regard to +anyp rovisions triggeredb ythe appointment of +theF DICi nt hatc apacity;o r +Supervisiona nd Regulation (continued) +BNYM ellon6 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_85.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_85.txt new file mode 100644 index 0000000000000000000000000000000000000000..57c815b8ed36239d145b7e4f5071d7bcef49a137 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_85.txt @@ -0,0 +1,100 @@ +•R epudiateo rd isaffirm anyc ontract or leaset o +whicht he depository institution is ap arty,t he +performance of whichi sd etermined by theF DIC +to be burdensomeand thed isaffirmance or +repudiationo fw hich is determined by theF DIC +to promotet he orderlyadministrationo ft he +depository institution. +In addition, underfederal law, thec laims of holders +of domesticdeposit liabilitiesa nd certain claims for +administrativee xpenses againstanI DI wouldb e +afforded ap riority overo ther generalu nsecured +claims againsts ucha ninstitution, including claims of +debt holdersof thei nstitution, in the“ liquidationo r +otherr esolution” ofsuch aninstitutionb yany +receiver. As ar esult, whethero rnot theF DICe ver +sought to repudiate anyd ebto bligations ofTheB ank +of NewY orkM ellono rB NY Mellon,N.A.,t he debt +holders wouldb et reated differently from, andc ould +receive,i fa nything, substantially lessthan,t he +depositors of theb ank. +TheD odd-FrankA ct createdaresolutionr egime +(knowna st he “orderly liquidationa uthority”) for +systemically important financialc ompanies,i ncluding +BHCs andt heir affiliates. Undert he orderly +liquidationa uthority,t he FDIC mayb ea ppointed as +receiverf or thes ystemically important institution, +andi ts failedn onbank subsidiaries,f or purposesof +liquidatingt he entity if,among otherconditions,i ti s +determined that thei nstitutioni si nd efault or in +dangero fdefault andt he failure poses ar iskt othe +stability of theU .S.f inancial system. +If theF DICi sa ppointed asreceiveru ndert he orderly +liquidationa uthority,t hent he powersoft he receiver, +andt he rightsa nd obligations ofcreditors ando ther +partiesw ho have dealtwith theinstitution, wouldb e +determined undert he Dodd-FrankA ct’s orderly +liquidationa uthority provisions,a nd not underthe +insolvency lawt hatw ouldo therwise apply. The +powerso ft he receiveru ndert he orderlyliquidation +authority were basedo nthe powersof theF DICa s +receiverf or depository institutions underthe FDIA ct. +However, thep rovisions governingthe rightso f +creditors undert he orderlyliquidationa uthority were +modified in certain respectst or educed isparitiesw ith +thet reatment ofcreditors’c laims undert he U.S. +Bankruptcy Code as comparedto thetreatment of +thosec laimsu ndert he newauthority.N onetheless, +substantiald ifferences in therightso fc reditors exist +between theset wo regimes, including ther ight ofthe +FDIC to disregardt he strict priority of creditorc laims +in some circumstances,t he useofa na dministrative +claims proceduret od etermine creditors’c laims (as +opposed to thej udicial procedureu tilized in +bankruptcy proceedings), andt he righto ft he FDIC to +transfer assetsor liabilitieso ft he institutiont oathird +partyo ra“bridge”e ntity. +DepositorP reference +UnderU .S.f ederal law, claims of ar eceivero fanI DI +fora dministrativee xpenses andclaims of holdersof +U.S. deposit liabilities( including foreignd eposits that +arep ayable in theU.S.a sw ella si naforeignb ranch +of thed epository institution) area fforded priority +overc laims of otherunsecuredc reditors of the +institution, including depositors in non-U.S. branches. +As ar esult, such depositors couldr eceive,i fa nything, +substantially lessthan thed epositors in U.S. offices +of thed epository institution. +2023 Bank Failures +On March1 2and 13, 2023,followingt he closures of +Silicon ValleyB ank( “SVB”) andSignature Bank, +respectively, andt he appointment oftheF DICa st he +receiverf or thoseb anks,t he FDIC announced that, +undert he systemic risk exceptions et forthi nthe +FederalD eposit InsuranceA ct,a sa mended( the“ FDI +Act”), alli nsured anduninsured deposits of those +banks were transferredt othe respectiveb ridge banks +forS VB andS ignature Bank. +On May1 ,2023, theF DICr eleasedacomprehensive +overviewo ft he deposit insurancesystema nd options +forr eformt oa ddressf inancial stability concerns +stemmingf romr ecentb ankf ailures. TheF DIC +evaluatedt hree primary options:l imitedc overage, +unlimitedc overage andt argetedc overage.T he +proposed options wouldr equire Congressionala ction, +though some aspectso ft he reportl ie within thescope +of theF DIC’sr ulemakinga uthority.W ea re +evaluatingt he impact of thep roposed reforms. +In addition, also on May1 ,2023, theF DICw as +appointed asreceiverf or FirstR epublic Bank. The +FDIC hasi ndicated that thee stimatedl ossest ot he +DIFo fr esolving FirstR epublic Bank aree xpected to +be $13 billion.Theser ecentb ankf ailuresa nd other +relatedd evelopmentsi nt he bankingindustry, such as +thea cquisitiono fC reditS uisseb yU BS in 2023, has +resulteda nd mayc ontinue to result in increased +regulatorya ctivity,s upervisoryf ocus,a nd related +restrictions on banking organizations. +Supervisiona nd Regulation (continued) +68 BNYM ellon +The secret object #5 is a "toothbrush". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_86.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_86.txt new file mode 100644 index 0000000000000000000000000000000000000000..2cd4eea724a93dbdf57be979e7474251db2eef26 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_86.txt @@ -0,0 +1,102 @@ +Deposit Insurance +OurU .S.b anking subsidiaries,i ncluding TheB anko f +NewY orkM ellona nd BNYM ellon, N.A.,a ccept +deposits,a nd thosed eposits have theb enefit of FDIC +insuranceu pt othe applicable limit. Thec urrent limit +forF DICi nsurance ford eposit accountsi s$250,000 +perd epositora te ach insuredb ank. Undert he FDI +Act, insuranceofd eposits maybet erminated by the +FDIC upon af inding that theI DI hase ngagedi n +unsafea nd unsound practices,isi na nunsafeo r +unsound conditiont ocontinue operations or has +violated anyapplicable law,regulation, rule,o rder or +conditioni mposed by ab ank’sf ederal regulatory +agency. +TheF DIC’sD IF is fundedb yassessments on IDIs. +TheF DICa ssessesD IF premiums basedo nabank’s +averagec onsolidated totala ssets,l esst he average +tangiblee quity of theI DI duringt he assessment +period. Forl argeri nstitutions,s ucha sT he Bank of +NewY orkM ellona nd BNYM ellon, N.A., +assessments ared etermined basedo nCAMELS +ratings andf orward-looking financialm easures to +calculate theassessmentr ate, whichi ss ubject to +adjustmentsb yt he FDIC,a nd thea ssessmentb ase. +Undert he FDIC’s regulations,acustody bank, +including TheB anko fN ew York Mellona nd BNY +Mellon, N.A.,m ay deductf romi ts assessmentb ase +100% ofcasha nd balancesdue fromd epository +institutions,s ecurities, federalf unds sold,a nd +securitiesp urchased undera greementt or esellw ith a +Standardized Approach risk-weight of 0%andm ay +deduct5 0% ofsuch assettypesw ith aS tandardized +Approach risk-weight of greaterthan 0% andu pt o +andi ncluding 20%.T hisa ssessmentb ased eduction +mayn ot exceedt he averagev alue of deposits that are +classified astransactiona ccountsa nd arei dentified +by theb anka sb eing directly linkedt oafiduciaryor +custodial andsafekeepinga ccount. +Following thec losureso fS VB andS ignature Bank in +March1 2and 13, 2023,theF DICa nnounced that,a s +requiredb ythe FDIA ct,a ny lossest ot he DIFt o +supportu ninsured depositors wouldb er ecoveredb ya +special assessmentprescribedt hrough regulation. +Undert he FDIA ct,t he FDIC hasd iscretionw ith +respect to thedesigna nd timeframe fora ny special +assessment, whichm ay be oninsuredd epository +institutions,d epository institutionh olding companies +(with theconcurrenceo ft he TreasuryS ecretary),o r +both, as theF DICd etermines to be appropriate.T he +FDIC mayc onsider thet ypeso fe ntitiest hatb enefit +fromt he actiont aken,e conomic conditions,t he +effectso nt he industry, ands ucho ther factorsa sthe +FDIC deemsa ppropriate. +On Nov. 16, 2023,theF DICa dopted af inal rule, +effectiveA pril 1, 2024,implementingaspecial +assessmento nI DIst or ecoverl ossest ot he DIF +associated with theclosureso fS VB andS ignature +Bank. When ther ulew as adopted,the FDIC +estimatedt hatt he assessedl ossesw ould total +approximately $16.3 billion. Undert he rule,t he +FDIC will collect frome ach IDIaspecial assessment +at aq uarterly rate of 3.36 basispoints( or an annual +rate of approximately 13.4 basispoints) of theI DI’s +estimatedu ninsured deposits (excluding thef irst $5 +billiono fe stimated uninsured deposits)a so fD ec. 31, +2022. Fora nI DI that is part of ah olding company +containing multiple IDIs,t he $5 billiondeduction +wouldb ea pportionedb ased on theI DI’s estimated +uninsured deposits as ap ercentage oftotale stimated +uninsured deposits held by allI DI affiliatesi nt he +consolidated banking organization. Thes pecial +assessmentw ill be collectedd uringa ninitials pecial +assessmentp eriodo fe ight quarters, with thefirst +quarterly assessmentp eriodb eginning onJan. 1, +2024, subject to potentiale xtension andapotential +one-timef inal special assessmentfor anys hortfallt o +theD IF.I nF ebruary2 024, theF DICe stimatedt he +assessedl ossesw ouldt otal approximately$20.4 +billion. We recorded an accrualt on oninterest +expenseo fa pproximately $632 millioni nthe fourth +quarter of 2023fort hiss pecial assessment. +Source of Strengthand Liability of Commonly +ControlledD epository Institutions +BHCs arer equiredb ylaw to act asas ource of +financiala nd managerial strengtht otheir bank +subsidiaries.B NY Mellonh as as tatutory obligation +to commit resources to itsb anks ubsidiaries in times +of financiald istress. In addition, anyl oans byBNY +Mellont oits bank subsidiaries wouldb es ubordinate +in right of paymenttod epositors andt ocertain other +indebtedness of itsb anks.I nt he evento faBHC’s +bankruptcy,a ny commitment bytheB HC to af ederal +bank regulator to maintain thec apitalo fasubsidiary +bank will be assumedb ythe bankruptcytrusteea nd +entitledt oapriority of payment. In addition, in +certain circumstances,B NY Mellon’sI DI +subsidiaries couldbeh eldl iablef or lossesi ncurred +by anotherB NY MellonI DI subsidiary.I nt he event +of impairmento ft he capitals tock of one ofBNY +Mellon’sn ationalb anks ubsidiaries or TheB anko f +Supervisiona nd Regulation (continued) +BNYM ellon6 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_87.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_87.txt new file mode 100644 index 0000000000000000000000000000000000000000..ff2d8aff1670d5e5fe704260176447734f7bcd29 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_87.txt @@ -0,0 +1,102 @@ +NewY orkM ellon, BNYM ellon, as theb anks’ +stockholder, couldb er equiredt opay such deficiency. +Transactions with Affiliates +Transactions betweenBNYM ellon’sb anking +subsidiaries,o nthe one hand,andt he Parent andi ts +nonbank subsidiaries andaffiliates, on theo ther,a re +subject to certain restrictions,l imitations and +requirements, whichinclude limits on thet ypesa nd +amountso ft ransactions (including extensions of +credit anda ssetp urchases by our banking +subsidiaries)t hatm ay take place andgenerally +require thoset ransactions to be onarm’s-length +terms. In general, extensions ofcredit by aB NY +Mellonb anking subsidiary to anyn onbank affiliate, +including theP arent, mustbe securedb ydesignated +amountso fs pecified collateraland arel imitedi nthe +aggregatet o1 0% ofther elevantb ank’sc apitala nd +surplusf or transactions with as inglea ffiliate andt o +20% ofther elevantb ank’sc apitala nd surplusf or +transactions with alla ffiliates. Therea re also +limitations onaffiliate credit exposures arisingfrom +derivativet ransactions ands ecuritiesl ending and +borrowing transactions. +IncentiveC ompensationA rrangements +Section9 56 oftheD odd-FrankA ct requiresf ederal +regulatorst op rescribe regulations or guidelines +regardingi ncentive-basedc ompensationp ractices at +certain financiali nstitutions,i ncluding BNYM ellon. +In April2 016, aj oint proposedrule wasr eleased, +replacing ap revious 2011 proposal,which eachof six +agencies must separatelyapprove.T he time frame +forf inal implementation, if any, is currently +unknown. +On Oct.22, 2022,theS EC adopted af inal rule +requiring nationalsecuritiese xchangesa nd national +securitiesa ssociations to adoptl istings tandards +requiring issuersl istedo na nexchange oran +associationt oestablishapolicyf or recovering +erroneously awardedi ncentive-basedc ompensation +paid toexecutiveo fficersu nderc ertain +circumstances.A ccordingly, in June 2023,theN ew +York StockE xchange adopted listings tandards, +effectiveO ct.2 ,2023, requiring listedi ssuers, +including BNYM ellon, to adopt ap olicyo nrecovery +of erroneously awardedc ompensationb yDec. 1, +2023. Thep olicyw oulda pplyt oexecutivei ncentive +compensationr eceivedo nora fter Oct. 2, 2023. BNY +Mellona doptedapolicyd esignedt ocomplyw ith the +listings tandards. +Anti-MoneyL aundering (“AML”) and theU SA +PATRIOTA ct +Am ajor focuso fg overnmental policyo nfinancial +institutions hasbeen aimedatc ombatingm oney +laundering andt errorist financing. TheU SA +PATRIOTA ct of 2001contains numerousAML +requirementsf or financiali nstitutions that are +applicable to BNYM ellon’sb ank, broker-dealer and +investment advisers ubsidiaries andmutualf unds and +privatei nvestment companiesa dvisedo rs ponsored +by oursubsidiaries.T hoser egulations impose +obligations onfinanciali nstitutions to maintain a +broadA ML program that includesi nternalc ontrols, +independent testing, compliance management +personnel, training,and customer due diligence +processes, as well as appropriatepolicies, procedures +andc ontrols todetect,p revent andr eportm oney +laundering, terrorist financinga nd othersuspicious +activity,a nd to verify thei dentity of theirc ustomers. +Certaino ft hoser egulations impose specificdue +diligence requirementso nf inancial institutions that +maintain correspondent or privatebanking +relationships with non-U.S. financiali nstitutions or +persons. +TheA nti-MoneyL aundering Acto f2 020 (“AMLA”), +whicha mends theB ankS ecrecy Act( “BSA”),w as +enacted to comprehensivelyr eforma nd modernize +U.S. AMLl aws. Amongo ther things,t he AMLA +codifies ar isk-baseda pproach to AMLc ompliance +forf inancial institutions;r equirest he developmento f +standardsb yt he U.S. Department oftheT reasuryf or +evaluatingt echnology andi nternalp rocessesf or BSA +compliance; andexpands enforcement- and +investigation-relateda uthority,i ncluding as ignificant +expansioni nthe availables anctions forc ertain BSA +violations andi nstitutingB SA whistleblower +incentives andprotections.T he AMLA contains +many statutoryp rovisions that require additional +rulemakings,r eports ando ther measures,a nd the +rulemaking processhas begun fors everal of these +provisions.I nJ une 2021,thef irst government-wide +prioritiesf or anti-moneyl aundering andc ountering +thef inancing ofterrorism (“AML/CFTP riorities”) +were published. TheseA ML/CFT Prioritiesw ill need +to be incorporated into banks’r isk-basedB SA +compliancep rogramsa fter completiono ft he +rulemaking processand onthee ffectived ateo ft he +finalr egulations.T he impact of theA MLAw ill +depend on,among otherthings, thec ompletiono ft he +rulemaking processand thei ssuingo fi mplementation +guidance. +Supervisiona nd Regulation (continued) +70 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_88.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_88.txt new file mode 100644 index 0000000000000000000000000000000000000000..62db5f8ad13c28f2bf676c76f9fae9d73a41b4c8 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_88.txt @@ -0,0 +1,100 @@ +FinancialC rimesE nforcementN etwork (“FinCEN”) +FinCEN issued rulesu ndert he BSAt hata pplyt o +coveredf inancial institutions,i ncluding TheB anko f +NewY orkM ellona nd BNYM ellon, N.A.,s etting +forthf ivep illars of an effectiveAML program: +developmento fi nternalp olicies, procedures and +relatedc ontrols;d esignationo facomplianceo fficer; +at horough ando ngoing training program; +independent review forc ompliance; andcustomer +due diligence (“CDD”). CDDr equiresacovered +financiali nstitutiont oimplement andm aintainr isk- +basedp rocedures forc onductingC DD that include +thei dentificationa nd verificationofa ny beneficial +owner(s)o feachl egal entitycustomer atthet ime a +newa ccount is opened. +NYSDFS Anti-MoneyL aundering andAnti-Terrorism +Regulations +TheN ew York StateD epartment ofFinancial +Services (“NYSDFS”)i ssued regulations requiring +regulated institutions,i ncluding TheB anko fN ew +York Mellon, to maintainat ransactionm onitoring +program to monitortransactions forp otentialB SA +andA ML violations ands uspicious activity reporting, +andawatchl istf iltering programto interdict +transactions prohibitedb yapplicable sanctions +programs. +Ther egulations require ar egulated institutiont o +maintain programst om onitora nd filtert ransactions +forp otentialB SA andA ML violations andp revent +transactions with sanctionede ntities. Ther egulations +also require institutions to submit annually ab oard +resolutiono rs enioro fficer compliancefinding +confirmings teps takent oascertain compliancew ith +ther egulation. +Cybersecurity and Computer Security Regulation +TheN YSDFSr equiresf inancial institutions regulated +by NYSDFS, including TheB anko fN ew York +Mellon, to establishacybersecurity program,a dopt a +writtenc ybersecurity policy, designateac hief +informations ecurity officer,a nd have policiesand +procedures in place to ensure thes ecurity of +informations ystems andn on-public information +accessiblet o, or heldby, thirdp arties. TheN YSDFS +rule also includesavarietyo fo ther requirementst o +protect thec onfidentiality,i ntegrity anda vailability +of informations ystems,a sw ella st he annuald elivery +of ac ertificateo fc ompliance. +TheA genciesh avea dopted af inal rule imposing +notificationr equirementsf or significantc omputer +security incidentso nb anking organizations.U nder +thef inal rule,aBHC, statem emberb anko rn ational +bank, including theP arent, TheB anko fN ew York +Mellona nd BNYM ellon, N.A.,a re requiredt onotify +theF ederal Reserveo rO CC, as applicable,within 36 +hourso fi ncidents that couldresulti nt he banking +organization’si nability todeliver services to a +material portiono fi ts customer base,d isrupt the +banking organization’slines of businessesthe failure +of whichw ouldr esulti nm ateriall osses, or disrupt +operations thef ailure of whichw ouldt hreaten the +financials tabilityo ft he U.S. +On July26, 2023,theS EC adopted rules, effectiveo n +Sept.5 ,2023, requiring publiccompanies, including +theP arent, todisclose cybersecurity incidentsand +details regardingt heir cybersecurity risk +management,s trategya nd governance. Undert he +rules, public companiesm ustd isclosem aterial +cybersecurity incidentsonF orm8 -K.D isclosureo f +material incidentsg enerally is due within four +businessd aysa fter ap ublic companyd eterminest hat +ac ybersecurity incidentis material.O na nannual +basis, public companiesm ustd escribei nt heir annual +reporto nF orm1 0-Kt heir processesf or assessing, +identifying, andm anaging, andm anagement’sr ole +ande xpertisei na ssessing andm anaging, material +cybersecurity risks; whetherany cybersecurity risks +have materially affected or arer easonablyl ikelyt o +material affectthec ompany; andt he boardof +directors’ oversight ofcybersecurity risks. +On March15, 2023,theS EC proposed an ew rule +regardingc ybersecurity risk management for entities +including broker-dealers, security-basedswap +dealers, andt ransfera gents. Thep roposed rule would +require such entitiestom aintainw rittenp oliciesa nd +procedures to addresst heir cybersecurity risk, +immediatelyn otifyt he SECo fs ignificant +cybersecurity incidents,andp ublicly disclose +descriptions oftheirc ybersecurity risksa nd +significantc ybersecurity incidents. +In addition, also on March1 5, 2023,theS EC also +proposed amendments toRegulationS -P,i ncluding a +requirement forb roker-dealers, investment +companies, RIAs,a nd transfer agents toadopt written +policiesa nd proceduresfora ni ncidentr esponse +program with respect to unauthorized accesst oo ru se +of customer information. Thep roposal wouldr equire +thesee ntitiest on otifyi ndividuals whoses ensitive +customer informationw as accessedo ru sedw ithout +Supervisiona nd Regulation (continued) +BNYM ellon7 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_89.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_89.txt new file mode 100644 index 0000000000000000000000000000000000000000..6db1d0f4de11a71288df44a67409359bcd696236 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_89.txt @@ -0,0 +1,100 @@ +authorizationn ot latert han3 0daysa fter becoming +awaret hatt he informationh as been compromised. +BNYM elloni se valuatingt he potentiali mpact of the +proposals. +Privacya nd Data Protection +Thep rivacy provisions oftheG ramm-Leach-Bliley +Actg enerally prohibitf inancial institutions,i ncluding +BNYM ellon, from disclosing nonpublicpersonal +financiali nformationo fc onsumer customerstot hird +partiesf or certain purposes (primarily marketing) +unlessc ustomers have theo pportunity to“opt out”o f +thed isclosure. TheF airC reditR eportingA ct +restrictsi nformation sharinga mong affiliatesf or +marketingp urposes. +In theE U, privacy lawi sprimarily regulated by the +GeneralD ataP rotectionR egulation( “GDPR”). The +GDPRc ontains enhanced complianceo bligations and +increased penaltiesf or non-compliancecomparedt o +priorE Ud atap rotectionl egislation. +Acquisitions/Transactions +Federala nd statel awsi mposen oticea nd approval +requirementsf or mergersa nd acquisitions involving +depository institutions orBHCs.T he Bank Holding +CompanyA ct of 1956,as amendedb ythe Gramm- +Leach-BlileyA ct andb ythe Dodd-FrankA ct (the +“BHC Act”), requiresthep rior approvalo ft he +FederalR eserve fort he director indirect acquisition +by aB HC of more than 5% ofanyc lass of thev oting +shares or allo rs ubstantially allo ft he assets of a +commercialb ank, savings andl oana ssociationo r +BHC. In reviewingbanka cquisitiona nd merger +applications,t he bankregulatorya uthoritiesw ill +consider,a mong otherthings,t he competitivee ffect +of thet ransaction, financiala nd managerial resources, +including thec apitalp ositiono ft he combined +organization, convenience andneedso ft he +community factors, including thea pplicant’sr ecord +undert he Community Reinvestment Acto f1 977 (the +“CRA”),t he effectivenesso ft he subject +organizations in combatingm oneyl aundering +activitiesa nd ther iskt othe stability of theU .S. +banking orfinancial system.I na ddition, prior +FederalR eserve approvalw ouldb er equiredf or BNY +Mellont oacquire direct or indirect ownershipo r +controlo fa ny votingshareso facompanyw ith assets +of $10 billionorm oret hati se ngagedi nactivities +that are“financiali nn ature.” +Climatea nd ESGR egulations +As theg lobalr egulatoryf ramework forClimate and +ESGd isclosurea nd risk management practices +continuest oe volve,w ec ontinue to evaluate the +impactso fn ew regulations on our businessand +operations. +In theU .S., theS EC proposed rulest oe nhance +consistencyo fc limate-relatedd isclosures among +registered companies. On March2 1, 2022,theS EC +proposed climate-relateddisclosurer equirementst hat +wouldr equire SECr eportingc ompanies to disclose, +among otherthingsa nd as applicable,directa nd +indirect greenhouseg as emissions,climate-related +scenario analysis,c limate transitionp lans orclimate- +relatedt argets or goalsandr elated progress, climate- +relatedr isks overthe short-,m edium- andl ong-term, +qualitative andq uantitativei nformationr egarding +climate-relatedr isks andh istorical impactsi na udited +financials tatements, corporateg overnance of +climate-relatedr isks,a nd climate-relatedr isk- +management processes. Further, on May2 5, 2022, +theS EC proposed rule andf orma mendments that +wouldr equire certain funds,i ncluding RICs such as +mutual funds,c losede nd funds andE TFs, that +consider ESGf actorsi nt heir investment processt o +provide additionalE SG disclosuresi nt heir fund +prospectuses andannuals hareholderr eports.T hese +proposed amendmentswoulda lsor equire certain +advisers,i ncluding RIAs,t hatc onsider ESGf actors +as part of theira dvisory businesst od iscloset he ESG +factorst heyc onsider in providing advisory services +andh ow they areincorporated when formulating +investment advice. +An umbero fstatesh avep roposed or enacted laws +andr egulations addressing climate disclosure.F or +example, on Oct. 7, 2023,California enacted three +statutes imposinge xtensive newclimate-related +disclosure obligations,w hich becamee ffectiveo n +Jan. 1, 2024.TheC limate CorporateD ata +Accountability Act( “SB2 53”)r equiresU .S. +companiesw itht otal annualrevenuesi ne xcesso f$ 1 +billiont hatd ob usinessi nC aliforniat od isclose +annually theirScope 1( owneda nd controlled +sources)a nd Scope 2( frome nergyp urchased and +used)g reenhouseg as emissions beginningin 2026, +andS cope 3( up andd ownv alue chain) greenhouse +gase missions beginningin 2027. TheC limate- +RelatedF inancial Risk Act(“SB2 61”)r equiresU .S. +companies( othert hani nsurance companies) with +totala nnualr evenuesi ne xcesso f$ 500 milliont hat +do businessinC aliforniat op ublishb iennial reports +Supervisiona nd Regulation (continued) +72 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_9.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_9.txt new file mode 100644 index 0000000000000000000000000000000000000000..95134f0fde5aec0d9eb4aa1eae29d400f4997500 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_9.txt @@ -0,0 +1,38 @@ +VIIBNY MELLON +Investment and Wealth Management continues to be an important +segment for the firm. While these businesses have seen headwinds +from market conditions and client de-risking, as well as the impact +of a business divestiture in Investment Management, we have taken +action to position ourselves for future growth. +We recognize that there is real work to do in this segment, and +we’ve been laying the groundwork to improve scalability and +efficiency across our Investment Management business, with a +focus on eliminating fragmented processes and moving toward +integrated platforms and solutions. +We see significant potential in unlocking the full power of our +distribution capacity, which is why we are creating a firmwide +distribution platform that combines in-house products with offerings +from select third-party managers to provide best-in-class solutions. +Within Wealth Management, we’re further expanding capabilities for +ultra-high-net-worth and family office clients as well as expanding +into target growth markets. +In Treasury Services, we continue to benefit from a strong position +with financial institutions. We’re one of the top five U.S. dollar +payments clearers in the world, clearing roughly $2.4 trillion of +U.S. dollar payments daily, on average. Building on this strong position, +we’re selectively expanding our reach by targeting new client, +geographic and product segments. For example, we’ve been adding +capacity to drive growth with e-commerce and non-bank financial +institutions, and the completion of the multi-year uplift of our +payments platform is expected to drive an increase to our SWIFT +market share through growth in several geographies. +Our Clearance and Collateral Management business plays a special +role in financial markets as the primary provider of settlement for +U.S. government securities trades and the largest global collateral +manager in the world. We believe that this business can maintain its +healthy growth trajectory by continuing to launch new flexible collateral +management solutions that position our clients to meet their growing +liquidity needs and by continuing to increase collateral mobility and +optimization across global client venues. +INVESTMENT AND +WEAL TH MANAGEMENT \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_90.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_90.txt new file mode 100644 index 0000000000000000000000000000000000000000..aa20d76df6fbf6bdd8f50cbe5faf158c1b5c71f0 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_90.txt @@ -0,0 +1,100 @@ +disclosing climate-relatedf inancial risksa nd the +measures adoptedto mitigatethe disclosedrisks +beginning onJan. 1, 2026.TheC aliforniaS tate Air +Resources Boardi sa uthorized to adopt implementing +regulations underSB2 53 andS B2 61. The +VoluntaryC arbon Market DisclosuresA ct (“AB +1305”)r equires, among otherthings,c ompanies +operatingw ithin Californiat od isclosec ertain +informationo naccuracy of claims made,including +regardingc arbon neutrality,net zeroemissions or +reductiono fg reenhouseg as emissions,interim +progressm easures,t hird-party verificationa nd,i f +applicable,c ertain informationo nthe voluntary +carbon offsetsmarketed, used,purchased or sold. +In Europe,E Ue ntitiesi n-scopef or theC orporate +Sustainability ReportingD irectivew ill soon be +subject to newr equirementst od isclosei nformation +about sustainability matters,including informationo n +BNYM ellon’si mpact on thee nvironmenta nd +informationo nrelated financialr isks and +opportunitiest oB NY Mellon. Five EU subsidiaries +of BNYM ellona re subject to theserequirements, +with BNYM ellonS A/NV requiredt oreporti n2 025 +andt he remainingf our subsidiaries requiredt oreport +in 2026. In addition, EU lawmakersa re in the +processo fa doptingt he CorporateS ustainability Due +Diligence Directive( “CS3D”), whichw ill likely +imposen ew due diligence obligations on our global +operations,i ncluding in relationt oour supplyc hains. +TheC S3Dw ill also require us to adopt andp ut into +effect at ransitionp lanf or climate change mitigation. +Ourr egulated banking subsidiary in theEUi sa lso +subject to supervisorye xpectations andp otential +enforcementa ctions fort he prudentmanagement of +climate-relateda nd environmentalr isks andr elated +disclosure. +In addition, ourUK supervisorya uthoritiesh ave +adopted newd isclosurer equirementsa nd supervisory +expectations that currentlyapplyo rw ill applyt oour +subsidiaries andbranchest hata re regulatedby the +UK FinancialC onductA uthority (“FCA”)a nd the +UK PrudentialR egulationA uthority (“PRA”). For +example, sincet he endo f2 021 ourPRAr egulated +branch andbanking subsidiary have beensubject to +theP RA’s supervisorye xpectations fort he +management ofclimate-relatedf inancial risks, +including as regardsg overnance, risk management, +scenario analysis andd isclosure. Further, newF CA +ruleso na nti-greenwashingw ill require that from +May3 1, 2024,anys ustainability-relatedc laims made +about our productsands ervices by ourFCAr egulated +entitiesa re consistent with thesustainability +characteristicso fs uchp roducts or services anda re +fair,c lear andnot misleading. +In addition, recentp ublishedg uidancef romo ur +regulators, including theA genciesa nd NYSDFS, has +primarily focusedo nclimate-relatedf inancial risk +management,i ncluding with respect to,a mong other +things,g overnance, policiesa nd procedures,strategy, +risk management,d ataa nd reporting, ands cenario +analysis.W ec ontinue to assess guidancef rom +regulatorsa nd its potentiali mpact. +RatingS ystemf or theS upervisiono fL arge Financial +Institutions +TheF ederal Reserve’sr atings ystemf or the +supervisiono fl arge financiali nstitutions (“LFIs”) +appliest o, among otherentities,a ll BHCs with total +consolidated assetsof $100 billionorm ore, including +BNYM ellon. +TheL FI ratings ystemi ncludesafour-level rating +scalea nd threec omponent ratings. Thef our levels +are: BroadlyM eetsE xpectations;C onditionally +MeetsE xpectations;D eficient-1;a nd Deficient-2. +Thec omponent ratingsa re assignedf or:C apital +Planning andP ositions;L iquidity Risk Management +andP ositions;a nd Governance andControls.A firm +must be rated“ BroadlyM eetsE xpectations”o r +“Conditionally MeetsE xpectations”f or each of its +component ratings to be considered “wellmanaged” +in accordance with various statutes andregulations +that permit additionala ctivities, prescribee xpedited +procedures or provide otherbenefits for“ well +managed” firms. +Regulated Entities of BNYM ellona nd Ancillary +RegulatoryR equirements +BNYM elloni sr egistereda sa nF HC undert he BHC +Act. We aresubject to supervisionb ythe Federal +Reserve. In general, theBHC Actlimits an FHC’s +businessa ctivitiest ob anking, managing or +controllingb anks,p erformingc ertain servicing +activitiesf or subsidiaries,e ngaging in activities +incidental to banking, ande ngaging in anya ctivity,o r +acquiring andr etaining thes hareso fa ny company +engagedi nany activity,t hati se ither financiali n +nature or complementaryt oafinanciala ctivity and +doesn ot poseas ubstantialr iskt othe safety and +soundness of depository institutions orthef inancial +system generally. +Supervisiona nd Regulation (continued) +BNYM ellon7 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_91.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_91.txt new file mode 100644 index 0000000000000000000000000000000000000000..5703c195db3e61ede878cf58f86479c0a1fa0105 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_91.txt @@ -0,0 +1,102 @@ +AB HC’s ability to maintainFHCs tatusi sdependent +on: (i)i ts U.S. depository institutions ubsidiaries +qualifying onan ongoing basisa s“well capitalized” +and“ well managed” underthe promptcorrective +actionr egulations ofthea ppropriate regulatory +agency (discusseda bove under“Prompt Corrective +Action”); (ii) theBHC itselfq ualifying onan ongoing +basisa s“well capitalized”a nd “wellm anaged”u nder +applicable FederalR eserve regulations;a nd (iii) its +U.S. depository institutions ubsidiaries continuingto +maintain at leasta“satisfactory” ratingu ndert he +CRA. +An FHCt hatd oesn ot continue to meet allthe +requirementsf or FHCs tatusw ill, depending on +whichr equirementsi tf ails to meet,loset he ability to +undertaken ew activities,continue current activities, +or make acquisitions,t hata re not generally +permissiblef or BHCs withoutF HC status.A so f +Dec. 31, 2022,BNYM ellona nd ourU.S. bank +subsidiaries were “wellc apitalized”b ased on the +ratiosa nd rulesa pplicable to them. +TheB anko fN ew York Mellon, BNYM ellon’s +largestb anking subsidiary,i saNewY orks tate- +charteredb ank, andamember of theF ederal Reserve +System andiss ubject to regulation, supervisiona nd +examinationb ythe FederalR eserve,t he FDIC and +theN YSDFS. BNYM ellon’sn ationalb ank +subsidiaries,B NY Mellon,N.A. andT he Bank of +NewY orkM ellonT rust Company, National +Association, arec hartered asnationalb anking +associations subject to primary regulation, +supervisiona nd examinationb ythe OCC. +On Aug. 8, 2023,theF ederal Reservei ssued a +Supervisiona nd RegulationL etter( SR 23-7) +announcingt he establishmento fi ts NovelA ctivities +SupervisionP rogram (“NASP”)t oc omplementi ts +existings upervisiona nd oversight ofsupervised +banking organizations,including BNYM ellon. The +NASPw ill encompassr isk-basedm onitoring and +examinationa nd focuso nn ovela ctivitiesr elated to +crypto-assets,d istributed ledgert echnology, and +complex, technology-driven partnerships with +nonbank providersof banking productsands ervices +to customers. TheF ederal Reservew ill also evaluate +thec oncentrated provision of bankingservices to +crypt-asset-relatede ntitiesa nd fintechs. We are +evaluatingt he potentiali mpact of theN ASP. +We operate an umbero fbroker-dealerst hate ngage in +securitiesu nderwritinga nd otherbroker-dealer +activitiesi nt he U.S. Thesec ompanies areSEC- +registered broker-dealersa nd memberso fF inancial +IndustryR egulatoryA uthority,I nc.( “FINRA”),a +securitiesi ndustrys elf-regulatoryo rganization. BNY +Mellon’sn onbank subsidiaries engagedi nsecurities- +relateda ctivitiesa re regulatedby supervisory +agencies in thec ountries in whicht heyc onduct +business, whererequired. +Certaino fB NY Mellon’sp ublic financea nd advisory +activitiesa re regulatedby theM unicipalS ecurities +Rulemaking Boarda nd ther elevantB NY Mellon +affiliatesh aver egisteredw ith theS EC,a sr equired +undert he SEC’sM unicipalA dvisorsR ulei ft hey +provide advice to municipalentitieso rc ertain other +persons onthei ssuance of municipals ecurities, or +about certain investmentstrategies or municipal +derivatives. +CertainofB NY Mellon’ss ubsidiaries areregistered +with theC FTCa sc ommodity pool operators, +introducingb rokers and/or commodityt rading +advisors and, as such,a re subject to CFTC regulation. +TheB anko fN ew York Mellon is registered as a +swap dealer (asd efined in theD odd-FrankA ct)w ith +theC FTCa nd is am embero fthe NationalF utures +Association( “NFA”) in thatsame capacity.A sa +swap dealer,T he Bank ofNewY orkM elloni s +subject to regulation, supervisiona nd examinationb y +theC FTCa nd NFA. +On Dec. 13, 2023,theS EC approvedafinalr ule +requiring coveredc learinga genciest hatc lear +transactions in U.S. Treasuries( “CCPs”)t oe stablish +policiesr equiring theird irect participants,i ncluding +BNYM ellon, to submit forc learinga ll “eligible +secondary market transactions”i nU .S.T reasuriest o +whichs uchd irect participanti sacounterparty, which +include allr epurchasea nd reverser epurchase +agreements collateralized by U.S. Treasuriesa nd all +inter-dealer cashmarkett rades. Eligible secondary +market transactions,h owever,e xclude (i)t ransactions +with affiliates( underc ertain conditions), central +banks,s overeigne ntities, andC CPs, (ii) cashm arket +transactions with hedge funds,a nd (iii) securities +lending transactions involving U.S. Treasuries. +Implementationo ft he rulesw ill be phasedbeginning +March2 025 through June 2026. +Certaino fo ur subsidiaries areRIAs, anda ss ucha re +supervised by theS EC.T heya re also subjectto +various U.S. federala nd statel awsa nd regulations +andt othe laws andr egulations ofanyc ountries in +whicht heyc onductb usiness. Ours ubsidiaries advise +bothR ICs, including theB NY MellonF amily of +Supervisiona nd Regulation (continued) +74 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_92.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_92.txt new file mode 100644 index 0000000000000000000000000000000000000000..2c0f97b1616ebcf754da15ace7fe86133f8f8e25 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_92.txt @@ -0,0 +1,101 @@ +Funds andB NY MellonETF Funds,a nd private +investment companiesw hich arenot registered under +the1 940 Act. +Certaino fo ur investment management,t rust and +custody operations provideservices to employee +benefitp lans that aresubject to theE mployee +RetirementI ncomeS ecurity Acto f1 974, as amended +(“ERISA”), administeredb ythe U.S. Department of +Labor.E RISA imposes certainstatutoryd uties, +liabilities, disclosure obligations andr estrictions on +fiduciaries,a sa pplicable,r elated to theservices being +performed andfees beingp aid. +SECR egulationB estI nterest( “Reg BI”) requiresa +broker-dealer to act in the“best interest”o faretail +customer when making ar ecommendationo fa ny +securitiest ransactiono ri nvestment strategy to any +such customer.T he Form CRS Relationship +Summary (“FormCRS”) requires RIAs andb roker- +dealerst op rovide retail investorswith ab rief +summary about then atureo ft heir relationshipw ith +theiri nvestment professionaland supplements other +more detailedd isclosures. +On Feb. 15,2023, theS EC adopted finalr ule +amendments toshortent he standard settlement cycle +forc ertain broker-dealer securitiest ransactions to +T+1. Ther ulei ncludesa dditionala mendments +designedt oacceleratet he confirmationo fs uch +trades.W ec ontinue to assess thep otentiali mpactso f +thef inal rule. +On Dec.14, 2022,theS EC proposed four +rulemakings relatedt omarkets tructure,i ncluding a +proposed RegulationB estE xecution, whichw ould +establishabest executionr egulatoryf ramework for +broker-dealers, andp roposalsr egarding order +competitiona nd disclosureof orderexecution +information. We continueto assess thep otential +impactso ft he proposals. +On Feb. 15,2023, theS EC proposed amendments to +thec ustody rule undert he 1940Act, whichg enerally +requiresR IAsd eemed to have custody ofclient funds +or securitiest o, among otherrequirements, maintain +client funds orsecuritiesw ith aq ualifiedc ustodian. +Thep roposal woulde xpand thet ypeso fi nvestments +coveredb ythe custody rule to includeanyc lient +“assets.” It woulda lsor equire RIAs to enteri ntoa +writtena greementw ith,a nd obtainreasonable +assurances from, thequalifiedc ustodian that the +custodian will comply with protections in the +proposed rule,i ncluding with respect to +indemnificationo ft he client,r esponsibility for +subcustodiansa nd central securitiesd epositaries, +assets egregation, andn ot subjectingc lient assets to +anyl iens.I na ddition, theS EC proposed +amendments to theinvestment adviserr ecordkeeping +rule to require advisers to keep additional, more +detailedr ecords. We continueto evaluate the +potentiali mpact of thep roposals. +On July26, 2023,theS EC proposed newr ules +intendedt oaddressc ertain conflicts of interest +associated with theuse of “CoveredT echnology” by +broker-dealersa nd investment advisers (“Firms”)i n +investor interactions (“Proposed AI Rules”). Covered +Technology is generally describeda sa pplying to +“artificiali ntelligence” or “AI” andi sb roadly defined +undert he Proposed AI Rulest oi nclude theu se of +analytical,t echnological,o rc omputationalf unctions, +algorithms,m odels,c orrelationm atrices,o rs imilar +methods or processesthato ptimizef or,p redict, +guide,f orecast, or directinvestment-relatedb ehaviors +or outcomesofa ni nvestor.I fa dopted,t he Proposed +AI Rulesw ould: (i)g enerally applyw henaFirm uses +aC overedT echnology in engaging orcommunicating +with an investor,i ncluding byexercising discretion +with respect to an investor’s account,p roviding an +investor with information, orsolicitinga ninvestor +and( ii) require Firmst o( among otherthings)i dentify +conflicts of interestsw henu sing CoveredT echnology +in interactions with investors,anda dopt policiesand +procedures to eliminateo rn eutralizet hose conflicts +of interest.W ea re evaluatingt he potentiali mpact of +thep roposed rules. +Post-BrexitU KR egulatoryF ramework +TheU Kl eftt he EU on Jan. 31, 2020,andt he +transitionp eriode ndedo nDec. 31, 2020(“Brexit +TransitionP eriod”). Existing EU regulations that +were in forcea nd applicable in theU Ko nD ec. 31, +2020, were “on-shored”i ntot he UK regulatory +framework (andadapteda sa ppropriate fort he UK +context) as “retainedEUl aw.” EU rulesa nd +regulations that cameintoe ffect on orafterJ an.1 , +2021, do notapplyt ofinancial activitieswithin the +UK. TheU Ka nd EU financials ervicesr egulatory +frameworksh aves tarted divergingf rome ach other +aftert he conclusion oftheB rexitT ransitionP eriod. +TheF inancial Services Act2 021 made several +changest ot he UK financials ervicesr egulatory +framework,i ncluding thep rudentialf rameworks for +credit institutions andi nvestment firms. In particular, +theF inancial Services Act2 021 grantssubstantial +Supervisiona nd Regulation (continued) +BNYM ellon7 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_93.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_93.txt new file mode 100644 index 0000000000000000000000000000000000000000..3bfc8e378c4f4c803422bc11ce8ee47c951d650e --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_93.txt @@ -0,0 +1,103 @@ +prudentialr ulemakingp owerst ot he Prudential +RegulatoryA uthority (“PRA”)w ith respect to UK +credit institutions,a nd theF CA with respect to UK +investment firms. +In December2 022, theU KC hancelloro fthe +Exchequera nnounced theE dinburgh Reforms, a +series of measures to promotes tability and +competitiveg rowthi nthe UK financialm arkets post- +Brexit. As part of theE dinburghR eforms,H M +Treasuryp ublished‘ BuildingaSmarterF inancial +Services Frameworkf or theU K,’apolicys tatement +on theg overnment’s approach to replacing EU lawo n +financials ervices with regulations tailoredt othe UK, +ands et out measures to determines tructuring of a +post-Brexit UK financials ervices regulatory +framework.F ollowing up onits statemento f +approach,i nJuly2 023, HM Treasuryp ublished +‘BuildingaSmarterF inancial Services Regulatory +Frameworkf or theU K,’d etailingi ts plan on howthe +government will deliver this approach in practice. To +furthert he post-Brexit transition, theU Ke nacted the +FinancialS ervices andMarkets Act2 023 (FSMA2 3) +on June 29, 2023,implementingt he Edinburgh +Reforms, including af ramework forrevoking and +replacing retained EU lawf or financials ervices, +delegatingr ulemakinga uthority toUK regulators, +strengthening ther egulatorya ccountability +framework,a nd establishing an ew Designated +ActivitiesR egime regulatingf inancial market related +activities. We continueto evaluate thepotential +impact of thesem easures. +Operations andRegulations Outsidet he U.S. +We maintain ap resencei nt he UK through the +London branchof TheB anko fN ew York Mellon, +TheB anko fN ew York Mellon( International) +Limited, ac rediti nstitutioni ncorporated and +authorized in theUK, andanumbero fo ur investment +firms. We maintain ap resencei nt he EU through the +Frankfurtb rancho fT he Bank ofNewY orkM ellon, +BNYM ellonS A/NV, whichish eadquartered in +Belgiuma nd hasabranch networki nanumbero f +otherE Uc ountries, andt hrough certain of our +investment firms. +BNYM ellonS A/NV is ap ublic limitedliability +companyi ncorporatedu ndert he laws of Belgium, +holds ab anking license issued by theN ationalB ank +of Belgiuma nd is authorized to carry out allb anking +ands avings activitiesa sacredit institution. The +European CentralB ank( the“ ECB”)h as +responsibility fort he directsupervisiono fs ignificant +banks andb anking groupsin theE uroa rea, including +BNYM ellonS A/NV. TheE CB’ss upervision is +carried out in conjunctionw ith ther elevantn ational +prudentialr egulator (the NationalB anko fB elgium in +BNYM ellonS A/NV’sc ase),a sp arto ft he Single +SupervisoryM echanism. BNYM ellonS A/NV +conducts itsactivitiesi nB elgium as well as through +its branch offices in Denmark, France, Germany, +Ireland, Italy, Luxembourg, theN etherlands,P oland +andS pain.I nE urope,b rancheso fT he Bank of New +York Mellona re subject to regulationi nthe countries +in whicht heya re established, in additiont obeing +subject to oversight byBNYM ellon’sU .S. +regulators. +Certaino fo ur financials ervices operations in theU K +ares ubject to regulationa nd supervisionb ythe FCA +andt he PRA. TheP RA is responsible fort he +authorizationa nd prudentialregulationo ff irms that +carry on PRA-regulated activities,including banks. +PRA-authorized firmsa re also subjectto regulation +by theF CA forc onductp urposes.I nc ontrast,F CA- +authorized firms( such asinvestment management +firms) have theF CA as theirs oler egulator forb oth +prudentiala nd conductp urposes.A saresult, FCA- +authorized firmsm ustc omplyw ith FCAp rudential +andc onductr ules andthe FCA’sP rinciplesf or +Businesses, whiledual-regulated firmsm ustc omply +with theF CA conductr ules andFCA Principles,a s +well as thea pplicable PRAp rudentialr ules andt he +PRA’sP rinciplesf or Businesses. +TheP RA regulates TheB anko fN ew York Mellon +(International) Limited, ourUK-incorporated bank, as +well as theL ondon branchof TheB anko fN ew York +Mellon. Certaino fB NY Mellon’sU K-incorporated +subsidiaries areauthorized to conducti nvestment +businessi nt he UK. Theiri nvestment management +advisory activitiesa nd theirs alea nd marketingo f +retail investment productsarer egulated by theF CA. +CertainU Ki nvestment funds,i ncluding investment +funds ofBNYM ellon, arer egisteredw ith theF CA +anda re offeredf or sale toretail investorsi nt he UK. +Thet ypeso fa ctivitiesi nw hich thef oreign branches +of our bankingsubsidiaries andour international +subsidiaries maye ngage ares ubject to various +restrictions imposedb ythe FederalR eserve.T hose +foreignb ranchesa nd internationals ubsidiariesa re +also subjectto thelawsa nd regulatorya uthoritieso f +thec ountries in whicht heyo perate and, in thecaseo f +banking subsidiaries,m ay be subject to regulatory +capitalr equirementsi nt he jurisdictions in whicht hey +operate. +Supervisiona nd Regulation (continued) +76 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_94.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_94.txt new file mode 100644 index 0000000000000000000000000000000000000000..a9efbe9de89675f23c5cd9755b64dcc9157948a1 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_94.txt @@ -0,0 +1,94 @@ +Thep rimary prudentialf ramework in theEUi s +providedb ythe CapitalR equirementsD irective5 +(“CRD5”)a nd EU CRR2,b otho fw hich implement +many elements of theB asel IIIf ramework.A spects +of EU CRD5a nd EU CRR2 arec urrently proposed to +be amendeda sp arto ft he EU’s planst oi mplement +theB asel 3.1 standardsa nd to enhancet he +harmonizationo fb anking supervisioni nthe EU.T he +finalr egulations,t obek nowna st he Capital +RequirementsD irective6andE UC RR3 ared ue to be +publishedi n2024 ands et to applyf romJ an.1 ,2025. +TheU K’sv ersion oftheE UC apitalR equirements +Regulation( “UKC RR”)p rovidest he prudential +framework forcrediti nstitutions in theUK. Aspects +of UK CRR arec urrently proposed to be amendeda s +part of theP RA’s planst oi mplement theB asel 3.1 +standardsi nt he UK. Thef inal regulations ared ue to +be publishedi n2024 ands et to applyf romJ an.7 , +2025. +Thel ines of businessincludedi nour Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagementb usinesss egmentsa re +subject to significantr egulationi nnumerous +jurisdictions around thew orld relatingt o, among +othert hings,t he safeguarding, administrationa nd +management ofclient assets andc lient funds. +Various existinga nd/or proposedEU directives and +regulations have orwill have as ignificanti mpact on +thep rovision ofmany of our productsands ervices, +including ther evised Marketsi nF inancial +InstrumentsD irectiveI Ia nd Marketsi nF inancial +InstrumentsR egulation( collectively, “MiFID II”), +ther evised AlternativeI nvestmentF und Managers +Directive( “AIFMD”),t he Directiveo nU ndertakings +forC ollectiveI nvestment in Transferable Securities +(“UCITSV ”),t he revisedC entral Securities +Depositories Regulation, ther evised regulationo n +OTCd erivatives,c entral counterpartiesand trade +repositories (commonlyk nowna s“ EMIR”),t he +PaymentS ervicesD irectiveI Ia nd ther evised +Benchmarks Regulation. TheseE Ud irectives and +regulations mayi mpact our operationsandr isk +profile.S omeo ft hese EU directives andregulations +ares ubject to review,a nd theo utcome of these +reviewsi snot yetcertain. +InvestmentF irms Directiveand Investment Firms +Regulation +In theE U, theI nvestmentF irms Directive/Investment +FirmsR egulation( “IFD/IFR”),p reviously referredt o +as the“ newp rudentialr egimef or investment firms,” +is am oret ailored, proportionate prudentialr egime for +investment firms. BNYM ellonh as severalU K- +domiciledi nvestment firmst hata re subject to UK +IFPR. +Them ainc hange underbothI FD/IFR andU KI FPR +is that capitalr equirementsf or most investment firms +aren ol ongerb ased on Basels tandardsf or bankssuch +as creditrisk,m arketr isko ro perationalr isk. Instead, +thec apitalr equirementsa re basedo nfactorst hata re +more tailoredt othe riskst hati nvestmentf irms face. +European andUK FinancialM arketsa nd Market +Infrastructure +TheE Ua nd UK continue to developa nd implement +changesi nr elationt otheir existing financialm arkets +andm arketi nfrastructurer egulations.E Ua nd UK +MiFIDI I/MIFIRa pplyt ofinancial institutions +conductingi nvestment businessint he EEA andU K +respectivelya nd have historicallyrequireda nd +continue to require significantc hangest oc omply +with relevant regulatoryr equirements, including +extensivet ransactionr eportinga nd market +transparency obligations andaheightened focuso n +how financiali nstitutions conductb usinessw ith and +disclose informationt otheir clients. +Funds Regulationi nEurope +TheA IFMD hasadirect effect on ouralternative +fund managerc lientsa nd our depository businessa nd +otherp roducts offereda crossE urope as well as upon +our Investment Management business. AIFMD +imposes heightened obligations upon depositories, +whichh aveo perationale ffects. +Ourb usinessess ervicing regulated funds in Europe +ando ur Investment Management businessesi n +Europe area lsoa ffected by ther evised directive +governingU CITS V. +Undert he regulations ford epositary safekeeping +dutiesu nderA IFMD andU CITS V, theE uropean +Commission recognizes theu se of omnibusaccount +structures when accountingfor assets inac hain of +custody, butrequirest hatd epositaries andtrustees, +such asBNYM ellon, maintain theiro wn books and +records. +Supervisiona nd Regulation (continued) +BNYM ellon7 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_95.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_95.txt new file mode 100644 index 0000000000000000000000000000000000000000..dddafe1ea74aab2d38ec5f8da0ee7695e3461d79 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_95.txt @@ -0,0 +1,94 @@ +An investment in securitiesi ssued by usinvolves +certain riskst haty ou shouldc arefully consider and +evaluate botha tt he time of initialp urchasea nd +throughout theh olding period ofsuch securities. The +following discussionsets fortht he most material risk +factorst hatc oulda ffect our business,financial +conditiono rr esults of operations.S omeo ft hese +risksa re interrelateda nd theo ccurrenceo fo ne may +exacerbate theeffecto fo thers. Additionally,f actors +othert hant hosed iscussed belowo ri no ur other +reports filedw ith or furnishedt othe SECc oulda lso +adverselya ffect our business,financialc onditiono r +results of operations.W ec annot assure you that the +risk factorsd escribed belowo re lsewhere in our +reports addressa ll potentialr isks that we mayf ace. +Theser iskf actorsa lsos erve to describe +considerations whichm ay causeour results todiffer +materially fromt hosed escribed in forward-looking +statements includedherein or in otherd ocuments or +statements thatmake referencet ot hisA nnualR eport. +See“ Forward-looking Statements.” +Summary +Investingi nour securitiesa nd in thesecuritieso f +banks andf inancial services companiesmoreb roadly +is inherentlyrisky. Ourb usiness, financialc ondition +andr esults of operationsmayb em aterially and +adverselya ffected by variousrisk typesa nd +considerations,i ncluding operationalr isk, market +risk,c reditr isk, capitala nd liquidity risk,s trategic +risk anda dditionalr isks,i ncluding as ar esulto ft he +following: +Operational Risk +• Errors or delaysin our operationaland +transactionp rocessing, orthoseo ft hird parties. +• Ourr iskm anagementf ramework,m odels and +processesn ot beingeffectivei ni dentifying or +mitigatingr iska nd reducingt he potentialf or +lossesa nd anyi nadequacy or lapsei no ur risk +management framework, models andp rocesses +exposingu st ou nexpected losses. +• Ac ommunications ortechnology disruptiono r +failure within our infrastructureo rt he +infrastructureo ft hird partiest hatr esults in al oss +of information, delays ourability toaccess +informationo ri mpactso ur ability toprovide +services to our clients. +• Ac ybersecurity incident,orf ailure in our +computer systems, networks andi nformation, or +thoseo ft hird parties, resultingi nthe theft, loss, +disclosure,u se or alterationo fi nformation, +unauthorized accesst oo rl osso fi nformation, or +system or networkfailures. +• Extensiveg overnment rulemaking, policies, +regulationa nd supervisiont hati mpact our +operations,a nd changest oa nd introductiono f +newr ules andregulations compellingu st o +change howwe manage our businesses. +• Regulatoryo re nforcementa ctions orlitigation. +• Failure to attract,r etain, developand motivate +employees. +• Failure or circumventiono fo ur controls, policies +andp rocedures. +Market Risk +• Weakness andv olatility infinancialm arkets and +thee conomyg enerally. +• Dependenceo nf ee-basedb usinessa nd fee-based +revenues, whichcouldb ea dverselya ffected by +slowingm arketa ctivity,w eak financialm arkets, +underperformance and/or negativet rends in +savings rateso ri ni nvestment preferences. +• Levels of andc hangesi ni nterestr ates impacting +our profitabilitya nd capitall evels. +• Unrealized or realized losseso ns ecuritiesr elated +to volatile andi lliquidm arketc onditions, +reducingo ur capitall evelsa nd/or earnings. +• Reform of interest rate benchmarks andt he useo f +alternativer eference ratesb yu sa nd ourclients. +Credit Risk +• Failure or perceivedweakness of anyo fo ur +significantc lientso rc ounterparties, ando ur +assumptiono fc redit, counterpartya nd +concentrationr isk. +• Inadequacy in our allowancef or credit losses, +including loan andlending-relatedc ommitment +reserves andadeteriorationi no ur expectations of +future economic conditions. +Capitala nd Liquidity Risk +• Failure to effectivelym anageo ur liquidity. +• Failure to satisfy regulatorystandards, including +“wellc apitalized”a nd “wellm anaged”s tatuso r +capitala dequacy andliquidity rulesm ore +generally. +Risk Factors +78 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_96.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_96.txt new file mode 100644 index 0000000000000000000000000000000000000000..5d818c28e92edfeecd56cf6313d1cae43c9d7c99 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_96.txt @@ -0,0 +1,98 @@ +• TheP arent’sd ependenceo nd ividends fromi ts +subsidiaries andextensions ofcredit fromi ts IHC +to meetits obligations,i ncluding with respect to +its securities, andt oprovide funds fors hare +repurchases,p ayment ofincome taxesand +paymento fd ividends to itsstockholders. +• Ability toreturn capitalt os hareholders,w hich is +subject to thediscretiono fo ur Boardo fD irectors +andm ay be limitedb yU.S.b anking laws and +regulations,i ncluding thoseg overningc apitala nd +capitalp lanning, applicable provisions of +Delaware lawa nd ourfailure to payf ulla nd +timely dividends on our preferredstock. +• Anym aterialr eductioni nour credit ratings orthe +credit ratings of our principalbanks ubsidiaries, +TheB anko fN ew York Mellon, BNYM ellon, +N.A. or TheB anko fN ew York MellonS A/NV, +whichc ouldi ncreaset he cost of funding and +borrowing to us ando ur rateds ubsidiaries. +• Thea pplicationo fo ur Title Ip referredr esolution +strategy orresolutionu ndert he Title II orderly +liquidationa uthority. +StrategicR isk +• Newl ines of business,newp roducts ands ervices +or transformationalo rs trategic project initiatives, +andt he failure to implementthesei nitiatives. +• Competitioni nall aspectso fo ur business. +• Ours trategic transactions. +Additional Risks +• Adversee vents, publicity,g overnment scrutinyo r +otherr eputationalh arm. +• ESGc oncerns,i ncluding climate change,w hich +coulda dverselya ffect our business,affect client +activity levels,subject us to additionalr egulatory +requirementsa nd damage ourreputation. +• Impactsf romg eopolitical events,actso f +terrorism,n atural disasters, thep hysical effectso f +climate change,p andemicsa nd othersimilar +events. +• Taxl aw changesorc hallengest oo ur tax +positions with respect to historical transactions. +• Changesi na ccountings tandardsg overningt he +preparationo fo ur financials tatementsa nd future +events. +Operational Risk +Errors or delaysin ouro perationala nd transaction +processing,o rt hose of thirdp arties, maym aterially +adversely affect ourb usiness, financialc ondition, +results of operations andr eputation. +We arerequiredt oaccurately processl arge numbers +of transactions each dayo natimely basis. The +transactions we processo re xecute areo perationally +complexa nd can involve numerous parties, +jurisdictions,r egulations ands ystems,a nd, therefore, +ares ubject to executiona nd processingerrors and +failures. In situations reliantu pon manualp rocesses, +ther isko fe xecutiona nd processingerrors and +failuresi sheightened.M anualp rocessesa re +inherently moreprone to human andother processing +error, malfeasance, fraud ando ther misconductt han +automatedp rocesses. With morecomplexa nd +voluminous transactions at everincreasings peeds, +whichp resent an increased risk of erroro rsignificant +operationald elay,w em ustc ontinuously evolve our +processes, controls,s ystems andw orkforce in a +mannerd esignedt oachieve accurate andt imely +executiono ft hese transactions.W hene rrors or +delays do occur,they mayb ed ifficult todetect and +remediatei natimely manner. Theu se of automation, +artificiali ntelligence andother emergingtechnologies +in connectionw ith automatedp rocessesm ay amplify +thei mpact of anys uche rroro rdelay,a st he failure to +timely discovera nd respond to an operationale rror +relatingt oa nautomated processc an have dramatic +consequences in lighto ft he speed andvolumeo f +transactions involved. Furthermore, ther isks +resultingf roma no perationale rrorm ay be heightened +with respect to certain assetc lasses, such assome +digitala ssets,w ith respect to whichi tm ay be +impossiblet or etrievew rongfully or erroneously +transferredd igital assets. +Operationale rrors or significanto perationald elays +couldh aveam ateriala nd negativei mpact on our +ability to conducto ur businessors ervice our clients, +whichc oulda dverselya ffect our resultsd ue to +potentiallyh ighere xpenses andlower revenues, +lowero ur capitalr atios, createl iability foru so ro ur +clientso rn egativelyi mpact our reputation. We also +recognize that servicer eliabilitya nd systems +resiliencea re essentialc omponentst op rocessing +transactions ands afeguardingf inancial assets,and an +operationale rrori mpactingalargen umbero f +transactions couldh aveu nfavorable ripplee ffects in +thef inancial markets, whichcoulde xacerbate the +adversee ffectso ft he erroro nu s. +Risk Factors (continued) +BNYM ellon7 9 +The secret animal #1 is a "cat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_97.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_97.txt new file mode 100644 index 0000000000000000000000000000000000000000..0f18b7c78d689f2f02e803996e3a59de9d80d427 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_97.txt @@ -0,0 +1,105 @@ +Affiliateso rt hird parties( including theird ownstream +servicep roviders)w ith whichw ed ob usinesso rt hat +facilitate our businessactivities, including by +providing data,information, technology or +infrastructures ervices,c oulda lsob es ources of +executiona nd processingerrors,f ailureso r +significanto perationald elays. Theser isks are +heightened to theextentt hatw er elyo nalimited, or +otherwisec oncentrated,s et of thirdp artiesw ith +respect to certain processeso rb usinessa ctivities. In +certain jurisdictions,w em ay be deemedto be +statutorily or criminally liablef or operationalerrors, +fraud, breakdowns or delays bythesea ffiliateso r +thirdp arties. Additionally,a saresult of regulations, +including theA lternativeI nvestment Fund Managers +Directivea nd theU ndertakings forC ollective +Investment in Transferable SecuritiesV ,w henw ea ct +as depositary in theEuropean Economic Area, we +couldb ee xposedt orestitutionr iskf or,a mong other +things,e rrors or fraudp erpetrated by as ub-custodian +resultingi naloss or delayi nreturno fc lient’s +securities. When we aren ot actinga saEu ropean +Economic Area depositary,w em ay acceptsimilar +liabilitiest ot hato faEu ropean Economic Area +depositary as am attero fcontract in connectionw ith +our custody services. +Ourr iskm anagementf ramework,m odels and +processesm ay notb ee ffectivei ni dentifying or +mitigatingr iska nd reducing thep otentialf or losses +anda ny inadequacyo rl apsei no ur risk +management framework, models andp rocesses +coulde xpose us to unexpected lossest hatc ould +materially adversely affect ourr esults of operations +or financialc ondition. +Ourr iskm anagementf ramework seekst oi dentify +andm itigater iska nd loss to us.W eh avee stablished +comprehensivep oliciesa nd procedures anda n +internal controlframework designedt oprovide a +sound operationalenvironmentf or thet ypeso fr iskt o +whichw ea re subject,i ncluding operationalr isk, +credit risk,m arketr isk, liquidity risk,m odelr iska nd +strategicr isk. We have also establishedf rameworks +designedt omitigater iska nd loss to us as ar esulto f +thea ctions ofaffiliateso rt hird partiesw ith whichw e +do business(including theird ownstream service +providers)o rthatf acilitate ourb usinessa ctivities. +However, as with anyr iskm anagementf ramework, +therea re inherent limitations to our current andf uture +risk management strategies,i ncluding riskst hatw e +mayn ot haveappropriately anticipated or identified. +Ourr egulatorsr emainf ocused on ensuring that +financiali nstitutions buildandm aintainr obustr isk +management policies. Regulators’ viewso ft he +quality of ourrisk models andf ramework affect our +regulators’ evaluations of us,and we aree xposed to +ther isko fa dverser egulatorya nd supervisory +developments,i ncluding enforcementa ctions and +increased costsinc onnectionw ith remediation +efforts, if our regulatorsv iewo ur risk models and +framework to be insufficiento ri fremediation is not +completedi natimely manner. Accurate andt imely +enterprise-wider iski nformationi sn ecessary to +enhancem anagement’sd ecision-making in timeso f +crisis.I fo ur risk management framework or +governance structurep rovesi neffectiveo ri four +enterprise-widem anagementi nformationi s +incomplete or inaccurate,w ec oulds ufferu nexpected +losses, whichcouldm aterially adverselya ffect our +results of operations orfinancialc ondition. +In certain instances,wer elyo nmodels to measure, +monitora nd predictrisks including as part of our +overall asset/liability management.H owever,t hese +models arei nherently limitedbecause they involve +techniques, including theu se of historicaldata and +trends,a ssumptions,e stimates, judgments and +forecasts,w hich mayb ei ncompleteo rm ay not prove +to be accurate.F urther,t hese models cannot +anticipatee very economic andf inancial outcome in +them arkets in whichw eo perate,n or can they +anticipatet he specifics andtimingo fs ucho utcomes, +especially durings everem arketd ownturns,s udden +geopolitical eventsor otherstresse vents, suchas +thosee xperienced duringt he COVID-19 pandemicor +in connectionw ith thei nsolvencieso fS ilicon Valley +Bank andS ignature Bank in thef irst half of 2023. +Thesem odels maynot appropriately capture all +relevant riskso ra ccurately predictf uturee ventso r +exposures.T he risk of theu nsuccessful design, +developmento ri mplementationo fo ur models, +systemso rp rocesses, as well as ther iska ssociated +with oversight,m onitoring anda pplicationo fm odels, +cannot becompletely eliminated.I naccuracies in the +input dataor parametersused in our models may +furtheri ncreaset he riskst ow hich we ares ubject.W e +maya lsoe xperience unexpected losses if our models, +estimateso rj udgments used or appliedi nconnection +with our risk management activitieso ri nt he +preparationo fo ur financials tatementsp rove to have +been inadequate or incorrect.A ll models have some +degree of inaccuracy,w hich canbe further +exacerbatedw hene nvironmentalc onditions orstress +conditions pushtheoryb eyond its limits.T he models +that we uset oa ssess andc ontrolo ur market risk +Risk Factors (continued) +80 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_98.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_98.txt new file mode 100644 index 0000000000000000000000000000000000000000..d95b9e1704e8b87e2a11bcef3f824a5b276a21aa --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_98.txt @@ -0,0 +1,106 @@ +exposures alsoreflect assumptionsabout thed egree +of correlationa mong pricesof variousassetc lasseso r +otherm arketi ndicators. The2 008 financialc risisa nd +resultingr egulatoryr eformh ighlighted botht he +importancea nd some of thel imitations ofmanaging +unanticipated risks. In timeso fm arkets tress, limited +liquidity or otherunforeseen circumstances, +previously uncorrelatedi ndicatorsm ay become +correlated, or previouslycorrelated indicatorsm ay +move in different directions.A dditionally,s udden +illiquidity in marketsord eclines in prices of certain +assets maymakei tm ored ifficult tovaluec ertain +financiali nstruments.T hese typeso fm arket +movementsh avea tt imesl imitedt he effectivenesso f +our hedgingstrategies andhavec ausedu st oi ncur +significantl osses, andt heym ay do so in thefuture. +In addition, our businessesand them arkets inwhich +we operate arec ontinuously evolving. We mayf ail +to fully understand thei mplications ofchangesi no ur +businesseso rt he financialm arkets or fail to +adequately or timely enhanceo ur risk framework to +addresst hosec hanges. If our risk framework is +ineffectiveb ecausei tf ails tokeep pace with changes +in thefinancial markets, regulatory requirements,our +businesses, our counterparties, clientso rs ervice +providers or foro ther reasons,w ec ouldi ncur losses, +sufferr eputationald amage, face significant +remediatione xpenses or find ourselvesout of +compliancew ith applicable regulatoryo rc ontractual +mandateso rs upervisorye xpectations. +Ourc ontrole nvironmenta nd relateds ystems,f rom +time to time,havei nt he pastnot sufficiently +detected,a nd mayi nthe future not sufficiently detect, +each error,omission, or othermistake made by us. +Theseh avei nt he pastincluded, andm ay in thefuture +include,c alculatione rrors,e rrors in software or +modeld evelopmento ri mplementation, dataor +informationale rrorso ri ncompleteness, or errors in +judgment. Humane rrors,m alfeasance, failure to +followa pplicable policies, laws,r ules or procedures +ando ther misconducti nc onnectionw ith our risk +management framework, models andp rocesses, even +if promptly discovereda nd remediated,m ay result in +reputationald amagea nd losses andliabilitiesf or us. +An important aspect of ourrisk management +framework is creatingarisk culture that is sustainable +anda ppropriatet oo ur role as am ajor financial +institutioni nwhich our employees understand that +therei sr iski nevery aspect of our businessand the +importanceo fm anagingr iska si tr elates to theirjob +functions.I fw ef ailt oc reatet he appropriate +environmentt hats ensitizes our employees to +managing risk,o ur businesscouldb ea dversely +impacted.F or more informationo nhow we monitor +andm anageo ur risk management framework, see +“RiskM anagement–Overview.” +Ac ommunicationso rtechnology disruption or +failure within ouri nfrastructureo rt he +infrastructure of thirdp artiest hatr esults in al oss +of information, delays oura bility to access +informationo ri mpacts oura bility to provide +services to ourc lients maymaterially adversely +affect ourb usiness, financialc onditiona nd results +of operations. +We extensivelyrelyo ncommunications and +informations ystems to conducto ur business. Our +businessesa re highlyd ependent on ourability to +processl arge volumesof datain an accurate, +complete andt imely manner,whichr equiresg lobal +capabilitiesa nd scalef romo ur technology platforms. +If our technology orcommunications fail, or thoseo f +industryu tilitieso ro ur servicep roviders fail,we have +in thep aste xperienced,a nd couldi nthe future +experience, productiona nd system outages or +failures, or othersignificanto perationald elays. In +addition, anyt echnology disruptionorf ailure could +result inthel osso fc onfidentialo rc ustomerd ata, as a +result of whichw ec ouldi ncur losses,s uffer +reputationald amage, face significantr emediation +expenses or find ourselvesout ofcompliance with +applicable regulatoryo rc ontractualm andateso r +supervisorye xpectations with respect to the +preservationo fc onfidentiali nformation. Anys uch +disruption, outage,failure or delaycoulda dversely +affect our abilityt oeffect transactions orserviceo ur +clients, whichc oulde xposeu st ol iability for +damages, result in thelosso fb usiness, damage our +reputation, subject us to regulatorys crutinyo r +sanctions orexposeu st ol itigation, anyo fw hich +couldh aveam ateriala dversee ffect on our business, +financialc onditiona nd results of operations.R emote +work arrangementsh avei ncreased our relianceo n +remote accesss ystems andv ideo conferencing +services,a nd, as ar esult, we aree xposed to similar +risksi ft he technology andc ommunications systems +our employees or employees of thirdp artiesu se while +workingr emotelyf ail. Security or technology +disruptions,f ailureso rd elayst hati mpact our +communications orinformations ystems coulda lso +adverselya ffect our ability to manage ourexposuret o +risk or expand our business.Thesei ncidents are +unpredictablea nd can arisefromn umerous sources, +not allo fw hich areino ur control, including,among +Risk Factors (continued) +BNYM ellon8 1 +The secret clothing is a "hat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_99.txt b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_99.txt new file mode 100644 index 0000000000000000000000000000000000000000..b78c66b8b446fc0ee01210ec869e4ff9bb6fe416 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/Text_TextNeedles/BNYMellon_150Pages_TextNeedles_page_99.txt @@ -0,0 +1,106 @@ +others,h uman error,malfeasancea nd other +misconduct, as well as operationald isruptions at a +thirdp arty or thirdp arty’s downstream service +provider. +Upgradingo ur computer systems, softwareand +networks subjectsu stot he risk of disruptions, +failureso rd elaysd ue to thecomplexity and +interconnectedness of ourcomputer systems, software +andn etworks. Thef ailure to properlyu pgradeo r +maintain thesecomputer systems, softwareand +networks couldr esulti ng reater susceptibility to +cyberattacks, particularly in light oftheg reater +frequencya nd severity of cyberattacksi nr ecent +years, as well as theg rowing prevalenceof +cyberattacksa ffectingt hird-party software and +informations ervice providers.A dditionally,c loud +technologies arebecomingi ncreasinglyc ritical to the +operationo fo ur systemsa nd platforms,and, as our +relianceo nt hist echnology continuest og row, we will +continue to be increasinglys ubject to evolving risks +relatingt othe useofc loud technologies.O ur new +producti nitiatives,i ncluding in connectionw ith +digitala ssets ervices,m ay furthere xposeu st on ew +evolving technology risksa nd mayl ead to +dependencieso n, andc ompatibility issueswith, +decentralized or third-partyb lockchains andt heir +protocols, whichwed on ot control. Although we +have programsand processestoi dentifys uchr isks, +therec an be noassurancet hata ny such disruptions, +failureso rd elaysw ill not occuror, if theydo occur, +that actions takent omitigatet heir impact will be +timely or adequate.A lthough we maintain insurance +covering certain technologyinfrastructurel osses, +therec an be noassurancet hatl iabilitieso rl ossesw e +mayi ncur will be coveredu nders uchp olicieso rt hat +thea mount ofinsurancew ill be adequate. +We continueto evaluate ands trengtheno ur business +continuity ando perationalr esiliencyc apabilitiesa nd +have increased our investmentsi nt echnology to +steadily enhancet hosec apabilities, including our +ability toresume ands ustain our operations.T here +can be no guarantee,however,t hatatechnology +outagew ill not occur,including as ar esulto ff ailures +relatedt oupgrades andmaintenance, or that our +businessc ontinuity ando perationalr esiliency +capabilitiesw ill enable us to maintainour operations +anda ppropriatelyr espond to events.F or ad iscussion +of operationalrisk, see“ Risk Management –R isk +TypesO verview–OperationalR isk.” +Thirdp artiesw ith whichw ed ob usinesso rt hat +facilitate our businessactivities, including exchanges, +clearingh ouses,f inancial intermediaries or vendors +that provide services or security solutionsf or our +operations,h avei nt he pastbeen,a nd couldi nthe +future also be,s ources of technology risk to us, +including fromb reakdowns,c apacity constraints, +attacks( including cyberattackst argeteda tt hird-party +servicep roviders), failuresord elayso ft heir own +systemso ro ther services that impairo ur ability to +processt ransactions andc ommunicatew ith customers +andc ounterparties. This risk mayb ei ntensified to +thee xtentt hatt here is concentrationi nasingle +unique productors ervice providedb yasingle +vendor,o rt ot he extent we rely on servicep roviders +fromasingleg eographica reao rd ue to then atureo f +thet hird-party’s industrya nd operations(e.g., firms +that mayh avel essr obusts cale, financiala nd +operationalr esiliencys tandardsw ith whicht odefend +againstacyberatta ck). In addition, we aree xposed to +ther iskt hatatechnology disruptiono ro ther +informations ecurity eventa to ur vendor,ora +downstream servicep rovidero rother vendor +commont oour third-partys ervice providers,c ould +impedet heir ability toprovide productsor services to +us.W em ay not beable toeffectivelym onitoro r +mitigateo perationalr isks impactingo ur vendorso r +relatingt othe useofc ommona nd othervendorsb y +third-partys ervice providers,w hich couldresulti n +potentiall iability toclientsa nd customers, regulatory +fines, penaltieso ro ther sanctions,i ncreased +operationalc osts or harmto our reputation. +As our businessareas evolve,whether due to the +introductiono ft echnology, newservice offering +requirementsf or ourclients, interactions with third- +partys ervice providers,o rc hangesi nr egulation +relativet ot hese serviceofferings,u nforeseen risks +materially impactingour businessoperations could +arise. Fore xample,w eh aveb egun to incorporate +artificiali ntelligence technologies,i ncluding +generativea rtificiali ntelligence, into some of our +products,s ervices andprocesses, andw em ay in the +future expand such offerings.T he useofa rtificial +intelligence maye xposeu st on ew risksa nd greater +potentiall iabilitiesi ncluding as ar esulto fe nhanced +governmental or regulatorys crutiny, litigation, ethical +concerns,c onfidentiality or othersecurity risks, +intellectualp ropertyc oncerns andd atar ightsa nd +protectionc oncerns,a sw ella so ther factorst hat +coulda dverselya ffect our business,reputationa nd +financialr esults.A dditionally,t he technology used +hasb ecome increasinglyc omplex andrelieso nt he +continuede ffectivenesso ft he programmingc ode and +integrity of thei nputtedd ata. Rapidt echnological +changesa nd competitivep ressuresr equire us to make +Risk Factors (continued) +82 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_150Pages/needles.csv b/BNYMellon/BNYMellon_150Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..07d8db0891dc1fcc84f4c18ea1ba4be9c8aa832a --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/needles.csv @@ -0,0 +1,25 @@ +The secret instrument is a "piano". +The secret tool is a "wrench". +The secret animal #4 is a "frog". +The secret shape is a "triangle". +The secret flower is a "sunflower". +The secret animal #2 is a "kangaroo". +The secret kitchen appliance is a "rice cooker". +The secret food is a "hamburger". +The secret landmark is the "Statue of Liberty". +The secret drink is "tea". +The secret object #4 is a "tree". +The secret animal #5 is a "bear". +The secret fruit is a "banana". +The secret office supply is a "paperclip". +The secret object #5 is a "toothbrush". +The secret animal #1 is a "cat". +The secret clothing is a "hat". +The secret transportation is a "boat". +The secret object #2 is a "phone". +The secret sport is "tennis". +The secret object #1 is a "table". +The secret vegetable is "broccoli". +The secret currency is a "dollar". +The secret object #3 is a "fork". +The secret animal #3 is a "shark". diff --git a/BNYMellon/BNYMellon_150Pages/needles_info.csv b/BNYMellon/BNYMellon_150Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..5c848cd47a26ed306de4ac88f91d4604bfdbcb79 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/needles_info.csv @@ -0,0 +1,25 @@ +The secret instrument is a "piano".,6,12,orange,black,0.286,0.647,times-bold,109 +The secret tool is a "wrench".,7,11,black,white,0.815,0.275,courier-oblique,117 +The secret animal #4 is a "frog".,17,8,blue,white,0.066,0.629,helvetica-boldoblique,112 +The secret shape is a "triangle".,22,11,purple,white,0.264,0.929,helvetica,128 +The secret flower is a "sunflower".,29,9,brown,white,0.359,0.054,times-italic,71 +The secret animal #2 is a "kangaroo".,35,11,red,white,0.84,0.646,courier,108 +The secret kitchen appliance is a "rice cooker".,42,10,green,white,0.248,0.516,helvetica-bold,112 +The secret food is a "hamburger".,43,10,yellow,black,0.274,0.443,times-bolditalic,105 +The secret landmark is the "Statue of Liberty".,51,9,white,black,0.894,0.6,times-roman,91 +The secret drink is "tea".,59,14,gray,white,0.76,0.741,courier-bold,124 +The secret object #4 is a "tree".,61,12,gray,white,0.433,0.271,times-bolditalic,97 +The secret animal #5 is a "bear".,72,10,yellow,black,0.028,0.076,times-roman,102 +The secret fruit is a "banana".,76,14,orange,black,0.251,0.057,courier-oblique,98 +The secret office supply is a "paperclip".,81,10,brown,white,0.959,0.26,courier-bold,74 +The secret object #5 is a "toothbrush".,85,7,green,white,0.142,0.224,times-italic,79 +The secret animal #1 is a "cat".,96,8,purple,white,0.737,0.032,helvetica,111 +The secret clothing is a "hat".,98,8,white,black,0.212,0.299,times-bold,89 +The secret transportation is a "boat".,106,11,black,white,0.426,0.921,helvetica-bold,97 +The secret object #2 is a "phone".,112,8,red,white,0.009,0.319,courier,135 +The secret sport is "tennis".,117,10,blue,white,0.434,0.589,helvetica-boldoblique,124 +The secret object #1 is a "table".,122,8,brown,white,0.831,0.066,times-bold,111 +The secret vegetable is "broccoli".,131,12,blue,white,0.173,0.989,times-roman,126 +The secret currency is a "dollar".,135,10,white,black,0.025,0.853,courier,83 +The secret object #3 is a "fork".,144,11,purple,white,0.651,0.415,helvetica-boldoblique,136 +The secret animal #3 is a "shark".,147,12,yellow,black,0.692,0.973,courier-bold,82 diff --git a/BNYMellon/BNYMellon_150Pages/prompt_questions.txt b/BNYMellon/BNYMellon_150Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..c63eee01dd5245da7c36aeb3781608bbbf0ea5b5 --- /dev/null +++ b/BNYMellon/BNYMellon_150Pages/prompt_questions.txt @@ -0,0 +1,25 @@ +What is the secret instrument in the document? +What is the secret tool in the document? +What is the secret animal #4 in the document? +What is the secret shape in the document? +What is the secret flower in the document? +What is the secret animal #2 in the document? +What is the secret kitchen appliance in the document? +What is the secret food in the document? +What is the secret landmark in the document? +What is the secret drink in the document? +What is the secret object #4 in the document? +What is the secret animal #5 in the document? +What is the secret fruit in the document? +What is the secret office supply in the document? +What is the secret object #5 in the document? +What is the secret animal #1 in the document? +What is the secret clothing in the document? +What is the secret transportation in the document? +What is the secret object #2 in the document? +What is the secret sport in the document? +What is the secret object #1 in the document? +What is the secret vegetable in the document? +What is the secret currency in the document? +What is the secret object #3 in the document? +What is the secret animal #3 in the document? diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_1.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_1.txt new file mode 100644 index 0000000000000000000000000000000000000000..9d23223635be23d36471c03e2570f3651546ae95 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_1.txt @@ -0,0 +1,7 @@ + + TRUST EXECUTION GROWTH W + INNOVATION CLIENTS RESILIENCE EFFICIENCY + CULTURE SOLUTIONS TALENT TRANSFORMATION + +BUILDING ON +ANNUAL REPORT 2023 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_10.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_10.txt new file mode 100644 index 0000000000000000000000000000000000000000..fb5930001b11572f965ac8be0ce62b808a5e0f9a --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_10.txt @@ -0,0 +1,11 @@ +VIII ANNUAL REPORT 2023 +OUR STRATEGIC PILLARS +BE MORE +FOR OUR +CLIENTS +RUN OUR +COMPANY +BETTER +POWER +OUR +CULTURE \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_100.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_100.txt new file mode 100644 index 0000000000000000000000000000000000000000..ba6f9a59c591acca8cfd68906b4b4d4650e187e7 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_100.txt @@ -0,0 +1,106 @@ +significanta nd ongoinginvestmentsi nt echnology +not onlyt odevelop competitiven ew products and +services or adopt newtechnologies,b ut to sustaino ur +current businesses. Ourfinancial performance +depends in part on ourability todevelopa nd market +thesen ew products ands ervices in at imely mannera t +ac ompetitivep rice andadopt or developnew +technologies that differentiate our productsor provide +cost efficiencies.T he failure to adequately review +andc onsider criticalbusinessc hangesp rior to and +duringi ntroductiona nd deploymentofk ey +technological systemso rt he failure to adequately +aligno perationalc apabilitiesw ith evolving client +commitmentsa nd expectations,s ubjectsu stot he risk +of an adverseimpact on ourability toservicea nd +retain customersa nd on our operations.The costsw e +incuri ne nhancingo ur technology couldb e +substantiala nd mayn ot ultimatelyimprove our +competitivenesso rp rofitability. +As ar esulto ff inancial entities,central agents, +clearinga gentsa nd houses,exchangesa nd +technology systemsa crosst he globe becomingm ore +interdependent andc omplex,atechnology failureo r +othero perationali ncidentt hats ignificantly degrades, +deleteso rc ompromises thes ystems or dataof one or +more financialentitieso rs uppliers couldh avea +material impact on counterpartieso ro ther market +participants,i ncluding us.A disruptivee vent,f ailure +or delayexperienced by oneinstitutionc ouldd isrupt +thef unctioning oftheo verall financials ystema nd +hasi nt he pastimpaired, andc ouldi nthe future +impair, our ability tosettle transactions,which could, +in turn,increaseo ur counterpartyc redita nd other +exposures. +Ac ybersecurity incident,orafailure in our +computer systems, networks andinformation, or +thoseo ft hird parties, couldr esulti nt he theft, loss, +disclosure,u se or alterationo fi nformation, +unauthorizeda ccesst oo rl osso fi nformation, or +system or networkf ailures. Anys uchi ncidento r +failure coulda dversely impactour ability toconduct +ourb usinesses, damage ourreputationa nd cause +losses. +We have been,and we expect to continue to be,t he +target of varyingdegrees of attemptedc yberattacks, +computer viruseso ro ther malicious software,d enial +of servicee fforts, phishinga ttacks, penetration +attempts ando ther informations ecurity threats +intendedt odisrupt our operations,i ncluding +unauthorized accessattempts andc yberattacks +targeted atthird-partys ervice providers andt heir +downstream servicep roviders.R emotew orking +arrangements, our employees’u sage ofmobile and +cloud technologies andour relianceo nt hird-party +servicep roviders leaveo ur networkssusceptible to +greater accesspointsf or attackerst oe xploit. This +furtheri ncreases ther isko fu nauthorized accesst o +our networksandr esults in greater amountso f +informationb eing availablef or access. Although we +deploy ab road range ofsophisticated defenses and +continue to expend significantr esources to bolster +thesep rotections,t here can be noassurancet hatt hese +security measureswill provide absolute security or +preventb reaches andattacks, andw ec oulds uffera +material adverseimpact or disruptionasaresult of a +cybersecurity incident. +Cybersecurity incidentsmay occurt hrough oras a +result of system errors,lack of adequate policiesa nd +procedures,h uman error,software vulnerabilities +(which mayb eu nknown),p otentiall apsesi n +informations ecurity practices or otherirregularities, +andi ntentionalo ru nintentionala ctsb yi ndividuals or +groups (including employees,v endors, customersa nd +statea ctors, as well as others with malicious intent) +having authorized or unauthorized accesst oo ur +systems, data-bearingd evices or facilitiesa swella s +thes ystems,d evices or facilitieso fo ur clients, +counterpartieso rt hird-party servicep roviders. +Malicious actorsm ay alsoattemptt op lace +individuals within BNYM ellono rf raudulently +inducee mployees,v endors, customerso ro ther users +of oursystemst hrough social engineering, such as +phishing, to disclose sensitiveinformationi norder to +gain accesst oo ur dataor that of ourclients, or to +send funds orauthorizet he sending offunds.A +cybersecurity incidentthat resultsi nt he theft, loss, +disclosure,u se or alterationo fi nformation( which +mayi nclude confidentialo rp roprietary information), +system or networkfailures, or unauthorized accesso r +loss of accesst oi nformation, mayr equire us to +reconstructl ostd ata( whichm ay not be possible)or +reimburse clientsf or dataandc reditm onitoring +services,o rr esulti nl osso fc ustomerb usinesso r +damage to our computerso rs ystems andt hoseo fo ur +customersa nd counterparties. Further, although the +applicationo fd istributed ledgert echnology is +growing, such technology is nascenta nd mayb e +vulnerablet oc yberattackso rh aveo ther weaknesses, +whichc ouldr esulti nt he loss of customer assets, +including customer funds orcustodiedd igitala ssets. +Losseso fc ertain typesofa ssets, such asdigital +assets,m ay be distinctlydifficult torecovera nd could +subject us to customer disputes,c laims for +reimbursement,l osses, negativep ublicity, +Risk Factors (continued) +BNYM ellon8 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_101.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_101.txt new file mode 100644 index 0000000000000000000000000000000000000000..073facf99e0f734f0e24a7eb8e9c89caf2179317 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_101.txt @@ -0,0 +1,106 @@ +reputationald amagea nd governmental andregulatory +scrutiny, investigations ande nforcementa ctions. +Ther isko fa no ccurrenceo facybersecurity incident +is inherentto ad ecision to investin our companya nd +thef inancial services sector as aw hole. These +impactsc ouldb ec ostly andt ime-consuminga nd +couldm ateriallya dverselya ffect our business, +financialc onditiona nd results of operations. +While we seekto mitigatethese riskst oe nsuret he +integrity of oursystemsa nd informationa nd +continuously evolve ourcybersecurity capabilities, +therec an be noassurancet hato ur mitigation +strategies will be effectivea gainst allf orms of +cyberattacks. It is possiblet hate mployees or services +providers mayn ot followo ur policiesand procedures +andw em ay not anticipateo ri mplement effective +preventivem easures againstall cybersecurity threats, +or detect allsucht hreats, including becausethe +techniquesu sedc hange,d evelop ande volve +frequently or aren ot recognized until aftert heya re +launched. Moreover, attacksc an originatef roma +wide varietyofs ources,i ncluding malicious actors +whoa re involvedw ith organized crimeor whom ay +be linkedt oterroristo rganizations orforeign +governments, or fromc ross-contaminationo f +legitimate parties( including vendorsand theirs ervice +providers,c lients, financialm arketu tilities, ando ther +financiali nstitutions). Risksr elatingt oattackso no ur +vendors, including supplyc hain attacksa ffectingo ur +software andi nformationt echnology service +providers,h aveb een rising as such attacksbecome +increasinglyf requent ands everea nd as financial +entitiesa nd technology systemsh aveb ecome +increasinglyc onsolidated,i nterdependent and +complex. +Thef ailure to maintaina nadequate technology +infrastructurea nd applications with effective +cybersecurity controls relativet ot he type,s izea nd +complexity of operations,markets andp roducts +traded,a ccesst ot rading venues andour market +interconnectedness couldi mpact operations and +impedeo ur productivityandg rowth, whichc ould +cause our earnings to declineo rc ouldi mpact our +ability tocomply with regulatoryo bligations,l eading +to regulatoryf ines andsanctions.W em ay be +requiredt oexpend significanta dditionalr esources to +modify,i nvestigateo rr emediate vulnerabilitieso r +othere xposuresa rising fromc ybersecurity risksa nd +threats. Despite our proceduresintendedt oidentify +andm itigatet he impact of cybersecurity incidents, a +cybersecurity incident,including as ar esulto fa +successful cyberattack,c ouldo ccura nd persistfor an +extendedp eriodo ft ime before beingd etected. In +addition, we mayn ot beable to identifya nd fully +assess thei mpact of ac ybersecurity incidentin a +timely manner. An investigationo facybersecurity +incident is inherently unpredictablea nd thee xtento f +ap articular cybersecurity incidentandt he pathof +investigatingt he incident mayn ot beimmediately +clear.I tm ay take as ignificanta mount oftime before +such aninvestigationc an be completeda nd reliable +informationa bout thei ncidenti sk nown. While such +an investigationi so ngoing, we mayn ot necessarily +know thes ource andextento ft he harmor how best +to containa nd remediatei t, certain errors or actions +couldb er epeated or compoundedb eforet heya re +discovereda nd remediated,a nd communicationt othe +public,c lients, regulatorsa nd otherstakeholders may +not besufficiently timelyor accurate,a ny orallo f +whichc ouldf urther increaset he costsa nd +consequences of ac ybersecurity incident.M oreover, +recently adopted cybersecurityregulations bythe +SECr equire us,a sapublic companys ubject to +Exchange Actr eportingr equirements, to publicly +disclose certain informationabout am aterial +cybersecurity event, includingthei mpact or +reasonablyl ikelyi mpact.D isclosurem ay be required +before thei ncidenth as been resolved or fully +investigated.A sw ith thed eterminationo fm ateriality +of anyo ther type ofevent, thedetermination +regardingt he materiality of anyp articular +cybersecurity incident orseries of relatedi ncidents +entails af actsa nd circumstances test that takesa +numbero fquantitativea nd qualitativefactors into +account.A saresult, our management mayd etermine +that certaincybersecurity incidentsare immaterial +andn ot subject to disclosure undert he newSEC +cybersecurity regulations.F or example, depending +on thep articularf actsa nd circumstances,o ur +management mayr each such ad eterminationi f, +among otherthings, thei ncident( or as erieso fr elated +incidents) doesn ot substantially disrupt ourability to +operate normally,o rd eliver our productsands ervices +to our clientsa nd them arketo natimely basis, or +result inthel osso rc ompromiseo fasignificant +amount of dataor potentiallysignificante xpenses or +liabilities. As ar esult, investorsshouldn ot assume +that thea bsence of disclosureundert he new +regulations meanst hato ur defenseshave been +successful in preventinga nd defendingevery +cyberattack directed atus or ourthird-partys ervice +providers. +Inaddition, we rely on av ariety of measures to +protect our intellectualp ropertya nd proprietary +Risk Factors (continued) +84 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_102.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_102.txt new file mode 100644 index 0000000000000000000000000000000000000000..3882295b5c369572732b3560c746b08a7fa5e816 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_102.txt @@ -0,0 +1,105 @@ +information, including copyrights, trademarks, +patentsa nd controls on accessa nd distribution. +Thesem easures mayn ot preventmisappropriationo r +infringement of ourintellectualp ropertyo r +proprietary informationa nd ar esultingl osso f +competitivea dvantage.F urthermore,i fathirdp arty +were to assert ac laim of infringement or +misappropriationo fi ts proprietary rights,obtained +through patentsoro therwise,a gainst us,w ec ould be +requiredt ospend as ignificanta mount ofresources to +defend such claims,develop alternativem ethods of +operations,p ay substantialm oneyd amages,o btaina +license fromt he thirdp arty or possiblystopp roviding +one ormore products or services.F urthermore,g iven +intellectualp ropertyo wnership andl icense rights +surrounding artificial intelligence, such asgenerative +artificiali ntelligence, arecurrently not fully +addressedb ycourtso rr egulators, theu se or adoption +of artificiali ntelligence into ourp roducts or services +mayr esulti ne xposuret oc laimsb yt hird partieso f +copyright infringement or otherintellectualp roperty +misappropriation, whichm ay require us to pay +compensationo rl icense fees to thirdparties. The +evolving legal, regulatorya nd compliancef ramework +fora rtificiali ntelligence maya lsoi mpact our ability +to protect our owndataa nd intellectualp roperty +againsti nfringing use. In addition, we conduct +businessi nv arious jurisdictions that mayn ot have +comparable levelsof protectionfor intellectual +propertya nd proprietaryinformationa st he U.S. The +protectiona fforded in thosejurisdictions mayb el ess +establisheda nd/or predictable. As ar esult, theremay +also be heightenedrisksa ssociated with thepotential +thefto fd ata, proprietary information, technology and +intellectualp ropertyi nthosej urisdictions by +domestic or foreigna ctors, including privateparties +andt hosea ffiliatedw ith or controlledb ystate actors. +Anyt heft of data,proprietary information, technology +or intellectualp ropertym ay negativelyi mpact our +operations andr eputation, including disruptingour +businessa ctivitiesi nt hosej urisdictions. +We arealsos ubject to lawsandr egulations relatingt o +thep rotectiona nd privacyof thei nformationo f +clients, employees andothers, anda ny failure to +comply with theselawsa nd regulations coulde xpose +us to liability,i ncreased regulatoryo versight and/or +reputationald amage. +We ares ubject to extensiveg overnmentr ulemaking, +policies, regulation andsupervision that impacto ur +operations.C hanges to andi ntroductiono fn ew +rulesa nd regulations have compelled, andint he +future mayc ompel, us to change howw em anage +ourb usinesses, whichc ould have am ateriala dverse +effect on ourbusiness, financialc onditiona nd +results of operations. +As al arge,i nternationally activef inancial services +company, we operate in ah ighlyr egulated +environment, anda re subject to ac omprehensive +statutorya nd regulatoryr egime affectinga ll aspects +of our businessand operations,including oversight by +governmental agenciesbothi nsidea nd outsidethe +U.S. Regulations andr elated regulatoryg uidancea nd +supervisoryo versight impact how we analyzec ertain +businesso pportunities, our capitala nd liquidity +requirements, ther evenue profileof certain of our +core activities, thep roducts ands ervices we provide, +how we manage our balancesheet,h ow we return +capitalt os hareholders,h ow we monitora nd manage +risk andh ow we promoteas ound governance and +controle nvironment. Anyc hangest ot he regulatory +frameworksa nd environmenti nw hich we operate +andt he significantm anagementa ttentiona nd +resources necessary to addresst hose changesc ould +materially adverselya ffect our business,financial +conditiona nd results of operationsandh aveo ther +negativec onsequences. +In thef uture, we couldb ecome subject to additional +laws,r ules andregulations,i ncluding relatedt othe +safekeepingo fc lient assets,c ybersecurity andd ata +protection, digitalassets,a rtificiali ntelligence and +othere mergingt echnologies,c limate risk +management andE SG governance andreporting, +including additionald isclosurer equirementsw ith +respect to sustainability-relatedg oals,i nvestment +strategies,r iskm anagementa nd emissions.I n +addition, certain regulatoryi nitiatives within and +outside oftheU .S.m ay overlap and/orconflictw ith +each other, whichc oulds ubject us to additional +compliancec osts andr egulatoryr isk. This reflects +thep ace of developmentsrelatingt ocybersecurity, +digitala ssets,a rtificiali ntelligence andclimate +regulation, including thei ncreased focusg lobally by +regulatorsa nd othergovernmental authoritieso n +theset opics andthe relativelyu ncertain,d istinct and +noveln atureo ft he associated principles. +Thee volving regulatorye nvironmenta nd uncertainty +about thet iminga nd scope offuture regulationsmay +contributet od ecisions we maym aket os uspend, +reduceo rw ithdraw frome xistingb usinesses, +activitieso ri nitiatives,w hich mayr esulti np otential +lost revenue orsignificantr estructuring orrelated +costso re xposures.W ea lsof ace ther isko f +becomings ubject to newo rm ores tringent +Risk Factors (continued) +BNYM ellon8 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_103.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_103.txt new file mode 100644 index 0000000000000000000000000000000000000000..d6aa1aabe3a9528881de43df8ba15c7508a85dc3 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_103.txt @@ -0,0 +1,104 @@ +requirementsi nc onnectionw ith theintroductiono f +newr egulations ormodificationo fe xisting +regulations,w hich couldrequire us to holdm ore +capitalo rl iquidity or have otheradversee ffectso n +our businessesorp rofitability.I na ddition, regulatory +responses in connectionw ith severe market +downturns or unforeseenstress events mayalter or +disrupt our plannedfutures trategiesa nd actions. +Them onetary,t ax andother policieso fv arious +governments, agencies andregulatorya uthoritiesb oth +in theU.S.a nd globallyhave as ignificanti mpact on +interest rates, currencies, commodity pricing +(including oil),the impositiono ft ariffs or other +limitations oninternationalt rade andt ravel, and +overall financialm arketp erformance, whichc an +impact our business,results of operationsandc apital. +Changesi nt hese policiesa re beyond ourcontrola nd +can be difficult topredicta nd we cannot determine +theu ltimate effect that anysuchc hangesw ouldh ave +upon our business,financialc onditiono rr esults of +operations.L egal or regulatoryc hangesa ffecting +accesst of inancial marketsc an alsoadverselya ffect +us.F or example, undert he HoldingF oreign +CompaniesA ccountable Act, theS EC must prohibit +tradingi nthe securitieso fc ompanies identifiedb y +theS EC fort hree consecutivey earsa shaving +retained an auditorlocated in af oreign jurisdiction +that theP ublic CompanyA ccountingO versight +Board( “PCAOB”) hasd etermined it isunablet o +inspect or investigatec ompletely. In December2 022, +theP CAOB vacated an earlierdeterminationw ith +respect to mainlandChinaa nd Hong Kong. +However, theP CAOB hasi ndicated it expectst o +continue to have complete accessg oing forwarda nd +will consider then eed to issuean ew determinationi f +needed.A saresult of this legislation,companies +located in mainlandChina, Hong Kong or potentially +otherj urisdictions mayd ecide,o re ventually be +required, to delisto ro therwise remove theirs ecurities +fromU .S.f inancial markets, whichwoulda dversely +affect our businesses,particularly our Issuer Services +lineo fb usiness. +Ther egulatorya nd supervisoryf ocus ofU.S. banking +agencies is primarily intendedt oprotect thes afety +ands oundness of theb anking system andfederally +insuredd eposits,a nd notto protect investorsi no ur +securities. Regulatorya nd supervisorys tandardsa nd +expectations bothwithin jurisdictions(inr elationt o +nationalv ersusn on-nationalf inancial services +providers)a nd acrossj urisdictions mayb ed ivergent +ando therwise mayn ot beappliedi namannert hati s +consistent andh armonized.A dditionally,b anking +regulatorsh avew ides upervisoryd iscretioni nthe +ongoing examinationa nd enforcemento fa pplicable +banking statutes,r egulations,a nd guidelines,a nd may +restrict our ability to engage in certain activitieso r +acquisitions ormayr equire us to limitour capital +distributions,m aintainm orec apitalo rh oldm ore +highlyl iquida ssets. +TheU .S.c apitalr ules subject us ando ur U.S. banking +subsidiaries to stringent capitalr equirements, which +couldr estrictg rowth, activitieso ro perations,t rigger +divestitureo fa ssets or operations orlimit our ability +to return capitalt os hareholders. +TheL CR andN SFR require us to maintainsignificant +holdings of high-qualityandg enerally lower-yielding +liquida ssets.I nc alculatingt he LCRa nd NSFR,w e +must also determinew hich deposits shouldb e +considered stable deposits.S tabled eposits mustmeet +as erieso fr equirementsa nd typically receive +favorable treatment underthe LCRa nd NSFR.W e +useq ualitativea nd quantitativea nalysist oi dentify +core stable deposits.I ti sp ossiblet hato ur LCRa nd +NSFR couldf allb elow applicable regulatory +requirementsa saconsequenceo ft he inherent +uncertaintiesa ssociated with thisanalysis (including +as ar esulto fr egulatoryc hangeso ra dditional +guidancef romo ur regulators).I na dditiont ofacing +potentialr egulatoryc onsequences (which couldb e +significant),w em ay be requiredt oremedyt his +shortfallb yl iquidatinga ssets inour investment +portfolio or raisinga dditionald ebt, each of which +couldh aveam aterialn egativei mpact on our net +interest revenue. +We developa nd submit plansf or ourrapida nd +orderlyr esolutioni nthe evento fm aterialf inancial +distress or failure to theFederal Reservea nd the +FDIC.I ft he agencies determinet hato ur submissions +aren ot credible or wouldn ot facilitate an orderly +resolution underthe U.S. Bankruptcy Code,a nd we +fail toaddressa ny such deficiencies in at imely +manner, we mayb es ubject to morestringent capital +or liquidity requirementso rr estrictions on our +growth,a ctivitieso ro perations,o rm ay be requiredt o +divest assets or operations,which couldadversely +affect our business,financialc onditiona nd results of +operations. +Ourg lobala ctivitiesa re also subjectto extensive +regulationb yvarious non-U.S.regulators, including +governments, securitiese xchanges, central banks and +otherr egulatoryb odies in thej urisdictions in which +we operate,r elatingt o, among otherthings,t he +Risk Factors (continued) +86 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_104.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_104.txt new file mode 100644 index 0000000000000000000000000000000000000000..4d7844f2017a271c37f81e91d52e6c7bbb244bed --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_104.txt @@ -0,0 +1,103 @@ +safeguarding, administrationa nd management of +client assets andc lient funds,r egulationo fm arkets, +recovery andr esolutionp lanninga nd paymentsand +financialm arketi nfrastructure. +Various laws,r egulations,r ules anddirectives +effectivei nt he jurisdictions in whichw eo perate have +an impact on our provision ofmany productsand +services.I mplementationo f, andr evisions to,t hese +laws,r egulations,r ules anddirectives have affected +our operationsandr iskp rofile.F or example, thek ey +regulatoryf rameworksi mpactingo ur operationsin +theE Ua nd UK continue to divergei nanumbero f +respects. Furtherd ivergencei nt he natureands cope +of theser egulations couldh avea na dversei mpact on +our results of operationsandb usinessp rospects. +In addition, we ares ubject in our globaloperations to +rulesa nd regulations relatingt ocorrupt andi llegal +payments andm oneyl aundering, economic sanctions +ande mbargo programsadministeredb ythe U.S. +Office of ForeignA ssets Controla nd similarb odies +andg overnmental agenciesworldwide, andlaws +relatingt odoing businesswith certain individuals, +groups andc ountries, such astheU .S.F oreign +Corrupt Practices Act, theBankS ecrecy Act, as +amendedb ythe USAP ATRIOT Act, theIranT hreat +Reductiona nd SyriaH uman RightsA ct of 2012and +theU KB ribery Act. While we have invested and +continue to invest significantresources in trainingand +in compliancem onitoring, theg eographical diversity +of our operations,employees,c lientsa nd customers, +as well as thev endorsa nd otherthird partiest hatw e +deal with,p resentst he risk that we mayb ef ound in +violationo fs uchr ules,r egulations orlaws anda ny +such violationc oulds ubject us to significantp enalties +or adverselya ffect our reputation. In addition, such +rulesc ouldi mpact our ability toengage in business +with certain individuals,entities, groups and +countries,w hich couldmaterially adverselya ffect +certain of our businessesand results of operations. +Government sanctions ando ur actions in responset o +them have had,andi nthe future couldc ontinue to +have,anegativ ei mpact on ourrevenue andb usiness. +Fore xample,f ollowing Russia’s invasion ofUkraine +in 2022, we ceased newb anking businessinR ussia. +As ar esulto ft he implementationo fd atap rotection- +relatedl awsa nd regulations,i ncluding theE UG DPR, +theC aliforniaC onsumerP rivacy Acto f2 018 andt he +NewY orkD epartment ofFinancialS ervices’ +cybersecurity regulation, we need to allocate +additionalt ime andr esources to comply with such +laws andr egulations,a nd our potentiall iability for +non-compliancea nd reportingo bligations in thecase +of databreaches hass ignificantly increased.I n +addition, our businessesare increasinglys ubject to +laws andr egulations relatingt oprivacy,s urveillance, +encryptiona nd datalocalizationi nthe jurisdictions in +whichw eo perate.C ompliancew itht hese laws and +regulations hasrequiredu st oc hange our policies, +procedures andtechnology fori nformations ecurity +ands egregationo fd ata, which, amongo ther things, +makesu smorev ulnerablet oo perationalf ailures, and +to monetarypenaltiesf or breachof such laws and +regulations. +Additionally,o ur settlement-relateda ctivitiesa nd +obligations area lsos ubject to regulatoryr isk, +including ther isko fr egulatorsg lobally accelerating +thet imelinet os ettlement,s ucha st he SEC’sr ecent +rule to shortent he standard settlement cyclef or +securitiest ransactions in theU.S.f romt rade dateplus +twob usinessd ays( T+2) to tradedatep luso ne +businessd ay (T+1)f or compliance in 2024. This rule +presents therisko fn on-compliance, andheightens +then eed forc areful coordination with and +dependencieso no ther industryp articipantsa swella s +additionalr isks associated with technology +developmenta nd implementation, change +management ando perationale rrors,a ny ofwhich +couldb em ateriali nl ight ofthem agnitude and +volumeo fo ur settlement-relateda ctivitiesa nd +obligations. +Failureto comply with laws,regulations or policies, +or meet supervisorye xpectations,a pplicable tous and +our businessescouldr esulti nc ivil or criminal +sanctions orenforcementp roceedings byregulatory +or governmental authorities,moneyp enaltiesa nd +reputationald amage, whichc ouldh aveam aterial +adversee ffect on our business,financialc ondition +andr esults of operations.I fv iolations oflegalo r +regulatoryr equirementsd oo ccur, they coulddamage +our reputation, increaseo ur legala nd compliance +costs, includingr equiring usto devotes ubstantial +resources towardsr emediatione fforts, andu ltimately +adverselyi mpact our results of operations.L aws, +regulations or policiescurrently affectingu sa nd our +subsidiaries,s upervisorye xpectations,o rr egulatory +andg overnmental authorities’interpretationo f +statutes andregulations mayc hange at anytime, +whichm ay adverselyimpact our businessand results +of operations.S ee “Supervisionand Regulation” for +additionali nformationr egarding thep otentiali mpact +of ther egulatorye nvironmento no ur business. +Risk Factors (continued) +BNYM ellon8 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_105.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_105.txt new file mode 100644 index 0000000000000000000000000000000000000000..4b288f8fe7880d03474cb7eb76622363ea95e9c2 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_105.txt @@ -0,0 +1,104 @@ +Regulatory or enforcementa ctions or litigation +couldm aterially adversely affect ourr esults of +operations or harm ourb usinesseso rreputation. +Like many majorf inancial institutions,w ea nd our +affiliatesa re thes ubject of inquiries,i nvestigations, +lawsuits andp roceedings bycounterparties, clients, +othert hird parties, taxa uthoritiesa nd regulatorya nd +otherg overnmental agenciesin theU.S.a nd abroad, +as well as theD epartment ofJusticea nd state +attorneysg eneral.S ee “Legalproceedings”i nN ote +22 oftheN otes to Consolidated FinancialS tatements +foradiscussion of material legala nd regulatory +proceedings in whichw ea re involved. Then umber +of thesei nvestigations andp roceedings,a sw ella st he +amount of penaltiesand finess ought,h as remained +elevated form anyf irms in thefinancial services +industry, including us.W eh avei nt he pastbeen,a nd +mayi nthe future become,s ubject to heightened +regulatorys crutiny, inquiries or investigations,a nd +potentially client-relatedi nquirieso rc laims,r elating +to broad, industry-wide concerns that couldlead to +increased expensesor reputationald amage. +Regulatorsa nd othergovernmental authoritiesmay +also be more likelyt opursuee nforcementa ctions,o r +seek admissions ofwrongdoing or guiltypleas,i n +connectionw ith theresolutiono fa ni nquiry or +investigationt othe extent af irmh as previously been +subject to otherg overnmental investigations or +enforcementa ctions.T he current trendo fl arge +settlementsb yf inancial institutions with +governmental entitiesmay adverselyaffect the +outcomesf or otherfinancial institutions in similar +actions,e specially whereg overnmental officialsh ave +announced that thel arge settlementsw ill be used as +theb asis or at emplatef or othersettlements. +Separately,p olicymakersg lobally continue to focus +on protectionofc lient assets,c ybersecurity andd ata +protection, thei mproperu se of electronic +communications as well as taxa voidancea nd +evasion. +Thec omplexity of thef ederal andstate regulatory +ande nforcementr egimesi nt he U.S.,c oupled with +theg lobals cope of our operationsandt he increased +aggressiveness of thet ax andregulatorye nvironment +worldwide, alsomeanst hatasinglee vent mayg ive +rise to al arge numberof overlappinginvestigations +andr egulatoryp roceedings,e ither by multiple federal +ands tate agencies in theU.S.o rb ym ultiple +regulatorsa nd othergovernmental entitiesort ax +authoritiesi nd ifferent jurisdictions.R esponding to +inquiries,i nvestigations,l awsuits andp roceedings, +regardless of theu ltimate outcome of them atter, is +time consuminga nd expensivea nd can divert the +attentiono fo ur senior management fromo ur +business. Theo utcome of such proceedings mayb e +difficult topredicto re stimate until latein the +proceedings,w hich mayl astanumbero fy ears. +Certaino fo ur subsidiaries aresubject to periodic +examination, special inquiries andpotential +proceedings byregulatorya uthorities. If compliance +failureso ro ther violations aref ound duringa n +examination, inquiry or proceeding,ar egulatory +agency couldinitiate actions andi mposes anctions for +violations,i ncluding, fore xample,r egulatory +agreements,r emediationu ndertakings,c easea nd +desist orders,c ivil monetary penaltieso rt ermination +of al icense andc ouldl ead to litigationb yinvestors +or clients, anyo fw hich couldcause our earnings to +decline. +Ourb usinessesi nvolve ther iskt hatc lientso ro thers +mays ue us,claimingt hatw eo rt hird partiesf or +whom they sayw ea re responsiblehave failedt o +perform underacontract or otherwisefailedt ocarry +out ad utyp erceivedt obeo wedt othem, including +perceivedf iduciary or contractuald uties. This risk +mayb eh eightenedd uringp eriods when credit, equity +or otherfinancial marketsa re deterioratingi nvalue or +arep articularly volatile,w henc lientso ri nvestorsa re +experiencing losseso ra sp ublic attentiono nissues +such as climatechange or otherESG matters +intensifies. As ap ublicly held company, we area lso +subject to therisko fc laims undert he federal +securitiesl aws. Volatility in our stockp rice increases +this risk. +Increasingly, regulators, taxa uthoritiesa nd courts +have sought to holdf inancial institutions liablef or the +misconducto ft heir clientsw here such regulatorsa nd +courts have determinedthat thef inancial institution +shouldh aved etectedt hatt he client wase ngagedi n +wrongdoing, even though thef inancial institutionh ad +no directknowledge ofthew rongdoing. +Actions broughtagainstu sm ay result in lawsuits, +enforcementa ctions,i njunctions,s ettlements, +damages, fineso rp enalties, whichc ouldh avea +material adverseeffect on ourfinancialc onditiono r +results of operations orrequire changest oo ur +business. Claims fors ignificantm onetaryd amages +area sserted in many ofthesel egal actions,while +claims ford isgorgement,p enaltiesa nd/or other +remedial sanctionsm ay be sought in regulatory +matters.T hese risksm ay be more acute when +operatingi nforeign jurisdictions orin instances +Risk Factors (continued) +88 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_106.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_106.txt new file mode 100644 index 0000000000000000000000000000000000000000..fd97bf6a26fabe2c57baefc3b36da0ccb925190e --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_106.txt @@ -0,0 +1,102 @@ +wherea dversariest os uchd isputes aregovernment or +quasi-government actorso therwise motivated in +wholeo ri np artb yn on-commerciali ncentives. +Although we establisha ccruals foro ur litigationa nd +regulatorym atters in accordance with applicable +accountingg uidance, our exposuret os uchl itigation +andr egulatorym atters can be unpredictable, and +when thosem atters proceed to as tage wheret hey +presentl ossc ontingenciest hata re bothp robablea nd +reasonablye stimable, therem ay be am aterial +exposuret ol ossi ne xcesso fa ny amountsa ccrued, or +in excesso fa ny loss contingenciesd isclosed as +reasonablyp ossible. Such loss contingenciesm ay not +be probableand reasonablye stimableu ntil the +proceedings have progressedsignificantly,w hich +couldt akes everal yearsa nd occurclose to resolution +of them atter. +Each of ther isks outlined abovecouldr esulti n +increased regulatorys upervisiona nd affect our ability +to attract andretainc ustomers or maintain accesst o +thec apitalm arkets. +Ourb usinessm ay be adverselyaffected if we are +unablet oa ttract, retain,d evelop andmotivate +employees. +Ours uccessd epends,i nlarge part,o nour ability to +attract newe mployees,r etain, developand motivate +our existinge mployees,h avead iverse andi nclusive +workplace andcontinue to compensate our employees +competitivelya mid heightened regulatoryr estrictions +anda ninflationary environment. Competitionf or the +most skilledemployees in mostactivitiesi nw hich we +engage can be intense, andwem ay not beable to +recruita nd retain keyp ersonnel. In addition, third- +partys uppliers ands ervice providers on whichw e +rely mayface challengesina ttractinga nd retaining +theire mployees,w hich mayh avean egativei mpact +on our operationsando ur resiliencyc apabilities. +We rely on certain employees with subject matter +expertiset oa ssist in theimplementationo fi mportant +initiatives andt osupportt he developmentofn ew +products ands ervices,i ncluding in connectionw ith +our technology initiatives.A sf ocus ontechnology +andr iskm anagementi ncreases in thefinancial +industry, competitionf or technologistsa nd risk +personnelh as intensified, whichc ouldc onstraino ur +ability toexecute on certain of ourstrategic +initiatives. +Oura bility toattract,r etaina nd motivatek ey +executives andother employeesmayb en egatively +affected by continuous changest oi mmigration +policiesa nd restrictions applicable to incentivea nd +otherc ompensationp rograms, including deferral, +clawback requirementsa nd otherlimits on incentive +compensation. Some of theser estrictions mayn ot +applyt osomeo fo ur competitors andt oother +institutions with whichw ec ompete fort alent, in +particular aswe arem oreo ften competingfor +personnelw ith financialt echnology providersand +othere ntitiest hatm ay not be publicly tradedor +regulated banking organizationsand, in either case, +mayn ot havethes amel imitations oncompensation +as we do. Furthermore, because ap ortiono fo ur +annuali ncentivec ompensationp aidt osomeo fo ur +employees is deferrede quity thatis subject to the +valueo fo ur common stock, declinesin our +profitability or outlookcoulda dverselya ffect the +ability to attract andretaine mployees. +Thel osso fe mployees’s kills,k nowledge ofthe +market,i ndustrye xperience, andthe cost of finding +replacements,p articularlyi naprotracted inflationary +environmentw ith ac ompetitivel abor market,h ave +led, andw ee xpect will continue to lead,t oa n +increasei nl abor costsa nd hurtour business. In +addition, ourcurrent orfuture approach to in-office +andr emote-work arrangementsm ay not meet the +needso re xpectations of ourcurrent or prospective +employees,m ay not be perceivedasf avorable as +compared to thea rrangementso fferedb ycompetitors +andm ay not beconducivet oacollaborativew orking +environment, whichc oulda dverselya ffect our ability +to attract,r etain, developand motivate employees.I f +we areu nablet oc ontinue to attract,r etain, develop +andm otivateh ighlyq ualifiede mployees,o ur +performance, includingo ur competitivep osition, +couldb ea dverselya ffected. +Af ailure or circumventiono fo ur controls,p olicies +andp rocedures couldhaveamaterial adverse effect +on ourbusiness, financialc ondition, resultsof +operations andr eputation. +Management regularly reviewsa nd updatesour +internal controls,disclosurec ontrols andp rocedures, +andc orporatep oliciesa nd procedures.Any system of +controls,h owever well designeda nd operated,is +basedi nparto nc ertain assumptions andc an provide +onlyr easonable, not absolute,a ssurances that the +objectives of thes ystemw ill be met. Anyf ailure or +circumventiono fo ur controls andp rocedures or +failure to comply with regulations relatedt ocontrols +andp rocedures couldhaveam ateriala dversee ffect +on our business,reputation, resultso fo perations and +Risk Factors (continued) +BNYM ellon8 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_107.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_107.txt new file mode 100644 index 0000000000000000000000000000000000000000..9800c74dc46f8667d0a39857e53fafc5a55cf156 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_107.txt @@ -0,0 +1,103 @@ +financialc ondition. Moreover, if we identifym aterial +weaknessesi no ur internal controloverf inancial +reportingo ra re otherwiser equiredt orestate our +financials tatements, wecouldb er equiredt o +implement expensivea nd time-consumingr emedial +measures andcould lose investor confidence in the +accuracy andcompletenesso fo ur financialr eports. +In addition, therea re risksthat individuals,e ither +employees or contractors, mayc ircumvent +establishedc ontrolm echanismsi no rder to,f or +example, exceed exposure,liquidity,t rading or +investment management limitations,o rc ommit fraud. +Additionally,a lthough we have policiesand +procedures prohibitingt he useofu nauthorized +personald evices andapplications by ouremployees +andc ontractors, weares ubject to inquiriesby +regulatorsw ith respect to recordkeepingo bligations +anda re subject to additionalr isks relatedt othe useo f +personald evices andnon-approvedp latforms, +applications andt oolsb yo ur employees or bythird +partiesw ith whichw ed ob usinessf or work-related +activities, including risksr elated to information +security andp otentialv iolations ofrecord retention, +reportinga nd otherrequirements. Anyf ailure to +comply with such policiesa nd procedures could +adverselya ffect our business. +Market Risk +Weaknessa nd volatility infinancialm arkets andt he +economy generally maymaterially adversely affect +ourb usiness, financialc onditiona nd results of +operations. +As af inancial institution, ourInvestment +Management,W ealth Management,P ershing, +Depositary Receiptsa nd Markets, including +SecuritiesL ending, businessesare particularly +sensitivet oe conomic andm arketc onditions, +including in thecapitala nd credit markets. Further, +when thesem arkets arev olatileo rd isruptive, we +have experienced declines in our fair valued assets, +including in our securitiesp ortfolio ands eed capital, +as well as af airv alue reductioni nthe portfoliosthat +we manage that generate investmentandw ealth +management fees.C onditions in thefinancial +marketsa nd thee conomyg enerally,b othi nthe U.S. +ande lsewhere around thew orld have materially +affected,a nd mayc ontinue to affect,o ur resultso f +operations,i ncluding investment management fees. +Foreigne xchanget rading that we execute forc lients +generatesr evenuesw hich areprimarily driven by the +volumeo fc lient transactions andt he spread realized +on theset ransactions,b otho fw hich areimpacted by +market volatility andt he impact of foreigne xchange +hedging activities. Ourc lients’ cross-border +investinga ctivity couldd ecreasei nr eactiont o +economic andp olitical uncertainties, including +changesi nl awso rr egulations governingcross-border +transactions,s ucha sc urrencyc ontrols or tariffs. +Volumesa nd/or spreadsi ns omeo fo ur products tend +to benefitf romc urrencyv olatility anda re likelyt o +decreased uringt imeso fl ower currencyvolatility. +Such revenuesa lsod ependo nour ability to manage +ther iska ssociated with thecurrencyt ransactions we +execute andp rogram pricing. +Av ariety of factorsi mpact globale conomiesa nd +financialm arkets,i ncluding interest ratesa nd their +associated yieldc urves, commodity pricing, market +andp olitical instabilities, volatile debt ande quity +market values,i nflation, expectations relatingt o +inflationt rends andm onetary policya ctions takenb y +central banks,t he strengtho ft he U.S. dollar, +geopolitical tensions,t he impositiono ft ariffs or other +limitations oninternationalt rade ortravel,i ncluding +changest oi nternationalt rade andi nvestment policies +by theU .S.t he EU or otherlarge economies( which +couldd isrupt worldt rade andl ead to trade +retaliation),u nemploymentl evels, labor strikes, +decliningb usiness, investor andc onsumer +confidence, recessionary fears,thei mpact of +volatilityi ndigital assetm arkets on theb roader +market,g overnmental budgetd eficits (including, in +theU .S., at thef ederal,s tate andm unicipall evels), +partialo rf ullg overnment shutdowns (including +concerns about thes tability of funding fort he U.S. +federalg overnment), andc ontagionr iskf rom +possibled efault on sovereignd ebt. More specifically, +in January 2023, theo utstanding nationaldebto ft he +U.S. government reached its statutoryl imit. Before +theU .S.g overnment suspendedt he debtceiling, the +U.S. TreasuryD epartment used extraordinary +measures to preventt he U.S. government’s defaulto n +its paymento bligations.F utured elayst or aise or +suspendt he federald ebtc eiling couldh aves evere +repercussions within theU.S.a nd to globalc redita nd +financialm arkets andc ouldr esulti navarietyo f +adversee ffectsf or our business,resultso fo perations, +liquidity andf inancial condition. +Anyr esultinge conomic pressure on market +participants andl ack of confidence in thefinancial +marketsm ay adverselyaffect our business,financial +conditiona nd results of operations.A dditionally, +globale conomiesa nd financialm arkets mayb e +Risk Factors (continued) +90 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_108.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_108.txt new file mode 100644 index 0000000000000000000000000000000000000000..5599e22f9ec026ef49bcc31e976aa51453406d8e --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_108.txt @@ -0,0 +1,102 @@ +adverselya ffected by widespread health emergencies, +pandemics, naturald isasters,c limate-related +incidents, conflicts anda ctso fw ar (sucha st he +conflicts inUkrainea nd in theMiddleE ast), +terrorism,e conomic sanctions,o ther geopolitical +events or concerns overthe possibilityof such events, +fore xample,t he economic andg eopolitical +challengesr elated to China, including developing +tensions betweenChinaa nd Taiwan and/or between +Chinaa nd theU .S.I np articular, we face the +following risksi nc onnectionw ith thesefactors, some +of whicha re discusseda tg reater lengthi nseparate +risk factors: +• Geopolitical tensiona nd economic instability in +countries aroundthew orld can attimesi ncrease +thed emandf or low-risk investments, particularly +in U.S. Treasuriesa nd thed ollar. A“ flight to +safety”h as historically increasedour balance +sheet,w hich hasn egativelyi mpacted,a nd could +continue to negativelyi mpact,o ur leverage-based +regulatoryc apitalm easures.A sustained“ flight +to safety”h as historically triggeredadeclinei n +trading, capitalm arkets andc ross-bordera ctivity +whichw ouldl ikelyd ecreaseo ur revenue, +negativelyi mpactingo ur resultso fo perations, +financialc onditiona nd, if sustainedi nthe long +term,o ur business. +• Thef ees earnedby ourInvestment Management +andW ealthM anagementb usinessesa re highera s +assets underm anagementa nd/ori nvestment +performance increase. Thosef ees arealso +impacted by thec ompositiono ft he assets under +management,w ith higherf eesf or some asset +categoriesa scomparedt oothers. Uncertain and +volatile capitalm arkets,p articularlyd eclines, +couldr esulti nm ovementsf romh ighert ol ower +feep roducts and/or reductions in our assets under +management becauseof investors’ decisions to +withdraw assetsor from simple declines in the +valueo fa ssetsu nderm anagementa sm arkets +decline. +• Market conditionsresultingi nlower transaction +volumes couldhavea na dversee ffect on the +revenuesa nd profitability of certain of our +businessess ucha sc learing, settlement,p ayments +andt rading. +• Uncertain andv olatile capitalm arkets, +particularly declines in equity prices,c ould +reducet he valueofo ur investmentsi ns ecurities, +including pensionand otherpost-retirementp lan +assets andp roduced ownwardp ressure on our +stockp rice andcredita vailability without regard +to our underlyingfinancials trength. +• Derivativei nstruments we holdf or our own +account to hedge andm anageo ur exposuret o +market risks, including interest rate risk,e quity +pricer isk, foreignc urrencyr iska nd credit risk +associated with our productsandb usinesses +might not performas intendedo re xpected, +resultingi nhigherr ealized losses andu nforeseen +stresseso nl iquidity.O ur derivatives-based +hedging strategies alsorely on thep erformance of +counterpartiest os uchd erivatives.T hese +counterpartiesm ay fail to perform forvarious +reasons resultingi nlosseso nu nder-collateralized +positions. +• Thep rocessw eu se to estimate our expected +credit lossesi ssubject to uncertainty in thatit +requiresu se of statistical models andd ifficult, +subjectivea nd complexj udgments,i ncluding +forecasts of economic conditions andh ow these +conditions mighti mpairt he ability of our +borrowers ando therst om eet theiro bligations.I n +uncertain andv olatile economic environments, +ande specially inenvironments thatdiffer +significantly fromt he historical environments +upon whicht he models we uset oe stimate our +expected credit losseswered eveloped, ourability +to estimateo ur expected credit lossesmay be +impaired, whichc oulda dverselya ffect our +overall profitability andr esults of operations. +Foradiscussion of our management ofmarket risk, +see“ Risk Management–R iskT ypesO verview– +Market Risk.” +We ared ependent on fee-based business for a +substantialm ajorityo fo ur revenue ando ur fee- +based revenuesc ould be adverselyaffected by +slowingm arketa ctivity,w eakf inancial markets, +underperformancea nd/orn egativet rendsi ns avings +rateso rini nvestment preferences. +Ourp rincipal commercialf ocus is on fee-based +business, whichisd istinctf romc ommercialb anking +institutions that earnmosto ft heir revenuesf rom +loansa nd othertraditionali nterest-generating +products ands ervices.F or they ear endedDec. 31, +2023, 74% of ourtotalr evenue wasf ee-based. Our +fee-basedb usinessesi nclude investment andw ealth +management,c ustody, corporatet rust,d epositary +receipts, clearing, collateralm anagementa nd treasury +services,w hich arehighlyc ompetitiveb usinesses. +Risk Factors (continued) +BNYM ellon9 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_109.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_109.txt new file mode 100644 index 0000000000000000000000000000000000000000..63a26f2adcd3887982bcb5f7f23656ce352bc84c --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_109.txt @@ -0,0 +1,100 @@ +Fees form anyo fo ur productsands ervices arebased +on thev olumeo ft ransactions processed,them arket +valueo fa ssets managedand/or administered, +securitiesl ending volumeand spreads, andf ees for +others ervices rendered.C orporatea ctions,c ross- +borderi nvesting, globalmergers anda cquisitions +activity,n ew debt ande quity issuances,and +secondary tradingv olumes,a mong otherthings, all +affect thel evel of ourfeer evenue.A st he volumeo f +thesea ctivitiesd ecreases due to lowclient activity, +weak financialm arkets or otherwise,our fee-based +revenuesa lsod ecrease, whichn egativelyi mpactso ur +results of operations. +If our Investment andW ealth Management +businessese xperience poor investment returnsd ue to +weak market conditions or underperformance +(relativet oc ompetitors or benchmarks),them arket +values of thep ortfoliost hatw em anagew ill be lower +(onarelativeb asis)a nd ourability toretain existing +assets and/or attract newc lient assets mayb e +impacted.M arketa nd regulatoryt rends havealso +resultedi nincreased demand forl ower feei nvestment +andw ealth management productsands ervices,a nd +lowerp erformance-fees tructures, botho fw hich have +impacted andmay continueto impact our fee +revenue.S omeo ft hese dynamicsh avea lso +negativelyi mpacted fees in our Market andWealth +Services andSecuritiesS ervices businessesa nd any +of thesed ynamicsm ay alsooccuri nt he future. +Significantd eclines in thevolumeo fc apitalm arkets +activity wouldr educet he numbero ftransactions we +processa nd thea mount ofsecuritiesw el enda nd +thereforew oulda lsoh avea na dversee ffect on our +results of operations.O ur businessmay be adversely +impacted by decreasesin theratea tw hich individuals +invest in mutualfunds ando ther collectivef unds,u nit +investment trusts or exchange-tradedf unds,o r +contributet od efined contributionplans.C hangesi n +economic andm arketc onditions,i ncluding as ar esult +of highermarketv olatility,i nflationary pressures, +recessionary conditions or declinesin equity values, +couldr esulti nc hangesi nt he investment patternso f +our clientso rn egativelyi mpact them arketv alue of +client portfolios,each of whichc ouldh avean egative +impact on ourresults of operations. +When our investment management revenuesd ecline, +interest ratesr iseo ro ther market factorsa ffect the +valueo fo ur investment management business, we +mayh ave, andi nthe pasthave had, declinesin the +fair valuei no ur Investment Management reporting +unit, one ofthet wo reportingu nits inour Investment +andW ealthM anagements egment.I ft he fair valueo f +theI nvestment Management reportingu nitd eclines +belowi ts carryingv alue,w ew ouldb er equiredt o +take,a nd in thepasth avet aken,a nimpairment +charge. +Levelso fa nd changesi ni nterestr ates have +impacted, andwill in thef uturec ontinue to impact, +ourp rofitability andc apitall evels, at times +adversely. +We earnrevenue,k nowna s“ neti nterestr evenue,” on +thed ifferenceb etween thei nteresti ncomee arnedo n +our interest-earning assets,s ucha st he loansw em ake +andt he securitiesw eh oldi nour investment securities +portfolio,a nd thei ntereste xpensei ncurredo nour +interest-bearingl iabilities, such asdeposits and +borrowedm oney. Additionally, we earnn et interest +revenue on otheractivitiesr elatingt ointerest-earning +assets andi nterest-bearingl iabilities, suchas reverse +repurchasea greements andr epurchasea greements, +respectively. Ourn et interest margin,w hich is the +result of dividing netinterestr evenue byaverage +interest-earning assets,i ss ensitivet ot he shapeo ft he +yieldc urve andw hether thei nterestr atep aido r +receivedi sf ixed or movesw ith changesi nm arket +interest rates. +Thec ontinuedp revalenceo fh igherr ates,a nd any +future rate increases,including unexpectedly +precipitous increases,c oulda dverselyi mpact our +business, financialc onditiona nd resultso f +operations,d ue to: +• higherm arketv olatility,r ecessionary conditions +andd eclines in equity values,r esultingi na +declinei nt he valuationofa ssets under +management; +• reduced liquidity in bonds andf ixed-income +funds,r esultingi nlower performance andfees; +• increased numbero fdelinquencies, bankruptcies +or defaultsandm oren onperforminga ssets and +netc harge-offs,a sb orrowers mayh avem ore +difficulty making higherinterestp ayments; +• higherr edemptions fromo ur fixed-income funds +or separate accounts, as clientsmovef unds into +investmentsw ith higherr ates of return; +• lowern et interest revenue andn et interest margin +due to lowernon-interest bearingd eposit levels, +as non-interest bearingd eposits leaveors hift to +interest-bearingd eposits; +Risk Factors (continued) +92 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_11.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_11.txt new file mode 100644 index 0000000000000000000000000000000000000000..97f4799064f67c486c4c01615dd8b83f4e711ce8 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_11.txt @@ -0,0 +1,67 @@ +As a commercial enterprise that has +operated for nearly two-and-a-half +centuries, we are able to thrive +for only one reason — by serving +our clients. +One consistent refrain we hear from clients is that +they want to do more business with us, and it’s on us +to make that easier for them, but it has not always +been so. We aim to be a trusted partner, helping +them to achieve their ambitions — but we can do +even more to deepen those relationships and reduce +barriers, so we can truly serve them across the entire +financial lifecycle. +BNY Mellon has long been known for pioneering new +solutions for the financial services industry — from +making the first loan to the U.S. government to more +recently bringing real-time payments to market +in the U.S. +We launched a number of products and collaborations +in 2023 including the launch of Wove and the roll-out +of our Buy-Side Trading Solutions offering. But it goes +well beyond that. All our businesses strive to bring +BE MORE +FOR OUR +CLIENTS +One of my goals coming into this role was to set +a roadmap and tangible targets to reinvigorate the +next phase of growth for the firm. Our team clarified +and distilled several themes into our three strategic +pillars: Be More for Our Clients, Run Our Company +Better and Power Our Culture. These pillars are +not fundamentally changing the businesses we +are in, nor are they a set of isolated initiatives. +Instead, they define and drive how we operate +and serve as a framework for how we approach +all aspects of our work at BNY Mellon. +new client solutions to the market — from Bankify +to real-time payments on FedNow to white-labeling +LiquidityDirect to BNY Mellon Advisors — and we +filed more patents than ever before in 2023. +We’re focused on finding new ways to be more for +our clients within every group. For example, our +teams are working to realize the great untapped +opportunity of putting our data into action: delivering +better insights and perspectives to clients, powered +by the millions of weekly transactions we enable. +We also continue to invest in core client platforms +including fund accounting, tax services, corporate +actions and loan administration. +Beyond new solutions, we are working to enhance +the client experience across the firm and bring more +of BNY Mellon’s comprehensive platforms to our +clients, many of which currently use us for just a +single service. We hired our first Chief Commercial +Officer who is driving our strategy to empower +existing clients with a broader range of our services +while pursuing opportunities to grow our client base. +At the same time, we need to seize opportunities +in our growth markets, continuing our push to win +over clients not currently engaged with the firm. +Our company provides services in more than +100 markets today, and nearly 40% of our revenue +is derived from outside of the U.S. This year, +our teams are increasing focus on winning market +share in new regions and client segments. +IXBNY MELLON +The secret tool is a "wrench". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_110.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_110.txt new file mode 100644 index 0000000000000000000000000000000000000000..1f3d3eac56448a41eb7043a610a3f105d2f25ea0 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_110.txt @@ -0,0 +1,99 @@ +• declines in deposit levels,resultingi nreduced +internal andregulatoryl iquidity buffers andl ower +revenues; +• reductions in thevalue of ourfixed-income +securitiesh eldf or liquidity purposes; +• furtheri ncreases in accumulatedo ther +comprehensivel ossi no ur shareholders’e quity +andt herefore our tangiblec ommone quity due to +thei mpact of rising long-term ratesont he +available-for-sales ecuritiesi no ur investment +portfolio,w hich wouldn egativelya ffect our risk- +baseda nd leverage basedregulatoryc apital +ratios; or +• higherf undingc ost. +Conversely, am ateriald eclinei nt he short-term rate +environment, and/or af lato ri nverted yieldc urve,i n +thef uturec oulda dverselyi mpact,a nd hasint he past +adverselyi mpacted,o ur netinterestr evenue and +results of operations dueto: +• compression of our netinterestm argin, +depending on our balancesheet positiona nd the +speed andsizeo ft he interest rate decline; +• sustainedw eakness of ourspread-based revenues, +resultingi ncontinuedv oluntaryw aiving offees +on certain moneymarketm utualf unds and +relatedd istributionf ees,i norder to preventt he +yields onsuch funds from becomingu neconomic; +or +• adversei mpactso nt he valueofo ur fixed-rate +mortgage-backed securities, driven by higher +mortgage prepaymentspeeds. +Am ored etailedd iscussiono ft he interest rate and +market risksw ef acei sc ontainedi n“Risk +Management –R iskT ypesO verview–Market Risk.” +We have experienced,and mayc ontinue to +experience, unrealized or realized losseso n +securitiesr elated to volatile andi lliquidm arket +conditions,r educingo ur capitall evelsa nd/or +earnings. +We maintain an investment securitiesp ortfolio of +various holdings,typesa nd maturities. At Dec.31, +2023, approximately 61% oftheses ecuritiesw ere +classified as available-for-sale,whicha re recordedon +our balancesheet atfair valuew ith unrealized gains +or lossesr eporteda sacomponent of accumulated +otherc omprehensive income,n et of tax. The +securitiesi no ur held-to-maturityportfolio,r ecorded +on our balancesheet at amortized cost,were +approximately 39% of oursecuritiesp ortfolio at Dec. +31, 2023. Oura vailable-for-sales ecuritiesp ortfolio, +to thee xtentu nhedged, mayr esulti ni ncreased +volatilityi nour accumulatedo ther comprehensive +income or earnings than al oanp ortfolio thatis +accounted fora ta mortized cost. +Ouri nvestment securitiesp ortfolio represents a +greater proportiono fo ur consolidated totala ssets +(approximately 31% at Dec. 31, 2023),i ncomparison +to many othermajor U.S. financiali nstitutions dueto +our custodya nd trustb ankb usinessm odel. +Accordingly, ourcapitall evelsa nd results of +operations andf inancial conditiona re materially +exposed to therisks associated with our investment +securitiesp ortfolio,i ncluding interest rate-related +risks. +We reservef or current expected credit losseswith +respect to our available-for-salea nd held-to-maturity +securities. Credit lossesine xcesso fo ur allowance +forc reditl ossesw ouldi mpact our resultso f +operations. +Underthe U.S. capitalr ules,a fter-tax changesint he +fair valueo fa vailable-for-salei nvestments ecurities +arei ncludedi nCET1c apital. Sinceh eld-to-maturity +securitiesa re not subject to fair-value accounting, +changesi nt he fair valueo ft hese instruments( other +than expected credit losses)aren ot similarlyi ncluded +in thed eterminationo fC ET1c apital. As ar esult, we +maye xperience increased variability inour CET1 +capitalr elativet ot hosem ajor financiali nstitutions +whom aintainalowerp roportiono ft heir consolidated +totala ssets inan available-for-saleaccounting +classification. +Generally,the fair valueo fa vailable-for-sale +securitiesi sdeterminedb ased on market prices +availablef romt hird-party sources.D uringp eriods of +market disruption, it maybed ifficult tovaluec ertain +of ourinvestment securitiesi ft rading becomesless +frequent and/or market data becomesl esso bservable. +As ar esult, valuations mayi nclude inputsa nd +assumptions that arelesso bservableo rr equire greater +estimationa nd judgmenta sw ella sv aluation methods +whicha re more complex. Thesev aluesm ay not be +ultimately realizable in am arkett ransaction, ands uch +values mayc hange very rapidlyasm arketc onditions +change andv aluationa ssumptions arem odified. +Decreases in valuem ay have am ateriala dversee ffect +on ourresults of operations orfinancialc ondition. +Thee stimate of expected credit lossesisd etermined +Risk Factors (continued) +BNYM ellon9 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_111.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_111.txt new file mode 100644 index 0000000000000000000000000000000000000000..4a7fbc9a52214d54e2b65131cd19804bfe7bdae9 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_111.txt @@ -0,0 +1,98 @@ +in part by management’s assessmento ft he financial +conditiona nd prospectsofaparticular issuer, +projections offuture cashf lows andr ecoverability of +thep articular security.M anagement’sc onclusions on +such assessmentsareh ighlyj udgmentala nd include +assumptions andp rojections offuture cashf lows +whichm ay ultimately prove to be incorrect as +assumptions,f actsa nd circumstances change.O nt he +otherh and, we arel imitedi nthe actions we can take +relatedt oour held-to-maturitysecuritiesa bsenta +significantd eteriorationi nthe issuer’s +creditworthiness. Therefore, we mayb ec onstrained +in our ability to liquidate ah eld-to-maturity security +that is deterioratingi nvalue.I fo ur determinations +change about ourintentiono ra bility tonot sell +available-for-sales ecuritiest hath avee xperienced a +reductioni nfairv alue belowtheir amortized cost,w e +couldb er equiredt orecognize al ossi ne arnings for +thee ntired ifferenceb etween fair valuea nd amortized +cost. +Fori nformationr egarding ourinvestment securities +portfolio,r efer to “Results of Operations – +Consolidated balances heet review –S ecurities.” +Reform of interest ratebenchmarks andthe useo f +alternativer eference ratesb yu sa nd ourc lients +coulda dversely affect ourb usiness, financial +conditiona nd results of operations. +Regulators, industryg roups andm arketp articipants +in theU.S.a nd othercountries continueto engage in +initiatives to introduceand encouraget he useo f +alternativer eference ratest or eplace certain interest +ratest hatw ereu seda sb enchmarksi nd ebts ecurities, +loansa nd otherfinancial instruments. Certaino ft he +alternativer eference ratesa ppeart oh aveg ained +acceptancea mong market participants.H owever, +interest rate benchmarkr eforms mayhaveu nexpected +adversec onsequences that couldbec ontrary to +market expectations.A lternativer eference ratesm ay +be basedupon indices,a nd mayh avec haracteristics, +different fromt he benchmarksthey replace. In some +cases,f inancial instrumentsm ay perform less +predictablya fter alternativereference ratesh ave +replaced theo riginalb enchmarks. Further, givent he +limitedp erformance andhistorical data of new +alternativer ates,t here can be noassurancet hat: +• anyo ft he newrates will be similart o, perform +thes amea s, producet he economic equivalent of, +or bean adequatesubstitute fort he benchmarks +that they replace; +• ap articular alternativereference rate will be +widely acceptedo ra dopted by market +participants; +• market participants will effectivelyi mplement +operationala nd otherarrangementst ot ransition +fromh istorical benchmarks,s ucha sL IBOR,t o +newa lternativer eference rates; +• market acceptanceofa na lternativer eference rate +will not be hinderedb ythe introductiono fo ther +referencer ates;o r +• anyp articular useo fh edgesw ill be effective. +In addition, we mayb ea dverselyi mpacted by theu se +of alternativer eference ratesa saresult of our +businessa ctivitiesa nd our underlying operations.W e +utilizer eference ratesi navarietyo fa greements and +instrumentsa nd arer esponsible fort he useo f +referencer ates in av ariety of capacities, as well as in +our operationalfunctions.W ec ouldb es ubject to +claims fromc ustomers,c ounterparties, investorso r +regulatorsa lleging that we didn ot correctly discharge +our responsibilitiesi ni nterpretinga nd implementing +contractuali nterestr atep rovisions orin selectingn ew +alternativer eference rates. Theset ypeso fc laims +coulds ubject us to increasedlegala nd operational +expenses andcouldd amageo ur reputation. +Uncertainty relating to alternativer eference rates +couldr esulti np ricing volatility,increased capital +requirements, loss of market sharei nc ertain products, +adverset ax or accountingc onsequences,h igher +compliance, legala nd operationalcosts,i ncreased +difficulty inestimatingo ur netinterestr evenue,a nd +risksa ssociated with client disclosures,discretionary +actions takeno rn egotiationo ff allback provisions, +andd isruptiono fb usinessc ontinuity,s ystems and +models,a ll of whichm ay adverselyimpact our +businessa nd results of operations. +CreditR isk +Thef ailure or perceivedweaknesso fa ny of our +significantc lientso rcounterparties, many of whom +arem ajor financiali nstitutions or sovereign entities, +ando ur assumptiono fc redit, counterparty and +concentrationr isk, coulde xposeu st oc reditl osses +anda dversely affect ourb usiness. +We have credit exposuret oc lients andc ounterparties +in many differentindustries, particularly financial +institutions,a saresult of trading, clearinga nd +financing, providingcustody services,s ecurities +Risk Factors (continued) +94 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_112.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_112.txt new file mode 100644 index 0000000000000000000000000000000000000000..14d146ebd85e46738e9ea147165b22b86c2c951e --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_112.txt @@ -0,0 +1,106 @@ +lending services or otherrelationships.W er outinely +execute transactionswith globalc lientsa nd +counterpartiesi nt he financiali ndustrya sw ella s +sovereigns ando ther governmental or quasi- +governmental entities. Ourdirect creditexposure +consists of extensions ofsecureda nd unsecuredcredit +to clientsa nd useofo ur balancesheet.I na dditiont o +traditionalc redita ctivities, we also extend intraday +credit inordert of acilitate ourv arious processing, +settlement andi ntermediationa ctivities. We couldb e +adverselya ffected by thea ctions andc ommercial +soundness of organizationsto whom we have lent +funds,a sd efaults or non-performance(ore ven +uncertainty concerning such defaulto rn on- +performance) by one ormore of thesei nstitutions,o r +them arkets generally,h avei nt he pastledt omarket- +wide liquidity problemsa nd couldl ead to losseso r +defaults by us or by otherinstitutions (including our +counterpartiesa nd/or clients) in thefuture. The +consolidationa nd failureso ff inancial institutions +duringt he 2008financialc risisi ncreased the +concentrationo fo ur client andc ounterpartyr isk. +As ar esulto fo ur membership inseverali ndustry +clearingo rs ettlement exchangesa nd central +counterpartyc learinghouses,w em ay be requiredt o +guarantee obligations andl iabilitieso rp rovide +financials upporti nt he eventt hato ther membersd o +not honortheiro bligations or default.These +obligations mayb el imitedt omembers that dealtw ith +thed efaultingm embero rto theamount (oramultiple +of thea mount)o four contributiont oaclearingo r +settlement exchange guaranteefund, or,i nafew +cases,t he obligationmay be unlimited. Additionally, +we aree xposedt osettlement risks, particularly inour +payments andf oreign exchange activities. Those +activitiesm ay lead to extensions ofcredit and +consequent lossesi nt he evento facounterparty +breach or an operationale rror, including thef ailure to +provide credit. We areexposed to risk of short-term +credit extensions to,o ro verdraftsb y, ourclientsi n +connectionw ith theprocesst of acilitate settlement of +trades andrelated foreigne xchange activities, +particularly when contractualsettlement hasbeen +agreed with our clients. Theo ccurrenceo fo verdrafts +at peak volatility couldc reates ignificantc redit +exposuret oo ur clientsd epending uponthev alue of +such clients’collateralp ledgedt ousa tt he time.T his +risk mayb eh eightened duringp eriods ofmarket +volatility,d uringw hich collateralvaluesm ay +decreases uddenly. +When we provide credit toclientsi nc onnectionw ith +providing cashm anagement, clearing, custodial and +others ervices,w ea re exposed to potentiall ossi ft he +client experiences creditdifficulties. Higherm arket +volatility, inflationary pressures, recessionary +conditions or declinesin equity values could +negativelya ffect thec reditworthinesso fo ur clients, +which, in turn,w ouldi ncreaseo ur credit risk.W ea re +also generally not able to nete xposures across +affiliatedc lientso rc ounterpartiesa nd mayn ot be +able to nete xposures to thes amel egal entityacross +multiple products.I na ddition, we mayi ncur al ossi n +relationt oone entity or productevent hough our +exposuret oo ne ofthee ntity’s affiliatesi so ver- +collateralized.M oreover, not allo fo ur client or +counterpartyc redite xposurei ss ecured. +In our agency securitiesl ending program,wea ct as +agento nb ehalfo four clients, thel enders of +securities, in securitiesl ending transactions with our +clients’ counterparties( including broker-dealers), +actinga sb orrowers,w herein securitiesa re lent by our +clientsa nd thes ecuritiesl oans arec ollateralized by +casho rs ecuritiesp ostedb ysuchc ounterparties. +Typically,i nthe caseo fc ashc ollateral, our clients +authorizeu sa stheir agentt oi nvest thec ashc ollateral +in approvedi nvestmentsp ursuantt oe ach client’s +investment guidelines andinstructions.S uch +approvedi nvestmentsm ay include reverser epurchase +transactions with repo counterparties. In many cases, +in thes ecuritiesl oans we enteri ntoo nbehalfo four +clients, we agreet or eplace thec lient’sl oaned +securitiest hatt he borrowerfails toreturn due to +certain defaults by theb orrower, mainly the +borrower’s insolvency.T herefore,i nsituations +wheret he market valueo ft he loaned securitiest hat +theb orrowerf ails toreturn to ac lient (which loaned +securitiesw ea re obligated to replacea nd return to the +client)e xceedst he amount of proceedsresultingf rom +thel iquidationo ft he client’s approvedi nvestments +andc asha nd non-cashcollateralo fs uchc lient,w e +mayb er esponsible fort he shortfalla mount necessary +to purchasea ny replacements ecurities. In addition, +in certain cases,w em ay alsoassume ther isko fl oss +relatedt oapprovedi nvestmentst hata re reverse +repurchaset ransactions as describeda bove.I nt hese +twos cenarios, we,rathert hano ur clients, aree xposed +to ther isks ofthed efaultingc ounterpartyi nthe +securitiesl ending transactions and, wherea pplicable, +in ther everse repurchaset ransactions. Forf urther +discussion on oursecuritiesl ending indemnifications, +see“ Commitmentsa nd contingent liabilities–Off- +balances heet arrangements”in Note 22 oftheN otes +to Consolidated FinancialS tatements. +Risk Factors (continued) +BNYM ellon9 5 +The secret office supply is a "paperclip". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_113.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_113.txt new file mode 100644 index 0000000000000000000000000000000000000000..94bc08327dd3de03c84868ae957b57a365ec79a6 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_113.txt @@ -0,0 +1,104 @@ +From time to time,wea ssume concentrated credit +risk at thei ndividualo bligor,c ounterpartyo rg roup +level, potentially exposingu st oasinglem arketo r +political eventoracorrelated seto fe vents. For +example, we mayb ee xposed to defaults by +companiesl ocated in countries with deteriorating +economic conditions or bycompaniesi nc ertain +industries. Ourc ommercialr eale statep ortfolio also +exposes us to concentrated creditrisk,i ncluding to +theN ew York metrom arket. Such concentrations +mayb em aterial. Ourc ounterpartye xposures change +daily,a nd thec ounterpartieso rg roups ofrelated +counterpartiest ow hich our risk exposurei sm aterial +also vary duringa ny reportedp eriod; however,our +largeste xposurest endt obet oo ther financial +institutions,c learingo rganizations,a nd governmental +entities, bothi nsidea nd outsidetheU .S. +Concentrationo fc ounterpartye xposurep resents +significantr isks to us andt oour clientsb ecause the +failure or perceivedweakness of ourcounterparties +(ori ns omec ases of ourclients’ counterparties) has +thep otentialt oe xposeu st or isko ff inancial loss. +Changesi nm arketp erceptiono ft he financial +strengtho fp articular financiali nstitutions or +sovereigni ssuersc an occurr apidly,a re oftenb ased +on av ariety of factorsa nd ared ifficult topredict. +Although our overallbusinessi ssubject to these +interdependencies, severalof our businessesare +particularly sensitivet ot hem, including ourcurrency +ando ther tradinga ctivities, our securitiesl ending and +securitiesf inance businessesa nd ourinvestment +management business. If we experience anyoft he +lossesd escribed above,itm ay materially and +adverselya ffect our results of operations. +We arealsos ubject to theriskt hato ur rightsa gainst +thirdp artiesm ay not beenforceable inall +circumstances.I na ddition, deteriorationi nthe credit +quality of thirdp arties whoses ecuritieso ro bligations +we hold, including ad eteriorationi nthe valueo f +collateralp ostedb ythird partiest os ecure their +obligations to us underderivatives contractsand other +agreements,c ould result in lossesand/or adversely +affect our ability torehypothecateo ro therwise use +thoses ecuritieso ro bligations forl iquidity purposes. +Disputes with clientsa nd counterpartiesa stot he +valuationo fc ollateralc an significantly increasei n +timeso fm arkets tressa nd illiquidity.I na ddition, +disruptions in theliquidity or transparency of the +financialm arkets mayresult in our inability tosell, +syndicateo rr ealizet he valueofo ur positions,thereby +leadingt oincreased concentrations.A ni nability to +reduceo ur positionsmayn ot onlyincreaset he market +andc reditr isks associated with such positions but +maya lsoi ncreaset he levelo fR WA on our balance +sheet,t hereby increasingo ur capitalr equirementsa nd +funding costs, allo fw hich couldadverselya ffect the +operations andp rofitability of our businesses. +UnderU .S.r egulatoryr estrictions oncredit exposure, +whichi nclude ab roadeningo ft he measureo fc redit +exposure, we arer equiredt olimit our exposures to +specifico bligorso rg roups,i ncluding financial +institutions.T hese regulatoryc redite xposure +restrictions maya dverselya ffect our businessesand +mayr equire us to modifyour operatingmodels or the +policiesa nd practiceswe use. +Further, we maintain sub-custodian relationships in +certain jurisdictions,i ncluding emerging ando ther +underdevelopedm arkets.O ur useofs ub-custodians +exposes us to operational, reputationala nd regulatory +risk,a sw ea re dependent uponsuch sub-custodianst o +perform certain services to clientsi nt hosem arkets. +Ther isks ofmaintainingc ustody services in such +marketsa re amplifiedd ue to evolving regulatorya nd +sanctions requirements, whichmay increaseo ur +financiale xposures,i nthe eventt hoses ub- +custodians, or we,a re unablet or eturn, transfer or +reinvest clients’ assets.U nderc ertain regulatory +regimes, we mayb eh eldr esponsible forr esulting +lossess ufferedb your clients, andw em ay agreet o +similaro rmores tringent standardsw ith clientst hat +aren ot subject to such regulations.W here we have +client depositliabilitiesr elated to non-U.S. currencies +in jurisdictions wherew emaintains ub-custodian +relationships,w eg enerally maintainac orresponding +amount ofcasho ndeposit with therelevants ub- +custodian or clearinga gency, whichi ncreases our +credit exposuret ot hate ntity andc an accumulate over +time basedu pon distributions on, or otheractivities +relatedt o, ourclients’ assets.I ft he sub-custodian or +clearinga gencyw eret ob ecome insolventi n +circumstances not involving expropriationo fa ssets or +otherc ircumstances that maye xcusep erformance +underr elevantc lient agreements,t he risk of loss on +such casho ndeposit couldb eo ursr athert hant he +clients’. +We couldi ncur lossesi fo ur allowancef or credit +losses, includingl oan andlending-related +commitment reserves,i si nadequateo ri fo ur +expectations of future economic conditions +deteriorate. +When we loan money, commit to loanmoneyo r +provide credit or enteri ntoa notherc ontract with a +Risk Factors (continued) +96 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_114.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_114.txt new file mode 100644 index 0000000000000000000000000000000000000000..a83bd7da032a4bf0e5a59a5327b93ce160f20423 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_114.txt @@ -0,0 +1,106 @@ +counterparty, we incurc reditr isk, orther isko fl ossi f +our borrowersdo notrepayt heir loansoro ur +counterpartiesf ailt op erform accordingt othe terms +of theira greements.O ur profitability isadversely +affected when our borrowersdefault, inwholeo ri n +part,o ntheir loanobligations to us orwhen therei sa +significantd eteriorationi nthe credit quality of our +loan portfolio.W er eserve forp otentialf uturec redit +lossesb yr ecordingaprovision forc reditl osses +through earnings.T he allowancef or loan losses and +allowancef or lending-relatedc ommitments +represents management’sestimate of current expected +credit lossesovert he lifetime of ther elated credit +exposuret akingi ntoa ccount relevant information +about pastevents,c urrent conditions andr easonable +ands upportablef orecasts of future economic +conditions that affectthec ollectability of ourloans +andl ending commitments. We useaq uantitative +methodology andq ualitativef ramework for +determiningt he allowancef or loan lossesa nd the +allowancef or lending-relatedc ommitments. Within +this qualitativef ramework,m anagementa pplies +judgmentw hena ssessing internal risk factorsa nd +environmentalf actorst oc omputea na dditional +allowancef or each component ofthel oanp ortfolio. +As is thecasew ith anys uchj udgments,w ec ould fail +to identifyt hese factorso ra ccurately estimate their +impact.W ec annot provideanya ssurancea st o +whetherc harge-offs relatedt oour credit exposure +mayo ccuri nt he future.C urrent andf uturem arket +ande conomic developments mayi ncreased efault and +delinquencyr ates andnegativelyi mpact theq uality of +our credit portfolio,w hich mayi mpact our charge- +offs.A lthough ourestimatesc ontemplatec urrent +conditions andh ow we expect them to change over +thel ifeo ft he portfolio,iti sr easonablyp ossiblet hat +actualc onditions couldb ew orse than anticipatedin +thosee stimates, whichcouldm aterially affect our +results of operationsandf inancial condition. See +“Results of Operations –C ritical accounting +estimates.” +Capitala nd LiquidityRisk +Ourb usiness, financialc onditiona nd results of +operations couldb ea dversely affected if we do not +effectivelym anageo ur liquidity. +Ouro peratingm odela nd overallstrategy rely heavily +on ouraccesst of inancial market utilitiesa nd global +capitalm arkets.W ithout such access,it wouldb e +difficult toprocessp aymentsa nd settle andc lear +transactions on behalfo four clients. Deteriorationi n +our liquidity position, whethera ctualo rp erceived, +can impact our market accessb ya ffecting +participants’w illingness to transactwith us.C hanges +to our liquidity can be causedb yvarious factors, such +as funding mismatches,afailu re in our asset/liability +management,m arketc onstraintsd isablinga ssett o +cashc onversion, inability to issued ebt, run-offs of +core deposits,a nd contingent liquiditye ventss ucha s +additionalc ollateralp osting. Changesi ne conomic +conditions orexposuret oc redit, market,o perational, +legala nd reputationalr isks can alsoaffect our +liquidity. +Ourb usinessi sdependent in part on ourability to +meet our casha nd collateralo bligations at a +reasonablec ostf or bothexpected andunexpected +cashf lows.W ea lsom ustm anagel iquidity riskso n +an intraday basis, in am annerd esignedt oensuret hat +we can accessr equiredf unds duringthe businessday +to make paymentsor settle immediateo bligations, +ofteni nreal time.W er eceive client deposits through +av ariety of investment management andi nvestment +servicingb usinessesa nd we rely on thosed eposits as +al ow-costa nd stable source of funding. Oura bility +to continue to receive thosed eposits,a nd othershort- +term fundingsources,i ss ubject to variability based +on an umbero ffactors, including volumeand +volatilityi nthe globalsecuritiesm arkets,t he relative +interest ratest hatw ea re prepared to payf or those +deposits,a nd thep erceptiono ft he safety of those +deposits or othershort-term obligations relativet o +alternatives hort-term investmentsa vailable toour +clients. We couldlosed eposits ifwe suffera +significantd eclinei nt he levelo fo ur business +activity,o ur credit ratings arem aterially downgraded, +interest ratesc ontinue to rise or remain at elevated +levels,o ri fweo ro ur peersbecome subject to +significantn egativep ress or significantr egulatory +actiono rl itigation, among otherreasons.O ur +liquidity coulda lsob ea dverselya ffected by +customers’ withdrawal of deposits inresponset o +volatilitya nd disruptionsin thefinancial marketso ra +stress events ucha st hate xperienced by regional +depository institutions in thefirst half of 2023. +Further, deposit outflowsc ouldi ncreasei fo ur clients +andc ustomers with uninsured deposits lookfor +alternativep lacements fort heir funds amidst market +andf inancial industryv olatility.Aperceivedl osso f +confidence in theB NY Mellona sadepository +institutionm ay be additionally exacerbatedb ythe +speed andpervasiveness withwhichi naccurate or +incomplete informationi sd isseminated through +social mediao ro ther internet forums.I fw ew eret o +lose as ignificanta mount of deposits,w em ay need to +replace such funding with moreexpensivef unding +Risk Factors (continued) +BNYM ellon9 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_115.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_115.txt new file mode 100644 index 0000000000000000000000000000000000000000..6f1f1ec03aa5b5675f7c6c4bbf3cd66a56df1506 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_115.txt @@ -0,0 +1,104 @@ +and/or reducea ssets,w hich wouldr educeo ur net +interest revenue. +Thed egreeo fc lientd emandf or short-term credit +tends to increaseduringp eriods ofmarket turbulence. +Fore xample,i nvestorsi nm utualf unds forw hich we +act as custodianmaye ngage in significantr edemption +activity due to adversem arketo re conomic +conditions.W em ay then extendintraday credit to +our fund clientsi no rder to facilitate theirability to +pays uchr edemptions.I na ddition, duringperiods of +market turbulence, drawsu nderc ommittedr evolving +credit facilitiest hatw ep rovide to our institutional +clientsm ay increase, andhavei nt he pastincreased, +substantially.S uchc lient demandmayn egatively +impact our leverage-based capitalr atios, andi ntimes +of sustainedm arketv olatility,m ay result in +significantl everage-basedr atio declines. +In addition, ouraccesst ot he debtande quity capital +marketsa nd credit marketsi sasignificants ourceo f +liquidity.E ventso rc ircumstances ofteno utside of +our control, such asmarket disruptions,l ack of +liquidity in themarkets,g overnment fiscal and +monetary policies, uncertainty overt he U.S. +government debtceilingo rl osso fc onfidence by +securitiesp urchaserso rc ounterpartiesi nu so ri nt he +funds markets, couldl imit our accesst oc apital +marketsa nd credit markets,increaseo ur cost of +borrowing, adverselya ffect ourl iquidity,o ri mpair +our ability toexecute our businessplan. In addition, +clearingo rganizations,r egulators, clientsa nd +financiali nstitutions with whichw ei nteract may +exercise ther ight to require additionalc ollateral +basedo nmarketp erceptions ormarket conditions, +whichc ouldf urther impairo ur accesst oa nd cost of +funding. Market perceptiono fs overeignd efault risks +can alsolead to inefficientmoneym arkets andc apital +markets, whichcouldf urther impact our funding +availability andc ost. Conversely, excessl iquidity +inflowsc ouldi ncreasei ntereste xpense, limit our +financialf lexibility,a nd increase thes izeo fo ur total +assets inam annert hatc ouldh avean egativei mpact +on ourcapitalr atios. +Undert he U.S. capitalr ules,t he size of thec apital +surcharget hata ppliest oaU.S. G-SIBi sb ased in part +on its relianceo ns hort-term wholesalef unding, +including certain typesofd eposit funding, whichm ay +increaset he cost of such funding. Furthermore, +certain non-U.S. authoritiesr equire largeb anks to +incorporateas eparates ubsidiary in countries in +whicht heyo perate,a nd to maintain independent +capitala nd liquidity at foreigns ubsidiaries.T hese +requirementsc ouldh indero ur ability toefficiently +manage ourfunding andl iquidity inac entralized +manner, requiring usto holdm orec apitala nd +liquidity overall. +In addition, ourcost of funding couldb ea ffected by +actions that we mayt akei no rder to satisfy applicable +LCRa nd NSFR requirements, to lowerour G-SIB +score, to satisfy thea mount ofeligible long-term debt +outstanding underthe TLACr ule, to address +obligations underour resolution planor to satisfy +regulatoryr equirementsi nn on-U.S. jurisdictions +relatingt othe pre-positioning ofliquidity incertain +subsidiaries.F urther,t he regulatoryo rs tresst est +liquidity valuea ssociated with thesecuritiesw eh old +subject to ah eld-to-maturity accountingd esignation +couldb er educed in thef uturet hrough regulatoryo r +supervisorya ction, exposingu st or elativelyg reater +capitalr atio volatility attributable to interest rate +movementst ot he extent we designate ar elatively +larger percentage of oursecuritiesp ortfolio as +available-for-saleg oing forwardi nresponset os uch +regulatoryo rs upervisoryc hanges. +If we areu nablet or aise funds usingthe methods +describeda bove,w ew ouldl ikelyn eed to finance, +reduceo rl iquidate unencumbereda ssets,s ucha so ur +central bank depositsandb ankp lacements,o r +securitiesi no ur investment portfolio to meetfunding +needs. We mayb eu nablet os ells omeo fo ur assets, +or we mayh avet os ella ssets at ad iscount from +market value, eitherof whichc oulda dverselya ffect +our business,financialc onditiona nd results of +operations.F urther,o ur abilityt osella ssets mayb e +impairedi fo ther market participants ares eekingt o +sell similara ssets at thes amet ime,w hich couldoccur +in al iquidity or othermarketc risis. Additionally,i f +we experience cashflowm ismatches, deposit run-off +or market constraintsresultingf romo ur inability to +convert assets tocasho ra ccessc apitalm arkets,o ur +liquidity couldb es everelyi mpacted.D uringp eriods +of market uncertainty,o ur levelo fc lient depositshas +in recenty earst endedt oincrease; however,b ecause +thesed eposits have high potentialr un-offr ates,w e +have historicallydepositedt hese so-calledexcess +deposits with central banks andi nother highlyl iquid +andl ow-yieldingi nstruments. +If we areu nablet oc ontinue to fund ourassets +through depositsora ccessc apitalm arkets on +favorable termso ri fwes uffera ni ncreasei no ur +borrowing costso ro therwise fail to manage our +liquidity effectively, ourliquidity,n et interest margin, +financialr esults andc onditionm ay be materially +Risk Factors (continued) +98 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_116.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_116.txt new file mode 100644 index 0000000000000000000000000000000000000000..3aa382b24e79cfa75c89bb277a0640204459c4a7 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_116.txt @@ -0,0 +1,103 @@ +adverselya ffected.I nc ertain cases,t hisc ould +require us to raisea dditionalc apitalt hrough the +issuance of preferredorc ommons tock,w hich could +dilute theownership of existings tockholders and/or +reducec ommons tock repurchases or ourcommon +stockd ividend, to preserve capital. Forafurther +discussion of ourliquidity,s ee “Resultsof Operations +–L iquidity andd ividends.” +Failure to satisfy regulatory standards,including +“wellc apitalized”a nd “wellm anaged” status or +capitala dequacya nd liquidity rulesm oreg enerally, +couldr esulti nl imitations on ouractivitiesa nd +adversely affect ourb usinessa nd financial +condition. +UnderU .S.a nd internationalr egulatoryc apital +adequacy rulesa nd otherregulatoryr equirements, we +ando ur subsidiary banks must meet or exceed +thresholds that include quantitativem easures of +assets,l iabilities, andc ertain off-balance sheet items, +subject to qualitativej udgments by regulatorsa bout +components, risk weightingsando ther factors. As +discussedi n“Supervisiona nd Regulation,” BNY +Melloni sr egisteredw ith theFederal Reservea sa +BHCa nd an FHC. An FHC’sa bility to maintainits +status as anFHCi sd ependent uponan umbero f +factors, including its U.S. bank subsidiaries +qualifying onan ongoing basisa s“well capitalized” +and“ well managed” underthe bankingagencies’ +prompt correctivea ctionr egulations as well as +applicable FederalR eserve regulations.F ailure by an +FHCo ro ne ofits U.S. bank subsidiaries to qualifya s +“wellc apitalized”a nd “wellm anaged,” if unremedied +overaperiod, wouldc ause it to loseits status as an +FHCa nd coulda ffect thec onfidence of clientsi ni t, +compromisingi ts competitivep osition. Additionally, +an FHCt hatd oesn ot continue to meet allthe +requirementsf or FHCs tatusc ouldl oset he ability to +undertaken ew activitiesorm akea cquisitions that are +not generallypermissiblew ithout FHCs tatuso rt o +continue such activities. +Thef ailure by one of ourU.S. bank subsidiaries to +maintain itsstatus as “wellcapitalized”c ouldl ead to, +among otherthings,h igherF DICa ssessments and +couldh aver eputationala nd associated business +consequences. +If we or oursubsidiary banks fail to meetU.S. and +internationalm inimumc apitalr ules andother +regulatoryr equirements, wemayn ot beable to +deploy capitali nt he operationofo ur businesso r +distributec apitalt os tockholders,w hich may +adverselya ffect our business. +Failure to meet anycurrent orfuture capitalo r +liquidity requirements, including thosei mposed by +theU .S.c apitalr ules,t he LCRo rt he NSFR,o rb y +regulatorsi ni mplementingo ther portions oftheB asel +III framework,couldm aterially adverselya ffect our +financialc ondition. Compliance with U.S. and +internationalr egulatoryc apitala nd liquidity +requirementsm ay impact our ability toreturn capital +to shareholders andm ay impact our operations by +requiring usto liquidatea ssets,i ncreaseb orrowings, +issuea dditionale quity or othersecurities, or ceaseo r +alterc ertain operations,w hich maya dverselya ffect +our results of operations. +Finally,o ur regulatoryc apitalr atios, liquidity +metrics, andr elated componentsare basedo nour +current interpretation, expectations,a nd +understanding ofthea pplicable rulesa nd ares ubject +to,a mong otherthings, ongoing regulatoryr eview, +regulatorya pprovalo fc ertain statistical models, +additionalr efinements,m odifications or +enhancements (whether requiredo ro therwise)t oo ur +models,a nd furtheri mplementationg uidance. Any +modifications resultingf romt hese ongoing reviews, +thea doptiono fn ew or heightenedprudential +regulatoryr equirements, or thec ontinued +implementationo ft he U.S. capitalr ules (sucha st he +proposed revisionsi nt he thirdq uarter of 2023 bythe +FederalR eserve,t he OCCa nd theF DICt o +implement andf inalizet he BaselI II reformsand the +reviseds tandard formarketr iskc apitalr equirements), +theL CR, theN SFR,t he resolution planning process +andr elated amendments,couldr esulti nc hangesi n +our RWAs,c apitalc omponents, liquidityi nflows and +outflows, HQLA,o ro ther elements involvedi nthe +calculationo ft hese measures,w hich couldimpact +regulatoryc apitala nd liquidity ratios. Further, +because operationalr iski sc urrently measuredbased +not onlyupon our historicaloperationall oss +experience but also upon ongoingevents in the +banking industryg enerally,o ur levelo fo perational +RWAs coulds ignificantly increaseoro therwise +remain elevated andm ay potentially be subject to +significantv olatility,n egativelyi mpactingo ur capital +ratios. Additionally,o ur liquidity positionc ouldb e +significantly impactedby changest ot he liquidity +framework itself, as regulatorsm ay seek to evaluate +potentialc hangest ot he regulatoryf ramework +following ther egionalb ankf ailuresi nt he firsth alfo f +2023. Theu ncertainty causedb ythese factorsc ould +RiskF actors (continued) +BNYM ellon9 9 +The secret object #5 is a "toothbrush". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_117.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_117.txt new file mode 100644 index 0000000000000000000000000000000000000000..c8cc903103f01c05975f6dff0dc3e6bb10381ad3 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_117.txt @@ -0,0 +1,103 @@ +ultimately impact our ability to meetour goals, +supervisoryr equirements, andr egulatorys tandards. +TheP arenti sanon-operatingh olding company +and, asar esult, isdependento nd ividends from its +subsidiaries ande xtensionso fc reditf romi ts IHCt o +meet its obligations,i ncluding with respect to its +securities, andt oprovide fundsf or share +repurchases, payment of income taxesand payment +of dividendstoi ts stockholders. +TheP arenti sanon-operatingh olding company, +whosep rincipal assetsands ources of income arei ts +principalU .S.b anks ubsidiaries—The Bank ofNew +York Mellona nd BNYM ellon, N.A.—and its other +subsidiaries,i ncluding Pershing andt he IHC. The +Parent is al egal entityseparate andd istinct fromi ts +banks,t he IHCa nd othersubsidiaries. Therefore, the +Parent primarilyrelieso nd ividends,i nterest, +distributions,a nd otherpaymentsf romi ts +subsidiaries,i ncluding extensions ofcredit fromt he +IHC, to meetits paymento bligations,i ncluding with +respect to itssecurities, andt oprovide funds fors hare +repurchases,t he paymentofi ncomet axes and +paymento fc ommona nd preferreddividends to its +stockholders,t othe extent declaredby theB oard of +Directors. +Therea re various limitations onthee xtentt ow hich +our banksando ther subsidiaries canfinanceo r +otherwises upplyf unds to theParent( by dividend or +otherwise) andcertain of ouraffiliates. Each of these +restrictions can reducet he amount offunds available +to meettheP arent’so bligations.M anyo fo ur +subsidiaries,i ncluding our banksubsidiaries,a re +subject to lawsandr egulations that restrict dividend +payments or authorizer egulatoryb odies to blocko r +reducet he flow offunds from thoses ubsidiaries to +theP arento ro ther subsidiaries.I na ddition, our bank +subsidiaries wouldn ot be permittedt odistributea +dividend if doing so wouldconstitute an unsafea nd +unsound practiceori fthe paymentwouldr educet heir +capitalt oa ninadequate level. Ours ubsidiaries may +also chooset or estrictd ividendp aymentst ot he +Parent in ordert oi ncreaset heir ownc apitalo r +liquidity levels.O ur banksubsidiaries arealso +subject to restrictions ontheira bility to lendto or +transact with non-bank affiliates, minimumr egulatory +capitala nd liquidity requirements, andr estrictions on +theira bility tousef unds depositedw ith themin bank +or brokerageaccountst of und theirb usinesses. See +“Supervisiona nd Regulation” and“ Results of +Operations –L iquidity andd ividends,” as well as +Note 19 oftheN otes to Consolidated Financial +Statements.F urther,w ee valuatea nd manage +liquidity on al egal entitybasis, whichmay place +legala nd otherlimitations on ourability toutilize +liquidity fromo ne legale ntity to satisfy thel iquidity +requirementso fa nother, including theP arent. +Therea re also limitations specifict ot he IHC’sa bility +to make distributions orextend credit to theParent. +TheI HC is not permittedt opay dividends to the +Parent if certain keyc apitala nd liquidity indicators +areb reached,a nd if ther esolutiono ft he Parent is +imminent, thecommittedl ines of credit providedb y +theI HC to theParentw ill automatically terminate, +with allo utstanding amountsb ecomingd ue. +Because theP arenti saholding company, its rights +andt he rights of its creditors,i ncluding theh olders of +its securities, to as hare of thea ssets of anys ubsidiary +upon thel iquidationo rr ecapitalizationo ft he +subsidiary,w ill be subject to theprior claims of the +subsidiary’s creditors( including, in thecaseo fo ur +banking subsidiaries,t heir depositors)e xceptt ot he +extent that theP arentm ay itselfb eac reditorw ith +recognized claimsagainstt he subsidiary.T he rights +of holdersof securitiesi ssued by theP arentt ob enefit +fromt hosed istributions will also be junior to those +priorc laims.C onsequently,s ecuritiesi ssued by the +Parent will be effectivelys ubordinatedt oall existing +andf uturel iabilitieso fo ur subsidiaries. +Oura bility to return capitalt os hareholdersi s +subject to thed iscretiono fo ur Boardo fD irectors +andm ay belimitedb yU .S.b anking laws and +regulations, includingt hose governing capitala nd +capitalp lanning,a pplicablep rovisionso fD elaware +lawa nd ourf ailure to pay full andt imely dividends +on ourpreferreds tock. +Holderso fo ur commona nd preferredstock areonly +entitledt oreceive such dividends or other +distributions ofcapitala so ur Boardo fD irectorsm ay +declareo ut offunds legallya vailablef or such +payments.A lthough we have historicallydeclared +cashd ividends on ourcommona nd preferredstock, +we aren ot requiredt od oso. In additiont othe Board +of Directors’ approval, our ability to takecertain +actions,i ncluding ourability todeclared ividends or +repurchaseo ur common stock, mayb es ubject to the +buffers undert he FederalR eserve’s capitala nd +TLAC rules. Theb uffers undert he capitalr ules are +affected by ther esults of CCAR. Through theC CAR +process, we mayb e, andhavei nt he pastbeen, +requiredt oresubmit our capitalp lani nthe evento fa +deteriorationi nthe generalfinancial marketso r +Risk Factors (continued) +100 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_118.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_118.txt new file mode 100644 index 0000000000000000000000000000000000000000..07d79b30f963063b2ec72d0fc736f0a1a1ad0d85 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_118.txt @@ -0,0 +1,102 @@ +economyo rc hangesi no ur risk profile (including a +material changein businesss trategyo rr isk +exposure),f inancial conditiono rc orporates tructure. +TheF ederal Reservei sa lsoa ble, outside theC CAR +process, to restrict our ability to makecapital +distributions ands ubject us to others upervisoryo r +enforcementa ctions. +AF ederal Reserved eterminationt hato ur capital +planning processeswerew eak or otherwisefailt o +meet supervisorye xpectations couldh aveav ariety of +adversec onsequences,i ncluding, without limitation, +ratings downgrades,ongoing heightenedsupervisory +scrutiny, expenses associatedwith remediation +activities, andp otentially an enforcementaction. +Af ailure to increasedividends along with our +competitors,o ra ny reductiono f, or eliminationo f, +our commons tock dividend wouldl ikelya dversely +affect them arketp rice of ourcommons tock,o ur +return on equity andm arketp erceptions ofBNY +Mellon. +Oura bility todeclareo rp ay dividends on, or +purchase, redeem or otherwiseacquire,s hareso fo ur +commons tock will be prohibited,subject to certain +exceptions,i nthe eventt hatw ed on ot declareand +payi nfulld ividends fort he then-current dividend +period (int he caseo fd ividends)o rmostr ecently +completedd ividendp eriod( in thecaseo f +repurchases)o four Series Ap referreds tock or the +last precedingd ividendp eriod( in thecaseo f +dividends)o rmostr ecently completedd ividend +period (int he caseo fr epurchases)o four Series F, +Series G, Series Ho rS eriesIpreferreds tock. +In addition, regulatoryc apitalr ules that areorw ill be +applicable tous,i ncluding theU .S.c apitalr ules risk- +basedc apitalr equirements, theS LR,t he stress capital +buffer, thee nhanced SLR, theT LACr ulea nd the +U.S. G-SIBs urcharge,m ay limit or otherwiserestrict +how we utilizeo ur capital, includingcommons tock +dividends ands tock repurchases,a nd mayr equire us +to increaseora ltert he mix of our outstanding +regulatoryc apitali nstruments.C hangesi nt he +compositiono fo ur balancesheet,i ncluding as a +result of changing economic conditions andm arket +values,m ay furtherr equire us to increaseora ltert he +mix of our outstandingregulatoryc apital, whichi n +turn couldi mpact our ability toreturn capitalt o +shareholders. +Anyrequirement to increaseour regulatoryc apital +ratioso ra ltert he compositiono fo ur capitalc ould +require us to liquidatea ssets or otherwisechange our +businessa nd/or investment plans, whichmay +negativelya ffect our financialr esults.F urther,a ny +requirement to maintainhigherl evelso fc apitalm ay +constraino ur ability toreturn capitalt os hareholders +either in thef ormo fc ommons tock dividends or +stockr epurchases. +Anym aterialr eductioni nour credit ratings orthe +credit ratings of ourprincipal banksubsidiaries, +TheB anko fN ew York Mellon,BNY Mellon, N.A. +or TheB anko fN ew York MellonS A/NV,c ould +increase thec osto ff undinga nd borrowing to us +ando ur rateds ubsidiariesa nd haveam aterial +adverse effect on ourbusiness, financialc ondition +andr esults of operationsando nt he valueo ft he +securitiesw ei ssue. +Ourd ebta nd preferredstock andthe debtand +deposits of our principalbanks ubsidiaries,T he Bank +of NewY orkM ellon, BNYM ellon, N.A. andT he +Bank ofNewY orkM ellonS A/NV, arec urrently +ratedi nvestment gradebyt he majorr atinga gencies. +Theser atinga genciesr egularly evaluate us ando ur +rateds ubsidiaries.T heir credit ratings areb ased on a +numbero ffactors, including ourfinancials trength, +performance, prospectsa nd operations,asw ella s +factorsn ot entirelyw ithin our control, including +conditions affectingt he financials ervices industry +generally andt he U.S. government.R atinga gencies +employ differentmodels andf ormulast oa ssess the +financials trengtho faratedc ompany, andf rom time +to timeratinga genciesh ave, in theird iscretion, +alteredt hese models.C hangest or atinga gency +models,g eneral economicconditions,r egulatory +developments or othercircumstances outside our +controlc ouldn egativelyi mpact ar atinga gency’s +judgmento ft he ratingo ro utlook it assigns to us or +our rateds ubsidiaries.A saresult, we or ourrated +subsidiaries mayn ot beable to maintainour +respectivec reditr atings or outlook on oursecurities. +Forf urther discussion of ourando ur principalbank +subsidiaries’c reditr atings,s ee “Resultsof Operations +–L iquidity andd ividends.” +Am aterialr eductioni nour credit ratings orthec redit +ratings of ourrateds ubsidiaries,w hich canoccura t +anyt ime without notice, couldhaveam aterial +adversee ffect on ouraccesst oc reditm arkets,t he +relatedc osto ff unding andb orrowing, ourcredit +spreads, our liquiditya nd certain tradingrevenues, +particularly in thosebusinessesw here counterparty +creditworthinessi scritical.I na ddition, in connection +with certain over-the-counter derivatives contracts +Risk Factors (continued) +BNYM ellon1 01 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_119.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_119.txt new file mode 100644 index 0000000000000000000000000000000000000000..70361e3ed441c5ee40e19645aad697b40a626d8e --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_119.txt @@ -0,0 +1,102 @@ +ando ther tradinga greements,c ounterpartiesm ay +require us or ourrateds ubsidiaries to provide +additionalc ollateralo rt ot erminatet hese contracts +anda greements andc ollateralf inancing arrangements +in theevent ofac reditr atings downgradebelow +certain ratings levels,w hich couldimpairo ur +liquidity.A downgradeb ya ny oneratinga gency, +depending onthea gency’sr elativer atings ofthe +entity at thet ime of thed owngrade, mayh avea n +impact comparable to theimpact of ad owngradeb y +allr atinga gencies. If ar atinga gencyd owngradeo ra +review ford owngradew eret oo ccurd uringb roader +market instability,o ur optionsforr esponding to +events maybem orel imiteda nd more expensive, +possiblys ignificantly.A ni ncreasei nt he costso fo ur +funding andb orrowing, oran impairmento fo ur +liquidity,c ouldh aveam ateriala dversee ffect on our +results of operationsandf inancial condition. A +material reductioni nour credit ratings also could +decreaset he numbero finvestorsa nd counterparties +willingo rp ermittedt od obusinessw ith or lend to us +anda dverselya ffect thev alue ofthes ecuritiesw e +have issued or mayi ssuei nt he future. +We cannot predictwhata ctions ratinga genciesm ay +take,o rw hata ctions we maye lect or berequiredt o +take in responset hereto,w hich maya dverselya ffect +us.F or furtherd iscussiono nthe impact of ac redit +ratingd owngrade, see“ Disclosure of contingent +features in OTCd erivativei nstruments”i nN ote2 3o f +theN otes to Consolidated FinancialS tatements. +Thea pplicationo fo ur Title Ip referredr esolution +strategy orresolutionu nder theT itle II orderly +liquidationa uthority coulda dversely affect the +Parent’s liquidity andf inancial conditiona nd the +Parent’s security holders. +In 2017, in connectionw ith our singlep oint ofentry +resolutions trategyu nderT itle Io fthe Dodd-Frank +Act, theParente ntered into ab inding support +agreementw ith certain keys ubsidiaries to facilitate +thep rovision ofcapitala nd liquidity resources to +them in theevent ofmaterial financiald istresso r +failure.T he supporta greementr equirest he Parent to +transfer cashando ther liquidf inancial assets to the +IHCo na nongoing basis, subjectto certain amounts +retained by theP arentt om eeti ts near-termc ash +needs, in exchange foru nsecureds ubordinated +funding notesissued by theI HC as well as a +committedl ineo fc reditt ot he Parent to servicei ts +near-termo bligations.T he Parent’s andt he IHC’s +obligations underthe supporta greementa re secured. +If our projectedliquidity resources deteriorates o +severely that resolutiono ft he Parent becomes +imminent, thecommittedl ineo fc reditt he IHC +providedt othe Parent will automatically terminate, +with alla mountso utstanding becomingd ue and +payable, andthe supporta greementw ill require the +Parent to transfer most of its remaininga ssets (other +than stocki nsubsidiaries andacashr eserve to fund +bankruptcy expenses)tot he IHC. As ar esult, during +ap eriodo fs everef inancial stress, theP arentc ould +become unablet om eet itsd ebta nd payment +obligations (including with respect to itssecurities), +causing theP arentt os eek protectionu nder +bankruptcy laws earliert hani to therwise wouldhave. +If theP arentw eret ob ecome subject to ab ankruptcy +proceedinga nd oursingle point ofentrys trategyi s +successful,o ur material entities will not besubject to +insolvency proceedings andt heir creditorsw ouldn ot +be expected to sufferl osses, whilet he Parent’s +security holders,i ncluding unsecureddebth olders, +couldf ace significantl osses, potentially includingthe +loss of theire ntirei nvestment.T he single point of +entrys trategy, in whicht he Parent wouldb et he only +legale ntity toenterr esolutionp roceedings,i s +designedt oresulti ng reater risk of loss to holders of +theP arent’su nsecureds eniord ebts ecuritiesa nd +certain others ecuritiest hanw ouldb et he caseu ndera +different resolution strategy. +Further, if thes inglep oint ofentrys trategyi sn ot +successful,o ur liquidity andf inancial condition +wouldb ea dverselya ffected andall security holders +may, as ac onsequence, be in aw orse positiont hani f +thes trategyh ad not beenimplemented. +In addition, Title II of theD odd-FrankA ct +establisheda norderly liquidationprocessi nt he event +of thef ailure of al arge systemically important +financiali nstitution, such asBNYM ellon, in ordert o +avoido rm itigates erious adversee ffectso nt he U.S. +financials ystem. Specifically,i fB NY Mellonisi n +defaulto rd angero fdefault, andc ertain specified +conditions arem et,t he FDIC mayb ea ppointed +receiveru ndert he orderlyliquidationa uthority,a nd +we wouldb er esolvedu ndert hata uthority insteadof +theU .S.B ankruptcy Code. +U.S. supervisorsh avei ndicated that as inglep oint of +entrys trategym ay be ad esirable strategy to resolvea +largef inancial institutions ucha sB NY Mellonu nder +Title II in am annert hatw ould, similart oo ur +preferreds trategyu ndero ur Title Ir esolutionp lan, +imposel osseso ns hareholders,u nsecuredd ebt +Risk Factors (continued) +102 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_12.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_12.txt new file mode 100644 index 0000000000000000000000000000000000000000..10eb52252adeb3530318ae13a40355c24ee81b04 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_12.txt @@ -0,0 +1,66 @@ +X ANNUAL REPORT 2023 +RUN OUR +COMPANY +BETTER +Next, we took meaningful steps +toward running our company +better in 2023, increasing +discipline with how we spend +so that our investments in the +business go further. We generated +double the amount of efficiency savings compared +to the prior year, which allowed us to self-fund half +a billion dollars of incremental investments. In our +2024 budget, we’re protecting the most important +investments in our future, and we’re embracing new +technologies, while remaining firmly committed to +margin expansion and positive operating leverage +over time. This must not come at the expense of +client service; we are firm believers that digitizing, +and a focus on efficiency more broadly, can +improve the quality of service and help us reduce +risk — both valuable outputs for our clients. +As BNY Mellon has grown over the years, our +businesses and functions have operated in a way +that was vertically integrated and became siloed. +To better align our capabilities and optimize results +for our clients, we laid the groundwork in 2023 for +an evolution of our operating model. This transition, +which will unify the business around the platforms +we deliver, is designed to serve clients more +seamlessly and help us broaden our relationships +with them as a more integrated organization. +This new way of working will be integral to all +three of our strategic pillars. Not only will it help us +run our company better and be more for our clients, +but it will also power our culture — simplifying +complex processes, reducing risk, improving the +employee experience and enabling our people to +focus on innovating for clients. +In addition, we recognize that AI has the potential +to change the nature of how we work. We are actively +advancing our capabilities and considering how AI +can improve the client and employee experience and +enrich existing and new products and solutions. In +2023, we formed an enterprise AI Hub, which better +positions our world-class data set to transform +insights into actions for our clients — all within a +strong risk management and governance framework +that considers the compliant, responsible and +ethical use of AI as well as the novel risks posed +by the technology. +Resilience forms the foundation for running our +company better. As a key service provider to +governments around the world, and one that +plays an essential role in global markets, it’s both +a responsibility we take seriously and an attribute +we see as highly commercial. Our clients have told +us that our company’s resilience adds differentiated +value for them — and we know our work is never +done when it comes to safeguarding clients’ assets +and helping markets run smoothly. Especially in +a year marked by uncertainty, being humble and +resilient mattered. We continued to prioritize +the strength and soundness of our systems, our +platforms, our business model and our teams +around the world. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_120.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_120.txt new file mode 100644 index 0000000000000000000000000000000000000000..9941a9ed59343dc6484ffa53e22a5542e38280d1 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_120.txt @@ -0,0 +1,102 @@ +holders ando ther unsecuredc reditors of theP arent, +while permittingt he holdingcompany’ss ubsidiaries +to continue to operate andr emains olvent.U nder +such as trategy, assumingt he Parent entered +resolutionp roceedings andi ts subsidiaries remained +solvent, lossesatt he subsidiary levelw ouldb e +absorbed by theP arenta nd ultimatelyborne bythe +Parent’s security holders (including holdersof the +Parent’s unsecuredd ebts ecurities),w hile third-party +creditors of theP arent’ss ubsidiariesw ouldn ot be +expected to sufferl osses. Accordingly, theP arent’s +security holders (including holdersof unsecureddebt +securitiesa nd otherunsecuredc reditors)c ouldf ace +lossesi ne xcesso fw hato therwise wouldhaveb een +thec ase. +StrategicR isk +Newl ines of business,newp roductsa nd services or +transformationalo rs trategic project initiatives +subject us to newo ra dditionalr isks,a nd thef ailure +to implementthesei nitiatives couldaffect our +results of operations. +From time to time,weh avel aunchedn ew lines of +business, offeredn ew products ands ervices within +existingl ines of businessoru ndertaken +transformationalo rs trategic projects. Therea re +substantialr isks andu ncertaintiesa ssociated with +thesee fforts.W ei nvest significanttime and +resources in developing andm arketingn ew lines of +business, products ands ervices andexecutingo nour +transformationala nd strategici nitiatives.F or +example, we have devoted considerableresources to +developing newtechnology solutions foro ur clients, +including ourinitiatives relatedt oreal-time electronic +payments andg lobalc ollateralm anagement, as well +as Wove,our integrative wealth management +advisory platform.I ft hese technology solutions are +not successful,i tc oulda dverselyi mpact our +reputation, businessand results of operations.I n +2022, we announced thel auncho fo ur DigitalA sset +Custody platform forselect U.S. institutionalc lients +to holda nd transfer Bitcoina nd Ether. Developing +andp roviding newproducts ands ervices,i ncluding +thoser elatingt odigitala ssets, increases our +operationalr iske xposures.T hese risksa re often +heightened in connectionw ith assetc lasses, such as +digitala ssets,t hata re not onlynew forB NY Mellon +but also relativelyn ew to thefinancial marketsm ore +broadly. Compared with our activitiesi nvolving +traditionala ssets,d igitala sset-relatedp roducts or +services mayi ntroducei ncremental or uniquerisks, +particularly thoseassociatedw ith cybersecurity +exposures andthird-party dependencies, as well as +reputational, technology,legala nd regulatoryr isks. +Regulatoryr equirementsc an affectwhether +initiatives areablet ob eb rought to marketin a +mannert hati st imely anda ttractivet oo ur customers. +Initialt imetablesf or thed evelopmenta nd +introductiono fn ew lines of businessorn ew products +or services andprice andp rofitability targetsmay not +be met. Furthermore, our revenuesa nd costsm ay +fluctuateb ecause newb usinesseso rp roducts and +services generally require startupc osts while +revenuesm ay take time to develop, whichm ay +adverselyi mpact our results of operations. +Significante ffort andr esources arenecessary to +manage ando versee thes uccessful completion of +transformationalo rs trategic project initiatives.I f +management makesc hoices aboutthesei nitiatives +that prove to be incorrect,a re basedo nincomplete, +inaccurate or fraudulenti nformation, fail to +accurately assess thec ompetitive landscapea nd +industryt rends orareu nablet oa ddresst he +expectations of variousstakeholders,t hent he value +andg rowthp rospectso fo ur businessmay be +affected.F urther,t hese initiatives oftenp lace +significantd emands onmanagement andalimited +numbero femployees with subject mattere xpertise +andm ay involve significantc osts to implement,as +well as increaseo perationalr iska sw ed evelop and +implement relatedc ontrols,p rocessesa nd procedures +ande mployees learnt ooperate undern ew systems, +controls,p rocessesa nd procedures.T he failure to +successfully execute on theset ransformationalo r +strategici nitiatives couldadverselyi mpact our +business, reputationa nd results of operations. +Legal, regulatorya nd reputationalr isks maya lso +existi nc onnectionw ith dealingw ith newp roducts or +markets, or clientsa nd customersw hose businesses +focuso ns uchp roducts or markets, wherethere is +regulatoryu ncertainty or different orconflicting +regulations depending onther egulator orthe +jurisdiction. We mayi nvest significanttime and +resources into theexpansiono fe xistingo rc reationo f +newc ompliancea nd risk management systemsw ith +respect to newp roducts or markets. +We ares ubject to competitioni nall aspectso fo ur +business, whichc ould negativelya ffect oura bility to +maintain or increase ourp rofitability. +Theb usinessesi nw hich we operate arei ntensely +competitivea round thew orld.L argera nd more +Risk Factors (continued) +BNYM ellon1 03 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_121.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_121.txt new file mode 100644 index 0000000000000000000000000000000000000000..b87b1dc3cdbdaf785de920be81df51a27fd7f12e --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_121.txt @@ -0,0 +1,103 @@ +geographically diversec ompanies,a nd financial +technology firmst hati nvest substantialresources in +developing andd esigning newtechnology andt hat +aren ot subject to thesamel evel of regulation, mayb e +able toofferf inancial products ands ervices atmore +competitivep rices than we area blet oo ffer. We have +also experienced,a nd anticipatet hatw ew ill continue +to experience, pricinga nd othercompetitivep ressures +in severalo fo ur businesses. Pricingp ressures, as a +result of thew illingness of competitors to offer +comparable or improvedp roducts or services at a +lowerp rice, mayr esulti nareductioni nt he pricew e +can chargeforo ur productsands ervices,w hich +could, andi nsomec ases has, negativelya ffected our +ability to maintainor increaseo ur profitability. +In addition, technological advanceshave made it +possiblef or othertypeso fn on-depository +institutions,s ucha sf inancial technology firms, +outsourcing companiesa nd dataprocessing +companies, to offeravarietyo fp roducts ands ervices +competitivew ith certain areaso fo ur business, +including with respect to our clearing, settlement, +payments andt rading activities. In thef uture, +financialt echnology firmsm ay be able toprovide +traditionalb anking productsands ervices by +obtaining ab ank-likec harter,s ucha st he OCC’s +fintech charter,or offercryptocurrencies. +Moreover, newo rd isruptivet echnologies may +quickly impact markets, andt he manneri nw hich our +clientsi nteract andtransact within markets. For +example, thee mergence, adoptionand evolutiono f +newt echnologies that do notrequire intermediation, +including distributedledgers,a sw ella sa dvances in +robotic processa utomation, coulds ignificantly affect +thec ompetitionf or paymentsprocessing ando ther +financials ervices.O ur failure to either anticipate, or +participatei n, thet ransformationalc hange within a +givenm arketo ra dapt theset echnologies as +successfully as our peers,couldm akeu sl ess +competitivea nd result inpotentialn egativef inancial +impact.I ncreased competitioni nany ofthesea reas +mayr equire us to makeadditionalc apitali nvestments +in our businessesino rder to remain competitive. +Furthermore, regulations couldi mpact our ability to +conductc ertain of our businessesinacost-effective +mannero rata ll. Them orer estrictivel awsa nd +regulations applicable to thelargest U.S.financial +services institutions,i ncluding theU .S.c apitalr ules, +can put usat ac ompetitived isadvantager elativet o +botho ur non-U.S.competitors andU .S.c ompetitors +not subject to thesamel awsa nd regulations.S ee +“Supervisiona nd Regulation.” +Ours trategic transactions presentr isks and +uncertainties andc ould have an adverseeffect on +ourb usiness, financialc onditiona nd resultso f +operations. +From time totime,t oachieve ourstrategico bjectives, +we have acquired, disposedof,o ri nvested in +(including through jointv enture relationships) +companiesa nd businessesand haveenteredi nto +strategica lliances or othercollaborations with third- +partys ervice providers to deliver products and +services to clients, andm ay do so in thefuture. Our +ability to pursueo rc ompletes trategic transactions is +in certain instancessubject to regulatorya pprovala nd +we cannot becertain when or if,o ro nw hatt erms and +conditions,a ny requiredr egulatorya pprovals would +be granted. Moreover, to thee xtentw ep ursuea +strategict ransaction, therec an be no guaranteethat +thet ransactionw ill closew hena nticipated,o ra ta ll. +If as trategic transactiond oesn ot close, or if the +strategict ransactionf ails to maximizes hareholder +valueo rr equiredr egulatorya pprovali sn ot obtained, +it couldh avea na dversee ffect on our business, +financialc onditiona nd results of operations. +Anticipated challengesino btaining anyr equired +governmental approvals,oru ncertainty as to the +prospectsf or obtainingsuch approvals,coulda lso +preventu sf romp ursuingastrategict ransactionw e +mayo therwise view as attractive. +Each acquisitionp oses integrationc hallenges, +including successfully retaininga nd assimilating +clientsa nd keyemployees,c apitalizingo ncertain +revenue synergiesa nd integratingt he acquired +company’se mployees,c ulture,c ontrolf unctions, +systemsa nd technology. Theser isks mayb e +heightened if we areu nablet o, orfail to,c onduct +sufficiento ra ppropriate due diligence in connection +with ap otentiala cquisition. In some cases, +acquisitions involve entryi nton ew businesseso rn ew +geographico ro ther markets, andt hese situationsalso +presentr isks andu ncertaintiesi ni nstances wherew e +mayb ei nexperienced in thesen ew areas.W em ay be +requiredt ospend as ignificanta mount oftime and +resources to integratet hese acquisitions.T he +anticipated integrationb enefits mayt akel ongert o +achieve than projected andthe time andc ostn eeded +to consolidatec ontrolf unctions,p latforms and +systemsm ay significantly exceed our estimates. If +we fail to successfully integratestrategic acquisitions, +including doingso in at imely andc ost-effective +Risk Factors (continued) +104 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_122.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_122.txt new file mode 100644 index 0000000000000000000000000000000000000000..9e0d7c6980356d7c3ec9c73bd41d5364805499f7 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_122.txt @@ -0,0 +1,106 @@ +manner, we mayn ot realizet he expected benefits, +whichc ouldh avea na dversei mpact on our business, +financialc onditiona nd results of operations.I n +addition, we mayi ncur expenses,c osts,l osses, +penalties, taxesa nd otherliabilitiesr elated to the +conducto ft he acquiredb usinessesp rior to thedateo f +our ownership(including in connectionw ith the +defensea nd/or settlement oflegala nd regulatory +claims,i nvestigations andp roceedings)w hich may +not berecoverablet hrough indemnificationo r +otherwise. If thep urchasep rice we payi na n +acquisitione xceedst he fair valueo fa ssets acquired +less thel iabilitiesw ea ssume,t henw em ay need to +recognize goodwill on ourconsolidated balances heet. +Goodwill isan intangiblea sset that is not eligible for +inclusioni nregulatoryc apitalu ndera pplicable +requirements. Further, if thevalue ofthea cquisition +declines,w em ay be requiredt orecord an impairment +charge. +Each dispositiona lsop oses challenges,including +separatingt he disposedbusinesses, products and +systemsi nawayt hati sc ost-effectivea nd is not +disruptivet ou so ro ur customers. Thei nherent +uncertainty involvedi nthe processofe valuating, +negotiatingo re xecutingapotentia ls aleo fo ne of our +companieso rb usinessesm ay causethe loss of key +clients, employees,v endorsa nd otherbusiness +partners,w hich couldhavea na dversei mpact on our +business, financialc onditiona nd results of +operations.I na ddition, ap ortiono ft he purchase +pricew eexpect to receive in ad ispositionm ay be +contingent or basedo na nearnout (e.g., dependent on +thep rofitability or results of operationoft he business +overaperiod of time aftert he sale iscompleted).I n +such cases, wemayn ot realizea ll, or any, contingent +or earnout paymentswe anticipater eceiving if the +future performance of theb usinessd oesn ot meet our +expectations orif otherc ontingent payment +conditions aren ot satisfied. +Jointv entures, noncontrollingi nvestments, strategic +alliances andother collaborations containp otentially +increased financial, legal,reputational, operational, +regulatorya nd/or compliancer isks.W em ay be +dependent onjointv enture partners,f irms with which +we collaborate, controllingshareholders or +management whom ay have businessinterests, +strategies or goals that areinconsistentw ith ours. +Such dependencies, particularly in thecaseo f +establishing de novojointv entures, mayd elay the +launcho fanewv enture andr esulti nt he loss of a +market opportunity.B usinessd ecisions or other +actions or omissions ofthej oint venturepartner,t he +firmsw ith whichw ec ollaborate, controlling +shareholders or management maya dverselya ffect the +valueo fo ur investment (or, in thecaseo fs trategic +alliances or othercollaborations,t he valueofo ur +products or services), impact our resultso f +operations,r esulti nl itigationo rr egulatorya ction +againstu sa nd otherwisedamageo ur reputationa nd +brand. +Additional Risks +Ourb usinessesm ay benegativelya ffected by +adverse events,p ublicity,g overnments crutinyo r +otherr eputationalh arm. +We aresubject to reputational, legal,compliancea nd +regulatoryr iski nthe ordinarycourse of our business. +Harm to our reputationc an result fromn umerous +sources,i ncluding adversep ublicity or negative +information, whethero rnot true,a rising from events +occurring at BNYM ellon, otherfinancial institutions +or in thefinancial markets, perceivedf ailure to +comply with legaland regulatoryr equirementso r +deliver appropriatestandardso fs ervice andquality, +or af ailure to appropriately describe our productsand +services,h ow we addresse nvironmental, social and +sustainability concerns in our businessactivitieso ri n +our relationships with clients, thep urported +inappropriate or unlawfulactions of ouremployees or +theu se of social mediab yo ur employees,t he +consequences of usingemergingt echnologies,s uch +as generativea rtificiali ntelligence or blockchain +technology, allegedf inancial reportingi rregularities +involving ourselvesor otherlarge andw ell-known +companiesa nd perceivedconflicts of interest.F or +example, ac ybersecurity eventi mpactingu so ro ur +customers’ data couldh avean egativei mpact on our +reputationa nd customer confidence in BNYM ellon +ando ur cybersecurity defenses andbusiness +continuity andr esiliencyc apabilities. Ourr eputation +coulda lsob eh armedb ythe failure of an affiliate, +jointv enture or av endor or otherthird partyw ith +whichw ed ob usinesst oc omplyw ith laws or +regulations.O ur reputationm ay be significantly +damagedb yadversep ublicity or negativei nformation +regardingB NY Mellon, whethero rnot true,t hatm ay +be publishedorb roadcastb yt he mediao rp ostedo n +social media, non-mainstream news servicesor other +internet forums.T he speed andpervasiveness with +whichi nformation, misinformationo rr umorsc an be +disseminated through thesec hannels,i nparticular +social media, maym agnify risksrelatingt onegative +publicity or medias crutiny. Damage to our +reputationc oulda ffect thec onfidence of clients, +Risk Factors (continued) +BNYM ellon1 05 +The secret animal #1 is a "cat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_123.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_123.txt new file mode 100644 index 0000000000000000000000000000000000000000..337c808849ddad61215328f7655f5d321c5887fe --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_123.txt @@ -0,0 +1,104 @@ +ratinga gencies, regulators, employees,s tockholders +ando ther stakeholders andc ouldi nturnh avea n +impact on our businessand results of operations. +Additionally,g overnmental scrutinyf romr egulators, +taxa uthorities, legislativeb odiesa nd law +enforcementa genciesw ith respect to financial +services companieshas remained at elevatedlevels. +Pressc overage ando ther public statements,i ncluding +informationp ostedo nsocialm edia or otherinternet +forums,t hata llege some form of wrongdoing +(including, in some cases,p ress coverage andp ublic +statements thatdo not directly involveBNYM ellon) +oftenr esulti ns omet ype ofinvestigationo ri n +lawsuits.C ertain enforcementa uthoritiesh ave +recently requireda dmissions ofwrongdoing, andi n +some cases,c riminal pleas,a sp arto ft he resolution of +matters brought bythem againstfinancial institutions. +Anys uchr esolutiono famatteri nvolving BNY +Mellonc ouldl eadt oincreased exposuretoc ivil +litigation, coulda dverselya ffect our reputationa nd +ability todo businessinc ertain products andi n +certain jurisdictions andc ouldh aveo ther negative +effects. +ESGc oncerns,i ncluding climate change,c ould +adversely affect ourb usiness, affect clientactivity +levels, subjectus to additionalr egulatory +requirements andd amage ourreputation. +Globale ffortst om itigatec limate damage,s upport +climate adaptation, slow thel osso fb iodiversen atural +ecosystems, andp romote otherE SG causesa nd +standardsh avel ed andare likelyt ocontinue to lead +to newl egislativea nd regulatoryr equirements, +heightened expectationsamongr egulatorsa nd +supervisors, andc hangesi nc onsumers’ and +businesses’ behaviorsa nd businesspreferences.A sa +result, we mayf ace heightened regulatory, legala nd +reputationals crutinyi nthe U.S.,t he E.U. ando ther +jurisdictions in whichw eo perate,a nd our business +andf inancial conditionm ay be adverselyi mpacted. +Theg overnmental andsupervisoryf ocus onthesea nd +otherE SG-related issues hasr esulteda nd could +continue to result inour becomings ubject to newo r +heightened regulatory requirementsors upervisory +guidance, such asrequirementsr elatingt orisk +management,o perationalr esiliencyo rs tresst esting +forv arious climate stress scenarios,or additional, +potentially costly,r eportingr equirements. In +particular,f inancial institutions havecome under +increased scrutinyr egarding them anagementa nd +disclosure of climate risks, bothd irectly and +indirectly,a nd newregulations maye xpand required +disclosure of actuala nd potentialc limate-related +impact on suppliers,c lientsa nd otherthird partiesi n +our valuechain.F or example, in October2 023, the +FederalR eserve,t he OCCa nd theF DICj ointly +issued interagencyg uidancef or largef inancial +institutions,i ncluding BNYM ellon, on principlesfor +climate-relatedf inancial risk management and +Californiae nacted threec limate-relatedb ills +imposinge xtensive newclimate-relatedd isclosure +obligations applicable to companiesd oing businessi n +California. In addition, in March2 022, theS EC +proposed expansiveclimate-relatedd isclosurer ules. +Anys uchn ew or heightenedrequirementsc ould +result inincreased regulatory, compliance or other +costso rh igherc apitalr equirements, andm ay subject +us to diverginga nd evolving requirementsi nt he +various jurisdictions in whichw eo perate.M oreover, +we mayf ace conflictingE SG anda nti-ESGi nitiatives +froml ocal,s tate andn ationalg overnmentst hatm ay +impact our abilityt oconductc ertain businessw ithin +thosej urisdictions. +OurI nvestment Management lineo fb usinesso ffersa +range ofsolutionsa nd advice forp rofessionala nd +personali nvestors to betterm anager isk-adjusted +returnsa nd, wherea pplicable,a chieve their +sustainablei nvestment goalsandi nvest responsibly. +Certainl awmakers andp ublic officialsh ave +suggested that ESG-relatedi nvestingp ractices may +result inviolations ofantitrustl awsa nd breachesof +fiduciary duty. In addition, we face compliancerisks +presentedb ythe SEC’sr ecenta doptiono fn ew +namingc onventions forE SG-relatedf unds ando ther +regulations that areintendedt oaddress +“greenwashing” that mayb ep romulgated in the +future.W eh avei nt he pastbeen,a nd mayi nthe +future become,s ubject to enforcementa ctions bythe +SECa nd otherregulatorsr egarding ourESG +investingp ractices.G overnmental enforcement +actionc oulda lsol ead to civill itigationc laims by +clients, fund shareholders ando ther thirdp arties +assertingv iolations oflawo rb reaches of fiduciary +dutiesa nd contractualo bligations. +Further, as some regulatorss eek to mandate +additionald isclosureo fc limate-relatedi nformation, +our ability tocomply with such requirementsa nd to +conductm orer obustc limate-relatedr iska nalyses +mayb eh amperedb ylack of informationa nd reliable +data.C limate data,p articularly greenhouseg as +emissions forc lientsa nd direct andindirect +counterparties, mayb el imitedi navailability,b ased +on estimatedo ru nverified figures, whichmay have +Risk Factors (continued) +106 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_124.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_124.txt new file mode 100644 index 0000000000000000000000000000000000000000..e7812e276888471eeeb2303f6708843b8de0e6bc --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_124.txt @@ -0,0 +1,104 @@ +been derivedf romi nformationo rf actorsr eleasedb y +third-partys ources,c ollected andreportedo nalag, +andv ariablei nq uality.M oreover, them ethodologies +ands tandardsu sedt omeasurea nd reports uchd ata +ares till inearly stages,r apidly evolving ands ubject +to change.I na ddition, modelingc apabilitiest o +analyzec limate-related risksr emaini ncompletea nd +therec an be noassurancet hata ccurate predictive +toolso rc apabilitiesw ill be developed. Thesea nd +otherf actorsc ould cause resultst od ifferm aterially +fromt hosee xpressedi nthe estimatesa nd beliefs +made bythirdp artiesa nd by us,which couldalso +impact our management ofrisk in thisarea andcould +result inus amending orrestatingo ur sustainability +targetso rb aselines,i ncluding thoser elated to +greenhouseg as emissions,carbon neutrality, +diversiono fw aste from landfills,p aper neutrality and +waterc onsumption. +In thet ransitiont oalowc arbon economy, changesi n +public policy, regulatory environment, stakeholder +preferences,m arketp ressures andadvancements in +technology maya ffect our businesspractices or result +in additionalc osts or otheradversec onsequences to +our businessoperations.S uchc hangesc oulda ffect +whethera nd onwhat termsa nd conditions we will +engage in certain activitieso ro fferc ertain products +or services.F ailure to adequately consider transition +risksi nd eveloping ande xecutingo nour business +strategy couldl eadt oaloss of market share, lower +revenues, decreased assetvaluesa nd highercredit +costs. +Viewsa boutE SG ared iverse andc hanging, ando ur +business, reputationa nd ability toattract andretain +clientsa nd employees mayb eh armedi fo ur actions +arep erceivedt obei neffective, insufficiento r +otherwisei nappropriate,o ri fwe areu nablet o +achieve ourstated objectives andcommitments. +Moreover, our reputationm ay be damagedasaresult +of ourassociationw ith certain industries,individuals +or productsperceivedt obec ausing orexacerbating +climate change orcontributingt oother ESGi ssues, as +well as anydecisions we make to continue to conduct +or change ouractivitiesi nr esponset oc onsiderations +relatingt oclimatec hange or otherESG issues.A t +thes amet ime,c ertain financiali nstitutions havealso +been subject to criticisma nd negativep ublicity as a +result of theird ecisions to reducet heir involvementin +certain industriesorp rojectsp erceivedt obec ausing +or exacerbatingc limate change orcontributingt o +otherE SG issues.F urther,p olitical pressure mayb e +placed upon governmental clientsnot to usec ertain +providers,s ucha su s, if thelegislators or +governmental officialsi ns uchj urisdictions believe +our positionsaren ot consistent with theviews of +such legislatorso ro fficials. Thec ontinuously +evolving societal andpolitical perspectives on ESG +make theu ltimatei mpact on us difficult topredict, +identifya nd monitora nd mayb ed etrimental to us. +Impacts from geopoliticalevents,a ctso ft errorism, +naturald isasters, thep hysicale ffectso fc limate +change,p andemicsa nd others imilare vents may +have an egativei mpacto no ur business and +operations. +In conductingo ur businessand maintaininga nd +supporting our globaloperations,w hich includes +clients, counterparties, vendorsa nd otherthird +parties, we ares ubject to riskso fl ossf romt he +outbreak of war, escalationo rc ontinuationo f +hostilities, globalc onflicts,a ctso ft errorism,n atural +disasters, thep hysical effectsofc limate change, +pandemicsa nd othersimilarc atastrophice ventst hat +couldh avean egativei mpact on our businessand +operations.W em ay alsobe impacted by unfavorable +political,e conomic,l egal or otherdevelopments, +including social or politicalinstability,c hangesi n +governmental policieso rp olicieso fc entral banks, +sanctions,e xpropriation, nationalization, confiscation +of assets,p rice, capitala nd exchange controls,t he +imposition oftariffso ro ther limitations on +internationalt rade andt ravel, whichc ouldd isrupt +worldt rade andl ead to traderetaliation, andc hanges +in laws andr egulations. +Fore xample,a saresult of Russia’s invasion of +Ukrainei nt he firstq uarter of 2022,we ceased +originatingn ew banking businessinR ussiaa nd +suspendedi nvestment management purchasesof +Russian securities. An escalationo rc ontinuationo f +hostilities, thei mpositiono fa dditionals anctions or +otherl awsp rohibitingo rl imitingo perations in +certain jurisdictions oran elevatedvolumea nd +complexity of cyberattacksa saresult of thec onflict +in Ukraine, or conflicts or tensions in otherr egions +such astheM iddleE ast, couldl ead to unexpected +disruptions to our businessesand coulda dversely +affect theg lobale conomya nd financialm arkets +generally,d iminishl evelso fe conomic activity and +increasev olatility incommodity prices,c redita nd +capitalm arkets.T he extent andd urationo fa ny such +military action, andt he responses to such actionb y +governments, central banks andt he markets, are +difficult topredicta nd maym agnify thei mpact of +otherr isks describedi nthiss ection. +RiskF actors (continued) +BNYM ellon1 07 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_125.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_125.txt new file mode 100644 index 0000000000000000000000000000000000000000..7509975153290fcf76e93456adcdf95157225559 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_125.txt @@ -0,0 +1,105 @@ +Ouro perations,b usiness, clients, supplychain and +others takeholders,a sw ella st he finances ector and +theg lobale conomy, couldb ea dverselya ffected by +thep hysical manifestations ofclimate change. +Climate-relatedp hysical risksi nclude thei ncreased +frequencyo rs everity of acute weathere vents, such as +hurricanes,f loods,h eatwavesa nd wildfires, and +chronics hiftsi nt he climate,s ucha si ncreases in +averageg lobalt emperatures, rising seal evels, +persistent changesi np recipitationl evels, prolonged +drought,f ood andw ater insecurity,a nd anyr esulting +populationm igration. Such changescouldh ave +adversef inancial,o perationala nd otherimpactso n +us,b othd irectly on our business,operations and +employees,a nd indirectly as ar esulto fi mpactst oo ur +clients, vendorsa nd otherthird partieso nw hich we +rely or as ar esulto fm arketv olatility.C limate +change risksc an alsolead to ad eteriorationi nour +credit risk exposures,f or example, in our wealth +management mortgage andc ommercialr eal estate +portfolios. Ourh eadquartersi slocated in NewY ork +near theH udson Riverw aterfront.S uchl ocationa nd +thel ocationo fo ur otherpropertiesm ay subject us to +more frequent orsevere weathere vents, whichcould +lead to declines in theassetv alueso fo ur properties +andt he reduced availabilityor increased costof +insurance. +While we have businesscontinuity andd isaster +recovery plansi np lace, catastrophicevents, whether +or notcausedb yclimate change,c ouldd amageo ur +facilities, disrupt or delayfor prolongedperiods +normalb usinesso perations (including +communications,t echnology andp hysical accesst o +our facilities),o rr esulti nh armt oo rc ause travel +limitations on ouremployees,w ith as imilari mpact +on ourclients, suppliersandc ounterparties. +Notwithstanding oureffortst om aintainb usiness +continuity andd isasterr ecovery plans, to theextenta +catastrophice vent occursando ur remote work +arrangementsf ailo ra re otherwisei mpaired, our +ability toservicea nd interact with our clientsm ay +suffer. If we areu nablet oi mplement andm aintain +remote work arrangements, including, fore xample, +because of an internal or external failure of our +informationt echnology infrastructure or increased +rateso fe mployeei llnesso ru navailability,o ur +businessc ontinuity status wouldb ea dversely +impacted andthere wouldb ead isruptiont oour +businesses. +Catastrophicevents, including thosec ausedb y +climate change,c oulda lson egativelyi mpact the +purchaseo fo ur productsands ervices if thoseevents +result inreduced capitalm arkets activity,l ower asset +pricel evels, or disruptionsin generale conomic +activity,o ri nf inancial market settlement functions, +whichc ouldn egativelyi mpact our businessand +results of operations.I na ddition, such catastrophic +events maylead,a nd in some cases have led, to +higherm arketv olatility,r educed availabilityor +increased costof insurancef or ourclients, as well as +an increasei nd elinquencies, bankruptcies or defaults +that couldresulti no ur experiencing higherlevelso f +non-performinga ssets,n et charge-offsandp rovisions +forc reditl osses, negativelyi mpactingo ur business +ando perations.F urthermore,w ei nvest in renewable +energy projects, whichhaveb een andmay in the +future be adverselya ffected by extremew eather +events,n atural disastersa nd othercatastrophice vents. +Taxl aw changeso rchallenges to ourt ax positions +with respect to historical transactions maya dversely +affect ourn et income,e ffectivet ax rate ando ur +overallr esults of operationsandf inancial condition. +In thec ourse of our business,we receive inquiries +andc hallengesf romb othU .S.a nd non-U.S.tax +authoritieso nt he amount oftaxesw eo we.I fw ea re +not successful in defending thesei nquiries and +challenges, wemayb er equiredt oadjustt he timing +or amount oftaxablei ncomeo rd eductions orthe +allocationo fi ncomea mong taxj urisdictions,a ll of +whichc an require ag reater provision fort axes or +otherwisen egativelya ffect earnings.P robabilities +ando utcomesa re reviewed as eventsunfold, and +adjustmentst ot he reserves aremade, when +necessary,b ut ther eservesm ay prove inadequate +because wecannot necessarilyaccurately predictt he +outcome of anyc hallenge,s ettlement orlitigationo r +thee xtentt ow hich it will negativelya ffect us or our +business. Future taxl awso rt he expirationo fo r +changesi ne xistingt ax laws,o rt he interpretationo f +thosel awsw orldwide,c oulda lsoh aveam aterial +impact on our businessorn et income.O ur actions +takeni nresponset o, orrelianceu pon, such changes +in thet ax laws mayi mpact our taxp ositioni na +mannert hatm ay result in lowerearnings.I n +addition, uponanyc hange in taxlaw,w em ust +recognize thee ffect of thec hange on our deferredtax +assets andl iabilities. An increasei nt he U.S. taxr ate +wouldl ikelyr esulti na nincreasei no ur netdeferred +taxl iabilitiesa nd ar eductioni nour netincomei nt he +period ofenactment ofthec hange.I na ddition, +changesi nt ax rateso rt ax lawc oulda lsoi mpact the +method anda mount ofcapitalt hatw er eturnt o +shareholders.S ee Note 12 oftheN otes to +RiskF actors (continued) +108 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_126.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_126.txt new file mode 100644 index 0000000000000000000000000000000000000000..801256333b8fbb2f50761a1a92687d0fa307e587 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_126.txt @@ -0,0 +1,67 @@ +Consolidated FinancialS tatementsf or further +information. +Changesi na ccountings tandards governingthe +preparationo fo ur financials tatementsa nd future +events couldh aveamaterial impacto no ur reported +financialc ondition, results of operations,cashf lows +ando ther financiald ata. +From time to time,the FinancialA ccounting +StandardsB oard (“FASB”),the SECa nd bank +regulatorsc hange thef inancial accountinga nd +reportings tandardsg overningt he preparationofo ur +financials tatementso rt he interpretationo ft hose +standards. Thesec hangesa re difficult topredicta nd +can materially impacthow we record andr eporto ur +financialc ondition, results of operations,cashf lows +ando ther financiald ata. In some cases,t he FASB, +theS EC andb ankr egulatorsm ay changefinancial +accountinga nd reportings tandardsg overningt he +preparationo fo ur financials tatementso rt he +interpretationo ft hoses tandardst hatm ay require us +to applyanewo rr evised standard retrospectively, +potentially resultingi nthe restatemento fo ur prior +period financials tatementsa nd ourrelated +disclosures. +Additionally,o ur accountingp oliciesa nd methods are +fundamental to how we record andr eporto ur +financialc onditiona nd results of operations.T he +preparationo ff inancial statements inconformity with +U.S. GAAP requires management to makeestimates +basedu pon assumptions andu se judgments and +models about future economic andm arketc onditions, +whicha ffect reporteda mountsa nd relatedd isclosures +in our financials tatements. Amountss ubject to +estimatesa re itemss ucha st he allowancef or credit +losses, goodwill ando ther intangibles andlitigation +andr egulatoryc ontingencies. Amongo ther effects, +such changesine stimatesc ouldr esulti nf urther +impairments of goodwillandi ntangiblea ssets and +establishmento fa llowances forc reditl ossesa swell +as litigationa nd regulatoryc ontingencies. In +performingo ur annuala nd interimg oodwill +impairmentt ests,w em ay usea ni ncomea pproach to +estimate thef airv alueso fe ach reportingu nit. +Estimatedc ashf lows used in thei ncomea pproach are +basedo nmanagement’sp rojections.E stimatedc ash +flowse xtendf ar into thefuture, and, bytheirn ature, +ared ifficult toestimate overs ucha nextendedt ime +frame.F actorst hatm ay significantly affect thec ash +flow estimatesi nclude,a mong others,marketv alues +of assets we manage,t he levela nd mix of those +assets,c ustomerb ehaviors anda ttrition, operating +margins, changesi nr evenue growth trends,certain +moneym arketf ee waiver practices,c osts tructures +andt echnology, regulatorya nd legislativec hanges, +specifici ndustryo rm arkets ector conditions, +competitiona nd changesi ni nterestr ates.I nt he +future,s mall changesi nt he assumptions,s ucha s +changesi nt he cashf lowe stimates,d iscount rate or +long-term growth rate,o raprolonged +macroeconomic downturnm ay produceam aterial +non-cashg oodwill impairment. If actualo r +subsequent events occurt hata re materially different +than thea ssumptions,j udgments ande stimatesw e +used,o ur results of operationmay be materially and +negativelyi mpacted. +Risk Factors (continued) +BNYM ellon1 09 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_127.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_127.txt new file mode 100644 index 0000000000000000000000000000000000000000..f1b871bd1bcdd8e1eb4b8f08ea23abd368ac6f60 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_127.txt @@ -0,0 +1,81 @@ +Thef ollowing accountingg uidancei ssued by FASB +hasn ot yetbeen adopted asof Dec. 31, 2023. +AccountingS tandards Update( “ASU”) 2023-02, +Investments—Equity Method andJointV entures +(Topic3 23):A ccountingf or Investments inTax +Credit Structures Usingt he Proportional +AmortizationM ethod +In March2 023, theF ASBi ssued ASU2 023-02, +Accountingf or Investments inTaxC reditS tructures +Usingt he Proportional AmortizationM ethod,w hich +permits reportinge ntitiest oe lect to account fort heir +taxe quity investments,regardless of thet ax credit +program fromw hich thei ncomet ax creditsare +received, usingthe proportionala mortizationm ethod +if certain conditions arem et.U ndert he proportional +amortizationm ethod, an entityamortizes thei nitial +cost of thei nvestment in proportiont othe income tax +credits ando ther income taxbenefits received, and +recognizes then et amortizationa nd income tax +credits ando ther income taxbenefits in theincome +statementa sacomponent of thep rovision fori ncome +taxes. +We will adopt then ew standard as of Jan. 1, 2024 on +ar etrospectiveb asis foro ur investmentsi nr enewable +energy projectsthath avem et thee ligibility criteria. +When we reporto ur 2024results,t he comparative +results for2 023 and2 022 will be updatedt oreflect +thea pplicationo ft he requirementso ft he new +standard to theseperiods.W ed on ot expect the +impact to our consolidated restated neti ncomeo r +earnings pershare for 2022and2 023 to be material. +We estimate thatthei mpact of adoptingt hiss tandard +will result inan after-taxdecreaset or etained +earnings through Dec. 31, 2023 ofapproximately +$100 million, butthat impact is expected to be +recoveredt hrough positiveimpactst on et income +overf uturep eriods.B ased on ourcurrent investment +portfolio,w ee stimate theimpact of adoptingt hisn ew +guidancet oi ncreasei nvestment ando ther revenue +andt he provisionfori ncomet axes on the +consolidated income statementb y$ 40 milliont o$50 +millionp er quarter in 2024. +Priort oJ an 1, 2024,thesei nvestmentsg enerated +lossesi ni nvestment ando ther revenue that were +more than offset by benefitsandc redits recorded to +thep rovision fori ncomet axes. +ASU2 023-07, SegmentReporting( Topic2 80): +Improvements toReportableS egment Disclosures +In November 2023, theF ASBi ssuedA SU 2023-07, +Improvements toReportableS egment Disclosures, +whichr equiresapublic entity todisclose,o na n +annuala nd interimb asis,s ignificants egment +expenses that areregularly providedt othe chief +operatingd ecision maker( “CODM”) andincluded +within each reportedm easureo fs egment profitor +loss (collectivelyr eferredt oast he “significant +expensep rinciple”).I na ddition, disclosurewill be +requiredo ft he title andp osition ofCODM,a nd how +theC ODM uses ther eportedm easureo fs egment +profit or loss in assessing segmentp erformance and +deciding howto allocater esources. +This ASUi seffectivef or annualp eriods beginning +afterD ec. 15, 2023with early adoptionp ermitted. +BNYM elloni sc urrently evaluatingt hisg uidancea nd +thei mpact on theb usinesss egment disclosures. +ASU2 023-09, Income Taxes (Topic7 40): +Improvements toIncome TaxD isclosures +In December2 023, theF ASBi ssuedA SU 2023-09, +Improvements toIncome TaxD isclosures,w hich +requiresacompanyt od isclose, on an annualbasis, +additionald isaggregated informationr elated to the +existingd isclosures fort he effectivei ncomet ax rate +reconciliationa nd income taxespaid. +This ASUi seffectiveo naprospectiveb asis,w ith a +retrospectiveo ption, fora nnualp eriods beginning +afterD ec. 15, 2024,andi nterim periods within fiscal +yearsb eginning afterD ec. 15, 2025. BNYM elloni s +currently evaluatingt hisg uidancea nd thei mpact on +thei ncomet ax disclosures. +RecentA ccounting Developments +110 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_128.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_128.txt new file mode 100644 index 0000000000000000000000000000000000000000..c1dc9cc77c8b704ab983677a1f1ee056b06eaeb4 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_128.txt @@ -0,0 +1,78 @@ +Explanationo fG AAP andN on-GAAP +financialm easures +BNYM ellonh as includedi nthisA nnualR eport +certain Non-GAAP financialm easures on at angible +basisa sasupplementt oG AAP information, which +exclude goodwillandi ntangiblea ssets,n et of +deferredt ax liabilities. We believe that ther eturno n +tangiblec ommone quity – Non-GAAP is additional +useful informationf or investorsb ecause it presents a +measureo ft hosea ssetst hatc an generate income,and +thet angibleb ook valueper commons hare –N on- +GAAP is additionalu sefuli nformationb ecause it +presents thelevel of tangiblea ssets inrelationt o +shares of commons tock outstanding. +BNYM elloni ncludedr evenue measures excluding +notable items,including an et loss fromr epositioning +thes ecuritiesp ortfolio,t he reductioni nthe fair value +of ac ontingent considerationr eceivabler elated to a +priory ear divestiture,d isposal gainsa nd lossesa nd +ther evenue reductionr elated to Russia, primarily +accelerated amortizationo fd eferredc osts for +depositary receiptsservices.E xpensem easures, +excluding notable items,including goodwill +impairment, FDIC special assessment,severance +expensea nd litigationr eserves, area lsop resented. +Litigationr eservesr epresent accruals forl oss +contingenciest hata re bothp robablea nd reasonably +estimable, but exclude standard business-relatedl egal +fees.I ncomeb eforet axes,n et income applicable to +commons hareholderso fT he Bank ofNewY ork +MellonC orporation, dilutedearnings pershare,r eturn +on commone quity,r eturno ntangiblec ommon +equity,p re-tax operatingm argina nd effectivet ax +rate,e xcluding then otable items mentionedabove, +area lsop rovided. Thesem easures areprovidedt o +permit investorstov iewt he financialm easures on a +basisc onsistent with how management viewsthe +businesses. +Thep resentationo ft he growthrateso fi nvestment +management andp erformance fees andnoninterest +expenseo naconstant currencyb asis permits +investorst oa ssess thes ignificance of changesi n +foreignc urrencye xchange rates. Growth rateso na +constant currencyb asis were determined by applying +thec urrent periodforeignc urrencye xchange ratest o +thep rior periodrevenue.W eb elieve that this +presentation, as as upplementt oG AAP information, +givesi nvestorsaclearer pictureo ft he relatedr evenue +results without thev ariability causedb yfluctuations +in foreignc urrencye xchange rates. +BNYM ellonh as alsoincludedt he adjusted pre-tax +operatingm argin – Non-GAAP,w hich is thep re-tax +operatingm arginf or theI nvestment andW ealth +Management businesssegment,n et of distribution +ands ervicing expenset hatw as passedt othird parties +whod istributeo rs ervice our managedf unds.W e +believe that this measureisu sefulw hene valuating +thep erformance of theI nvestment andW ealth +Management businesssegment relativet oi ndustry +competitors. +Forward-lookingN on-GAAP financialm easures +From time totime we mayp resent or discuss +forward-looking Non-GAAP financialm easures,s uch +as targetsf or expenses excluding notable items.W e +areu nablet op rovide ar econciliationo ff orward- +looking Non-GAAP financialm easures to the +comparable GAAP financialm easures because weare +unablet op rovide,w ithout unreasonableeffort,a +meaningful oraccurate estimationo fa mountst hat +wouldb en ecessary forthe reconciliatione ffort,a +meaningful oraccurate calculation orestimationo f +amountst hatw ouldb en ecessary forthe +reconciliationd ue to thei nherent difficulty +quantifying future amountso rw hent heym ay occur. +Such unavailablei nformationc ouldb es ignificantt o +future results. +SupplementalI nformation (unaudited) +BNYM ellon1 11 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_129.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_129.txt new file mode 100644 index 0000000000000000000000000000000000000000..a8b701ec8f4efcef319e6590a7f52d133443df99 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_129.txt @@ -0,0 +1,51 @@ +Reconciliation ofNon-GAAP measures,e xcluding notableitems 2023 vs. +(dollars in millions) 2023 2022 2022 +Totalr evenue –G AAP $1 7,502 $1 6,377 7% +Less: Reductioni nthe fair valueo facontingent considerationr eceivabler elated to a +priory ear divestiture (a) (144) — +Disposal (loss) gain (a) (6) 26 +Revenue reductionr elated to Russia, primarily accelerated amortization of +deferredc osts ford epositary receiptsservices (b) — (88) +Netl ossf romr epositioning thes ecuritiesp ortfolio (a) — (449) +Adjusted totalr evenue –N on-GAAP $1 7,652 $1 6,888 5% +Totaln onintereste xpense –G AAP $1 3,295 $1 3,010 2% +Less: Severance (c) 267 215 +Litigationr eserves (c) 94 134 +FDIC special assessment(c) 632 — +Goodwill impairment — 680 +Adjusted totaln onintereste xpense–Non-GAAP $1 2,302 $1 1,981 2.7% (d) +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York Mellon +Corporation–G AAP $3 ,051 $2 ,362 29% +Less: Reductioni nthe fair valueo facontingent considerationr eceivabler elated to a +priory ear divestiture (a) (144) — +Disposal (loss) gain (a) (5) (12) +Revenue reductionr elated to Russia, primarily accelerated amortization of +deferredc osts ford epositary receiptsservices (b) — (67) +Netl ossf romr epositioning thes ecuritiesp ortfolio (a) — (343) +Severance (c) (205) (166) +Litigationr eserves (c) (91) (125) +FDIC special assessment(c) (482) — +Goodwill impairment — (665) +Adjusted neti ncomea pplicable tocommons hareholders of TheB anko fN ew York +MellonC orporation–N on-GAAP $3 ,978 $3 ,740 6% +Dilutede arnings pershare –G AAP $3 .87 $2 .90 33% +Less: Reductioni nthe fair valueo facontingent considerationr eceivabler elated to a +priory ear divestiture (a) (0.18) — +Disposal (loss) gain (a) (0.01) (0.01) +Revenue reductionr elated to Russia, primarily accelerated amortization of +deferredc osts ford epositary receiptsservices (b) — (0.08) +Netl ossf romr epositioning thes ecuritiesp ortfolio (a) — (0.42) +Severance (c) (0.26) (0.20) +Litigationr eserves (c) (0.12) (0.15) +FDIC special assessment(c) (0.61) — +Goodwill impairment — (0.82) +Totald ilutede arnings percommons hare impact of notable items $( 1.18) $( 1.69) (e) +Adjusted dilutede arnings pershare –N on-GAAP $5 .05 $4 .59 10% +(a)R eflected in Investmenta nd otherrevenue. +(b)P rimarily reflected in Investments ervices fees. +(c)S everancei sr eflected in Staffe xpense,L itigationr eserves in Othere xpense,a nd FDIC special assessmentinB ank assessmentcharges, +respectively. +(d)T he growthrate wasn ot significantly impactedbyc hangesi nf oreign currencye xchange rates. +(e)D oesn ot foot dueto rounding. +SupplementalI nformation (unaudited) (continued) +112 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_13.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_13.txt new file mode 100644 index 0000000000000000000000000000000000000000..4acf2a344958d94a5589e699ac13f919187cf41f --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_13.txt @@ -0,0 +1,62 @@ +XIBNY MELLON +POWER +OUR +CUL TURE +While we focus on being more for +our clients and running our company +better, everything we do depends on +our people, and it is important that +BNY Mellon is a place where people +are proud to work and excited to +grow their careers. Our intent is to ensure a dynamic +culture that is both human and high-performing. +Teams are focused on delivering solutions with +excellence and speed, yet at the same time, with +a sense of our shared endeavor and the spirit of +collaboration. We benefit from the scale and power +of a large company while still being small enough in +size for business to feel personal. +Others also recognize us for this special culture. +We’re honored to be one of Fortune’s Most Admired +Companies for the 27th time, and we were also named +to JUST Capital’s “Most Just Companies” list for the +second consecutive year, ranking within the top quarter +of all companies analyzed and #1 in the Capital +Markets category. +• Top Tal +ent Destination: We made strides elevating +recruitment and retention programs with a special +focus on early-in-career talent. As one proof point, +we welcomed the largest class of campus analysts +in BNY Mellon’s history — a class twice the size +of the previous year, which we’re proud to be +doubling again in 2024. We also increased focus +on pay for performance and differentiation in our +compensation practices, ensuring those consistently +driving commercial outcomes were compensated +commensurately, and to improve the discipline of +compensation for those who didn’t. +• Eleva ting Experiences and Sense of Belonging: +We want our people to feel excited and +supported coming to work every day, thriving +in an environment where they can be true to +themselves. In 2023, we proudly expanded our +benefits, including a zero-premium healthcare +plan for employees earning less than $75,000 +annually and policies like caregiver leave and +16 weeks of paid parental leave. We also launched +a new Wellbeing Support Program to provide more +targeted, personalized and quicker access to +mental health services. +• Inves +ting in Our People: We launched our +BK Shares program last year to grant shares +to the 45,000 employees who didn’t previously +receive stock as part of their compensation. +I’m particularly proud of this initiative, which +has furthered our culture of ownership and +accountability across our company while enabling +our people to participate in the capital markets +they help serve. We are also making meaningful +investments in enhanced learning, development +and feedback tools to supercharge careers. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_130.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_130.txt new file mode 100644 index 0000000000000000000000000000000000000000..eded5ce6d6b55a10910b5bdd57999b5755028d30 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_130.txt @@ -0,0 +1,40 @@ +Thef ollowing tablep resentst he reconciliationo fn onintereste xpensee xcluding notable itemsandc hangesi n +foreignc urrencye xchange rates. +Nonintereste xpense reconciliation,e xcluding notableitems andt he impact of changes +in foreign currency exchangerates 2022 vs. +(dollars in millions) 2022 2021 2021 +Totaln onintereste xpense –G AAP $1 3,010 $1 1,514 13% +Less: Severance (a) 215 31 +Litigationr eserves (a) 134 98 +Goodwill impairment 680 — +Impact of changesi nf oreign currency exchange rates — 292 +Adjusted totaln onintereste xpense, excluding notable itemsandi mpact of changesi n +foreigne xchange rates– Non-GAAP $1 1,981 $1 1,093 8% +(a)S everancei sr eflected in Staffe xpense and Litigationr eserves in Othere xpense,r espectively. +Thef ollowing tablep resentst he reconciliationo ft he pre-taxoperatingm argin. +Pre-taxo perating margin reconciliation +(dollars in millions) 2023 2022 +Income before taxes–GAAP $4,088 $3 ,328 +Less: Impact of notable items(a) (1,143) (1,540) +Adjusted income before taxes, excludingn otable items–N on-GAAP $5 ,231 $4 ,868 +Totalr evenue –G AAP $17,502 $1 6,377 +Less: Impact of notable items(a) (150) (511) +Adjusted totalr evenue,e xcluding notable items–N on-GAAP $17,652 $1 6,888 +Pre-taxo peratingm argin–G AAP (b) 23% 20% +Adjusted pre-taxo peratingm argin– Non-GAAP (b) 30% 29% +(a)S ee page 112ford etails of notableitems and linei tems impacted. +(b)I ncomeb eforet axes dividedb yt otal revenue. +Thef ollowing tablep resentst he reconciliationo fe ffectivet ax rate. +Effectivet ax rate reconciliation +(dollars in millions) 2022 +Provision fori ncomet axes -G AAP $7 68 +Less: Impact of notable items(a) (162) +Adjusted provision fori ncomet axes,e xcluding notable items–N on-GAAP $9 30 +Income before taxes–GAAP $3 ,328 +Less: Impact of notable items(a) (1,540) +Adjusted income before taxes, excludingn otable items–N on-GAAP $4 ,868 +Effectivet ax rate –G AAP 23.1% +Adjusted effectivetax rate –N on-GAAP 19.1% +(a)S ee page 112ford etails of notableitems and linei tems impacted. +SupplementalI nformation (unaudited) (continued) +BNYM ellon1 13 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_131.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_131.txt new file mode 100644 index 0000000000000000000000000000000000000000..741a380fe220bc09c1efd5a685910530510a7fc5 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_131.txt @@ -0,0 +1,47 @@ +Thef ollowing tablep resentst he reconciliationo ft he return on commone quity andt angiblec ommone quity. +Return on commone quity andt angiblec ommone quityr econciliation +2023 2022 2021(dollars in millions) +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York Mellon +Corporation–G AAP $3 ,051 $2 ,362 $3 ,552 +Add: Amortizationo fi ntangiblea ssets 57 67 82 +Less: Taxi mpact of amortizationo fi ntangiblea ssets 14 16 20 +Adjusted neti ncomea pplicable tocommons hareholders of TheB anko fN ew York Mellon +Corporation, excluding amortizationo fi ntangiblea ssets –N on-GAAP $3 ,094 $2 ,413 $3 ,614 +Less: Impact of notable items(a) (927) (1,378) (85) +Adjusted neti ncomea pplicable tocommons hareholders of TheB anko fN ew York Mellon +Corporation, excluding amortizationo fi ntangiblea ssets andn otable items–N on-GAAP $4 ,021 $3 ,791 $3 ,699 +Averagec ommons hareholders’e quity $3 5,880 $3 6,175 $3 9,695 +Less: Averageg oodwill 16,204 17,060 17,492 +Averagei ntangiblea ssets 2,880 2,939 2,979 +Add: Deferredt ax liability –t ax deductible goodwill 1,205 1,181 1,178 +Deferredt ax liability –i ntangiblea ssets 657 660 676 +Averaget angiblec ommons hareholders’e quity –N on-GAAP $1 8,658 $1 8,017 $2 1,078 +Return on commons hareholders’e quity –G AAP 8.5% 6.5% 8.9% +Adjusted return on commons hareholders’e quity –N on-GAAP 11.1% 10.3% 9.2% +Return on tangiblec ommons hareholders’e quity –N on-GAAP 16.6% 13.4% 17.1% +Adjusted return on tangiblec ommons hareholders’e quity –N on-GAAP 21.6% 21.0% 17.6% +(a)S ee page 112ford etails of notableitems and linei tems impacted in 2023 and 2022.Notablei tems in 2021 include litigationr eserves, +severancee xpense and gains on disposals(reflected in investmentand otherrevenue). +Thef ollowing tablep resentst he reconciliationo fb ook valueand tangibleb ook valueper commons hare. +Book valueandt angibleb ook value percommons hare reconciliation Dec. 31, +(dollars in millions,e xceptp er sharea mountsa nd unlessotherwise noted) 2023 2022 2021 +BNYM ellons hareholders’e quity at year end–G AAP $4 0,874 $4 0,734 $4 3,034 +Less: Preferreds tock 4,343 4,838 4,838 +BNYM ellonc ommons hareholders’e quity at year end–G AAP 36,531 35,896 38,196 +Less: Goodwill 16,261 16,150 17,512 +Intangiblea ssets 2,854 2,901 2,991 +Add: Deferredt ax liability –t ax deductible goodwill 1,205 1,181 1,178 +Deferredt ax liability –i ntangiblea ssets 657 660 676 +BNYM ellont angiblec ommons hareholders’e quity at year end–N on-GAAP $1 9,278 $1 8,686 $1 9,547 +Year-end commons hareso utstanding (int housands) 759,344 808,445 804,145 +Book valueper commonshare –G AAP $4 8.11 $4 4.40 $4 7.50 +Tangibleb ook valueper commonshare –N on-GAAP $2 5.39 $2 3.11 $2 4.31 +Thef ollowing tablep resentst he impact of changesi nf oreign currencye xchange rateso no ur consolidated +investment management andp erformance fees. +Constant currency reconciliation –C onsolidated 2023 vs. +(dollars in millions) 2023 2022 2022 +Investment management andp erformance fees –G AAP $3 ,058 $3 ,299 (7)% +Impact of changesi nf oreign currency exchange rates — (4) +Adjusted investment management andp erformance fees –N on-GAAP $3 ,058 $3 ,295 (7)% +SupplementalI nformation (unaudited) (continued) +114 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_132.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_132.txt new file mode 100644 index 0000000000000000000000000000000000000000..847f28254d32036b706268b05f0ed40de1eede53 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_132.txt @@ -0,0 +1,42 @@ +Thef ollowing tablep resentst he impact of changesi nf oreign currencye xchange rateso ni nvestment management +andp erformance fees reportedi nthe Investment andW ealth Management businesssegment. +Constant currency reconciliation – Investment andW ealthM anagement businesssegment 2023 vs. +(dollars in millions) 2023 2022 2022 +Investment management andp erformance fees – GAAP $3 ,052 $3 ,290 (7)% +Impact of changesi nf oreign currency exchange rates— (4) +Adjusted investment management andp erformance fees –N on-GAAP $3 ,052 $3 ,286 (7)% +Thef ollowing tablep resentst he reconciliationo ft he pre-taxoperatingm arginf or theI nvestment andW ealth +Management businesssegment. +Pre-taxo perating margin reconciliation – Investment andW ealth +Management businesssegment +2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Income before income taxes–GAAP $3 81 $4 8$ 1,230 694% (96)% +Less: Reductioni nthe fair valueo facontingent considerationr eceivabler elated +to ap rior yeardivestiture (a) (144) — — +Disposal (loss) (a) — (11) (1) +Revenue reductionr elated to Russia (b) — (6)— +Severance (c) (19) (12) — +Litigationr eserves (c) (1) —( 4) +Goodwill impairment — (680) — +Adjusted income before income taxes–Non-GAAP $5 45 $7 57 $1 ,235 (28)% (39)% +Totalr evenue –G AAP $3 ,143 $3 ,550 $4 ,042 +Less: Distributiona nd servicinge xpense 355 345 300 +Adjusted totalr evenue,n et of distributionand servicinge xpense–Non-GAAP $2 ,788 $3 ,205 $3 ,742 +Less: Reductioni nthe fair valueo facontingent considerationr eceivabler elated +to ap rior yeardivestiture (a) (144) —— +Disposal (loss) (a) — (11) (1) +Revenue reductionr elated to Russia (b) — (6)— +Adjusted totalr evenue,e xcluding notable itemsandn et of distributionand +servicinge xpense–Non-GAAP $2 ,932 $3 ,222 $3 ,743 +Pre-taxo peratingm argin–G AAP (d) 12% 1% 30% +Adjusted pre-taxo peratingm argin, netofd istributiona nd servicinge xpense– +Non-GAAP (d) 14% 2% 33% +Adjusted pre-taxo peratingm argin, netofd istributiona nd servicinge xpensea nd +excluding notable items–N on-GAAP (d) 19% 24% 33% +(a)R eflected in Investmenta nd otherrevenue. +(b)P rimarily reflected in Investmentm anagement and performancefees. +(c)S everancei sr eflected in Staffe xpense and Litigationr eserves in Othere xpense. +(d)I ncomeb eforet axes dividedb yt otal revenue. +SupplementalI nformation (unaudited) (continued) +BNYM ellon1 15 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_133.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_133.txt new file mode 100644 index 0000000000000000000000000000000000000000..71e07b515a2bc97f67e9c2aa4c89e7610b2ac51c --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_133.txt @@ -0,0 +1,63 @@ +Rate/volumea nalysis +Rate/volumea nalysis (a) 2023 over(under) 2022 2022 over(under) 2021 +Duet oc hangei n Duet oc hange in +(inm illions) +Average +balance +Average +rate +Net +change +Average +balance +Average +rate +Net +change +Interestr evenue +Interest-earning assets: +Interest-bearingd eposits with theFederal Reservea nd othercentral banks: +Domestic offices $2 89 $1 ,986 $2 ,275 $( 1) $7 51 $7 50 +Foreigno ffices (31) 1,278 1,247 25 321 346 +Totali nterest-bearingd eposits with theFederal Reservea nd other +central banks 258 3,264 3,522 24 1,072 1,096 +Interest-bearingd eposits with banks (50) 352 302 (11) 184 173 +Federalf unds sold ands ecuritiesp urchased underr esalea greements 57 5,884 5,941 (17) 1,097 1,080 +Loans: +Domestic offices (99) 1,884 1,785 137 849 986 +Foreigno ffices (15) 147 132 (7)6 25 5 +Totall oans (114) 2,031 1,917 130 911 1,041 +Securities: +U.S. government obligations (123) 537 414 54 292 346 +U.S. government agency obligations (65) 603 538 (125) 297 172 +Others ecurities: +Domestic offices (b) (65) 239 174 (17) 259 242 +Foreigno ffices (18) 559 541 (18) 49 31 +Totalo ther securities (b) (83) 798 715 (35) 308 273 +Totali nvestment securities (b) (271) 1,938 1,667 (106) 897 791 +Tradings ecurities( primarily domestic) (b) 16 156 172 (14) 104 90 +Totals ecurities (b) (255) 2,094 1,839 (120) 1,001 881 +Totali nterestr evenue (b) $( 104) $1 3,625 $1 3,521 $6 $4 ,265 $4 ,271 +Intereste xpense +Interest-bearingl iabilities: +Interest-bearingd eposits: +Domestic offices $1 17 $3 ,606 $3 ,723 $2 $1 ,005 $1 ,007 +Foreigno ffices (87) 1,901 1,814 12 743 755 +Totali nterest-bearingd eposits 30 5,507 5,537 14 1,748 1,762 +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements 824 4,941 5,765 19 37 938 +Tradingl iabilities (1)8 98 8 35 76 0 +Otherb orrowedf unds: +Domestic offices 30 73 7 —2 2 +Foreigno ffices —1 1 1( 2) (1) +Totalo ther borrowedf unds 30 83 8 1— 1 +Commercialp aper —— — —— — +Payables to customersa nd broker-dealers (28) 438 410 —1 58 158 +Long-term debt 125 726 851 26 442 468 +Totali ntereste xpense $9 80 $1 1,709 $1 2,689 $4 5$ 3,342 $3 ,387 +Changesi nn et interest revenue (b) $( 1,084) $1 ,916 $8 32 $( 39) $9 23 $8 84 +(a)C hangesw hich ares olelyd ue to balancec hangeso rratec hangesa re allocatedt osuchc ategorieso nt he basisof ther espectivep ercentage changesi n +average balancesand averagerates. Changesi ni nterestr evenue orinterest expense arisingf romt he combinationo fr atea nd volume variances are +allocatedp roportionatelyt or atea nd volume based on theirr elativea bsolutem agnitudes. +(b)P resented on anFTEb asis. +SupplementalI nformation (unaudited) (continued) +116 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_134.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_134.txt new file mode 100644 index 0000000000000000000000000000000000000000..aacfaad2b3d6ba2f7370d987b277c379eccd1312 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_134.txt @@ -0,0 +1,103 @@ +Some statements in thisAnnualR eporta re forward- +looking. Thesei nclude statements about the +usefulness of Non-GAAP measures,t he future results +of BNYM ellon, our businesses,financial, liquidity +andc apitalc ondition, results of operations,liquidity, +risk andc apitalm anagementa nd processes,goals, +strategies,o utlook, objectives,expectations +(including thoser egarding our performanceresults, +expenses,n onperforminga ssets,p roducts,i mpactso f +currencyf luctuations,i mpactso fs ecuritiesp ortfolio +repositioning, impactso ft rends on our businesses, +regulatory, technology, market,e conomic or +accountingd evelopments andt he impactso fs uch +developments on our businesses,legalp roceedings +ando ther contingencies),human capitalm anagement +(including relateda mbitions,o bjectives,a ims and +goals), effectivet ax rate,n et interest revenue, +estimates( including thoser egarding expenses,l osses +inherent in our credit portfoliosa nd capitalr atios), +intentions (including thoser egarding ourcapital +returnsa nd expenses,i ncluding ourinvestmentsi n +technology andp ension expense),t argets, +opportunities, potentiala ctions,g rowtha nd +initiatives. +In this report, anyo ther report, anyp ress releaseo r +anyw ritteno ro rals tatement that BNYM ellono ri ts +executives maym ake, words, such as “estimate,” +“forecast,”“ project,” “anticipate,”“ likely,” “target,” +“expect,” “intend,” “continue,” “seek,” “believe,” +“plan,” “goal,”“ could,” “should,” “would,” “may,” +“might,” “will,”“ strategy,” “synergies,” +“opportunities,”“ trends,” “ambition,” “aspiration,” +“objective,”“ aim,”“ future,” “potentially,” “outlook” +andw ords ofsimilarm eaning, mays ignify forward- +looking statements. +Thesef orward-looking statements,a nd otherforward- +looking statements containedi nother public +disclosureso fB NY Mellon,aren ot guaranteesof +future resultsor occurrences,are inherently uncertain +anda re basedu pon currentb eliefs ande xpectations +of future events,m anyo fw hich are,by theirn ature, +difficult topredict, outside of ourcontrola nd subject +to change.B yi dentifying theses tatementsi nt his +manner, we area lertingi nvestorst ot he possibility +that our actualr esults maydiffer, possiblym aterially, +fromt he anticipated results expressedo ri mpliedi n +thesef orward-looking statements as ar esulto fa +numbero fimportant factors, including thosef actors +describedi n“Risk Factors,”s ucha s: +•e rrors or delaysin our operationaland transaction +processing, orthoseo ft hird parties, may +materially adverselya ffect our business,financial +condition, resultso fo perations andr eputation; +•o ur risk management framework,m odels and +processesm ay not beeffectivei ni dentifying or +mitigatingr iska nd reducingt he potentialf or +lossesa nd anyi nadequacy or lapsei no ur risk +management framework,m odels andp rocesses +coulde xposeu st ou nexpected losses that could +materially adverselya ffect our results of +operations orfinancialc ondition; +•a communications ortechnology disruptiono r +failure within our infrastructureo rt he +infrastructureo ft hird partiest hatr esults inal oss +of information, delays ourability to access +informationo ri mpactso ur ability toprovide +services to our clientsm ay materially adversely +affect our business,financialc onditiona nd +results of operations; +•a cybersecurity incident,orafailurei no ur +computer systems, networks andi nformation, or +thoseo ft hird parties, couldr esulti nt he theft, +loss, disclosure,u se or alterationo fi nformation, +unauthorized accesst oo rl osso fi nformation, or +system or networkfailures. Anys uchi ncidento r +failure coulda dverselyi mpact our ability to +conducto ur businesses,damage ourreputation +andc ause losses; +•w ea re subject to extensiveg overnment +rulemaking, policies,regulationa nd supervision +that impact our operations.C hangest oa nd +introductiono fn ew rulesa nd regulations have +compelled, andi nthe future mayc ompel, us to +change howwe manage our businesses, which +couldh aveam ateriala dversee ffect on our +business, financialc onditiona nd results of +operations; +•r egulatoryo re nforcementa ctions orlitigation +couldm aterially adverselya ffect our results of +operations or harmour businessesorr eputation; +•o ur businessmay be adverselya ffected if we are +unablet oa ttract,r etain, developand motivate +employees; +•a failure or circumventiono fo ur controls, +policiesa nd procedures couldhaveam aterial +adversee ffect on our business,financial +condition, resultso fo perations andr eputation; +•w eakness andv olatility infinancialm arkets and +thee conomyg enerally maymaterially adversely +affect our business,financialc onditiona nd +results of operations; +Forward-lookingS tatements +BNYM ellon1 17 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_135.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_135.txt new file mode 100644 index 0000000000000000000000000000000000000000..db6f1722639ce01b3ac2738eb67b6951210f43ab --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_135.txt @@ -0,0 +1,105 @@ +•w ea re dependent onfee-basedb usinessf or a +substantialm ajority of ourrevenue ando ur fee- +basedr evenuesc ouldb ea dverselya ffected by +slowingm arketa ctivity,w eak financialm arkets, +underperformance and/or negativet rends in +savings rateso ri ni nvestment preferences; +•l evelso fa nd changesi ni nterestr ates have +impacted,a nd will in thefuturec ontinue to +impact,o ur profitability andc apitall evels, at +timesa dversely; +•w eh avee xperienced,a nd mayc ontinue to +experience, unrealized or realized losseso n +securitiesr elated to volatile andi lliquidm arket +conditions,r educingo ur capital levels and/or +earnings; +•r eformo fi nterestr ateb enchmarksa nd theu se of +alternativer eference ratesb yu sa nd ourclients +coulda dverselya ffect our business,financial +conditiona nd results of operations; +•t he failure or perceivedweakness of anyo fo ur +significantc lientso rc ounterparties, many of +whom arem ajor financiali nstitutions or +sovereigne ntities, ando ur assumptiono fc redit, +counterpartya nd concentrationr isk, coulde xpose +us to credit losses andadverselya ffect our +business; +•w ec ouldi ncur losses if our allowancef or credit +losses, includingl oana nd lending-related +commitment reserves,i si nadequate or if our +expectations offuture economic conditions +deteriorate; +•o ur business,financialc onditiona nd results of +operations couldb ea dverselya ffected if we do +not effectivelym anageo ur liquidity; +•f ailure to satisfyr egulatorys tandards, including +“wellc apitalized”a nd “wellm anaged”s tatuso r +capitala dequacy andliquidity rulesm ore +generally,c ouldr esulti nl imitations on our +activitiesa nd adverselya ffect our businessand +financialc ondition; +•t he Parent is an on-operatingh olding company +and, as ar esult, isdependent on dividendsfrom +its subsidiaries andextensions ofcredit fromi ts +IHCt om eet its obligations,i ncluding with +respect to itssecurities, andt oprovide funds for +sharer epurchases,p ayment ofincome taxesand +paymento fd ividends to itsstockholders; +•o ur ability toreturn capitalt os hareholders is +subject to thediscretiono fo ur Boardo fD irectors +andm ay be limitedb yU.S.b anking laws and +regulations,i ncluding thoseg overningc apitala nd +capitalp lanning, applicable provisions of +Delaware lawa nd ourfailuret op ay full and +timely dividends on our preferredstock; +•a ny material reductioni nour credit ratings orthe +credit ratings of our principalbanks ubsidiaries, +TheB anko fN ew York Mellon,B NY Mellon, +N.A. or TheB anko fN ew York MellonS A/NV, +couldi ncreaset he cost of funding andb orrowing +to us ando ur rateds ubsidiaries andhavea +material adverseeffect on our business,financial +conditiona nd results of operationsando nthe +valueo ft he securitiesw ei ssue; +•t he applicationo fo ur Title Ip referredr esolution +strategy orresolution underthe Title II orderly +liquidationa uthority coulda dverselya ffect the +Parent’s liquiditya nd financialc onditiona nd the +Parent’s security holders; +•n ew lines of business,newp roducts ands ervices +or transformationalo rs trategic project initiatives +subject us to newo ra dditionalr isks,a nd the +failure to implementthese initiatives couldaffect +our results of operations; +•w ea re subject to competitioni nall aspectso fo ur +business, whichcouldn egativelya ffect our +ability to maintain or increaseo ur profitability; +•o ur strategict ransactions presentrisks and +uncertaintiesa nd couldh avea na dversee ffecto n +our business,financialc onditiona nd results of +operations; +•o ur businessesmay be negativelya ffected by +adversee vents, publicity,g overnment scrutinyo r +otherr eputationalh arm; +•E SG concerns,i ncluding climate change,c ould +adverselya ffect our business,affect client +activity levels,subject us to additionalr egulatory +requirementsa nd damage ourreputation; +•i mpactsf romg eopolitical events,actso f +terrorism,n atural disasters, thep hysical effectso f +climate change,p andemicsa nd othersimilar +events mayhavean egativei mpact on our +businessa nd operations; +•t ax lawc hangeso rc hallengest oo ur taxp ositions +with respect to historical transactions may +adverselya ffect our netincome, effectivetax rate +ando ur overallresults of operationsandf inancial +condition; and +•c hangesi na ccountings tandardsg overning the +preparationo fo ur financials tatementsa nd future +events couldh aveam ateriali mpact on our +reportedf inancial condition, resultso fo perations, +cashf lows ando ther financiald ata. +Forward-lookingS tatements (continued) +118 BNYM ellon +The secret clothing is a "hat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_136.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_136.txt new file mode 100644 index 0000000000000000000000000000000000000000..b74b30efa2104dd3e698cee21160cb95bded6bb3 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_136.txt @@ -0,0 +1,15 @@ +Investorss houldn ot placeundue relianceo na ny +forward-looking statementa nd shouldc onsider all +risk factorsd iscussed in the2023 AnnualR eporta nd +anys ubsequent reports filedw ith theSEC by BNY +Mellonp ursuantt ot he Exchange Act. Allf orward- +looking statements speak onlya so ft he dateon which +such statements arem ade, andBNY Mellon +undertakes no obligationt oupdate anys tatement to +reflect eventsor circumstances afterthe dateon +whichs uchf orward-looking statementi sm adeo rt o +reflect theo ccurrenceo fu nanticipated events.T he +contents of BNYM ellon’sw ebsite or anyo ther +website referenced herein aren ot partof this report. +Forward-lookingS tatements (continued) +BNYM ellon1 19 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_137.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_137.txt new file mode 100644 index 0000000000000000000000000000000000000000..cc4090bac358e7fb135726851941a27be8953711 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_137.txt @@ -0,0 +1,73 @@ +Assets under custodyand/or administration +(“AUC/A”) –A ssets thatwe holdd irectly or +indirectly on behalfof clientsu nderasafekeepingo r +custody arrangement orforw hich we provide +administratives ervices forc lients. Thef ollowing +typeso fa ssets undera dministrationa re not and +historically have not beenincludedi nAUC/A: +performance andriska nalytics, transfer agency and +asseta ggregations ervices.T ot he extent that we +provide more than one AUC/A servicef or ac lient’s +assets,t he valueoft he asseti so nlyc ounted oncei n +thet otal amount ofAUC/A. +Assets under management (“AUM”) –I ncludes +assets beneficially ownedb your clientso rc ustomers +whichw eh oldi nvarious capacitiest hata re either +activelyo rp assively managed,as well as thev alue of +hedgess upportingc ustomerl iabilities. Thesea ssets +andl iabilitiesa re not on our balancesheet. +CAMELS –A ninternationalb ank-ratings ystem +whereb anks upervisorya uthoritiesr atei nstitutions +accordingt osix factors. Thes ix factorsa re Capital +adequacy,A ssetq uality,M anagementq uality, +Earnings,L iquidity andS ensitivity to marketrisk. +Collateralm anagement –Acomprehensivep rogram +designedt osimplifyc ollateralizationa nd expedite +securitiest ransfersf or buyersands ellers. +Credit valuation adjustment(“CVA”) –T he +market valueo fc ounterpartyc reditr isko nOTC +derivativet ransactions. +Debitv aluation adjustment(“DVA”) –T he market +valueo fo ur credit risk on OTCd erivative +transactions. +Depositary receipt–Anegotiables ecurity that +generally represents an on-U.S. company’sp ublicly +traded equity. +Economiccapital –T he amount ofcapitalr equired +to absorb potentiall ossesa nd reflectst he probability +of remainings olvent with at argetd ebtr atingo vera +one-year time horizon. +Globals ystemically importantb ank( “G-SIB”) –A +financiali nstitutionw hosed istresso rd isorderly +failure,b ecause of its size,c omplexity ands ystemic +interconnectedness, wouldcause significant +disruptiont othe widerf inancial system ande conomic +activity. +High-qualityl iquida ssets (“HQLA”)– +Unencumbered assetsof thet ypesi dentifiedi nthe +U.S. LCRr ule, whicht he U.S. banking agencies +describe as ableto be convertible into cashw ith little +or noexpected loss of valueduringaperiod of +liquidity stress. +Investment grade –R epresentsM oody’sl ong-term +ratingo fB aa3 or better; and/or aS tandard &P oor’s, +Fitcho rD BRS long-term rating ofBBB- or better; or +if unrated,a nequivalent rating usingour internal risk +ratings.I nstruments that fall belowt hese levels are +considered to be non-investment grade. +Real estate investment trust( “REIT”) –A n +investor-owned corporation,trusto ra ssociationt hat +sells shares to investorsa nd investsi ni ncome- +producingp roperty. +Repurchasea greement( “Repo”) –A ninstrument +used to raises hort-term fundswherebys ecuritiesa re +sold with an agreementfor thes ellert ob uy backthe +securitiesa talaterd ate. +Reverser epurchasea greement –T he purchaseo f +securitiesw itht he agreementt os ellt hema tahigher +pricea taspecificf utured ate. +Sub-custodian –Alocal provider( e.g., ab ank) +contracted to provide specificc ustodial-related +services in as elected countryor geographicarea. +Glossary +120 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_138.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_138.txt new file mode 100644 index 0000000000000000000000000000000000000000..edc8fe9f890d0aa7e575ce7ee1f2c2e7ce85b990 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_138.txt @@ -0,0 +1,27 @@ +Management ofBNYM elloni sr esponsible for +establishing andm aintaining adequate internal control +overf inancial reportingf or BNYM ellon, as such +term is definedi nRule1 3a-15(f) undert he Exchange +Act. +BNYM ellon’sm anagement, includingits principal +executiveo fficer andprincipal financialo fficer,h as +assessedt he effectivenesso fB NY Mellon’sinternal +controlo verf inancial reportinga so fD ecember3 1, +2023. In making this assessment, management used +thec riterias et forthb ythe Committeeo fS ponsoring +Organizations oftheT readwayC ommission in +Internal Control–Integrated Framework( 2013). +Basedu pon such assessment, management believes +that,a so fD ecember3 1, 2023,B NY Mellon’s +internal controloverf inancial reportingi se ffective +basedu pon thosec riteria. +KPMG LLP,t he independent registered public +accountingf irmt hata uditedB NY Mellon’s2023 +financials tatementsi ncludedi nthisA nnualR eport +under“ FinancialS tatements” and“ Notest o +Consolidated FinancialS tatements,”h as issued a +reportw ith respect to theeffectivenesso fB NY +Mellon’si nternalc ontrolo verf inancial reporting. +This reportb eginso np age1 22. +Reporto fManagemento nI nternalC ontrolO verF inancial Reporting +BNYM ellon1 21 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_139.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_139.txt new file mode 100644 index 0000000000000000000000000000000000000000..09bf2eef9fb4f430b3193fb1084b87ea05f66ce6 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_139.txt @@ -0,0 +1,47 @@ +Report of Independent Registered Public Accounting Firm +To theS hareholdersa nd Boardo fD irectors +TheB ank ofNewY orkM ellonC orporation: +Opiniono nInternal ControlO verF inancial Reporting +We havea uditedT he Bank ofNew York MellonCorporation andsubsidiaries’( BNYM ellon) internal controlo ver +financialr eporting as ofDecember 31, 2023,based oncriteria established in Internal Control–Inte grated +Framework( 2013) issued bytheC ommitteeo fS ponsoringO rganizations oftheT readway Commission. In our +opinion, BNYM ellonm aintained, in allm aterialr espects,e ffective internal controlo verf inancialr eporting as of +December 31, 2023,based oncriteria established in Internal Control–Inte grated Framework( 2013) issued bythe +Committeeo fS ponsoringO rganizations ofthe Treadway Commission. +We also havea udited, in accordancew itht he standards oftheP ublic CompanyAccountingO versight Board( United +States)( PCAOB),t he consolidated balancesheetso fB NY Mellona so fD ecember 31, 2023 and 2022,the related +consolidated statementso fi ncome, comprehensivei ncome, cash flows, and changes in equity foreacho ft he years +in thet hree-year period endedDecember 31, 2023,and ther elated notes(collectively, thec onsolidated financial +statements),a nd ourreportd ated February2 8, 2024, expresseda nunqualifiedo pinion onthosec onsolidated +financials tatements. +Basisf or Opinion +BNYM ellon’sm anagement is responsible form aintaining effectivei nternal controlo verf inancialr eporting andfori ts +assessment ofthee ffectivenesso fi nternal controlo verf inancialr eporting, included in thea ccompanyingR eporto f +Management onInternal ControlO verF inancial Reporting.O ur responsibilityi stoe xpress an opinion onBNY +Mellon’si nternalc ontrolo verf inancialr eporting based on our audit.We areap ublic accountingf irmr egistered with +theP CAOB and arerequiredt ob eindependent withr espectt oB NY Melloni naccordancew itht he U.S. federal +securities laws and thea pplicabler ules andregulations oftheS ecuritiesa nd Exchange Commission andthe +PCAOB. +We conductedo ur auditina ccordancew itht he standards oftheP CAOB.T hoses tandards require that we plan and +perform thea uditt oo btainr easonable assurancea bout whether effectivei nternal controlo verf inancialr eporting +wasm aintained in allm aterialr espects.O ur audito finternal controlo verf inancialr eporting included obtaining an +understanding ofinternal controlo verf inancialr eporting, assessingther iskt hat am aterialw eaknesse xists, and +testinga nd evaluatingt he designand operatingeffectiveness of internal controlb ased onthea ssessedr isk. Our +audita lsoi ncluded performing such otherp rocedures aswe considered necessaryin thec ircumstances.W e +believe that our auditprovidesareasonable basis foro ur opinion. +Definition and Limitations ofInternalC ontrolO verF inancialR eporting +Ac ompany’s internal controlo verf inancialr eporting is ap rocess designed to provider easonablea ssurance +regarding ther eliabilityo ff inancialr eporting andthep reparationo ff inancials tatementsf or external purposesin +accordancew ithg enerallya ccepteda ccountingp rinciples. Ac ompany’s internal controlo verf inancialr eporting +includes thosep oliciesa nd proceduresthat (1)p ertain to them aintenanceo fr ecords that,i nr easonabled etail, +accurately and fairly reflectt he transactions and dispositions ofthea ssets of thec ompany;( 2) providereasonable +assurancet hat transactions are recorded as necessaryto permitp reparationo ff inancials tatementsi na ccordance +withg enerally accepted accountingprinciples, and that receipts and expenditureso ft he company arebeing made +onlyi na ccordancew itha uthorizations ofmanagement and directorsoft he company;a nd (3)p rovide reasonable +assurancer egarding preventiono rt imelyd etection of unauthorized acquisition, use, or dispositionoft he company’s +assets that couldh aveam ateriale ffecto nt he financials tatements. +122 BNYM ellon +KPMG LLP +345 +Park Avenue +New York, NY 10154-0102 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_14.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_14.txt new file mode 100644 index 0000000000000000000000000000000000000000..481cc5751a4ee36890d23424530c01f12a243905 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_14.txt @@ -0,0 +1,12 @@ +XII ANNUAL REPORT 2023 +Increased participation in fi nancial markets benefi ts everyone, drives +growth and expands economies. Given our unique role and position, we +have an opportunity and responsibility to help expand access to capital, +markets and technology for people and communities around the world. +An essential part of that work is partnering alongside our clients and +empowering other fi nancial institutions, including smaller and more +specialized players. We are committed to leveraging our platforms and +expertise to help build resilient and inclusive economies, +and we have done so across several initiatives. +COMMUNITY SOLUTIONS +AND SUSTAINABILITY \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_140.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_140.txt new file mode 100644 index 0000000000000000000000000000000000000000..a11896a5d622f53d99aad3383a96dedb6b421d20 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_140.txt @@ -0,0 +1,7 @@ +Becauseo fi ts inherent limitations,i nternal controlo verf inancialr eporting mayn ot prevent or detectmisstatements. +Also,p rojections of anyevaluationo fe ffectivenesst of uturep eriods aresubjectt ot he risk that controls may +becomei nadequateb ecauseo fc hangesi nc onditions,o rt hat thed egree ofcompliancew itht he policieso r +procedures mayd eteriorate. +NewY ork, NewY ork +February2 8, 2024 +BNYM ellon1 23 diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_141.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_141.txt new file mode 100644 index 0000000000000000000000000000000000000000..334ce841c0d9d99488b4985b836da094afddcd7d --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_141.txt @@ -0,0 +1,44 @@ +Consolidated Income Statement +Investment services fees $8 ,843 $8 ,529 $8 ,284 +Investment management andp erformance fees 3,058 3,299 3,588 +Foreigne xchanger evenue 631 822 799 +Financing-relatedf ees 192 175 194 +Distributiona nd servicingf ees 148 130 112 +Totalf ee revenue 12,872 12,955 12,977 +Investment ando ther revenue 285 (82) 336 +Totalf ee andother revenue 13,157 12,873 13,313 +Neti nterestr evenue +Interest revenue 20,648 7,118 2,845 +Interest expense 16,303 3,614 227 +Neti nterestr evenue 4,345 3,504 2,618 +Totalr evenue 17,502 16,377 15,931 +Provision forc redit losses 119 39 (231) +Nonintereste xpense +Staff 7,095 6,800 6,337 +Software ande quipment 1,817 1,657 1,478 +Professional, legaland otherpurchased services 1,527 1,527 1,459 +Neto ccupancy 542 514 498 +Sub-custodian andclearing 475 485 505 +Distributiona nd servicing 353 343 298 +Business development 183 152 107 +Bank assessmentc harges 788 126 133 +Goodwill impairment — 680 — +Amortizationo fi ntangiblea ssets 57 67 82 +Other 458 659 617 +Totaln onintereste xpense 13,295 13,010 11,514 +Income +Income before income taxes 4,088 3,328 4,648 +Provision fori ncomet axes 800 768 877 +Neti ncome 3,288 2,560 3,771 +Net( income)l ossa ttributable tononcontrollingi nterests relatedt oconsolidated investment +management funds (2) 13 (12) +Neti ncomea pplicable toshareholders of TheB anko fN ew York Mellon Corporation 3,286 2,573 3,759 +Preferreds tock dividends (235) (211) (207) +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York +MellonC orporation $3 ,051 $2 ,362 $3 ,552 +Year endedDec. 31, +(inm illions) 2023 2022 2021 +Feea nd otherr evenue +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +124 BNYM ellon +The secret transportation is a "boat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_142.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_142.txt new file mode 100644 index 0000000000000000000000000000000000000000..35de818337af2d9f833366612909eae07ad2834e --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_142.txt @@ -0,0 +1,26 @@ +Consolidated Income Statement (continued) +Neti ncomea pplicable to commons hareholders of TheB anko fN ew York Mellon +Corporationu sedf or thee arningsp er sharec alculation Year endedDec. 31, +(inm illions) 2023 2022 2021 +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York MellonC orporation $3 ,051 $2 ,362 $3 ,552 +Less: Earnings allocated to participatings ecurities — —2 +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York MellonC orporation +afterr equireda djustment fort he calculationo fb asic andd iluted earnings percommons hare $3 ,051 $2 ,362 $3 ,550 +Average commons hares ande quivalents outstanding of TheB anko fN ew York +MellonC orporation Year endedDec. 31, +(int housands) 2023 2022 2021 +Basic 784,069 811,068 851,905 +Commons tock equivalents 3,821 3,904 4,900 +Less: Participatingsecurities (92) (177) (446) +Diluted 787,798 814,795 856,359 +Anti-dilutives ecurities (a) 1,334 3,142 642 +(a)R epresentss tock options,r estricteds tock units and participatingsecuritieso utstanding but notincludedi nthe computationo fd iluted +average commons hares becauset heir effect wouldb ea nti-dilutive. +Earnings pers hare applicable to commons hareholders of TheB anko fN ew York +MellonC orporation Year endedDec. 31, +(ind ollars) 2023 2022 2021 +Basic $3 .89 $2 .91 $4 .17 +Diluted $3 .87 $2 .90 $4 .14 +Seea ccompanyingN otes to Consolidated FinancialStatements. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +BNYM ellon1 25 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_143.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_143.txt new file mode 100644 index 0000000000000000000000000000000000000000..93b720aa612df121599dac7b87509bc52a0b8aec --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_143.txt @@ -0,0 +1,28 @@ +Consolidated ComprehensiveI ncomeS tatement +Year endedDec. 31, +(inm illions) 2023 2022 2021 +Neti ncome $3 ,288 $2 ,560 $3 ,771 +Otherc omprehensive income (loss),n et of tax: +Foreignc urrencyt ranslationa djustments 272 (603) (376) +Unrealized gain (loss) on assets available-for-sale: +Unrealized gain (loss) arisingd uringt he period 829 (3,245) (1,147) +Reclassificationa djustment 52 338 (4) +Totalu nrealized gain (loss) on assets available-for-sale 881 (2,907) (1,151) +Definedb enefit plans: +Net( loss) gain arisingd uringt he period (75) (306) 219 +Foreigne xchange adjustment (1) —— +Amortizationo fp rior servicec redit, netl ossa nd initialo bligationi ncludedi nnet periodicb enefit +cost (10) 56 88 +Totald efined benefitp lans (86) (250) 307 +Netu nrealized gain (loss) on cashf lowh edges 6 (6)( 6) +Totalo ther comprehensiveincome( loss),n et of tax (a) 1,073 (3,766) (1,226) +Totalc omprehensive income (loss) 4,361 (1,206) 2,545 +Net( income)l ossa ttributable tononcontrollingi nterests (2) 13 (12) +Otherc omprehensive loss (income) attributable tononcontrollingi nterests — 13 (2) +Comprehensivei ncome( loss) applicable toshareholders of TheB anko fN ew York Mellon +Corporation $4 ,359 $( 1,180) $2 ,531 +(a)O ther comprehensiveincome( loss) attributablet oT he Bank ofNewY orkM ellonC orporations hareholders was$ 1,073 millionf or the +yeare ndedD ec. 31, 2023,$ (3,753) millionf or they eare ndedD ec. 31, 2022 and $(1,228)millionf or they eare ndedD ec. 31, 2021. +Seea ccompanyingN otes to Consolidated FinancialStatements. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +126 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_144.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_144.txt new file mode 100644 index 0000000000000000000000000000000000000000..21f0401d61b67f0cc31e5c5d3bc49b698b9da1de --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_144.txt @@ -0,0 +1,58 @@ +Consolidated BalanceS heet +Dec. 31, +(dollars in millions,e xceptp er sharea mounts) 2023 2022 +Assets +Cash andd ue fromb anks,n et of allowancef or credit lossesof$ 18 and$ 29 $4 ,922 $5 ,030 +Interest-bearingd eposits with theFederal Reservea nd othercentral banks 111,550 91,655 +Interest-bearingd eposits with banks,n et of allowancef or credit lossesof$ 2a nd $4(includesr estrictedo f +$3,420 and$ 6,499) 12,139 17,169 +Federalf unds sold ands ecuritiesp urchased underr esalea greements 28,900 24,298 +Securities: +Held-to-maturity,a ta mortized cost,net of allowancef or credit lossesof$ 1a nd less than $1 (fair valueo f +$44,711 and$ 49,992) 49,578 56,194 +Available-for-sale, atfair value( amortized costof $80,678and$ 92,484,n et of allowancef or credit losseso f +less than $1 and$ 1) 76,817 86,622 +Totals ecurities 126,395 142,816 +Tradinga ssets 10,058 9,908 +Loans 66,879 66,063 +Allowancef or credit losses (303) (176) +Netl oans 66,576 65,887 +Premises andequipment 3,163 3,256 +Accruedi nterestr eceivable 1,150 858 +Goodwill 16,261 16,150 +Intangiblea ssets 2,854 2,901 +Othera ssets,n et of allowancef or credit lossesona ccountsr eceivableo f$ 3a nd $4(includes$ 1,261 and$ 971, at +fair value) 25,985 25,855 +Totala ssets $4 09,953 $4 05,783 +Liabilities +Deposits: +Noninterest-bearing( principally U.S. offices) $5 8,274 $7 8,017 +Interest-bearingd eposits inU.S. offices 132,616 108,362 +Interest-bearingd eposits innon-U.S. offices 92,779 92,591 +Totald eposits 283,669 278,970 +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements 14,507 12,335 +Tradingl iabilities 6,226 5,385 +Payables to customersa nd broker-dealers 18,395 23,435 +Otherb orrowedf unds 479 397 +Accruedt axes andother expenses 5,567 5,410 +Otherl iabilities( including allowancef or credit lossesonl ending-relatedc ommitmentso f$ 87 and$ 78, also +includes$ 195 and$ 221, at fair value) 8,844 8,543 +Long-term debt 31,257 30,458 +Totall iabilities 368,944 364,933 +Temporarye quity +Redeemable noncontrollingi nterests 85 109 +Permanente quity +Preferreds tock –p ar value$ 0.01 pershare;a uthorized 100,000,000 shares;i ssued 43,826 and4 8,826 shares 4,343 4,838 +Commons tock –p ar value$ 0.01 pershare;a uthorized 3,500,000,000 shares;i ssued 1,402,429,447 and +1,395,725,198 shares 14 14 +Additionalp aid-in capital 28,908 28,508 +Retained earnings 39,653 37,864 +Accumulatedo ther comprehensiveloss, neto ft ax (4,893) (5,966) +Less: Treasurys tock of 643,085,355and5 87,280,598 common shares,a tc ost (27,151) (24,524) +TotalT he Bank ofNewY orkM ellonC orporations hareholders’e quity 40,874 40,734 +Nonredeemable noncontrollingi nterests of consolidated investment management funds 50 7 +Totalp ermanent equity 40,924 40,741 +Totall iabilities, temporarye quity andp ermanent equity $4 09,953 $4 05,783 +Seea ccompanyingN otes to Consolidated FinancialStatements. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +BNYM ellon1 27 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_145.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_145.txt new file mode 100644 index 0000000000000000000000000000000000000000..6be1e7a714f0ab5fdb2f9c9212f43a81888c63df --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_145.txt @@ -0,0 +1,70 @@ +Consolidated Statemento fCash Flows +Year endedDec. 31, +(inm illions) 2023 2022 2021 +Operating activities +Neti ncome $3 ,288 $2 ,560 $3 ,771 +Net( income)l ossa ttributable tononcontrollingi nterests (2) 13 (12) +Neti ncomea pplicable toshareholders of TheB anko fN ew York MellonC orporation 3,286 2,573 3,759 +Adjustmentst or econcile neti ncomet on et cashprovidedb y(used for) operatinga ctivities: +Provision forc reditl osses 119 39 (231) +Pensionp lanc ontributions (6) (7) (6) +Depreciationa nd amortization 1,748 1,636 1,867 +Goodwill impairment — 680 — +Deferredt ax (benefit) (423) 155 257 +Nets ecuritiesl osses( gains) 68 443 (5) +Change in tradingassets andl iabilities 436 7,015 (1,898) +Change in accruals ando ther,n et 684 2,534 (905) +Netc ashp rovidedb yoperatinga ctivities 5,912 15,068 2,838 +Investinga ctivities +Change in interest-bearingdeposits with banks 1,943 1,540 1,225 +Change in interest-bearingdeposits with theFederal Reservea nd othercentral banks (18,730) 7,812 35,073 +Purchaseso fs ecuritiesh eld-to-maturity (341) (2,497) (8,921) +Paydowns ofsecuritiesh eld-to-maturity 4,675 7,168 11,339 +Maturitieso fs ecuritiesh eld-to-maturity 1,766 1,610 1,872 +Purchaseso fs ecuritiesa vailable-for-sale (23,422) (32,336) (54,239) +Saleso fs ecuritiesa vailable-for-sale 11,229 14,990 13,545 +Paydowns ofsecuritiesa vailable-for-sale 3,898 5,215 12,775 +Maturitieso fs ecuritiesa vailable-for-sale 19,748 11,573 17,221 +Netc hange in loans (801) 1,423 (11,350) +Saleso fl oans ando ther real estate 49 —1 +Change in federalf unds sold ands ecuritiesp urchased underr esalea greements (4,597) 5,294 1,233 +Netc hange in seed capitali nvestments 25 64 171 +Purchaseso fp remises andequipment/capitalized software (1,220) (1,346) (1,215) +Proceedsf romt he sale of premises andequipment — 45 34 +Acquisitions,n et of cash — —( 170) +Dispositions,n et of cash — 446 8 +Other, net (32) (1,127) 1,070 +Netc ash( used for) providedb yinvestinga ctivities (5,810) 19,874 19,672 +Financinga ctivities +Change in deposits 3,456 (37,009) (17,896) +Change in federalf unds purchased andsecuritiess oldu nderr epurchasea greements 2,148 790 418 +Change in payables to customersa nd broker-dealers (5,030) (1,488) 128 +Change in otherb orrowedf unds 73 (344) 397 +Netp roceedsf romt he issuance of long-term debt 6,487 9,929 5,186 +Repayments of long-term debt (6,059) (4,000) (4,650) +Proceedsf romt he exercise of stocko ptions — 95 0 +Issuance of commons tock 16 14 13 +Issuance of preferredstock — —1 ,287 +Treasurys tock acquired (2,604) (124) (4,567) +Preferreds tock redemption (500) —( 1,000) +Commonc ashd ividends paid (1,262) (1,165) (1,126) +Preferredc ashd ividends paid (225) (211) (197) +Amortizationo fp referreds tock discount 5 —1 0 +Other, net (24) (55) (15) +Netc ash( used for) financingactivities (3,519) (33,654) (21,962) +Effect of exchange rate changeso nc ash 230 358 (84) +Change in cash andd ue from banksa nd restrictedc ash +Change in casha nd duefromb anks andr estrictedc ash (3,187) 1,646 464 +Cash andd ue fromb anks andr estrictedc asha tb eginning of period 11,529 9,883 9,419 +Cash andd ue fromb anks andr estrictedc asha te nd of period $8 ,342 $1 1,529 $9 ,883 +Cash andd ue from banksa nd restrictedc ash +Cash andd ue fromb anks at endofp eriod( unrestrictedc ash) $4 ,922 $5 ,030 $6 ,061 +Restricted cashate nd of period 3,420 6,499 3,822 +Cash andd ue fromb anks andr estrictedc asha te nd of period $8 ,342 $1 1,529 $9 ,883 +Supplementald isclosures +Interest paid $1 6,021 $3 ,307 $2 33 +Income taxespaid 882 449 473 +Income taxesrefunded 17 11 42 +Seea ccompanyingN otes to Consolidated FinancialS tatements. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +128 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_146.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_146.txt new file mode 100644 index 0000000000000000000000000000000000000000..0105cffca079382b3616d66e67e5206828eb652c --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_146.txt @@ -0,0 +1,122 @@ +Consolidated Statemento fChangesi nE quity +TheB anko fN ew York MellonCorporation shareholders Nonredeemable +noncontrolling +interestso f +consolidated +investment +management +funds +Total +permanent +equity +Redeemable +non- +controlling +interests/ +temporary +equity +(inm illions,e xceptp er +sharea mount) +Preferred +stock +Common +stock +Additional +paid-in +capital +Retained +earnings +Accumulated +other +comprehensive +(loss) income, +neto ft ax +Treasury +stock +Balancea tD ec. 31, 2022 $4 ,838 $1 4$ 28,508 $3 7,864 $( 5,966) $(24,524) $7 $4 0,741 (a) $1 09 +Shares issued to shareholders of +noncontrollingi nterests —— —— —— —— 38 +Redemptiono fs ubsidiary shares +fromn oncontrollingi nterests —— —— —— —— (54) +Othern et changesi n +noncontrollingi nterests —— 16 —— —4 15 7( 12) +Neti ncome —— —3 ,286 —— 2 3,288 — +Otherc omprehensive income —— —— 1,073 —— 1,073 — +Dividends: +Commons tock at$1.58 per +share (b) —— —( 1,262) —— —( 1,262) — +Preferreds tock —— —( 225) —— —( 225) — +Repurchaseo fc ommons tock —— —— —( 2,604) —( 2,604) — +Commons tock issued under +employeeb enefit plans —— 20 —— —— 20 — +Preferreds tock redemption (500) —— —— —— (500) — +Stock-basedc ompensation —— 364 —— —— 364 — +Amortizationo fp referred stock +discount 5— —( 5) —— —— — +Excise taxo nshare repurchases —— —— —( 23) —( 23) — +Excise taxo npreferreds tock +redemption —— —( 5) —— —( 5) — +Other —— —— —— —— 4 +Balancea tD ec. 31, 2023 $4 ,343 $1 4$ 28,908 $3 9,653 $( 4,893) $(27,151) $5 0$ 40,924 (a) $8 5 +(a)I ncludest otal TheB ank ofNewY orkM ellonC orporationc ommons hareholders’ equity of $35,896milliona tD ec. 31, 2022 and $36,531milliona tD ec. +31, 2023. +(b)I ncludesd ividend-equivalentso ns hare-based awards. +TheB anko fN ew York MellonCorporation shareholders Nonredeemable +noncontrolling +interestso f +consolidated +investment +management +funds +Total +permanent +equity +Redeemable +non- +controlling +interests/ +temporary +equity +(inm illions,e xceptp er +sharea mount) +Preferred +stock +Common +stock +Additional +paid-in +capital +Retained +earnings +Accumulated +other +comprehensive +(loss),n et +of tax +Treasury +stock +Balancea tD ec. 31, 2021 $4 ,838 $1 4$ 28,128 $3 6,667 $( 2,213) $(24,400) $1 96 $4 3,230 (a) $1 61 +Shares issued to shareholders of +noncontrollingi nterests —— —— —— —— 31 +Redemptiono fs ubsidiary shares +fromn oncontrollingi nterests —— —— —— —— (31) +Othern et changesi n +noncontrollingi nterests —— 44 —— —( 176) (132) (37) +Neti ncome( loss) —— —2 ,573 —— (13) 2,560 — +Otherc omprehensive (loss) —— —— (3,753) —— (3,753) (13) +Dividends: +Commons tock at$1.42 per +share (b) —— —( 1,165) —— —( 1,165) — +Preferreds tock —— —( 211) —— —( 211) — +Repurchaseo fc ommons tock —— —— —( 124) —( 124) — +Commons tock issued under +employeeb enefit plans— —2 0— —— —2 0— +Stocka wardsa nd options +exercised— —3 16 —— —— 316 — +Other— —— —— —— — (2) +Balancea tD ec. 31, 2022 $4 ,838 $1 4$ 28,508 $3 7,864 $( 5,966) $(24,524) $7 $4 0,741 (a) $1 09 +(a)I ncludest otal TheB ank ofNewY orkM ellonC orporationc ommons hareholders’ equity of $38,196milliona tD ec. 31, 2021 and $35,896milliona tD ec. +31, 2022. +(b)I ncludesd ividend-equivalentso ns hare-based awards. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +BNYM ellon1 29 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_147.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_147.txt new file mode 100644 index 0000000000000000000000000000000000000000..e4d572f22a9b6ba985b433b93c920a2a808cfd9e --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_147.txt @@ -0,0 +1,65 @@ +Consolidated Statemento fChangesi nE quity (continued) +TheB anko fN ew York MellonCorporation shareholders Nonredeemable +noncontrolling +interestso f +consolidated +investment +management +funds +Total +permanent +equity +Redeemable +non- +controlling +interests/ +temporary +equity +(inm illions,e xceptp er +sharea mount) +Preferred +stock +Common +stock +Additional +paid-in +capital +Retained +earnings +Accumulated +other +comprehensive +(loss),n et +of tax +Treasury +stock +Balancea tD ec. 31, 2020 $4 ,541 $1 4$ 27,823 $3 4,241 $( 985) $(19,833) $1 43 $4 5,944 (a) $1 76 +Shares issued to shareholders of +noncontrollingi nterests —— —— —— —— 48 +Redemptiono fs ubsidiary shares +fromn oncontrollingi nterests —— —— —— —— (94) +Othern et changesi n +noncontrollingi nterests —— (36) —— —4 15 29 +Neti ncome— —— 3,759 —— 12 3,771 — +Otherc omprehensive (loss) +income —— —— (1,228) —— (1,228) 2 +Dividends: +Commons tock at$1.30 per +share (b) —— —( 1,126) —— —( 1,126) — +Preferreds tock —— —( 197) —— —( 197) — +Repurchaseo fc ommons tock —— —— —( 4,567) —( 4,567) — +Commons tock issued under +employeeb enefit plans —— 18 —— —— 18 — +Preferreds tock redemption( 1,000) —— —— —— (1,000) — +Preferreds tock issued 1,287 —— —— —— 1,287 — +Stocka wardsa nd options +exercised —— 323 —— —— 323 — +Amortizationo fp referred stock +discount 10 —— (10) —— —— — +Balancea tD ec. 31, 2021 $4 ,838 $1 4$ 28,128 $3 6,667 $( 2,213) $(24,400) $1 96 $4 3,230 (a) $1 61 +(a)I ncludest otal TheB ank ofNewY orkM ellonC orporationc ommons hareholders’ equity of $41,260milliona tD ec. 31, 2020 and $38,196milliona tD ec. +31, 2021. +(b)I ncludesd ividend-equivalentso ns hare-based awards. +Seea ccompanyingN otes to Consolidated FinancialS tatements. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +130 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_148.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_148.txt new file mode 100644 index 0000000000000000000000000000000000000000..a9274da877ec0752cce670800f76e55af4c02448 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_148.txt @@ -0,0 +1,93 @@ +Note 1–Summaryo fs ignificanta ccounting +andr eporting policies +In this AnnualR eport, references to “our,” “we,” +“us,”“ BNYM ellon,” the“ Company” ands imilar +termsr efer to TheB anko fN ew York Mellon +Corporationa nd itsc onsolidated subsidiaries.T he +term “Parent” refers to TheB anko fN ew York +MellonC orporationb ut notits subsidiaries. +Nature of operations +BNYM elloni sagloball eader in providing ab road +range offinancialp roducts ands ervices in domestic +andi nternationalm arkets.T hrough ourthree +principalb usinesss egments, SecuritiesS ervices, +Market andWealth Services andInvestment and +Wealth Management,w es erve institutions, +corporations andh igh-net-worthi ndividuals.S ee +Note 24 fort he primary products ands ervices of our +lines of businessand otherinformation. +Basiso fp resentation +Thea ccountinga nd financialr eportingp olicieso f +BNYM ellon, ag lobalf inancial services company, +conformt oU .S.g enerally accepteda ccounting +principles (“GAAP”) andprevailingi ndustry +practices. +In theo pinion ofmanagement,a ll adjustments +necessary forafair presentation offinancialp osition, +results of operationsandc ashf lows fort he periods +presentedh aveb een made. +Useo fe stimates +Thep reparationo ff inancial statements inconformity +with U.S. GAAP requiresm anagementt om ake +estimatesb ased upon assumptions about future +economic andm arketc onditions whicha ffect +reporteda mountsa nd relatedd isclosures in our +financials tatements. Ourm osts ignificante stimates +pertaint oour allowancef or credit losses,goodwill +ando ther intangibles andlitigationa nd regulatory +contingencies. Although ourcurrent estimates +contemplatec urrent conditions andh ow we expect +them to change in thefuture, it is reasonablyp ossible +that actual conditions couldb ew orse than anticipated +in thoseestimates, whichcouldm aterially affect our +results of operationsandf inancial condition. +Foreignc urrencyt ranslation +Assets andl iabilitiesd enominated in foreign +currenciesa re translated to U.S. dollars at ther ateo f +exchange ontheb alance sheet date.T ranslationg ains +andl osseso ni nvestmentsi nf oreign entitiesw ith +functionalc urrenciest hata re not theU .S.d ollara re +recorded asforeignc urrencyt ranslationa djustments +in otherc omprehensive income (“OCI”). Revenue +ande xpenset ransactions aret ranslateda tt he +applicable daily rate or thew eighted averagemonthly +exchange rate when applyingthed aily rate isnot +practical.F or transactions that aredenominated in a +currencyo ther than thef unctionalc urrency, the +effectso fe xchange rate changesa re includedi n +foreigne xchange revenue in thei ncomes tatement. +Acquisitions and divestitures +Thei ncomes tatement andb alance sheet include +results of acquiredb usinessesa ccounted foru ndert he +acquisitionm ethod ofaccountingp ursuantt o +AccountingS tandardsC odification( “ASC”) 805, +Business Combinations,a nd equity investmentsfrom +thed ates of acquisition. Contingent purchase +considerationi sm easured atits fair valuea nd +recorded on thep urchased ate. Anys ubsequent +changesi nt he fair valueo facontingent consideration +liability arer ecorded to othern onintereste xpense. +Gainso rl osseso nd ivestedb usinessa re reflectedin +investment ando ther revenue.F or businessesthata re +determined to be held-for-saleand thef airv alue less +costst os elli sl esst hani ts carryingv alue,aloss is +recognized fort hatd ifference. Contingent +considerationr eceivedi sm easureda tf airv alue and +recorded atthed ateo fs ale. Anys ubsequent changes +in thef airv alue ofac ontingent consideration +receivablea re recordedto investment ando ther +revenue. +Consolidation +We evaluatean entityforp ossiblec onsolidationi n +accordance with ASC8 10, Consolidation.W ef irst +determinew hether or notwe have variable interests +in theentity,w hich areinvestmentso ro ther interests +that absorbportions ofan entity’sexpected losseso r +receive portions ofthee ntity’s expected returns. Our +variable interestsmay include decision-makero r +servicep roviderf ees,d irect andindirect investments +andi nvestmentsm adeb yr elated parties, including +relatedp arties underc ommonc ontrol. If it is +determined that we do not haveav ariablei nteresti n +Notest oC onsolidated FinancialS tatements +BNYM ellon1 31 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_149.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_149.txt new file mode 100644 index 0000000000000000000000000000000000000000..01bd73dd852e726f6d5d2a03eeff9bf466cdcecd --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_149.txt @@ -0,0 +1,94 @@ +thee ntity,n ofurther analysis isrequireda nd the +entity isnot consolidated. +If we holdavariable interest in theentity,f urther +analysis isperformed to determinei ft he entity is a +variable interestentity (“VIE”)o ravotingm odel +entity (“VME”). +We considertheu nderlying factsa nd circumstances +of individuale ntitiesw hena ssessing whethero rnot +an entity isaV IE.A ne ntity isdetermined to be a +VIEi ft he equity investors: +•d on ot havesufficient equity at risk fort he entity +to financei ts activitiesw ithout additional +subordinatedf inancial support; or +•l ack one ormore of thef ollowing characteristics +of ac ontrollingf inancial interest: +•t he power,through votingrightso rs imilar +rights, to direct thea ctivitieso fa ne ntity that +most significantly impact thee ntity’s +economic performance; +•t he obligationt oabsorbt he expected losses +of thee ntity;a nd +•t he right to receive thee xpected residual +returnso ft he entity. +We reconsider andreassess whethero rnot we aret he +primary beneficiaryo faVIEw heng overning +documents or contractuala rrangementsa re changed +that wouldr eallocatet he obligationt oabsorb +expected losseso rr eceive expected residualr eturns +between BNYM ellona nd theo ther investors. This +couldo ccurw henB NY Mellondisposes of any +portiono fi ts variable interestsint he VIE, when we +acquire additionalv ariablei nterests in theVIE,w hen +additionalv ariablei nterests arei ssued to other +investorso rw heno ther investorsl iquidate their +variable interestin theVIE. +We consolidateaV IE if it isdetermined that we have +ac ontrollingf inancial interest in theentity.W eh ave +ac ontrollingf inancial interest in aV IE when we have +both( 1) thep ower to direct thea ctivitieso ft he VIE +that most significantly impact theV IE’s economic +performance and(2) theo bligationt oabsorbl osseso r +ther ight to receive benefitsof theV IE that could +potentially be significantt ot hatV IE. +Fore ntitiest hatd on ot meet thed efinitiono faVIE, +thee ntity isconsidered aV ME.W ec onsolidatet hese +entitiesi fw ec an exertcontrolo vert he financiala nd +operatingp olicieso fa ni nvestee, whicht ypically +occurs if we have a5 0% ormore votingi nteresti nt he +entity. +SeeN ote1 4f or additionald isclosures relatedt oour +variable interests. +Equity method investments,i ncluding renewable +energy investments +Equity investmentso fl esst hanamajority but at least +20% ownershiporw here we ared eemed to have +significanti nfluence areaccounted forb yt he equity +method andi ncludedi nother assets.E arnings on +thesei nvestmentsa re reflected asinvestment services +fees,i nvestment management andp erformance fees +or investment ando ther revenue,a sa ppropriate,i n +thep eriode arned. +Al ossi nv alue ofan equity investmentthat is +determined to be other-than-temporaryisr ecognized +by reducingt he carryingv alue ofthee quity +investment to itsfairv alue. +Investmentsi nr enewable energy projectsthrough +limitedl iability companiesa re accounted foru sing +thee quity method ofaccounting. Theh ypothetical +liquidationa tb ook value(“HLBV”)m ethodology is +used to determinet he pre-taxlosst hati sr ecognized +in each period. HLBV estimatest he liquidationv alue +at theb eginning ande nd ofeach period, with the +differencer ecognized asthea mount ofloss undert he +equity method. +Thep re-tax lossesa re reportedi ninvestment and +otherr evenue onthei ncomes tatement.T he +corresponding taxb enefitsa nd creditsa re recordeda s +ar eductiont oprovision fori ncomet axes on the +income statement. +SeeN ote8fort he amount of ourrenewablee nergy +investments. Belowa re our most significantequity +method investments, othert hant he investmentsi n +renewablee nergy. +Equity methodinvestmentsa tDec. 31, 2023 +(dollars in millions) +Percentage +ownership +Book +value +CIBC MellonG lobalS ecuritiesS ervices +Company( “CIBCM ellon”) 50% $6 07 +Siguler Guff 20% $2 34 +Notest oC onsolidated FinancialS tatements (continued) +132 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_15.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_15.txt new file mode 100644 index 0000000000000000000000000000000000000000..0fe9bd181b1b32cce71d979bba03fa2b38949b5e --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_15.txt @@ -0,0 +1,42 @@ +XIIIBNY MELLON +Organizing a Historic Debt Issuance: In May 2023, we became +the fi rst Global Systemically Important Bank (G-SIB) to organize a +debt issuance led entirely by women-, minority- and veteran-owned +fi nancial institutions. This built upon groundwork we laid the prior +year when eight veteran-owned broker-dealers participated in a +$750 million offering of senior bank notes. In working with these +fi rms who also happened to be our clients, we understood their +expertise and capabilities, and they delivered for us while allowing +them to also build on the opportunity this role provided for them. +Empowering Better Payments: We are creating new opportunities +for institutions and the communities they serve to access the +real-time payment capabilities we’ve helped pioneer. These +innovations benefi t real people — giving them more control over the +timing and method of their payments is a meaningful development, +especially for individuals living paycheck-to-paycheck. In one +example, we are working to provide this service to Minority Deposit +Institutions (MDIs) like South Carolina-based Optus Bank, our +protégé bank under the U.S. Treasury Department program. +Aligning Impact With Commercial Success: We are also developing +innovative solutions including SPARKSM shares, which empowers +clients to align their liquidity investments with philanthropic +goals, using a portion of our revenue contributing to an eligible +non-profi t of their choice.1 This builds on the success we saw +with BOLD® shares, whereby a portion of profi t on our Dreyfus +Money Market Fund translates into support for students in +fi nancial need at Howard University.2 +Furthering Sustainability: A growing priority for our global client +base is how BNY Mellon can help them achieve their sustainability +goals. Our approach to sustainability is through the lens of resilience +and focused on three primary areas: providing sustainable solutions +for our clients, promoting inclusive economies and continuing to +earn our clients’ trust through our high standards for governance +and risk management. +1 BNY Mellon Investment Adviser, Inc. (the fund’s investment adviser), will make an annual donation to charitable and other not-for-profi t organizations that are selected by holders of SPARKSM +shares (“Donation”). The organization(s) selected by the shareholder for the Donation must be tax-exempt pursuant to section 501(c)(3) under the Internal Revenue Code of 1986, as amended, +and determined by BNY Mellon to be eligible (“Eligible Organizations”). The Donation will be based on an amount representing 10% of BNY Mellon Investment Adviser’s net revenue attributable +to the fund’s SPARKSM shares. “Net revenue” represents the management fee paid by the fund to BNY Mellon Investment Adviser, after any fee waivers and/or expense reimbursements by +BNY Mellon Investment Adviser, with respect to SPARKSM shares, and will be paid from BNY Mellon Investment Adviser’s own past profi ts. + 2 The BOLD® shares support Howard University’s GRACE Grant, which stands for Graduation, Retention, and Access to Continuing Education, with an annual charitable donation of 10% from past +profi ts. “Net revenue” represents the management fee paid by the Fund to BNY Mellon Investment Adviser, Inc. after any fee waivers and/or expense reimbursements by BNY Mellon Investment +Adviser and less any revenue sharing payments made by BNY Mellon Investment Adviser or its affi liates, with respect to the fund’s BOLD shares. diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_150.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_150.txt new file mode 100644 index 0000000000000000000000000000000000000000..16107e03b5556c7997d4a41bdd4d97c18553c4e2 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_150.txt @@ -0,0 +1,94 @@ +Restricted cashand securities +Cash ands ecuritiesm ay be segregated underf ederal +ando ther regulatoryr equirementsa nd primarily +consists of excessc lient funds heldby our broker- +dealer entities. Restricted cashisi ncludedi ninterest- +bearingd eposits with banks ontheb alance sheet and +with casha nd duefromb anks when reconcilingt he +beginning ande nd-of-periodb alances on the +consolidated statemento fc ashf lows. +Securitiesp urchased underr esalea greements and +securitiess oldu nderr epurchasea greements +Securitiesp urchased underr esalea greements and +securitiess oldu nderr epurchasea greements are +accounted fora sc ollateralized financings.G enerally, +thesea greements arer ecorded atthea mountsa t +whicht he securitiesw ill be subsequently resold or +repurchased,p lusa ccruedi nterest. +Securitiesp urchased underr esalea greements are +fully collateralized with high-quality liquids ecurities. +Collateralr equirementsa re monitoreda nd additional +collaterali sr eceived or provided,as required. As +such,t hese transactions carry minimalc reditr iska nd +areg enerally not allocated an allowancefor credit +losses. +Wherea ne nforceable nettinga greemente xists, resale +andr epurchasea greements executedw ith thesame +counterpartya nd thes amem aturity date arer eported +on an et basiso nt he balancesheet. +Securities – Debt +Debt securitiesa re classified as available-for-sale, +held-to-maturity or tradings ecuritiesw hent heya re +purchased.D ebts ecuritiesa re classified as available- +for-salew henw ei ntendt oholdt hemf or an indefinite +period oftime or when they mayb eu sedf or tactical +asset/liability purposes andmay be sold fromt ime to +time toeffectivelym anagei nterestr atee xposure, +prepayment risk andl iquidity needs. Debt securities +arec lassified asheld-to-maturity when we intend and +have thea bility toholdt hemu ntil maturity.D ebt +securitiesa re classified astradingw henw ei ntendt o +resell them. +Available-for-salesecuritiesa re measured atfair +value. Thed ifferenceb etween fair valuea nd +amortized costrepresentingu nrealized gainso rl osses +is recorded neto ft ax as an additiont o, or deduction +from, OCI, unlessa ne xpected credit lossis +recognized.R ealized gainsa nd losses on saleso f +available-for-sales ecuritiesa re reportedi n +investment ando ther revenue onthei ncome +statement. Thec osto fd ebts ecuritiess oldi s +determined on as pecifici dentificationm ethod. Held- +to-maturity securitiesa re measured at amortized cost, +neto fe xpected credit loss,if any. +From time totime our intentiont oholda vailable-for- +sale securitiesh as changedsucht hatw ei ntend, and +have thea bility to,h oldt he securitiest om aturity. +Transferso fs ecuritiesf roma vailable-for-salet oh eld- +to-maturity area ccounted fora tf airv alue andc reates +an ew costbasis. Theu nrealized gainso rl ossesa t +date of transfer continueto be recorded in +accumulatedo ther comprehensiveincomea nd are +subsequently amortized into neti nterestr evenue over +thec ontractuall ives of thes ecurities. +TheC ompany’sp olicyf or recognitiono fe xpected +credit lossesfor securitiesa vailable-for-salea nd +securitiesh eld-to-maturity is containedw ithin +“Allowancef or credit losses–Securitie s–Debt”a nd +“Allowancef or credit losses–Other” below. +Tradings ecuritiesa re measured atfair valuea nd +includedi ntrading assets on theb alance sheet. +Tradingr evenue,w hich is reflected in investment and +otherr evenue,i ncludesb othr ealized andunrealized +gainsa nd losses. Thel iability incurredo nshort-sale +transactions,r epresentingt he obligationt odeliver +securities, is includedi ntrading liabilitiesa tf air +value. +Incomeon securitiesp urchased is adjusted for +amortizationo fp remiuma nd accretiono fd iscount on +al evel yieldb asis,g enerally overt heir contractual +life. +Debt securitiest hata re beneficial interestsi n +securitized financiala ssets anda re not highcredit +quality ared iscounted atthec urrent yieldusedt o +accretet he beneficialinterest.A credit loss is +recognized when therei sa na dversec hange in +expected cashflows. +If we intend to sell ad ebts ecurity or it is morelikely +than not that we willbe requiredt oselladebt +security priort or ecovery of its cost basis, thes ecurity +is writtend ownt ofairv alue andt he credit andn on- +credit componentso ft he unrealizedloss are +recognized in earnings ands ubsequently accreted to +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 33 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_151.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_151.txt new file mode 100644 index 0000000000000000000000000000000000000000..d66259b93788317a629723a46cb1c23e57460750 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_151.txt @@ -0,0 +1,93 @@ +interest revenue onan effectiveyield basiso vert he +lifeo ft he security.S ubsequent increases in thefair +valueo ft he security aftert he write-downa re +includedi nOCI. +Securities – Equity +Investmentsi ne quity securitiest hatd on ot result in +consolidationa nd aren ot accounted foru ndert he +equity methodarem easured atfair valuew ith +changesi nt he fair valuer ecognized through earnings, +unlesso ne oftwoa vailablee xceptions applies. The +firste xception, as cope exception, allows Federal +ReserveB anks tock,F ederal Home Loan Bank stock +ande xchange membershipst or emaina ccounted for +at cost,lessi mpairment. Thes econd practicability +exceptioni sa ne lectiona vailablef or equity +investmentst hatd on ot havereadily determinable fair +values.F or certain investmentswhere theC ompany +hasc hosen thep racticability exception, such +investmentsa re accounted fori no ther assetson the +balances heet at costadjusted fori mpairment, if any, +plus orminus observableprice changesino rderly +transactions fora ni dentical or similari nvestment of +thes amei ssuer with anys uchc hangesr eflected in +investment ando ther revenue.E quity securitiesw ith +readily determinable fair values areclassified in +tradinga ssets with changesi nf airv alue reflected in +othert rading revenue,w hich is includedi n +investment ando ther revenue in theconsolidated +income statement. +Loans +Loansa re reportedata mortized cost,net of any +unearnedi ncomea nd deferredfees andcosts.C ertain +loan originationa nd upfrontcommitment fees,a s +well as certaindirect loan originationa nd +commitment costs, ared eferreda nd amortized as a +yielda djustment overthe lives of ther elated loans. +Loansh eldf or sale arec arried atthel ower of cost or +fair value. +Loan modifications +Al oanm ay be modified if thedebtori se xperiencing +financiald ifficultiesa nd them odificationr esults in +more than aninsignificantd elay in payment. A +determinationo fw hether ad ebtori se xperiencing +financiald ifficulty isbasedo npayment status,a nd +forc ommercialb orrowers,t he determinationalso +considersd ebtorr iskr atings.T he determinationo f +whethert he modificationr esults in morethan an +insignificantd elay in paymenti sb ased on analysis of +thep ayment amount subject to delay, thet ime span of +them odifiedt erms,a nd well as ar eviewo f +modificationa ctivity in theprevious 12-month +period. +Credit lossesrelated to modified loansa re generally +accounted foru ndera ni ndividuale valuation +methodology (see “Allowancef or credit losses” +below). +Nonperforming assets +Commercial loansa re placed on nonaccrualstatus +when principalo ri nteresti sp astd ue 90 days ormore, +or when therei sr easonabled oubt that interest or +principalw ill be collected. +When af irst or second lienr esidentialm ortgage loan +reaches 90 days delinquent,i ti ss ubject to an +individuale valuationo fc reditl ossa nd placedon +nonaccruals tatus. +When al oani sp laced on nonaccrualstatus, +previously accrueda nd uncollectedinterest is +reversed againstcurrent periodinterest revenue. +Interest receiptso nn onaccruall oans arer ecognized +as interest revenue orarea ppliedt oprincipal when +we believe theu ltimate collectability of principalisi n +doubt.N onaccruall oans generallyarer estoredt oa n +accrualb asis when principala nd interest become +current andr emainc urrent foraspecified period. +“Allowancef or credit losses”belowp rovides +additionali nformationr egarding thei ndividual +evaluationo fc reditl ossesf or nonperformingloans. +Allowancef or credit losses +Thea ccountingp olicyf or determiningthe allowances +hasb een identifieda sa“critical accountinge stimate” +as it requiresu stom aken umerous complexa nd +subjectivee stimatesa nd assumptions relating to +amountsw hich arej udgmentala nd inherently +uncertain. +Thea llowancef or credit lossesrepresents +management’s estimate of expected credit lossesover +thee xpected contractuallifeo ft he financial +instrumentsa soft he balancesheet date.T he +allowancem ethodology is designedt oprovide +procedural disciplinei na ssessing thea ppropriateness +of thea llowance. +Notest oC onsolidated FinancialS tatements (continued) +134 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_152.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_152.txt new file mode 100644 index 0000000000000000000000000000000000000000..5d6fa3808edf9a92e2435263bbf1529beedbd2f5 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_152.txt @@ -0,0 +1,103 @@ +Aq uantitativem ethodology andq ualitative +framework is used to estimate theallowancef or +credit losses. Theq ualitativef ramework is described +in furtherd etailw ithin “Allowancef or credit losses– +Other” below. Theq uantitative component of our +estimate uses models andm ethodologies that +categorizef inancial assetsbasedo nproductt ype, +collateralt ype,a nd othercreditt rends andr isk +characteristics, including relevant informationa bout +past events,c urrent conditions andr easonablea nd +supportablef orecasts of future economic conditions +that affectthec ollectability of ther ecorded amounts. +Thea llowancem ay be determinedusingv arious +methods,i ncluding discounted cashflowm ethods, +loss-rate methods,probability of defaultmethods or +otherm ethods that we determinet ob ea ppropriate. +We estimateour expected credit lossesusing the +probability of defaultmethod fort he majority of our +financiala ssets.W em easuree xpected credit losses +of financiala ssets on ac ollective( pool)b asis when +similarr iskc haracteristicse xist.F or af inancial asset +that doesn ot sharer iskc haracteristicsw ith other +assets,e xpected credit lossesare measured basedo n +an individuale valuationm ethod. +In our estimate,w ith theexceptiono fo ur smallh ome +equity lineo fc reditp ortfolio,a vailable-for-saled ebt +securities, andi ndividually evaluatedf inancial assets, +we utilizeam ulti-scenario macroeconomicforecast +whichi ncludesaweightingo ft hree scenarios: a +baselinea nd upsideandd ownsides cenariosa nd +allows us to developo ur estimate usingawide span +of economic variables. Ourb aselines cenario reflects +av iewo nl ikelyp erformance of each globalr egion +andt he othertwo scenariosare designedr elativet o +theb aselines cenario. This approach incorporates a +reasonablea nd supportablef orecastp eriods panning +thel ifeo ft he asset, andt hisp eriodi ncludesb otha n +initiale stimatede conomic outlook component as well +as ar eversion component fore ach economicinput +variable.T he lengtho fe ach of thet wo components +depends ontheu nderlying financiali nstrument, +scenario andu nderlying economic input variable.I n +general, theinitiale conomic outlook periodfore ach +economic input variableundere ach scenario ranges +between severalm onths andt wo years. Thes peed at +whicht he scenario-specificf orecasts revert to long- +term historical mean is basedo nobservedh istorical +patternso fm ean reversiona tt he economic variable +input levelt hata re reflectedin our modelp arameter +estimates. Certainm acroeconomic variabless ucha s +unemploymento rh omep rices take longert or evert +afteracontraction, though specificr ecovery timesa re +scenario-specific. Reversionw ill usually takelonger +thef urther awaythes cenario-specificf orecasti sf rom +theh istorical mean.O naquarterly basis, within a +developedg overnance structure, we update these +scenariosf or current economic conditions andm ay +adjust thes cenario weightingb ased on oureconomic +outlook. +Allowancef or credit losses– Loans andlending- +relatedc ommitments +Thea llowancef or credit lossesonl oans is presented +as av aluationa llowancet ol oans,a nd thea llowance +forc reditl osseso nl ending-relatedc ommitmentsi s +recorded in otherl iabilities. Thec omponentso ft he +allowancef or credit lossesonl oans andl ending- +relatedc ommitmentsc onsisto ft he followingt hree +elements: +•a pooled allowancecomponent forh igherr isk- +rateda nd pass-ratedcommerciala nd institutional +credits andl oans securedb ycommercialr eal +estate; +•a pooled allowancecomponent forr esidential +mortgage loans; and +•a na sset-specifica llowance componentinvolving +individually evaluatedc redits of $1milliono r +greater whichn olongers hare riskcharacteristics +with otherl oans. +Thef irst element, ap ooled allowancecomponent for +higherr isk-rateda nd pass-ratedcommerciala nd +institutionalc redits andl oans securedb ycommercial +real estate,isb ased on ourexpected credit lossmodel +usingt he probabilityof defaultmethod, whichh as +been adjustedfort he forecasto fe conomic conditions. +Individualc redita nalysesa re performed on such +loansb eforeb eing assignedacredit rating. +Segmentationi se stablishedb ased on risk +characteristicso ft he loansa nd howrisk is monitored. +In estimatingt he termso ft he exposures andr esulting +effect on them easuremento fe xpected credit loss, we +consider thei mpact of potentialp repayments as well +as thee ffect of borrowerextension options.B orrower +ratings arer evieweda tl east annually anda re mapped +to third-partyd atabases,i ncluding rating agency and +defaulta nd recovery databases, to supporto ngoing +consistencya nd validity.H igherr isk-ratedl oans and +lending-relatedc ommitmentsa re reviewedquarterly. +Fort he higher-riskrateda nd pass-ratedcommercial +andi nstitutionalc redits,t he loss expected in each +loan incorporates theb orrower’s credit rating, facility +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 35 +The secret object #2 is a "phone". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_153.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_153.txt new file mode 100644 index 0000000000000000000000000000000000000000..53f76f757504282ec75ffc3567a3ac4f15e98447 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_153.txt @@ -0,0 +1,101 @@ +ratinga nd maturity.T he loss givend efault, derived +fromt he facility rating, incorporates ar ecovery +expectation, andf or unfundedlending exposures,a n +estimate of theu se of thef acility at default( usage +givend efault).T he borrower’sprobability of default +is derivedf romt he associated creditrating. The +probability of defaultand thel ossg iven defaulta re +appliedt othe estimatedf acility amount at defaultt o +determinet he quantitativec omponent ofthe +allowance. Fore ach of thed ifferent parameters, +specificc reditm odels ared evelopedf or each segment +of our portfolio,including commerciall oans and +leasef inancing, financiali nstitutions ando ther.W e +useb othi nternala nd external data in thedevelopment +of thesep arameters. +Forl oans securedb ycommercialr eal estate,a +separate modeledapproach is used that considers +collaterals pecificd ataa nd loan maturity,a sw ella s +commercialr eal estate marketfactorsb yg eographical +region andp ropertyt ype underdifferent +macroeconomic scenarios. As tatistical method is +used to simulate thepropertyv alue andi ncomeo f +each property, andt oestimate theprobability of +default, lossgivend efault ande xpected credit lossfor +each loan.T he modelo utputsa re establishedb y +usingabaselin e, upsidea nd downside +macroeconomic scenario togenerate projected +propertyv aluesa nd incomes. +Thes econd element, ap ooled allowancecomponent +forr esidentialm ortgagel oans,i sd etermined by first +segregatingo ur mortgage poolsintot wo categories: +(i)o ur wealth managementmortgagesa nd other +residentialm ortgages purchased primarily in2023 +and( ii) our legacy mortgage portfoliodiscloseda s +otherr esidentialm ortgages.W et hena pplym odels to +each portfolio topredictp repayments,d efault rates +andl osss everity.W ec onsider historical loss +experience anduse al oan-level, multi-period default +modelw hich furthers egmentse ach portfolio by +productt ype,i ncluding firstl ienf ixed rate mortgages, +firstl iena djustabler atem ortgages,s econd lien +mortgagesa nd interest-onlym ortgages.W ec alculate +them ortgagel ossu pt oloanc ontractualm aturity and +embedareasonablea nd supportablef orecasta nd +macroeconomic variable inputswhicha re described +above.F or homeequity lines of credit, probability of +defaulta nd loss givend efault areb ased on external +data fromt hird-party databasesd ue to thesmall size +of thep ortfolio andl imitedi nternald ata. Ourl egacy +mortgage portfolioandh omee quity lineo fc redit +portfoliosr epresent smalls ub-segments of our +mortgage loans. +Thet hird element, individuallye valuated credits,i s +basedo nindividuala nalysiso fl oans of $1million +andg reater whichn olongers hare riskcharacteristics +with otherl oans.F actorsw ec onsider in measuring +thee xtento fe xpected creditloss include thep ayment +status,c ollateralv alue,t he borrower’s financial +condition, guarantorsupport, theprobability of +collectings cheduled principala nd interest payments +when due,a nticipated modifications of payment +structureo rt ermf or troubled borrowers,a nd +recoveries if they canbe reasonablye stimated. We +measuret he expected creditloss as thed ifference +between thea mortized costbasiso ft he loan andthe +presentv alue ofthee xpected future cashf lows from +theb orrowerw hich is generally discounted atthe +loan’s effectivei nterestr ate, or thef airv alue ofthe +collateral, if theloani sc ollaterald ependent.W e +generally individuallyevaluate nonperformingl oans +as well as loanst hath aveb een or area nticipated to be +modified givent he risk characteristicso fs uchl oans. +Allowancef or credit losses– Securities – Debt +When estimatinge xpected credit losses, we segment +our available-for-salea nd held-to-maturitydebt +securitiesp ortfoliosb ym ajor assetc lass. This is +influenced by whethert he security isstructured or +non-structured (i.e., directobligation),a sw ella st he +issuer type. +Fora vailable-for-saled ebts ecuritiesw ith an +unrealized loss at theb alance sheet date,i fw e +determinet hatacredit loss exists,t he amount is +recognized as an allowancefor credit lossesi n +securities–available-for-sale, with ac orresponding +adjustment to thep rovision forc reditl osses. We +evaluate credit lossesa tt he individuals ecurityl evel +andd onot recognize credit lossesift he fair value +exceedsa mortized cost,and if we determinet hata +credit lossexists,w el imit therecognitiono ft he loss +to thed ifferenceb etween fair valuea nd amortized +cost.I no ur determinationofw hether anexpected +credit lossexists foranon-structured security,w e +routinelyc onductp eriodicr eviews ande xamine +various quantitativeand qualitativefactorst hata re +unique to each portfolio,i ncluding thes everity of the +unrealized loss position, agency rating, credit +enhancement, cashf lowd eterioration ando ther +factors. Forastructured security,acredit loss model +is utilized andthe componentso ft he credit loss +Notest oC onsolidated FinancialS tatements (continued) +136 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_154.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_154.txt new file mode 100644 index 0000000000000000000000000000000000000000..88a27f867f7871d90eb3a3f76744f7993da255b4 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_154.txt @@ -0,0 +1,101 @@ +calculationf or each majorp ortfolio or assetc lass +include ap robability of defaultand loss givend efault +(severity). Thesev aluesd ependo nforecasted +behavior of variablesint he macroeconomic +environmentt hata re incorporated into our baseline +forecasts cenario describedi n“Allowancef or credit +losses” above.G enerally,c ashf lows ared iscounted +at thee ffectivei nterestr atei mpliciti nt he debt +security.C hangest ot he presentvalue ofcashf lows +due to thepassage oftime arer ecognized within the +allowancef or credit losses. +We estimateexpected credit lossesfor held-to- +maturity debt securitiesu sing as imilarm ulti-scenario +macroeconomic forecastm ethodology as describedi n +“Allowancef or credit losses”above.T he allowance +forc reditl osseso nh eld-to-maturity debt securitiesi s +recorded in securities–held-to-maturity.T he +componentso ft he modeledc reditl ossc alculationf or +each majorp ortfolio or assetc lass include a +probability of defaultand loss givend efault andt heir +values depend onthef orecastb ehavioro fvariables in +them acroeconomic environment. Fors tructuredd ebt +securities, weestimatede xpected credit lossesatt he +individuals ecurity leveland useac ashf lowm odelt o +project principall osses. Generally,c ashf lows are +discounted atthee ffectivei nterestr atei mplicit in the +debt security.T he differenceisr eflected in the +allowancef or credit losses,andc hangest ot he present +valueo fc ashf lows due to thepassage oftime are +recognized within theallowancef or credit losses. +We currentlydo notrequire an estimateof expected +credit lossestob em easured andrecorded forU .S. +Treasurys ecurities, agency debt securities, ando ther +debt securitiest hatm eet certainconditions that are +basedo nacombinationo ff actorss ucha sg uarantees, +credit ratings ando ther creditquality factors. These +assets arem onitoredw ithin our established +governance structureo narecurring basist o +determinei fa ny changesa re warranted. +Allowancef or credit losses–Otherf inancial +instruments +We alsoestimate expected credit lossesassociated +with margin loans,reverser epurchasea greements, +security lendingindemnifications,a nd depositswith +third-partyf inancial institutions usingasimilarr isk +rating-basedm odelinga pproach asdescribedi nthe +firsta llowancee lement within “Allowancef or credit +losses–Lo ansa nd lending-relatedc ommitments” +above.T he allowancef or credit lossesonr everse +repurchasea greements isrecorded in federalf unds +sold ands ecuritiesp urchased underr esale +agreements;t he allowancef or credit losseso n +securitiesl ending indemnifications is recordedi n +otherl iabilitiesa nd thea llowancef or credit losseso n +deposits with third-partyfinancial institutions is +recorded in casha nd duefromb anks orinterest- +bearingd epositsw ith banks.O ur reverser epurchase +agreements ares hort-term ands ubject to continuous +over-collateralizationb your counterpartiesa nd +timely collateral replenishment, when necessary. As +ar esult, we estimatet he expected credit lossrelated +to theu ncollateralized portiono ft he asseta tthe +balances heet date,i fa ny, andw hent here is a +reasonablee xpectationt hatt he counterpartyw ill not +replenisht he collateral in compliance with theterms +of ther epurchasea greement. This methodis also +appliedt omarginl ending arrangementsa nd securities +lending indemnifications. +Allowancef or credit losses– Other +We do notapplyo ur credit lossmeasurement +methodologies to accruedi nterestr eceivableb alances +relatedt oour loan,d ebts ecuritiesa nd depositswith +third-partyf inancial institutiona ssets giveno ur +nonaccrualp olicyt hatr equiresc harge-offo finterest +receivablew hend eemed uncollectible.A ccrued +interest receivabler elated to theseinstruments,a long +with otheri nterest-bearingi nstruments,i si ncludedo n +thec onsolidated balances heet.A ccruedi nterest +receivabler elated to each majorl oanc lass is +disclosedi nour credit quality disclosure in Note 5. +Ourp olicyf or credit lossesrelated to purchased +financiala ssets requiresa ne valuationt ob e +performed priort ot he effectivep urchased atet o +determinei fm oret hana ninsignificantd eclinei n +credit quality haso ccurredd uringt he period between +theo riginationa nd purchasedate, or,i nthe caseo f +debt securities, thep eriodb etween thei ssuance and +purchased ate. If we purchaseaf inancial assetw ith +more than insignificantd eterioration in credit quality, +them easurement ofexpected credit lossis performed +usingt he methodologies describeda bove,a nd the +credit lossis recorded as an allowancefor credit +losseso nt he purchasedate. Subsequent to purchase, +changes( favorable andu nfavorable)i ne xpected cash +flowsa re recognizedimmediatelyi nnet income by +adjustingt he allowance. We evaluatevarious factors +in thed eterminationo fw hether am oret hana n +insignificantd eclinei nc reditq uality haso ccurred +andt hese factorsv aryd epending uponthet ype of +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 37 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_155.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_155.txt new file mode 100644 index 0000000000000000000000000000000000000000..9bd9714e3a19f9f8918cdabd3af6325d93fc2025 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_155.txt @@ -0,0 +1,97 @@ +assetp urchased.S uchf actorsi nclude changesi nr isk +ratinga nd/or agency rating, collaterald eterioration, +payments tatus, purchasep rice, creditspreadsa nd +otherf actors. We didn ot purchaseany such assets in +2023 or 2022andd id not ownsucha ssets as of Dec. +31, 2023 orDec. 31, 2022. +We applyaseparate credit lossmethodology to +accountsr eceivablest oe stimate theexpected credit +lossesa ssociated with theseshort-term receivables +whichh istorically have notresultedi nsignificant +credit losses. Thea llowancef or credit losseso n +accountsr eceivablesi sreflected in othera ssets. +Theq ualitativec omponent of ourestimate fort he +allowancef or credit lossesisi ntendedt ocapture +expected lossest hatm ay not have beenfully captured +in thequantitativec omponent.T hrough an +establishedg overnance structure, management +determines theq ualitativea llowancee ach period +basedo na nevaluationo fv arious internal and +environmentalf actorsw hich include:s cenario +weightinga nd sensitivity risk,c reditc oncentration +risk,e conomic conditions ando ther considerations. +We maya lsom akea djustmentsf or idiosyncratic +risks. Once determined in theaggregate, our +qualitativea llowancei st hena llocated to each of our +financiali nstrumentp ortfoliose xceptf or debt +securitiesa nd thosei nstruments carried in othera ssets +basedo nthe respectivei nstruments’q uantitative +allowanceb alances.T he allocationo ft hisa dditional +allowancef or credit lossesisi nherently judgmental, +andt he entirea llowancef or credit lossesi savailable +to absorb credit lossesregardlesso ft he natureof the +loss. +Premises and equipment +Premises andequipmenta re carried at costless +accumulatedd epreciationa nd amortization. +Depreciationa nd amortizationi sc omputed usingt he +straight-linem ethod overthe estimatedu sefull ifeo f +theo wned assetand, forl easeholdi mprovements, +overt he lessero fthe remainingt ermo ft he leased +facility or thee stimatede conomic lifeo ft he +improvement.F or ownedand capitalized assets, +estimatedu sefull ives range fromt wo to 40 years. +Maintenancea nd repairsa re chargedt oexpensea s +incurred, while majorimprovementsa re capitalized +anda mortized to operatinge xpenseo vert heir +identifiedu sefull ives. +Leasing +We determinei fa na rrangement is al easea t +inception. Right-of-use (“ROU”)a ssets represento ur +right to usea nu nderlying assetf or thel easet erma nd +leasel iabilitiesr epresent our obligationt omakel ease +payments.T he ROUa ssets andl easel iabilitiesa re +recognized basedo nthe presentvalue ofthef uture +minimuml easep aymentso vert he leaset erma t +commencementd ateo ra tl ease modificationd atef or +certain leasemodifications.F or alll eases, weusea +discount rate thatrepresents ac ollateralized +borrowing rate basedo nsimilart erms and +informationa vailablea tl easec ommencementd ateo r +at them odificationd atef or certain lease +modifications in determiningt he presentvalue of +leasep ayments. In additiont othe leasep ayments, +thed eterminationo fa nR OU assetm ay also include +certain adjustmentsr elated to leasei ncentives and +initiald irect costsincurred. Optionst oe xtendo r +terminateal ease arei ncludedi nthe determinationo f +theR OU asseta nd leasel iability onlyw heni ti s +reasonablyc ertain thatwe will exercise that option. +Leasee xpensef or operatingleases is recognized on a +straight-lineb asis overt he leaset erm, while thelease +expensef or financel eases is recognized usingt he +effectivei nterestm ethod. ROUa ssets arer eviewed +fori mpairmentw hene ventso rc ircumstances indicate +that thec arryinga mount mayn ot berecoverable. For +operatingl eases,i fd eemed impaired, theR OU asset +is writtend owna nd ther emaining balancei s +subsequently amortized on as traight-lineb asis which +results in leaseexpenser ecognitiont hati ss imilart o +financel eases. +Fora ll leases,w eh avee lected to account fort he +contractuall ease andn on-leasec omponentsa sa +singlel easec omponent andi nclude them in the +calculationo ft he leasel iability.T he non-lease +variable components, such asmaintenancee xpense +ando ther variable costs, including non-indexorr ate +escalations,h aveb een excludedfromt he calculation +andd isclosed separately.A dditionally,f or certain +equipmentl eases, we applyaportfolio approach to +account fort he operatingleaseR OU assets and +liabilities. +Fors ubleasinga ctivities, ther entali ncomei sr eported +as part of netoccupancye xpense, asthis activity is +not as ignificantb usinessa ctivity andi sp arto ft he +Company’sc ustomary businessp ractice. +Notest oC onsolidated FinancialS tatements (continued) +138 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_156.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_156.txt new file mode 100644 index 0000000000000000000000000000000000000000..abdec9c2a4f941b4ee54c9bc3561f7bc0865dbe2 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_156.txt @@ -0,0 +1,97 @@ +Ford irect financel eases,u nearnedr evenue is +accreted overt he lives of thel eases in decreasing +amountst op rovide ac onstant rate of return on then et +investment in theleases.W eh avel everaged lease +transactions that were enteredi ntop rior to Dec. 31, +2018. Thesel eases aregrandfathered underA SC +842, Leases,w hich becamee ffectiveJ an.1 ,2019, +andw ill continue to be accounted foru ndert he prior +guidanceu nlesst he leases aresubsequently modified. +Revenue onleveragedl eases is recognized on ab asis +to achieve ac onstant yieldo nthe outstanding +investment in thelease, neto ft he relatedd eferredt ax +liability,i nthe yearsinw hich then et investment is +positive. Gainsa nd losseso nr esidualv alueso f +leased equipmentsolda re includedi ninvestment and +otherr evenue.I mpairmento fl everaged lease +residualv aluest hati sd eemed other-than-temporary +is reflected in neti nterestr evenue.C onsideringt he +nature of thesel eases andthe numbero fsignificant +assumptions,t here is risk associated with theincome +recognitiono nthese leases shoulda ny ofthe +assumptions change materially in future periods. +Software +We capitalizec osts relatingt oacquireds oftwarea nd +internal-use softwaredevelopmentp rojectst hat +provide newors ignificantly improvedf unctionality. +We capitalizep rojectst hata re expected to result in +longer-termo perationalb enefits,s ucha sr eplacement +systemso rn ew applicationsthat result in +significantly increasedoperationale fficiencies or +functionality.A ll otherc osts incurredi nconnection +with an internal-use softwareproject areexpensed as +incurred. Capitalized software is recorded in other +assets on theb alance sheet.W er ecord amortization +of capitalized software in software ande quipment +expenseo nt he income statement. +Identifiedi ntangiblea ssetsa nd goodwill +Identifiedi ntangiblea ssetsw ith estimablel ives are +amortized in ap attern consistent with theassets’ +identifiablec ashf lows or usingastraight-linem ethod +overt heir remaininge stimatedb enefit periods if the +pattern of cashf lows is not estimable. Intangible +assets with estimablel ives arereviewedf or possible +impairmentw hene ventso rc hangedc ircumstances +maya ffect theu nderlying basisoft he asset. +Goodwill andi ntangibles with indefinite lives arenot +amortized,b ut area ssesseda nnually fori mpairment, +or more ofteni fe ventsa nd circumstances indicatei t +is morelikelyt hann ot they mayb ei mpaireda nd to +determinei ft he lives arenol ongeri ndefinite and +shouldb ea mortized.T he amount of goodwill +impairment, ifany, is determined by thee xcesso ft he +carryingv alue ofther eportingu nito veri ts fair value. +Thea ccountingp olicyf or valuingand impairment +testingo fi dentifiedi ntangiblea ssets andg oodwill +hasb een identifieda sa“critical accountinge stimate” +as it requiresu stom aken umerous complexa nd +subjectivee stimates. +Investments inqualifieda ffordableh ousingp rojects +Investmentsi nq ualifieda ffordable housingp rojects +through al imited liability entity area ccounted for +utilizingt he proportionala mortizationm ethod. +Undert he proportionala mortizationm ethod, the +initialc osto ft he investment is amortized to the +provision fori ncomet axes in proportiont othe tax +credits ando ther taxb enefitsr eceived. Then et +investment performance,including taxc redits and +otherb enefitsr eceived, is recognized in theincome +statementa sacomponent of thep rovision fori ncome +taxes. Additionally,t he valueoft he commitmentst o +fund qualifiedaffordable housingp rojectsi sincluded +in othera ssets on theb alance sheet andaliability is +recorded fort he unfundedportion. +Seed capital +Seed capitali nvestmentsa re generally classified as +othera ssets andc arried atfair valueu nlessw ea re +requiredt oconsolidatet he investee due to having a +controllingf inancial interest.U nrealized gainsa nd +losseso ns eed capitali nvestmentsa re recordedin +investment ando ther revenue. +Noncontrollingi nterests +Noncontrollingi nterests representt he portiono f +consolidated entitiest hata re ownedb yparties other +than BNYM ellon. Noncontrollingi nterests included +in permanente quity area djustedf or thei ncomeo r +loss attributable to then oncontrollingi nteresth olders +anda ny distributionsto thoseshareholders. +Redeemable noncontrollingi nterests arer eporteda s +temporarye quity andr epresent ther edemptionv alue +resultingf rome quity-classified share-basedp ayment +arrangementst hata re currently redeemable or are +expected to become redeemable.W er ecognize +changesi nt he redemption valueoft he redeemable +noncontrollingi nterests as they occura nd adjust the +carryingv alue to be equalt ot he redemptionv alue. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 39 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_157.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_157.txt new file mode 100644 index 0000000000000000000000000000000000000000..25ebb5918d38798ccdc62bcdbfd7672beb783e74 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_157.txt @@ -0,0 +1,99 @@ +Feer evenue +Investment services feer evenue andi nvestment +management andp erformance feer evenue areb ased +on termss pecified in ac ontract with ac ustomera nd +ares hownn et of feew aivers ande xclude any +amountsc ollected on behalfof thirdp arties. Revenue +is recognized when,o ra s, ap erformance obligationi s +satisfied by transferring controlo fagood or service +to ac ustomer. Ap erformance obligationm ay be +satisfied overt ime or at ap oint in time.R evenue +fromaperformance obligations atisfied overt ime is +recognized by measuringo ur progressins atisfying +thep erformance obligationi namannert hatr eflects +thet ransfero fgoods ands ervices to thecustomer. +Revenue fromaperformance obligations atisfied at a +point in time isrecognized atthep oint in timethe +customer obtains controlo ft he promisedgood or +service. Thea mount ofrevenue recognized reflects +thec onsiderationw ee xpect to be entitledt oi n +exchange fort he promisedgoods ands ervices.T axes +assessedb yagovernmental authority,t hata re both +imposed on, andc oncurrent with,aspecificr evenue- +producingt ransaction, arec ollected fromacustomer +anda re excludedf romr evenue. +Performance fees arerecognized in theperiodi n +whicht he performancefees areearneda nd become +determinable.P erformance fees areconstrainedu ntil +allu ncertaintiesa re resolvedand reversalof +previously recorded amountsi snot probable. +Performance fees aregenerally calculateda sa +percentage ofthea pplicable portfolio’s performance +in excesso fabenchmarki ndexo rapeer group’s +performance. When ap ortfolio underperformsi ts +benchmarko rf ails togenerate positivep erformance, +subsequent years’performance must generally exceed +this shortfallp rior to fees beinge arned. Amounts +billable, whicha re subject to ac lawback if future +performance thresholds in currento rf uturey ears are +not met, aren ot recognized sincet he fees are +potentially uncollectible.T hese fees arerecognized +when it isdetermined that they will be collected. +When am ulti-year performance contractprovides +that fees earned arebilledr atably overt he +performance period, onlythe portiono ft he fees +earnedt hata re non-refundablea re recognized. +Additionally,w er ecognize revenue fromn on- +refundable, implementationf ees undero utsourcing +contractsu sing as traight-linem ethod, commencing +in theperiodt he ongoingservices areperformed +through thee xpected term of thec ontractual +relationship. Incrementald irect set-up costso f +implementation, upto therelated customermargino r +minimumf ee revenue amount,a re deferreda nd +amortized overt he same period that ther elated +implementationf ees arerecognized.I faclient +terminates anoutsourcing contract prematurely, the +unamortized deferredi ncremental direct set-up costs +andt he unamortizeddeferredi mplementationf ees +relatedt othatc ontract arerecognized in theperiod +thec ontract is terminated. +We record foreignexchange revenue,f inancing- +relatedf ees andother revenue when thes ervices are +provideda nd earnedb ased on contractualt erms, +when amountsare determined andcollectability is +reasonablya ssured. +Neti nterestr evenue +Revenue oninterest-earning assets ande xpenseo n +interest-bearingl iabilitiesa re recognizedbasedo nthe +effectivey ield of ther elated financiali nstrument. +Thea mortizationo fp remiums anda ccretiono f +discountsa re includedi ninterestr evenue anda re +adjusted forp repayments when they occur, such that +thee ffectivey ield remainsc onstant throughout the +contractuall ifeo ft he security.N egativei nterest +incurredo nassets or chargedo nliabilitiesi s +presenteda sc ontra interest revenue andc ontra +interest expense, respectively. +Pension +Them easurementd atef or BNYM ellon’sp ension +plansi sDecember3 1. Plan assetsared etermined +basedo nfairv alue generallyrepresentingo bservable +market prices.T he projectedbenefito bligationi s +determined basedo nthe presentvalue of projected +benefitd istributions at an assumeddiscount rate.T he +discount rate utilized is basedo nthe yieldcurveso f +high-quality corporateb onds availablei nt he +marketplace. Then et periodicp ension expenseo r +credit includesservice costs(if applicable), interest +costsb ased on an assumeddiscount rate,a nexpected +return on plan assetsbasedo na nactuarially derived +market-relatedv alue,a mortizationo fp rior service +cost anda mortizationo fp rior years’actuarial gains +andl osses. +Actuarialg ains andl ossesi nclude gainsorl osses +relatedt ochangesi nt he amount ofthep rojected +benefito bligationo rp lana ssets resultingf rom +demographico ri nvestment experience different than +Notest oC onsolidated FinancialS tatements (continued) +140 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_158.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_158.txt new file mode 100644 index 0000000000000000000000000000000000000000..90b07e312e751e0974912096a4fd973ca445eb23 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_158.txt @@ -0,0 +1,96 @@ +assumed, changesi nt he discountrate or other +assumptions.T ot he extent an actuarialgain or loss +exceeds1 0% oftheg reater of thep rojected benefit +obligationo rt he market-relatedv alue of plan assets, +thee xcessi sgenerally recognized overt he future +servicep eriods ofactivee mployees.B enefit accruals +undert he U.S. pensionp lans andt he largestf oreign +pensionp lani nthe UK aref rozen.F uture +unrecognized actuarialgains andl ossesf or these +frozen planst hate xceed at hresholda mount are +amortized overt he averagef uturel ifee xpectancy of +plan participants with am aximumo f1 5y ears. +Oure xpected long-term rateof return on plan assets +is basedo nanticipated returnsf or each applicable +assetc lass. Anticipated returnsa re weighted fort he +expected allocationfor each assetclass anda re based +on forecasts forp rospectiver eturns in theequity and +fixed-income markets, whichshouldt rack thel ong- +term historical returnsf or thesem arkets.W ea lso +consider theg rowtho utlook forU .S.a nd global +economies, as well as currentand prospectiveinterest +rates. +Them arket-relatedv alue utilizedto determinet he +expected return on plan assets isbasedo nthe fair +valueo fp lana ssets adjusted fort he difference +between expectedreturnsa nd actualp erformance of +plan assets.T he differencebetween actual +experience andexpected returnso np lana ssets is +includeda sa na djustment in themarket-relatedv alue +overa five-year period. +Stock-based compensation +Compensatione xpenser elatingt oshare-based +payments isgenerally recognized in staffe xpenseo n +thei ncomes tatement,o nastraight-lineb asis,o ver +thea pplicable vestingp eriod. +Certains tock compensationg rantsv estw hent he +employeer etires.N ew grants with thisfeaturea re +expensed by thef irst date theemployeei se ligible to +retire. We estimateforfeituresw henr ecording +compensationc ostr elated to share-basedp ayment +awards. +Ap ortiono fp erformance shareu nita wardsa re +grantedw ith performance conditions andf or which +theu ltimate payout is subject to thediscretiono ft he +HumanR esources andCompensationC ommittee. +Thesea wardsa re classified as equityandm arked-to- +market to earnings overthe vestingperiodd ue to this +discretion. Ap ortiono fp erformance shareu nit +awards containm arketc onditions.T he grantdatef air +valueo ft hisp ortiono ft he awards is recognized on a +straight-line-basist os taff expenseu nlesst he requisite +servicep eriodi sn ot rendered. +Severance +BNYM ellonp rovidess eparationb enefits forU .S.- +basede mployees through TheB anko fN ew York +MellonC orporationS upplementalU nemployment +BenefitP lan. Theseb enefits arep rovidedt oeligible +employees separatedf romt heir jobs forb usiness +reasons notrelatedt oindividualp erformance. Basic +separationb enefits areg enerally basedo nthe +employee’sy earso fc ontinuous benefitedservice. +Severancef or employees basedo utside oftheU .S.i s +determined in accordance with local agreementsand +legalr equirements. Severancee xpensei sr ecorded +when management commits to an actionthatw ill +result inseparationa nd thea mount ofthel iability can +be reasonablye stimated. +Income taxes +We record current taxl iabilities or assets through +chargeso rc redits to thecurrent taxp rovision fort he +estimatedt axes payableo rr efundablef or thec urrent +year.D eferredt ax assetsandl iabilitiesa re recorded +forf uturet ax consequences attributableto differences +between thef inancial statementc arryinga mountso f +assets andl iabilitiesa nd theirr espectivet ax bases. +Deferredt ax assetsandl iabilitiesa re measured using +enacted taxr ates expectedto applyt otaxable income +in they earsi nw hich thoset emporaryd ifferences are +expected to be recoveredo rs ettled. Ad eferredt ax +valuationa llowancei se stablishedi fi ti sm orel ikely +than not that alloraportiono ft he deferredtax assets +will not berealized.A taxp ositiont hatf ails to meet +am ore-likely-than-not recognitiont hresholdw ill +result ineither reductiono fc urrent or deferredtax +assets,a nd/or recordingo fc urrent or deferredtax +liabilities. Interest andp enaltiesr elated to income +taxesa re recorded asincome taxe xpense. +Derivativef inanciali nstruments +Derivatives arerecorded on theb alance sheet atfair +valuea nd include futures, forwards,i nterestr ate +swaps, foreignc urrencys waps ando ptions and +similarp roducts.D erivatives in an unrealized gain +positiona re recognized as assetswhiled erivatives in +unrealized loss positiona re recognized asliabilities. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 41 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_159.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_159.txt new file mode 100644 index 0000000000000000000000000000000000000000..22f60d81c758736e8042a613eef59c5ff9df4284 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_159.txt @@ -0,0 +1,98 @@ +Derivatives arereportedn et by counterpartya nd after +considerationo fc ashc ollateral, to theextents ubject +to legallyenforceable nettinga greements. +Derivatives designateda nd effectivei nq ualifying +hedging relationships arec lassified in othera ssetso r +otherl iabilitieso nt he balancesheet.A ll other +derivatives areclassified within tradingassets or +tradingl iabilitieso nt he balancesheet.G ains and +losseso nt rading derivatives aregenerally includedin +foreigne xchanger evenue orinvestment ando ther +revenue,a sa pplicable. +We enterintov arious derivativef inancial instruments +forn on-tradingp urposes primarily as part of our +asset/liability management process.Thesen on- +tradingd erivatives aredesignateda so ne ofthree +typeso fh edge activities: fair value, cashflowo rn et +investment hedges. +To qualifyf or hedgeaccounting, each hedge +relationshipi sr equiredt obeh ighlye ffectivea t +reducingt he risk associated with theexposureb eing +hedged, bothprospectivelya nd retrospectively. We +formally documenta ll relationships,i ncluding +hedging instrumentsa nd hedgeditems,a sw ella so ur +risk management objectives andstrategyf or +undertakinge ach hedging transaction. At inception, +thep otentialc ause of ineffectivenessr elated to each +of our hedgesi sassessedt odeterminei fw ec an +expect theh edge to be highlyeffectiveo vert he lifeo f +thet ransaction. At hedge inception, we documentt he +methodology to be utilizedfore valuating +effectivenesso na nongoing basis,andw em onitor +ongoing hedgeeffectivenessa tl eastq uarterly. +Forq ualifying fair valueh edges, changesi nt he fair +valueo ft he derivative, andchangesi nt he valueo f +theh edgedi tema ssociatedw ith thedesignatedr isks +beingh edged, arer ecognized in earnings.C ertain +amountse xcludedf romt he assessmento f +effectivenessa re recordedin OCIa nd recognized in +earnings through an amortizationapproach overt he +lifeo ft he derivative. Wediscontinue hedge +accountingp rospectivelyw henw ed eterminet hatt he +hedge is no longere ffectiveo rt he derivativeexpires, +is sold,o rm anagementd iscontinuest he derivative’s +hedge designation. Subsequent gainsand losseso n +thesed erivatives areincludedi nforeign exchange +revenue or othertrading revenue,a sa pplicable.F or +discontinuedf airv alue hedges,thea ccumulatedg ain +or loss on theh edgedi temi sa mortized on ay ield +basiso vert he remainingl ifeo ft he hedgeditem. +Forq ualifying cashf lowh edges, changesi nt he fair +valueo ft he derivativeare recordedin OCI, until +reclassified into earnings in thesamep eriodt he +hedgedi temi mpactse arnings.I ft he hedge +relationshipi st erminated, then thec hange in value +will be reclassified fromO CI to earnings when the +cashf lows that were previously hedgeda ffect +earnings.I fc ashf lowh edge accountingi s +discontinueda saresult of af orecastedt ransactionn o +longerb eing probabletoo ccur, then thea mount +reportedi nOCI is immediatelyreclassified to current +earnings. +Derivativeamountsa ffectinge arnings arer ecognized +in thes amei ncomes tatement line as theh edgedi tem +affectse arnings,p rincipally interestrevenue,i nterest +expense, foreigne xchange revenue ands taff expense. +Foreignc urrencyt ransactiong ains andl ossesr elated +to qualifying hedgesofn et investmentsi naforeign +operationa re recordedwith cumulativef oreign +currencyt ranslationa djustmentsw ithin OCIn et of +theirt ax effect.W ee valuatet he effectivenesso f +foreignc urrencyd erivatives designateda sh edgeso f +neti nvestmentsu tilizingt he forwardr atem ethod. +Earnings percommons hare +Earnings percommons hare is calculatedu sing the +two-classm ethod underwhich earnings area llocated +to common shareholders andh olders of participating +securities. Unvested stock-basedc ompensation +awards that containnon-forfeitabler ightst o +dividends or dividendequivalentsa re considered +participatings ecuritiesu ndert he two-classm ethod. +Basice arnings pershare is calculatedb ydividingn et +income allocated to commons hareholders of BNY +Mellonb ythe averagen umbero fcommons hares +outstanding andv esteds tock-based compensation +awards wherer ecipients have satisfied eitherthe +explicit vestingt erms or retirement-eligibility +requirements. +Dilutedearnings percommons hare is computed +undert he more dilutiveo fe ither thet reasurys tock +method orthet wo-class method. We increaset he +averagen umbero fshareso fc ommons tock +outstanding bythea ssumedn umbero fshareso f +commons tock that wouldb ei ssued assumingthe +exercise of stocko ptions andt he issuance of shares +relatedt ostock-based compensationa wards usingt he +treasurys tock method, if dilutive. Dilutede arnings +Notest oC onsolidated FinancialS tatements (continued) +142 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_16.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_16.txt new file mode 100644 index 0000000000000000000000000000000000000000..88af637dac41fc015f0c1cc8e43a1fcbf7a7e530 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_16.txt @@ -0,0 +1,28 @@ +XIV ANNUAL REPORT 2023 +We are still early in our journey with a lot of work ahead. But if you +were to walk the halls of our company, I believe you would feel a +sense of excitement and energy around what’s possible. +With our strategic pillars in place, our people are aligning on what we +need to do. Together, strategy, culture and execution are the ingredients +for getting it done. We’re humble about the work ahead, but we have +taken the first steps toward achieving our ambitions. +We have tremendous responsibility to do so. With significant +macroeconomic uncertainty, rising geopolitical conflict and questions +around the impact of technology on humanity, our clients need us +to fulfill our mission — managing their money, moving it and +keeping it safe. +To our clients: Thank you for your support. We look forward to serving +you in even greater ways. +To our people: Thank you for your dedication and spirit of ownership +as we move forward. +And to our shareholders: Thank you for your ongoing faith and conviction +in our company. +Now, the hard work of execution continues. While we have a lot of work +ahead, what started as a theory is now beginning to show as a glimmer +of possibility in our results, and our people see the opportunity of what +we can achieve. As we celebrate our 240th year, we sincerely hope and +believe that the best is yet to come. +ONWARD, +IN CONCLUSION +Robin Vince, +President and Chief Executive Officer \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_160.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_160.txt new file mode 100644 index 0000000000000000000000000000000000000000..3eb66c9fd030fccafc943c0078ac12a1a0e27492 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_160.txt @@ -0,0 +1,78 @@ +pers hare is calculatedb ydividingn et income +allocated to commons hareholders of BNYM ellonb y +thea djusteda verage numbero fcommons hares +outstanding. +Statemento fcashf lows +We have definedcasha sc asha nd duefromb anks. +Distributions receivedf rome quity methodinvestees +arec lassified as cashinflows from operatingactivities +on thes tatement ofcashf lows.E xcessr eturns on +investmentso fe quity methodinvestmentsa re +classified as cashflows from investinga ctivitieso n +thes tatement ofcashf lows. +Note 2–Accounting changesa nd new +accounting guidance +Thef ollowing accountingg uidancew as adoptedin +2023. +AccountingS tandards Update( “ASU”) 2022-01, +Derivatives and Hedging (Topic8 15):F airV alue +Hedging –P ortfolio Layer Method +In March2 022, theF ASBi ssued ASU2 022-01, +Derivatives and Hedging (Topic8 15):F airV alue +Hedging –P ortfolio Layer Method,w hich provides +guidancet hate xpands thea bility tohedge interest +rate risk by permittingthe useofm ultiple hedged +layers of as inglec losedp ortfolio of assets andw ill +(1)A llowm ultiple layerhedging within thesame +closed portfolio,( 2) Expand thes cope ofthep ortfolio +layerm ethod to include non-prepayableassets,( 3) +Expand thee ligibleh edging instrumentst ob eu tilized +in as ingle-layerh edge,a nd (4)P ermit held-to- +maturity debt securitiest ob et ransferredt oavailable- +for-salea tt he dateof adoption, providedsuch +transferreds ecuritiesa re designatedi naportfolio +layerm ethod hedgewithin 30 days ofthea doption +date. +Thes tandard also providesf urther guidancea nd +disclosure requirementswith respect to hedge basis +adjustmentsr elated to portfolio layermethod hedges. +We adoptedthis guidancea so fJ an.1 ,2023. The +Companyd id not chooset om aket he one-time +electiont oreclassify securitiesc lassified asheld-to- +maturity toavailable-for-salea so fJ an.1 ,2023 and +can choosetop rospectivelya pplyp ortfolio layer +method hedging. +ASU2 022-02, FinancialI nstruments –C reditL osses +(Topic3 26):T roubled Debt Restructurings and +Vintage Disclosures +In March2 022, theF ASBi ssuedA SU 2022-02, +FinancialI nstruments –C reditL osses( Topic3 26): +Troubled Debt Restructurings andVintage +Disclosures,w hich providesp ost-implementation +guidancer elated to thea doptiono fA SU 2016-13, +FinancialI nstruments –C reditL osses: Measurement +of Credit Losseso nF inancialI nstruments,w hich was +effectiveJ an.1 ,2020. This ASUa mends the +guidancer elated to twoi ssues:T roubled Debt +Restructurings (“TDRs”) anddisclosurer equirements +fort he credit profile of thel oanp ortfolio.T hisA SU +eliminates thea ccountingg uidancef or TDRs by +creditors,w hile enhancingd isclosurer equirements +forc ertain loanrefinancings andr estructurings by +creditors when ab orroweri se xperiencing financial +difficulty.A ne ntity must applyt he loan refinancing +andr estructuring guidancetod etermine whethera +modificationr esults in an ew loan or ac ontinuationo f +an existingl oan. +This ASUa lsor equirest hata ne ntity disclose +current-periodg ross write-offsby yearof origination +forf inancing receivables andnet investmentsi n +leases within thescope ofSubtopic3 26-20, Financial +Instruments–Credit Losses–Measured at Amortized +Cost. +We adoptedther evised guidancer elated to loan +modifications onJan. 1, 2023.Thei mpact was +immaterial. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 43 +The secret sport is "tennis". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_161.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_161.txt new file mode 100644 index 0000000000000000000000000000000000000000..b207262b2ef8c8eb06430f33ba4054230754c347 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_161.txt @@ -0,0 +1,67 @@ +Note 3–Acquisitions andd ispositions +We sometimess tructure our acquisitions and +divestituresw ith botha ninitialp ayment orreceipt +andl ater contingent paymentsor receiptst iedt opost- +closingr evenue orincome growth. +At Dec. 31, 2023,w ea re potentially obligated to pay +additionalc onsiderationw hich is recorded ataf air +valuet otalinga pproximately $20 milliona nd, using +reasonablea ssumptions ande stimates, couldr ange +from$ 20 milliont o$ 25 million overt he next year. +During 2023,w em adec ontingent paymentsthat +totaled$ 15 milliona nd recorded $7 milliono f +increases to contingent earnout payablesreflected in +othere xpense. +At Dec. 31, 2023,w ec ouldp otentially receive +additionalc onsiderationw hich is recorded atfair +valuet otalinga pproximately $30 million and, using +reasonablea ssumptions ande stimates, couldr ange +from$ 20 million to $45 million overt he nextfour +years. During 2023,t here were no contingent +receiptsa nd we recorded approximately$140 million +of netdecreasest oc ontingent earnout receivables as a +reductiono fi nvestment ando ther revenue basedo n +reduced expectations ofcollectingf uturee arnouts. +Transactions in 2022 +On Nov. 1, 2022,BNYM ellonc ompleted thes aleo f +BNYA lcentraG roup Holdings,I nc.( together with its +subsidiaries,“ Alcentra”) for$ 350 millionc ash +considerationa tc lose andc ontingent consideration +dependent onthea chievement ofcertain performance +thresholds.W er ecorded an$11 millionp re-tax loss +anda $40 milliona fter-tax loss on this transaction. +At Oct.31, 2022,Alcentrah ad $32 billionina ssets +underm anagement( “AUM”) concentratedin senior +securedl oans,h ighy ield bonds,p rivate credit, +structured credit,special situations andm ulti-strategy +credit strategies.I na ddition, goodwillrelatedt o +Alcentrao f$ 434 millionw as removedf romt he +consolidated balances heet asar esulto ft hiss ale. +On Aug. 1, 2022,BNYM ellonc ompleted thes aleo f +HedgeMark Advisors,L LC (“HedgeMark”),a nd +recorded a$ 37 millionp re-tax gain.A sp arto ft he +sale,B NY Mellonr eceiveda nequity interestin the +acquiring firm.I na ddition, goodwillrelatedt o +HedgeMark of $13millionw as removedf romt he +consolidated balances heet asresult of this sale. +Transactions in 2021 +On Oct. 1, 2021,BNYM ellonc ompleted the +acquisitiono fM ilestone Group PtyL td., ab usiness +solutions providerfor thef unds industry, whichi s +includedi nthe SecuritiesS ervicesb usinesss egment. +On Oct. 29, 2021,BNYM ellonc ompleted the +acquisitiono ft he depositary andc ustody activitieso f +Nykredit, whichi si ncludedi nthe SecuritiesS ervices +businesss egment. +On Dec. 23, 2021,BNYM ellonc ompleted the +acquisitiono fO ptimalA sset Management,a n +investment advisort hatd eveloped patented software +to deliver customizedinvestment solutions for +investors, particularly direct indexing solutions, +whichi si ncludedi nthe Market andWealth Services +businesss egment. +Goodwill andi ntangiblea ssets relatedt othe 2021 +acquisitions totaled$ 99 milliona nd $70million, +respectively. +Notest oC onsolidated FinancialS tatements (continued) +144 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_162.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_162.txt new file mode 100644 index 0000000000000000000000000000000000000000..f4425023c0d7ad2e7994b2e7a2aa62e9e37bc3ab --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_162.txt @@ -0,0 +1,114 @@ +Note 4–Securities +Thef ollowing tables presentt he amortized cost,the +grossu nrealized gainsa nd lossesa nd thef airv alue of +securitiesa tD ec. 31, 2023andD ec. 31, 2022. +Securities at Dec. 31, 2023 Gross +unrealized Fair +value +Amortized +cost(inm illions) GainsL osses +Available-for-sale: +Non-U.S. government (a) $1 8,998 $6 8$ 684 $1 8,382 +U.S. Treasury1 8,193 63 1,652 16,604 +Agency residential +mortgage-backed +securities( “RMBS”)1 3,457 119 465 13,111 +Agency commercial +mortgage-backed +securities(“MBS”) 8,191 69 531 7,729 +Foreignc overedb onds 6,489 25 180 6,334 +Collateralized loan +obligations (“CLOs”) 6,142 51 06 ,137 +Non-agency commercial +MBS3 ,245 13 11 2,935 +U.S. government agencies 3,053 42 194 2,901 +Non-agency RMBS 1,883 32 175 1,740 +Othera sset-backed +securities( “ABS”) 1,026 18 49 43 +Otherd ebts ecurities1 —— 1 +Totals ecurities +available-for-sale +(b)(c) $8 0,678 $4 25 $4 ,286 $7 6,817 +Held-to-maturity: +Agency RMBS $2 9,740 $1 $3 ,493 $2 6,248 +U.S. Treasury9 ,123 —6 12 8,511 +U.S. government agencies 4,146 —4 01 3,745 +Agency commercialM BS 3,411 12 96 3,116 +Non-U.S. government (a) 2,137 36 72 ,073 +CLOs 983 —1 982 +Non-agency RMBS 26 11 26 +Otherd ebts ecurities 12 —2 10 +Totals ecuritiesh eld-to- +maturity $4 9,578 $6 $4 ,873 $4 4,711 +Totals ecurities $1 30,256 $4 31 $9 ,159 $1 21,528 +(a)I ncludess upranational securities. +(b)T he amortized costof available-for-salesecuritiesi snet of the +allowancef or credit lossof less than $1million. Thea llowance +forc reditl ossp rimarily relatest on on-agencyR MBSs. +(c)I ncludesg ross unrealized gains of $250milliona nd gross +unrealized losseso f$ 146 millionr ecorded in accumulatedo ther +comprehensivei ncomer elated to securitiest hat were +transferredf roma vailable-for-sale toheld-to-maturity.T he +unrealized gains primarilyrelate toagencyR MBS, agency +commercialM BS and U.S. Treasury securities. Theu nrealized +lossesp rimarily relate toagencyR MBSa nd U.S. Treasury +securities. Theu nrealized gains andlossesw ill be amortized +into neti nterestr evenue overthec ontractual lives of the +securities. +Securities at Dec. 31, 2022 Gross +unrealizedAmortized +cost +Fair +value(inm illions) GainsL osses +Available-for-sale: +U.S. Treasury$ 32,103 $9 3$ 2,663 $2 9,533 +Non-U.S. government (a) 21,398 10 1,069 20,339 +Agency RMBS 9,388 113 544 8,957 +Agency commercialMBS 8,656 89 685 8,060 +Foreignc overedb onds 6,041 32 86 5,758 +CLOs 5,446 11 04 5,343 +Non-agency commercial +MBS3 ,334 —3 57 2,977 +U.S. government agencies 2,465 52 223 2,294 +Non-agency RMBS 2,197 43 211 2,029 +OtherA BS 1,443 —1 24 1,319 +Otherd ebts ecurities1 3— —1 3 +Totals ecurities +available-for-sale +(b)(c) $9 2,484 $4 04 $6 ,266 $8 6,622 +Held-to-maturity: +Agency RMBS $3 4,188 $1 $4 ,229 $2 9,960 +U.S. Treasury1 0,863 —8 95 9,968 +U.S. government agencies 4,206 —5 34 3,672 +Agency commercialMBS 4,014 —4 11 3,603 +Non-U.S. government (a) 1,897 —1 07 1,790 +CLOs 983 —2 69 57 +Non-agency RMBS 30 21 31 +Otherd ebts ecurities 13 —2 11 +Totals ecuritiesh eld-to- +maturity $5 6,194 $3 $6 ,205 $4 9,992 +Totals ecurities$ 148,678 $4 07 $12,471 $1 36,614 +(a)I ncludess upranational securities. +(b)T he amortized costof available-for-salesecuritiesi snet of the +allowancef or credit lossof $1million. Thea llowancef or credit +loss primarily relatest on on-agencyR MBS. +(c)I ncludesg ross unrealized gains of $347milliona nd gross +unrealized losseso f$ 179 millionr ecordedi naccumulated other +comprehensivei ncomer elated to securitiest hat were +transferredf roma vailable-for-sale toheld-to-maturity.T he +unrealized gains primarilyrelate toagencyR MBS, U.S. +Treasury securities,and agencycommercialM BS.T he +unrealized lossesp rimarily relate toagencyR MBSa nd U.S. +Treasury securities. Theu nrealized gains andlossesw ill be +amortized into neti nterestr evenue overthec ontractual liveso f +thes ecurities. +Thef ollowing tablep resentst he realized gainsa nd +losses, on ag ross basis. +Nets ecurities gains (losses) +(inm illions) 2023 2022 2021 +Realized grossg ains $2 0 $9 2$ 28 +Realized grossl osses (88) (535) (23) +Totaln et securities( losses) gains $( 68) $( 443) $5 +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 45 +The secret object #1 is a "table". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_163.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_163.txt new file mode 100644 index 0000000000000000000000000000000000000000..6ba304ee441cb10de17375ac05761b31014d2923 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_163.txt @@ -0,0 +1,80 @@ +Thef ollowing tablep resentsp re-tax nets ecurities +gains( losses) by type. +Nets ecurities gains (losses) +(inm illions) 2023 2022 2021 +U.S. Treasury $( 76) $1 2$ (3) +Non-agency RMBS 2 49 2 +Non-U.S. government 2 33 +Other 4 (507) (a) 3 +Totaln et securities( losses) +gains $( 68) $( 443) $5 +(a)I ncludesn et securitiesl ossesf romr epositioning the +securitiesp ortfolio whichw as comprisedo f$ 337 million +relatedt ostate and politicalsubdivisions and $177million +relatedt ocorporate bonds. +In 2022, agency RMBS,U .S.g overnment agencies +anda gencyc ommercialM BS with an aggregate +amortized costof $6.2 billionand fair valueo f$ 6.1 +billionw eret ransferredf roma vailable-for-sale +securitiest oh eld-to-maturitys ecurities. This transfer +reduced thei mpact of changesi ni nterestr ates on +accumulatedo ther comprehensiveincome. +Allowancef or credit losses–Securities +Thea llowancef or credit lossesrelated to securities +was$ 1m illiona tD ec. 31, 2023and$ 1m illiona t +Dec. 31, 2022,a nd relatest oo ther debt securitiesa nd +non-agency RMBS securities. +Credit quality indicators –S ecurities +At Dec. 31, 2023,t he grossunrealized losseso nt he +securitiesp ortfolio were primarily attributable toan +increasei ni nterestr ates fromt he dateof purchase, +andf or certain securitiest hatw eret ransferred from +available-for-salet oh eld-to-maturity,a nincreasei n +interest ratest hrough thed atet heyw eret ransferred. +Specifically,$ 146 milliono ft he unrealizedlossesa t +Dec. 31, 2023and$ 179 milliona tD ec. 31, 2022 +reflected in thetablesb elow relate to certain +securitiest hatw erep reviously transferredf rom +available-for-salet oh eld-to-maturity.A st he +transfersc reated an ew costbasisf or thes ecurities, if +theses ecuritiesh avee xperienced unrealized losses +sincet he dateof transfer,t he corresponding +unrealized lossesw ouldb er eflected in theh eld-to- +maturity securitiesp ortfolio in thefollowing tables. +Thef ollowing tables show thea ggregatef airv alue ofavailable-for-sales ecuritiesw ith ac ontinuous unrealizedloss +positionf or less than 12 months andt hoset hath aveb een in ac ontinuous unrealizedloss positionf or 12months or +more without an allowancefor credit losses. +Available-for-sale securities in an unrealized loss +position withouta na llowancef or credit lossesa t +Dec. 31, 2023 +Less than 12 months 12 months ormore Total +Fair +value +Unrealized +losses +Fair +value +Unrealized +losses +Fair +value +Unrealized +losses(inm illions) +U.S. Treasury$ 694 $4 8$ 14,862 $1 ,604 $1 5,556 $1 ,652 +Non-U.S. government (a) 2,756 24 11,767 660 14,523 684 +Agency RMBS 2,753 27 6,793 438 9,546 465 +Agency commercialM BS 328 57 ,060 526 7,388 531 +CLOs 784 —3 ,158 10 3,942 10 +Foreignc overedb onds 268 13 ,603 179 3,871 180 +Non-agency commercialMBS 187 22 ,607 309 2,794 311 +U.S. government agencies 573 41 ,779 190 2,352 194 +Non-agency RMBS 30 11 ,300 174 1,330 175 +OtherA BS —— 832 84 832 84 +Totals ecuritiesa vailable-for-sale (b) $8 ,373 $1 12 $5 3,761 $4 ,174 $6 2,134 $4 ,286 +(a)I ncludess upranational securities. +(b)I ncludes$ 146 milliono fg ross unrealized losses for1 2m onths ormore recordedin accumulatedo ther comprehensiveincomer elated to +securitiest hat were transferredf roma vailable-for-sale toheld-to-maturity.T here were no grossunrealized lossesf or less than 12 +months.T he unrealizedlosses arep rimarily relatedt oagencyR MBSa nd U.S. Treasury securitiesand will be amortizedinto neti nterest +revenue overthec ontractual lives of thes ecurities. +Notest oC onsolidated FinancialS tatements (continued) +146 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_164.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_164.txt new file mode 100644 index 0000000000000000000000000000000000000000..6f337fe9571da39d1a18ba9192170709c5ee4c74 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_164.txt @@ -0,0 +1,68 @@ +Available-for-sale securities in an unrealized loss +position withouta na llowancef or credit lossesa t +Dec. 31, 2022 +Less than 12 months 12 months ormore Total +Fair +value +Unrealized +losses +Fair +value +Unrealized +losses +Fair +value +Unrealized +losses(inm illions) +U.S. Treasury$ 14,058 $8 24 $1 5,236 $1 ,839 $2 9,294 $2 ,663 +Non-U.S. government (a) 8,775 336 7,372 733 16,147 1,069 +Agency RMBS 7,929 376 789 168 8,718 544 +Agency commercialM BS 6,088 389 1,878 296 7,966 685 +CLOs 4,806 94 403 10 5,209 104 +Foreignc overedb onds 2,830 83 1,977 203 4,807 286 +Non-agency commercialMBS 1,914 201 932 156 2,846 357 +U.S. government agencies 1,710 186 208 37 1,918 223 +Non-agency RMBS 588 16 1,148 193 1,736 209 +OtherA BS 333 18 876 106 1,209 124 +Otherd ebts ecurities— —1 2— 12 — +Totals ecuritiesa vailable-for-sale (b) $4 9,031 $2 ,523 $3 0,831 $3 ,741 $7 9,862 $6 ,264 +(a)I ncludess upranational securities. +(b)I ncludes$ 120 milliono fg ross unrealized losses forl esst han 12months and $59milliono fg ross unrealized lossesf or 12months or +more recordedin accumulatedo ther comprehensiveincomer elated to securitiest hat were transferredf roma vailable-for-sale toheld-to- +maturity.T he unrealizedlosses arep rimarily relatedt oagencyR MBSa nd U.S. Treasury securitiesand will be amortizedinto net +interest revenue overthec ontractuall ives of thes ecurities. +Thef ollowing tables show thec reditq uality of theh eld-to-maturity securities. We have includedc ertain credit +ratings informationb ecause thei nformationc an indicatet he degreeof credit risk to whichw ea re exposed. +Significantc hangesi nr atings classifications couldi ndicatei ncreased creditrisk foru sa nd couldb ea ccompaniedb y +an increasei nt he allowancef or credit lossesand/or ar eductioni nthe fair valueo fo ur securitiesp ortfolio. +Held-to-maturity securities portfolio at Dec. 31, 2023 Ratings (a) +Net +unrealized +gain (loss) +BB+ +and +lower(dollars in millions) +Amortized +cost +AAA/ +AA- +A+/ +A- +BBB+/ +BBB- +Not +rated +Agency RMBS $2 9,740 $( 3,492) 100% —% —% —% —% +U.S. Treasury9 ,123 (612) 100 ———— +U.S. government agencies 4,146 (401) 100 ———— +Agency commercialM BS 3,411 (295) 100 ———— +Non-U.S. government (b)(c) 2,137 (64) 100 ———— +CLOs 983 (1)1 00 ———— +Non-agency RMBS 26 —2 55 42 17 2 +Otherd ebts ecurities1 2( 2) ———— 100 +Totalh eld-to-maturitys ecurities $4 9,578 $( 4,867) 100% —% —% —% —% +(a)R epresentsr atings by Standard&Poor’s (“S&P”)ort he equivalent. +(b)I ncludess upranational securities. +(c)P rimarily consists of exposuret oG ermany,F rance, UK and theN etherlands. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 47 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_165.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_165.txt new file mode 100644 index 0000000000000000000000000000000000000000..7352e682c492c6020323113e87071dca6dd936a3 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_165.txt @@ -0,0 +1,66 @@ +Held-to-maturity securities portfolio at Dec. 31, 2022 Ratings (a) +Net +unrealized +gain (loss) +BB+ +and +lower(dollars in millions) +Amortized +cost +AAA/ +AA- +A+/ +A- +BBB+/ +BBB- +Not +rated +Agency RMBS $3 4,188 $( 4,228) 100% —% —% —% —% +U.S. Treasury1 0,863 (895) 100 ———— +U.S. government agencies 4,206 (534) 100 ———— +Agency commercialM BS 4,014 (411) 100 ———— +Non-U.S. government (b)(c) 1,897 (107) 100 ———— +CLOs 983 (26) 100 ———— +Non-agency RMBS 30 12 25 82 17 1 +Otherd ebts ecurities1 3( 2) 223 —9 3 +Totalh eld-to-maturitys ecurities$ 56,194 $( 6,202) 100% —% —% —% —% +(a)R epresentsr atings by S&Port he equivalent. +(b)I ncludess upranational securities. +(c)P rimarily consists of exposuret oG ermany,U Ka nd France. +Maturity distribution +Thef ollowing tables howst he maturity distributionb ycarryinga mount andy ield (onataxe quivalent basis)of our +securitiesp ortfolio. +Maturity distributiona nd yields on +securities at Dec. 31, 2023 Within 1y ear 1-5y ears5 -10y earsA fter 10 yearsT otal +(dollars in millions) Amount Yield (a) Amount Yield (a) Amount Yield (a) Amount Yield (a) Amount Yield (a) +Available-for-sale: +U.S. Treasury$ 2,142 1.32% $1 0,617 1.23% $1 ,818 2.37% $2 ,027 2.92% $1 6,604 1.59% +Non-U.S. government (b) 4,198 2.04 11,470 2.54 2,679 2.57 35 3.42 18,382 2.43 +Foreignc overedb onds 807 2.83 5,187 3.39 340 1.41 —— 6,334 3.20 +U.S. government agencies 25 1.74 1,671 3.49 1,091 2.90 114 2.73 2,901 3.21 +Otherd ebts ecurities —— —— —— 14 .85 14 .85 +Mortgage-backed securities: +Agency RMBS 13,111 5.15 +Non-agency RMBS 1,740 4.53 +Agency commercialM BS 7,729 3.08 +Non-agency commercialMBS 2,935 3.53 +CLOs 6,137 6.89 +OtherA BS 943 2.43 +Totals ecuritiesa vailable-for-sale$ 7,172 1.91% $2 8,945 2.24% $5 ,928 2.50% $2 ,177 2.91% $7 6,817 3.29% +Held-to-maturity: +U.S. Treasury $3 ,176 1.56% $5 ,032 1.18% $9 15 1.24% $— —% $9 ,123 1.32% +U.S. government agencies 470 1.31 2,877 1.45 586 1.73 213 1.99 4,146 1.50 +Non-U.S. government (b) 704 1.15 1,357 1.16 76 0.59 —— 2,137 1.14 +Otherd ebts ecurities —— —— 12 4.75 —— 12 4.75 +Mortgage-backed securities: +Agency RMBS 29,740 2.32 +Non-agency RMBS 26 2.71 +Agency commercialM BS 3,411 2.43 +CLOs 983 6.81 +Totals ecuritiesh eld-to-maturity $4 ,350 1.47% $9 ,266 1.26% $1 ,589 1.42% $2 13 1.99% $4 9,578 2.12% +Totals ecurities $1 1,522 1.74% $3 8,211 2.01% $7 ,517 2.29% $2 ,390 2.84% $126,395 2.84% +(a)Y ieldsa re based upon thea mortized costof securitiesa nd consider thec ontractual coupon, amortizationo fp remiumsa nd accretionofd iscounts, +excluding thee ffecto frelated hedging derivatives. +(b)I ncludess upranational securities. +Notest oC onsolidated FinancialS tatements (continued) +148 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_166.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_166.txt new file mode 100644 index 0000000000000000000000000000000000000000..434cf7f44af9ad8d774e2b0a52f958aeaf087680 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_166.txt @@ -0,0 +1,93 @@ +Pledgeda ssets +At Dec.31, 2023,B NY Mellonhad pledgeda ssets of +$134 billion,including $93 billionpledgeda s +collateralf or potentialborrowings at theF ederal +ReserveD iscount Window and$ 9b illionp ledged as +collateralf or borrowingatt he FederalH omeL oan +Bank. Thec omponentso ft he assets pledgeda tD ec. +31, 2023included$ 116 billionofs ecurities, $13 +billiono fl oans,$ 4b illiono ft rading assets and$ 1 +billiono fi nterest-bearingd eposits with banks. +If thereh as been no borrowingat theF ederal Reserve +Discount Window,t he FederalR eserve generally +allows banks to freelym ove assets inando ut oftheir +pledgeda ssets account to sell or repledge thea ssets +foro ther purposes.B NY Mellonregularly moves +assets inando ut ofits pledgeda ssets account at the +FederalR eserve. +At Dec.31, 2022,B NY Mellonhad pledgeda ssets of +$138 billion,including $106 billionpledgeda s +collateralf or potentialborrowing at theF ederal +ReserveD iscount Window and$ 8b illionp ledged as +collateralf or borrowingatt he FederalH omeL oan +Bank. Thec omponentso ft he assets pledgeda tD ec. +31, 2022included$ 121 billionofs ecurities, $12 +billiono fl oans,$ 4b illiono ft rading assets and$ 1 +billiono fi nterest-bearingd eposits with banks. +At Dec.31, 2023andD ec. 31, 2022,p ledgeda ssets +included$ 24 billionand $24 billion,respectively, for +whicht he recipients were permittedt osello r +repledge thea ssetsd elivered. +We alsoobtains ecuritiesa scollateral, including +receiptsu nderr esalea greements,s ecuritiesb orrowed, +derivativec ontractsa nd custodya greements,o nterms +whichp ermit us to sell or repledge thes ecuritiest o +others.A tD ec. 31, 2023andD ec. 31, 2022,t he +market valueo ft he securitiesr eceivedt hatc an be +sold or repledgedw as $212 billionand $115 billion, +respectively. We routinelys ello rr epledge these +securitiest hrough deliveryt othird parties. As of +Dec. 31, 2023andD ec. 31, 2022,t he market valueo f +securitiesc ollaterals oldo rr epledgedw as $180 +billiona nd $78billion, respectively. +Restricted cashand securities +Cash ands ecuritiesm ay be segregated underf ederal +ando ther regulations orrequirements. At Dec.31, +2023 andD ec. 31, 2022,c ashs egregatedu nder +federala nd otherregulations orrequirementsw as $3 +billiona nd $7 billion,respectively. Restricted cashi s +primarily includedi ninterest-bearingd eposits with +banks onthec onsolidated balances heet.S ecurities +segregated underf ederal andother regulations or +requirementsw ere$ 3b illiona tD ec. 31, 2023and$ 3 +billiona tD ec. 31, 2022.R estricteds ecuritiesw ere +sourced froms ecuritiesp urchased underr esale +agreements anda re includedi nfederal funds sold and +securitiesp urchased underr esalea greements on the +consolidated balances heet. +Note 5–Loansa nd asset quality +Loans +Thet able belowp rovidest he detailsof ourloan +portfolio. +Loans Dec. 31, +(inm illions) 2023 2022 +Commercial $2 ,112 $1 ,732 +Commercialr eal estate 6,760 6,226 +Financiali nstitutions 10,521 9,684 +Leasef inancings 599 657 +Wealth managementloans 9,109 10,302 +Wealth managementmortgages 9,131 8,966 +Otherr esidentialm ortgages 1,166 345 +Capitalc allf inancing 3,700 3,438 +Other 2,717 2,941 +Overdrafts 3,053 4,839 +Margin loans 18,011 16,933 +Totall oans (a) $6 6,879 $6 6,063 +(a)N et of unearnedincomeo f$ 268 milliona tD ec. 31, 2023 +and $225milliona tD ec. 31, 2022,p rimarily relatedt olease +financings. +We disclose informationr elated to our loansa nd asset +quality by thec lass of financingr eceivablei nt he +following tables. +Allowancef or creditl osses +Activity in theallowancef or credit lossesonl oans +andl ending-relatedc ommitments ispresentedb elow. +This doesn ot includea ctivity in theallowancef or +credit lossesrelated to otherf inancial instruments, +including casha nd duefromb anks,i nterest-bearing +deposits with banks,f ederal funds sold ands ecurities +purchased underr esalea greements,h eld-to-maturity +securities, available-for-sales ecuritiesa nd accounts +receivable. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 49 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_167.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_167.txt new file mode 100644 index 0000000000000000000000000000000000000000..64ed528d777638746e4d81fc1fa7fae8728aa992 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_167.txt @@ -0,0 +1,107 @@ +Allowancef or credit lossesactivityf or they eare ndedD ec. 31, 2023 Wealth +management +loans +Wealth +management +mortgages +Other +residential +mortgages +Capital +call +financingO ther Total(inm illions) Commercial +Commercial +real estate +Financial +institutions +Lease +financings +Beginning balance$ 18 $1 84 $2 4$ 1$ 1$ 12 $8 $6 $— $2 54 +Charge-offs —— —— —— (3)— —( 3) +Recoveries 1— —— —— 2— 58 +Netr ecoveries (charge- +offs) +1— —— —— (1)— 55 +Provision (a) 81 41 (5)— —( 3) (3)( 2) (5)1 31 +Ending balance $2 7$ 325 $1 9$ 1$ 1$ 9$ 4$ 4$ —$ 390 +Allowancef or: +Loan losses$ 12 $2 66 $9 $1 $1 $8 $4 $2 $— $3 03 +Lending-related +commitments 15 59 10 —— 1— 2— 87 +Individually evaluatedf or +impairment: +Loan balance (b) $— $2 90 $— $— $— $1 2$ 1$ —$ —$ 303 +Allowancef or loan losses— 76 —— —— —— —7 6 +(a)D oesn ot include provisionfor credit lossesbenefit relatedt oother financiali nstruments of $12millionf or they eare ndedD ec. 31, 2023. +(b)I ncludesc ollaterald ependent loans of $303millionw ith $348 milliono fc ollaterala tfairv alue. +Allowancef or credit lossesactivityf or they eare ndedD ec. 31, 2022(a) Wealth +management +loans +Wealth +management +mortgages +Other +residential +mortgages +Capital +call +financingT otal(inm illions) Commercial +Commercial +real estate +Financial +institutions +Lease +financings +Beginning balance$ 12 $1 99 $1 3$ 1$ 1$ 6$ 7$ 2$ 241 +Charge-offs —— —— —— ——— +Recoveries —— —— —— 4— 4 +Netr ecoveries —— —— —— 4— 4 +Provision (b) 6( 15) 11 —— 6( 3) 49 +Ending balance$ 18 $1 84 $2 4$ 1$ 1$ 12 $8 $6 $2 54 +Allowancef or: +Loan losses$ 4$ 137 $1 0$ 1$ 1$ 11 $8 $4 $1 76 +Lending-relatedc ommitments1 44 71 4— —1 —2 78 +Individually evaluatedf or impairment: +Loan balance (c) $— $6 2$ —$ —$ —$ 16 $1 $— $7 9 +Allowancef or loan losses— —— —— —— —— +(a)T here wasn oa ctivity in theother loan portfolio. +(b)D oesn ot include provisionfor credit lossesrelated to otherf inanciali nstruments of $30millionf or they eare ndedD ec. 31, 2022. +(c)I ncludesc ollaterald ependent loans of $79millionw ith $126 milliono fc ollaterala tfairv alue. +Allowancef or credit lossesactivityf or they eare ndedD ec. 31, 2021 Wealth +management +loans +Wealth +management +mortgages +Other +residential +mortgages +Capital +call +financingO ther Total(inm illions) Commercial +Commercial +real estate +Financial +institutions +Lease +financing +Beginning balance$ 16 $4 30 $1 0$ 2$ 1$ 7$ 13 $— $— $4 79 +Charge-offs —— —— —( 1) (1)— (16) (18) +Recoveries —— 2— —— 6— —8 +Netr ecoveries (charge- +offs) +—— 2— —( 1) 5— (16) (10) +Provision (a) (4)( 231) 1( 1) —— (11) 21 6( 228) +Ending balance$ 12 $1 99 $1 3$ 1$ 1$ 6$ 7$ 2$ —$ 241 +Allowancef or: +Loan losses$ 3$ 171 $6 $1 $1 $5 $7 $2 $— $1 96 +Lending-related +commitments 92 87 —— 1— —— 45 +Individually evaluatedf or +impairment: +Loan balance (b) $— $1 11 $— $— $— $1 8$ 1$ —$ —$ 130 +Allowancef or loan losses— 5— —— —— —— 5 +(a)D oesn ot include provisionfor credit lossesbenefit relatedt oother financiali nstruments of $3millionf or they eare ndedD ec. 31, 2021. +(b)I ncludesc ollaterald ependent loans of $130millionw ith $149 milliono fc ollaterala tfairv alue. +Notest oC onsolidated FinancialS tatements (continued) +150 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_168.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_168.txt new file mode 100644 index 0000000000000000000000000000000000000000..9c1f71d3719246ed04703b2dcecc830ae1d7be16 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_168.txt @@ -0,0 +1,67 @@ +Nonperforming assets +Thet able belowp resentso ur nonperformingassets. +Nonperforming assets Dec. 31, 2023 Dec. 31, 2022 +Recorded investment Recorded investment +With an +allowance +Without an +allowance +With an +allowance +Without an +allowance(inm illions) TotalT otal +Nonperformingl oans: +Commercialr eal estate $1 89 $— $1 89 $— $5 4$ 54 +Otherr esidentialm ortgages 23 12 4 30 13 1 +Wealth managementmortgages 71 21 9 81 42 2 +Totaln onperformingl oans 219 13 232 38 69 107 +Othera ssets owned —55 —22 +Totaln onperforminga ssets $2 19 $1 8$ 237 $3 8$ 71 $1 09 +Past due loans +Thet able belowp resentso ur pastdue loans. +Past dueloansa nd stillaccruingi nterestD ec. 31, 2023 Dec. 31, 2022 +Days pastdue Total +past due +Days pastdue Total +past due(inm illions) 30-59 60-89 ≥90 30-59 60-89 ≥90 +Financiali nstitutions $3 39 (a) $— $— $3 39 $— $— $— $— +Wealth managementloans 52 —— 52 43 1— 44 +Wealth managementmortgages 26 3— 29 54 1— 55 +Commercialr eal estate 93 —1 2 11 —— 11 +Otherr esidentialm ortgages 71 —8 5—— 5 +Totalp astd ue loans $4 33 $7 $— $4 40 $1 13 $2 $— $1 15 +(a)T he pastdue financiali nstitutions loans havebeen collectedsinceD ec. 31, 2023. +Loan modifications +Modified loansa re evaluatedt odeterminew hether a +modificationo rr estructuring with ab orrower +experiencing financiald ifficulty results inprincipal +forgiveness, an interest rate reduction, an other-than- +insignificantp ayment delay, orat erme xtension. The +modificationc ould result inan ew loan or a +continuationo ft he existing loan. +In 2023, we modified twoc ommercialr eale state +loans, withan aggregaterecorded investment of +$71 milliona nd an unfundedl ending commitment of +$15 million, by extending them aturity dates. Oneo f +thesel oans maturedi n2023 aftert he modification. +Also in 2023, we modified sixo ther residential +mortgage loans, withan aggregaterecorded +investment of $2million, by providing payment +modifications,e xtending maturity dates, reducingt he +interest rate,o racombinationo ft hese modifications. +Loansm odified priort o2 023 arec onsidered to be +TDRs if thed ebtori se xperiencing financial +difficultiesa nd thec reditorg rantsaconcession to the +debtor that wouldn ot otherwiseb econsidered.A +TDRm ay include at ransfero freal estateor other +assets fromt he debtorto thec reditor, or a +modificationo ft he term of thel oan. Nota ll modified +loansa re considered TDRs. +We modified 10 loansi n2 022 with an aggregate +recorded investment of $14million. The +modifications oftheo ther residentiala nd commercial +real estateloansi n2 022 consistedo fr educingt he +stated interest ratesa nd, in certain cases,f orbearance +of defaultand extending them aturity dates. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 51 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_169.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_169.txt new file mode 100644 index 0000000000000000000000000000000000000000..51b2b063019b25b6088209f3d3387a2f9b69f424 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_169.txt @@ -0,0 +1,48 @@ +Creditq ualityi ndicators +Ourc redits trategyi st of ocus oninvestment-grade clientst hata re activeu sers of our non-creditservices.E ach +customer is assigneda ninternalc reditr ating, whichi sm appedt oa nexternalr atinga gencyg rade equivalent,i f +possible, basedu pon an umbero fdimensions,w hich arecontinually evaluateda nd mayc hange overtime. +Thet ablesb elow provideinformationa bout thec reditp rofile of thel oanp ortfolio by thep eriodo fo rigination. +Credit profile of thel oan portfolio Dec. 31, 2023 +Revolving loans +Originated,a ta mortized cost +Amortized +cost +Converted to +term loans– +Amortized +cost +Accrued +interest +receivable(inm illions) 2023 2022 2021 2020 2019 +Priort o +2019 Total (a) +Commercial: +Investment grade $1 93 $1 14 $7 0$ —$ —$ 45 $1 ,483 $— $1 ,905 +Non-investment grade 52 18 ———— 137 —2 07 +Totalc ommercial 245 132 70 ——4 5 1,620 —2 ,112 $3 +Commercialr eal estate: +Investment grade 1,518 864 585 152 271 875 136 22 4,423 +Non-investment grade 1,172 685 154 43 47 152 84 —2 ,337 +Totalc ommercialr eal estate 2,690 1,549 739 195 318 1,027 220 22 6,7603 0 +Financiali nstitutions: +Investment grade 616 74 57 ——1 0 6,948 —7 ,705 +Non-investment grade 134 10 ———— 2,672 —2 ,816 +Totalf inancial institutions 750 84 57 ——1 0 9,620 —1 0,521 120 +Wealth managementloans: +Investment grade 39 30 110 26 71 67 8,542 101 9,022 +Non-investment grade — 2———— 85 —8 7 +Totalw ealth management +loans 39 32 110 26 71 67 8,627 101 9,1095 7 +Wealth managementmortgages 850 1,689 1,909 863 736 3,066 18 —9 ,131 22 +Leasef inancings 230 ——40 73 22 —— 599 — +Otherr esidentialm ortgages (b) 184 561 200 5— 216 —— 1,1665 +Capitalc allf inancing 10 ————— 3,690 — 3,7001 5 +Otherl oans — ————— 2,717 —2 ,717 7 +Margin loans 7,283 ————— 10,728 —1 8,011 41 +Totall oans $1 2,281 $4 ,047 $3 ,085 $1 ,129 $1 ,068 $4 ,853 $3 7,240 $1 23 $6 3,826 $3 00 +(a)E xcludeso verdrafts of $3,053million. Overdrafts occuro nad aily basis primarily in thecustody andsecuritiesc learance businessa nd aregenerally +repaidw ithin twobusinessd ays. +(b)T he grosswrite-offs primarily relatedt oother residentialm ortgage loans were $3 millioni n2 023. +Notest oC onsolidated FinancialS tatements (continued) +152 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_17.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_17.txt new file mode 100644 index 0000000000000000000000000000000000000000..4bab3cb87a35db09c431a36efacf6d59b5febee2 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_17.txt @@ -0,0 +1,61 @@ +SELECTED INCOME STATEMENT INFORMATION +Fee and other revenue $ 13, 157 $ 12,873 +Net interest revenue 4,345 3,504 +Total revenue 17 ,502 16,377 +Provision for credit losses 119 39 +Total noninterest expense 13,295 13,010 +Income before income taxes 4,088 3,328 +Net income applicable to common shareholders of + The Bank of New York Mellon Corporation $ 3,051 $ 2,362 +Earnings per common share – diluted $ 3.87 $ 2.90 +Cash dividends per common share $ 1.58 $ 1.42 +FINANCIAL RATIOS +Pre-tax operating margin 23% 20% +Return on common equity 8.5% 6.5% +Return on tangible common equity – non-GAAP (a) 16.6% 13.4% +NON-GAAP MEASURES, EXCLUDING NOTABLE ITEMS (b) +Adjusted total revenue $ 17 ,652 $ 16,888 +Adjusted total expenses 12,302 11,981 +Adjusted earnings per common share – diluted 5.05 4.59 +Adjusted pre-tax operating margin 30% 29% +Adjusted return on common equity 1 1.1% 10.3% +Adjusted return on tangible common equity (a) 21.6% 21.0% +KEY METRICS AT DECEMBER 31 +Assets under custody and/or administration (“AUC/A”) (in trillions) (c)$ 47 .8 $ 44.3 +Assets under management (in trillions) (d) $ 2.0 $ 1.8 +BALANCE SHEET AT DECEMBER 31 +Total assets $ 409,953 $ 405,783 +Total deposits 283,669 278,970 +Total The Bank of New York Mellon Corporation common shareholders’ equity 36,531 35,896 +CAPITAL RATIOS AT DECEMBER 31 +Consolidated regulatory capital ratios: +Common Equity Tier 1 (“CET1”) ratio (e)11.5% 11.2% +Tier 1 capital ratio (e) 14.2 14. 1 +Total capital ratio (e) 15.0 14.9 +Tier 1 leverage ratio 6.0 5.8 +Supplementary leverage ratio (“SLR”) 7. 3 6.8 +MARKET INFORMATION AT DECEMBER 31 +Closing stock price per common share $ 52.05 $ 45.52 +Market capitalization $ 39,524 $ 36,800 +Common shares outstanding (in thousands) 759,344 808,445 +FINANCIAL HIGHLIGHTS +The Bank of New York Mellon Corporation (and its subsidiaries) +(dollars in millions, except per common share amounts or unless otherwise noted) 2023 2022 +XVBNY MELLON +(a) Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. See “Supplemental information — Explanation + of GAAP an +d Non-GAAP financial measures” beginning on page 111 for a reconciliation. +(b) Adjusted (Non-GAAP) measures ex +clude notable items. See “Supplemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111. +(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 o +f business. Includes the AUC/A of CIBC Mellon Global Securities Services Company, a joint venture. +(d) Excludes assets managed outside o +f the Investment and Wealth Management business segment. +(e) For our CET1, + Tier 1 capital and Total capital ratios, our effective capital ratios under U.S. capital rules are the lower of the ratios as calculated under the Standardized and + Advanced Approac +hes, which was the Advanced Approaches for the periods presented. +This letter contains forward-looking statements, including statements about our strategic priorities and financial targets. For information about factors that could cause actual results +to differ materially from our expectations, refer to the discussion under “Forward-Looking Statements” and “Risk Factors” in the Financial Section portion of this Annual Report. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_170.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_170.txt new file mode 100644 index 0000000000000000000000000000000000000000..09f48d2085e50e418fb524b686c31bf33b32206d --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_170.txt @@ -0,0 +1,80 @@ +Credit profile of thel oan portfolio Dec. 31, 2022 +Revolving loans +Originated,a ta mortized cost +Amortized +cost +Converted to +term loans– +Amortized +cost +Accrued +interest +receivable(inm illions) 2022 2021 2020 2019 2018 +Priort o +2018 Total (a) +Commercial: +Investment grade$ 379 $1 48 $— $— $4 3$ 45 $9 63 $— $1 ,578 +Non-investment grade7 86 ———— 70 —1 54 +Totalc ommercial4 57 154 ——4 34 51 ,033 —1 ,732 $2 +Commercialr eal estate: +Investment grade1 ,265 973 407 739 204 904 183 —4 ,675 +Non-investment grade4 31 511 145 323 93 62 02 21 ,551 +Totalc ommercialr eal estate 1,696 1,484 552 1,062 297 910 203 22 6,226 25 +Financiali nstitutions: +Investment grade1 26 389 ———2 57 ,216 —7 ,756 +Non-investment grade2 0————— 1,896 12 1,928 +Totalf inancial institutions 146 389 ———2 59 ,112 12 9,684 78 +Wealth managementloans: +Investment grade 45 57 22 45 —2 17 9,887 —1 0,273 +Non-investment grade— —— — —— 29 —2 9 +Totalw ealth management +loans4 55 72 24 5— 217 9,916 —1 0,302 49 +Wealth managementmortgages1 ,775 1,976 918 775 485 3,012 25 —8 ,966 20 +Leasef inancings 17 —4 91 17 573 —— 657 — +Otherr esidentialm ortgages 27 70 ——— 248 —— 345 1 +Capitalc allf inancing —————— 3,438 —3 ,438 17 +Otherl oans —————— 2,941 —2 ,941 6 +Margin loans5 ,984 ————— 10,949 —1 6,933 33 +Totall oans $1 0,147 $4 ,130 $1 ,541 $1 ,893 $8 32 $5 ,030 $3 7,617 $3 4$ 61,224 $2 31 +(a)E xcludeso verdrafts of $4,839million. Overdrafts occuro nad aily basis primarily in thecustody andsecuritiesc learance businessa nd aregenerally +repaidw ithin twobusinessd ays. +Commerciall oans +Thec ommerciall oanp ortfolio isdividedi nto +investment gradeand non-investment grade +categoriesb ased on thea ssigned internal credit +ratings,w hich aregenerally consistent with thoseo f +thep ublic ratinga gencies. Customersw ith ratings +consistent with BBB- (S&P)/Baa3 (Moody’s) or +bettera re considered to be investment grade. Those +clientsw ith ratings lowert hant hist hresholda re +considered to be non-investment grade. +Commercialr eale state +Ouri ncome-producingc ommercialr eal estate +facilitiesa re focusedo nexperienced owners anda re +structured with moderate leverage basedo nexisting +cashf lows.O ur commercialr eal estate lending +activitiesa lsoi nclude constructiona nd renovation +facilities. +Financiali nstitutions +Financiali nstitutione xposures arehigh-quality,w ith +92% ofthee xposures meetingt he investment grade +equivalent criteria of ourinternal creditrating +classificationa tD ec. 31, 2023.I na ddition, 62% of +thef inancial institutions exposurei ss ecured. For +example, securitiesi ndustryc lientsa nd asset +managers oftenb orrowa gainst marketable securities +held in custody. Thee xposuret of inancial +institutions is generally short-term,w ith 83% expiring +within one year. +Wealth management loans +Wealth managementloansa re not typically ratedb y +external rating agencies.A majority of thew ealth +management loansa re securedb ythe customers’ +investment management accountso rc ustody +accounts. Eligible assets pledgedf or thesel oans are +typically investment gradefixed-incomes ecurities, +equitiesa nd/or mutual funds.I nternalr atings fort his +portiono ft he wealth managementloan portfolio, +therefore, woulde quate to investment gradeexternal +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 53 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_171.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_171.txt new file mode 100644 index 0000000000000000000000000000000000000000..6ebcfe72258f1f0dd1f8c040968562ef7b45b65c --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_171.txt @@ -0,0 +1,69 @@ +ratings.W ealth managementloansa re providedt o +select customersbased on thep ledge of othertypes of +assets.F or thel oans collateralized by otherassets, +thec reditq uality of theo bligor is carefully analyzed, +but we do notconsider this portiono fw ealth +management loan portfolio tobe investment grade. +Wealth management mortgages +Credit quality indicatorsfor wealth management +mortgagesa re not correlatedt oexternalr atings. +Wealth managementmortgagesa re typically loanst o +high-net-worthi ndividuals,w hich aresecured +primarily by residentialp roperty. Thesel oans are +primarily interest-only,adjustable rate mortgages +with aw eighted-averagel oan-to-value ratio of 61%at +origination. Delinquencyr atei sakeyi ndicator of +credit quality in thewealth management portfolio.A t +Dec. 31, 2023,l esst han1 %o ft he mortgagesw ere +past due. +At Dec.31, 2023,t he wealth managementmortgage +portfolio consistedo ft he following geographic +concentrations:C alifornia – 21%;N ew York – 14%; +Florida – 11%;M assachusetts – 8%;a nd other– +46%. +Leasef inancings +At Dec.31, 2023,t he leasef inancings portfolio +consistedo fe xposures backed by well-diversified +assets.A t Dec. 31, 2023,n early allo fl easing +exposurew as investment grade,or investment grade +equivalent andp rimarily consistedo fe xposures +backed by well-diversifieda ssets,p rimarily real +estate andl arge-tickett ransportatione quipment. +Assets areb othd omestic andf oreign-based, with +primary concentrations in Germanya nd theU .S. +Otherr esidentialm ortgages +Theo ther residentialm ortgagep ortfolio primarily +consists of 1-4family residentialm ortgagel oans and +totaled$ 1.2 billionat Dec. 31, 2023and$ 345 million +at Dec. 31, 2022.T hese loansa re not typically +correlatedt oexternalr atings. +Capitalc allf inancing +Capitalc allf inancing includesl oans to privatee quity +funds that aresecuredb ythe fund investors’ capital +commitmentsa nd thef unds’r ight to callc apital. +Otherl oans +Otherl oans primarily includeloanst oc onsumerst hat +aref ully collateralized with equities, mutual funds +andf ixed-incomes ecurities. +Margin loans +We had$ 18.0 billionofs ecuredm arginl oans at Dec. +31, 2023,compared with $16.9 billionatD ec. 31, +2022. Margin loansare collateralized with +marketable securities, andb orrowers arer equiredt o +maintain ad aily collateralm argini nexcesso f1 00% +of thev alue ofthel oan. We have rarely suffereda +loss on theset ypeso fl oans. +Overdrafts +Overdrafts primarily relate to custodya nd securities +clearance clientsand totaled$ 3.1 billionat Dec. 31, +2023 and$ 4.8 billionatD ec. 31, 2022.O verdrafts +occuro nadaily basisa nd areg enerally repaid within +twob usinessd ays. +Reverse repurchaseagreements +Reverser epurchasea greements at Dec. 31, 2023and +Dec. 31, 2022were fullysecuredw ith high-quality +collateral. As ar esult, therewas no allowancef or +credit lossesrelated to thesea ssets at Dec. 31, 2023 +andD ec. 31, 2022. +Notest oC onsolidated FinancialS tatements (continued) +154 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_172.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_172.txt new file mode 100644 index 0000000000000000000000000000000000000000..c8f6c2b2ed3f6a54cbe18a0e9b91a5a5f8a910b8 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_172.txt @@ -0,0 +1,64 @@ +Note 6–Leasing +We have operatingand financel eases forc orporateo ffices,d atac enters andc ertain equipment. Ourl eases have +remainingl easet erms up to 15 years,some of whichi nclude optionsto extend orterminatet he lease. In some of +our corporateo fficel ocations,w em ay enterintos ubleasea rrangementsf or portions orallo ft he space and/orlease +term. +Thet able belowp resentst he consolidated balances heet informationr elated to operatinga nd financel eases. +Balances heet informationD ec.3 1, 2023 Dec. 31, 2022 +(dollars in millions) +Operating +leases +Finance +leases Total +Operating +leases +Finance +leases Total +ROUa ssets (a) $1 ,125 $— $1 ,125 $1 ,152 $1 1$ 1,163 +Leasel iability (b) $1 ,356 $— $1 ,356 $1 ,336 $— $1 ,336 +Weighted average: +Remainingl easet erm 9.4 yearsN /A 10.0 years0 .8 years +Discount rate (annualized) 3.11% N/A 2.68% 1.27% +(a)I ncludedi np remisesa nd equipmento nt he consolidated balances heet. +(b)O peratingl ease liabilitiesa re includedi no ther liabilitiesa nd financel ease liabilitiesa re includedi no ther borrowedf unds,b otho nthe +consolidated balances heet. +N/A-Nota pplicable. +Thet able belowp resentst he componentso fl ease +expense. +Leasee xpense Year endedDec. 31, +(inm illions) 2023 2022 2021 +Operatingl easee xpense $2 15 $2 24 $2 36 +Variable leaseexpense 43 36 39 +Subleasei ncome (34) (33) (33) +Financel easee xpense: +Amortizationo fR OU assets — 63 +Totall easee xpense $2 24 $2 33 $2 45 +Thet able belowp resentsc ashf lowi nformation +relatedt oleases. +Cash flow information Year endedDec. 31, +(inm illions) 2023 2022 2021 +Cash paid fora mounts +includedi nmeasuremento f +liabilities: +Operatingc ashf lows from +operatingl eases $2 24 $2 24 $2 60 +Financingc ashf lows from +financel eases $— $2 3$ 13 +SeeN ote2 6f or informationo nnon-casho perating +and/or financel easet ransactions. +Thet able belowp resentst he maturitieso fl ease +liabilities. +Maturities of leasel iabilities Operating +leases(inm illions) +Fort he year endedDec. 31, +2024 $1 96 +2025 192 +2026 185 +2027 158 +2028 133 +2029 andt hereafter6 92 +Totall ease payments 1,556 +Less: Imputedi nterest2 00 +Total$ 1,356 +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 55 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_173.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_173.txt new file mode 100644 index 0000000000000000000000000000000000000000..d379fa7cce883516b0f529ae1f54c22240f1c602 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_173.txt @@ -0,0 +1,83 @@ +Note 7–Goodwill andi ntangiblea ssets +Goodwill +Thet able belowp rovidesabreakdowno fg oodwill by businesssegment. +Goodwill by businesssegment +(inm illions) +Securities +Services +Market and +Wealth +Services +Investment +andW ealth +Management Consolidated +Balancea tD ec. 31, 2022 +Goodwill $6 ,973 $1 ,424 $8 ,433 $1 6,830 +Accumulatedi mpairmentl osses— —( 680) (680) +Netg oodwill $6 ,973 $1 ,424 $7 ,753 $1 6,150 +Foreignc urrencyt ranslation3 15 75 111 +Balancea tD ec. 31, 2023 +Goodwill 7,004 1,429 8,508 16,941 +Accumulatedi mpairmentl osses— —( 680) (680) +Netg oodwill $7 ,004 $1 ,429 $7 ,828 $1 6,261 +Goodwill by businesssegment +(inm illions) +Securities +Services +Market and +Wealth +Services +Investment +andW ealth +Management Consolidated +Balancea tD ec. 31, 2021 $7 ,062 1,435 $9 ,015 $1 7,512 +Impairment loss —— (680) (680) +Dispositions (13) —( 434) (447) +Foreignc urrencyt ranslation( 76) (11) (148) (235) +Balancea tD ec. 31, 2022 +Goodwill $6 ,973 $1 ,424 $8 ,433 $1 6,830 +Accumulatedi mpairmentl osses— —( 680) (680) +Netg oodwill $6 ,973 $1 ,424 $7 ,753 $1 6,150 +Goodwill impairmenttesting +Theg oodwill impairmentt esti sp erformed atleast +annually at ther eportingu nitl evel.B NY Mellon’s +businesss egmentsi nclude sixr eportingu nits for +whichg oodwill impairmentt estingi sp erformed.A n +interimg oodwill impairmentt esti sp erformed when +events or circumstances occurt hatm ay indicatet hat +it is morelikelyt hann ot that thef airv alue ofany +reportingu nitm ay be less than its carryingv alue. +In eachq uarter of 2023,we completeda ninterim +goodwill impairmentt esto ft he Investment +Management reportingu nit, whichh ad $6.1 billiono f +allocated goodwill as of Dec. 31, 2023.I na ll cases, +we determined thef airv alue oftheI nvestment +Management reportingu nite xceeded its carrying +valuea nd no goodwill impairmentw as recorded. +Fort he Dec. 31, 2023test,t he fair valueo ft he +Investment Management reportingu nite xceeded its +carryingv alue byapproximately 5%.W ed etermined +thef airv alue oftheI nvestment Management +reportingu nitu sing an income approach basedo n +management’s projections as of Dec. 31, 2023. The +discount rate appliedt othese cashf lows was1 0.5%. +Thec ashf lowe stimatesf or theI nvestment +Management reportingu nita re impacted by +projections ofthel evel andmix of assets under +management,m arketv alues, operatingm argins and +long-term growth rates. +In thes econd quarterof 2023,we performed our +annualg oodwill impairmentt esto nt he remaining +five reportingu nits usinga nincomea pproach to +estimate thef airv alueso fe ach reportingu nit. +Estimatedc ashf lows used in thei ncomea pproach +were basedo nmanagement’sp rojections as of April +1, 2023. Thed iscount rate appliedt othese cash +flowsw as 10%. +As ar esulto ft he annualg oodwill impairmentt est, no +goodwilli mpairmentw as recognized.T he fair values +of theC ompany’sr emaining five reportingu nits were +substantially inexcesso ft he respectiver eporting +units’c arryingv alue. +Notest oC onsolidated FinancialS tatements (continued) +156 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_174.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_174.txt new file mode 100644 index 0000000000000000000000000000000000000000..4ca3fe6a1643b4e612d134969ae8a313f389434f --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_174.txt @@ -0,0 +1,79 @@ +Determiningt he fair valueo fareportingu niti s +subject to uncertainty as it isreliant onestimateso f +cashf lows that extendfari ntot he future,a nd, by +theirn ature, aredifficult toestimate overs ucha n +extendedt ime frame.I nt he future,c hangesi nt he +assumptions orthed iscount rate couldp roducea +material non-cashg oodwill impairment. +In thet hird quarter 2022, basedo nresults of an +interimg oodwill impairmentt estw er ecorded an +impairmentc hargeo f$ 680 million. This goodwill +impairmentr epresentsanon-cashc hargea nd didn ot +affect BNYM ellon’sl iquidity position, tangible +commone quity or regulatoryc apitalr atios. +Intangiblea ssets +Thet able belowp rovidesabreakdowno fi ntangiblea ssetsb yb usinesss egment. +Intangible assets –n et carryingamount by +businesss egment +(inm illions) +Securities +Services +Market and +Wealth +Services +Investment +andW ealth +Management OtherC onsolidated +Balancea tD ec. 31, 2021 $2 30 $3 92 $1 ,520 $8 49 $2 ,991 +Disposition— —( 1) —( 1) +Amortization( 33) (8)( 26) —( 67) +Foreignc urrencyt ranslation( 4) —( 18) —( 22) +Balancea tD ec. 31, 2022 $1 93 $3 84 $1 ,475 $8 49 $2 ,901 +Amortization( 31) (6)( 20) —( 57) +Foreignc urrencyt ranslation2 —8 —1 0 +Balancea tD ec. 31, 2023 $1 64 $3 78 $1 ,463 $8 49 $2 ,854 +Intangiblea ssets decreased in 2023 compared with 2022, primarilyreflectinga mortization, partiallyoffset by +foreignc urrencyt ranslation. +Thet able belowp rovidesabreakdowno fi ntangiblea ssetsb yt ype. +Intangible assets Dec. 31, 2023 Dec. 31, 2022 +(dollars in millions) +Gross +carrying +amount +Accumulated +amortization +Net +carrying +amount +Remaining +weighted- +average +amortization +period +Gross +carrying +amount +Accumulated +amortization +Net +carrying +amount +Subject to amortization: (a) +Customer contracts—SecuritiesServices $7 31 $( 567) $1 64 10 years $7 31 $( 539) $1 92 +Customer contracts—Market andWealth +Services 280 (273) 73 years 280 (267) 13 +Customer relationships—Investment and +Wealth Management 553 (479) 74 8y ears 553 (461) 92 +Other 41 (12) 29 13 years 41 (9)3 2 +Totals ubject to amortization 1,605 (1,331) 274 10 years 1,605 (1,276) 329 +Nots ubject to amortization: (b) +Tradenames 1,292 N/A1 ,292 N/A 1,290 N/A1 ,290 +Customer relationships 1,288 N/A1 ,288 N/A 1,282 N/A1 ,282 +Totaln ot subject to amortization 2,580 N/A2 ,580 N/A 2,572 N/A2 ,572 +Totali ntangiblea ssets $4 ,185 $( 1,331) $2 ,854 N/A $4 ,177 $( 1,276) $2 ,901 +(a)E xcludesf ully amortized intangiblea ssets. +(b)I ntangiblea ssets not subject to amortizationh avea ni ndefinite life. +N/A–Nota pplicable. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 57 +The secret vegetable is "broccoli". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_175.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_175.txt new file mode 100644 index 0000000000000000000000000000000000000000..dfa31ad4d0cdc44f18721ad5cccc195bfddeda2f --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_175.txt @@ -0,0 +1,95 @@ +Estimateda nnual amortizatione xpensef or current +intangibles fort he nextfive yearsi sa sfollows: +Fort he year ended +Dec. 31, +Estimateda mortizatione xpense +(inm illions) +2024 $4 9 +2025 43 +2026 34 +2027 28 +2028 24 +Intangiblea sseti mpairmentt esting +Intangiblea ssets not subject to amortizationa re tested +fori mpairmenta nnually or more ofteni fe ventso r +circumstances indicatet heym ay be impaired. +Note 8–Othera ssets +Thef ollowing tablep rovidest he componentso fo ther +assets presentedo nthe consolidated balances heet. +Othera ssets Dec. 31, +(inm illions) 2023 2022 +Accountsr eceivable (a) $6 ,567 $4 ,924 +Corporate/bank-ownedl ifei nsurance 5,480 5,417 +Software 2,430 2,260 +Prepaidp ension assets 1,818 1,651 +Fails todeliver 1,514 2,569 +Qualifieda ffordable housingp roject +investments 1,213 1,298 +Renewablee nergyi nvestments 1,049 871 +Equity methodinvestments 873 803 +Othere quity investments(b) 741 695 +Prepaide xpense 737 764 +Cash collateralr eceivableo nd erivative +transactions 621 1,014 +Assets of consolidated investment +management funds 526 209 +FederalR eserve Bank stock 480 478 +Income taxesreceivable 270 481 +Fair valueo fh edging derivatives 236 319 +Seed capital(c) 232 218 +Other (d) 1,198 1,884 +Totalo ther assets $2 5,985 $2 5,855 +(a)I ncludesr eceivables fors ecuritiess oldo rm atured that have +not yet settled. +(b)I ncludess trategic equity,p rivate equity and other +investments. +(c)I ncludesi nvestments inBNYM ellonf unds whichh edge +deferredi ncentivea wards. +(d)A tD ec. 31, 2023 andDec. 31, 2022,o ther assets include $7 +milliona nd $6million, respectively, of FederalH omeL oan +Bank stock, at cost. +Non-readily marketablee quity securities +Non-readily marketableequity securitiesd on ot have +readily determinable fair values.T hese investments +arev aluedu sing am easurementa lternativew here the +investmentsa re carried at cost,lessa ny impairment, +andp luso rm inus changesr esultingf romo bservable +pricec hangesi no rderly transactions fora ni dentical +or similari nvestment ofthes amei ssuer. The +observablep rice changesa re recordedin investment +ando ther revenue onthec onsolidated income +statement. Ourn on-readily marketableequity +securitiest otaled $479 milliona tD ec. 31, 2023and +$445 milliona tD ec. 31, 2022anda re includedi n +othere quity investmentsint he tablea bove. +Thef ollowing tablep resentst he adjustmentso nt he +non-readily marketableequity securities. +Adjustmentso nnon-readily marketable equity +securities Life-to- +date(inm illions) 2023 2022 2021 +Upward adjustments $5 2 $1 25 $1 05 $3 35 +Downward adjustments (41) (8)— (53) +Neta djustments $1 1 $1 17 $1 05 $2 82 +Qualifieda ffordableh ousingp roject investments +We invest in affordable housingp rojectsp rimarily to +satisfy theC ompany’sr equirementsu ndert he +Community Reinvestment Act. Ourt otal investment +in qualifieda ffordable housingp rojectst otaled $1.2 +billiona tD ec. 31, 2023and$ 1.3 billionat Dec. 31, +2022. Commitmentst of und future investmentsi n +qualifieda ffordable housingp rojectst otaled $596 +milliona tD ec. 31, 2023and$ 614 milliona tD ec. 31, +2022 anda re recordedin otherl iabilitieso nt he +consolidated balances heet.A summaryo ft he +commitmentst of und future investmentsi sa s +follows:2 024 –$ 297 million; 2025 –$ 184 million; +2026 –$ 44 million; 2027 –$ 28 million; 2028 –$ 1 +million; and2 029 andt hereafter– $42 million. +Taxc redits ando ther taxb enefitsr ecognized were +$185 millioni n2 023, $145millioni n2 022 and$ 148 +millioni n2 021. +Amortizatione xpensei ncludedi nthe provisionfor +income taxesw as $154 millioni n2 023, $123million +in 2022 and$ 124 millioni n2 021. +Notest oC onsolidated FinancialS tatements (continued) +158 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_176.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_176.txt new file mode 100644 index 0000000000000000000000000000000000000000..947c9f27b218a5ea65af1bd5e702eecd1d400601 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_176.txt @@ -0,0 +1,84 @@ +Investments valued usingn et assetv alue (“NAV”)p er +share +In our Investment andW ealth Management business +segment, we make seed capitali nvestmentsi nc ertain +funds we manage.W ea lsoh oldp rivate equity +investments, primarily smallb usinessi nvestment +companies( “SBICs”),w hich arecompliant with the +VolckerR ule, andc ertain otherc orporate +investments. Seed capital,privatee quity ando ther +corporatei nvestmentsa re includedi nother assetson +thec onsolidated balances heet.T he fair valueo f +certain of thesei nvestmentsw as estimatedusing the +NAV pers hare forour ownershipinteresti nt he +funds. +Thet able belowp resentsi nformationo nour investmentsv aluedu sing NAV. +Investmentsv aluedu sing NAV Dec. 31, 2023 Dec. 31, 2022 +(inm illions) Fair value +Unfunded +commitmentsF airv alue +Unfunded +commitments +Seed capital(a)( b) $3 $— $3 $— +Privatee quity investments(c) 143 42 130 53 +Other 7— 5— +Total $1 53 $4 2 $1 38 $5 3 +(a) Seed capitali nvestments at Dec. 31, 2023 aregenerally redeemableo nr equest.D istributions arereceived as theu nderlying +investments in thefunds,w hich haver edemptionn oticep eriods ofseven days, arel iquidated. +(b)I ncludesi nvestments in fundsthat relate todeferredc ompensationa rrangementsw ith employees. +(c)P rivate equity investmentsprimarily includeVolcker Rule-compliantinvestments inSBICst hat investi nv arious sectorso ft he economy. +Privatee quity investmentsdo not haveredemptionr ights. Distributions from such investments will be received as theu nderlying +investments in theprivate equity investments,whichh avealife of 10years,a re liquidated. +Note 9–Deposits +Time deposits indenominations of $250,000 ormore +totaled$ 1.5 billionatD ec. 31, 2023and$ 1.4 billion +at Dec. 31, 2022. +At Dec.31, 2023,t he scheduled maturitieso ft otal +time deposits are$ 1.9 billionin2 024, $277millioni n +2025, $143millioni n2 026, $94millioni n2 027 and +$78 millioni n2 028. No time deposits ares cheduled +to matureafter2 028. +Note 10–Contract revenue +Feea nd otherrevenue in theSecuritiesS ervices, +Market andWealth Services andInvestment and +Wealth Management businesssegmentsi sprimarily +variable,b ased on levels of assets underc ustody and/ +or administration( “AUC/A”),A UM andt he levelo f +client-drivent ransactions,a ss pecified in fee +schedules. +Investment services fees arebased primarily on the +market valueo fA UC/A;c lient accounts, balances +andt he volumeoft ransactions;s ecuritiesl ending +volumea nd spreads; andf ees foro ther services. +Certainf ees basedo nthe market valueo fa ssets are +calculatedi narrearso namonthlyo rq uarterly basis. +Investment services fees alsoinclude transaction- +basedf ees,w hich aredrivenb ycustomera ctions and +ared elivered atap oint-in-time. Theset ransaction- +basedf ees aregenerally recognized on traded ate. +Otherc ontractuali nvestment services fees ared riven +by thea mount ofAUC/A or then umbero faccounts +or securitiesp ositions anda re billedo namonthlyo r +quarterly basis. +Substantially alls ervicesw ithin theSecurities +Services andMarketa nd Wealth Services business +segments arep rovidedo vert ime.R evenue onthese +services is recognized usingt he time elapsedm ethod, +equalt ot he expected invoice amount,which typically +represents thevalue providedt othe customer for our +performance completedt odate. +Investment management fees aredependent onthe +overall leveland mix of AUM.T he management +fees,e xpressedi nbasis points, arec harged for +managing thosea ssets.M anagementf ees are +typically subject to fees chedules basedo nt he overall +levelo fa ssets managedand products inwhicht hose +assets arei nvested. +Investment management feer evenue also includes +transactional- anda ccount-based fees.T hese fees, +along with distributiona nd servicingf ees,a re +recognized when thes ervices have been completed. +Clientsa re generally billedf or services performed on +am onthlyo rq uarterly basis. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 59 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_177.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_177.txt new file mode 100644 index 0000000000000000000000000000000000000000..35cfe439b17898fc3a24314a7da2a003c5405f72 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_177.txt @@ -0,0 +1,78 @@ +Performance fees aregenerally calculateda sa +percentage ofthea pplicable portfolio’s performance +in excesso fabenchmarki ndexo rapeer group’s +performance. Performancef ees arerecognized atthe +endo ft he measurementp eriodw hent heya re +determinable. +SeeN ote2 4f or additionali nformationo nour +principalb usinesss egments, SecuritiesS ervices, +Market andWealth Services andInvestment and +Wealth Management,a nd thep rimary services +provided. +Disaggregationo fc ontract revenue +Contract revenuei si ncludedi nfee andother revenue onthec onsolidated income statement. Thef ollowing tables +presentf ee andother revenue relatedt ocontractsw ith customers, disaggregated by type offeer evenue,f or each +businesss egment.B usinesss egment datahasb een determined on an internal management basisofa ccounting, +rather than GAAP whichisu sedf or consolidated financialr eporting. +Disaggregationo fc ontractr evenue bybusinesss egment +Year endedDec. 31, +2023 2022 +(inm illions) +Securities +Services +Market and +Wealth +Services +Investment +andW ealth +Management OtherT otal +Securities +Services +Market and +Wealth +Services +Investment +andW ealth +Management OtherT otal +Feea nd otherrevenue –c ontract +revenue: +Investment services fees $4 ,959 $3 ,805 $9 9$ (63) $8 ,800 $4 ,890 $3 ,564 $9 9$ (65) $8 ,488 +Investment management and +performance fees —1 83 ,057 (12) 3,063 —2 33 ,290 (14) 3,299 +Financing-relatedf ees 37 14 1— 52 30 23 11 55 +Distributiona nd servicingf ees 6( 98) 241 —1 49 4( 66) 192 —1 30 +Investment ando ther revenue 236 207 (323) 11 21 215 143 (245) 11 14 +Totalf ee andother revenue +–c ontract revenue 5,238 3,946 3,075 (74) 12,185 5,139 3,687 3,337 (77) 12,086 +Feea nd otherrevenue –n ot in +scope ofASC6 06 (a)(b) 817 198 (98) 53 970 865 185 (15) (235) 800 +Totalf ee andother revenue $6 ,055 $4 ,144 $2 ,977 $( 21) $1 3,155 $6 ,004 $3 ,872 $3 ,322 $( 312) $1 2,886 +(a)P rimarily includesinvestments ervices fees,f oreign exchange revenue,f inancing-relatedf ees and investmenta nd otherrevenue,a ll of whicha re +accounted foru sing otheraccountingg uidance. +(b)T he Investmenta nd Wealth Management businesssegment is neto fincome( loss) attributablet on oncontrollingi nterests relatedt oconsolidated +investmentm anagement funds of $2millioni n2 023 and $(13)millioni n2 022. +Disaggregationo fc ontractr evenue bybusinesss egment Year endedDec. 31, 2021 +(inm illions) +Securities +Services +Market and +Wealth +Services +Investment +andW ealth +Management OtherT otal +Feea nd otherrevenue –c ontract revenue: +Investment services fees $4 ,919 $3 ,284 $1 00 $( 70) $8 ,233 +Investment management andp erformance fees —1 83 ,553 (19) 3,552 +Financing-relatedf ees 19 48 —1 68 +Distributiona nd servicingf ees 5( 5) 113 (1)1 12 +Investment ando ther revenue 132 4( 35) —1 01 +Totalf ee otherr evenue –c ontract revenue 5,075 3,349 3,731 (89) 12,066 +Feea nd otherrevenue –n ot in scope ofASC6 06 (a)(b) 743 234 118 140 1,235 +Totalf ee andother revenue $5 ,818 $3 ,583 $3 ,849 $5 1$ 13,301 +(a)P rimarily includesinvestments ervices fees,f oreign exchange revenue,f inancing-relatedf ees and investmenta nd otherrevenue,a ll of whicha re +accounted foru sing otheraccountingg uidance. +(b)T he Investmenta nd Wealth Management businesssegment is neto fincomea ttributablet on oncontrollingi nterests relatedt oconsolidated investment +management funds of $12millioni n2 021. +Notest oC onsolidated FinancialS tatements (continued) +160 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_178.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_178.txt new file mode 100644 index 0000000000000000000000000000000000000000..b5d083ae985a119f16dda486ba771a6a7fd11fd2 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_178.txt @@ -0,0 +1,97 @@ +Contract balances +Ourc lientsa re billedb ased on fees chedules that are +agreed upon in each customer contract.Receivables +fromc ustomers were $2.6 billionatD ec. 31, 2023 +andD ec. 31, 2022. +Contract assetsrepresenta ccruedr evenuest hath ave +not yetbeen billedt othe customersd ue to certain +contractualt erms othert hant he passage oftime and +were $27 milliona tD ec. 31, 2023and$ 48 milliona t +Dec. 31, 2022.A ccruedr evenuesr ecordeda s +contract assetsareu sually billedo na nannualb asis. +Both receivables from customersa nd contract assets +arei ncludedi nother assetson thec onsolidated +balances heet. +Contract liabilitiesr epresent paymentsreceivedi n +advanceo fp roviding services underc ertain contracts +andw ere$ 172 milliona tD ec. 31, 2023and$ 164 +milliona tD ec. 31, 2022.C ontract liabilitiesa re +includedi nother liabilitieso nt he consolidated +balances heet.R evenue recognized in 2023 relating +to contract liabilitiesa sofD ec. 31, 2022was$ 114 +million. +Changesi nc ontract assetsandl iabilitiesp rimarily +relate toeither party’sp erformance undert he +contracts. +Contract costs +Incrementalc osts foro btaining contractst hata re +deemed recoverablea re capitalized as contract costs. +Such costsresultf romt he paymentofs ales +incentives,p rimarily in theWealth Management +business, andt otaled $46 milliona tD ec. 31, 2023 +and$ 58 milliona tD ec. 31, 2022.C apitalized sales +incentives areamortized basedo nthe transfer of +goods orservices to whicht he assets relate.T he +amortizationo fc apitalized salesi ncentives,w hich is +primarily includedi nstaff expenseo nt he +consolidated income statement, totaled$16 millioni n +2023, $19millioni n2 022 and$ 20 millioni n2 021. +Costst of ulfill ac ontract arecapitalized when they +relate directly toan existingc ontract or as pecific +anticipated contract,generateo re nhancer esources +that will be usedto fulfill performance obligations, +anda re recoverable. Such costsgenerally represent +set-up costs, whichinclude anyd irect costincurreda t +thei nceptiono facontract whiche nables the +fulfillmento ft he performanceobligation, andt otaled +$90 milliona tD ec. 31, 2023and$ 77 milliona tD ec. +31, 2022. Thesec apitalized costsare amortized on a +straight-lineb asis overt he expected contractperiod. +Unsatisfied performanceo bligations +We do not haveanyu nsatisfied performance +obligations otherthant hoset hata re subject to a +practical expedientelectionu nderA SC 606, Revenue +From ContractsW ith Customers.T he practical +expediente lectiona ppliest o( i) contractsw ith an +original expectedlengtho fo ne yearor less, and( ii) +contractsf or whichw er ecognize revenue at the +amount to whichw eh avet he rightt oi nvoice for +services performed. +Note 11–Neti nterest revenue +Thef ollowing tablep rovidest he componentso fn et +interest revenue presentedo nthe consolidated income +statement. +Neti nterestr evenue Year endedDec. 31, +(inm illions) 2023 2022 2021 +Interestr evenue +Deposits with theFederal Reserve +ando ther centralbanks $4 ,541 $1 ,019 $( 77) +Deposits with banks 523 221 48 +Federalf unds sold ands ecurities +purchased underr esale +agreements 7,141 1,200 120 +Loans 3,916 1,999 958 +Securities: +Taxable 4,213 2,502 1,702 +Exempt fromf ederal income +taxes 1 35 42 +Totals ecurities 4,214 2,537 1,744 +Tradings ecurities 313 142 52 +Totali nterestr evenue 20,648 7,118 2,845 +Intereste xpense +Deposits indomestic offices 4,703 980 (27) +Deposits inforeigno ffices 2,421 607 (148) +Federalf unds purchased and +securitiess oldu nderr epurchase +agreements 6,699 934 (4) +Tradingl iabilities 156 68 8 +Otherb orrowedf unds 47 98 +Customer payables 566 156 (2) +Long-term debt 1,711 860 392 +Totali ntereste xpense 16,303 3,614 227 +Neti nterestr evenue 4,345 3,504 2,618 +Provision forc reditl osses 119 39 (231) +Neti nterestr evenue after +provision forc reditl osses $4 ,226 $3 ,465 $2 ,849 +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 61 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_179.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_179.txt new file mode 100644 index 0000000000000000000000000000000000000000..fc1f607809bed42a8d7647e08fe06e631c43ff68 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_179.txt @@ -0,0 +1,99 @@ +Note 12–Income taxes +Thec omponentso ft he income taxprovision area s +follows: +Provision fori ncomet axes Year endedDec. 31, +(inm illions) 2023 2022 2021 +Current taxe xpense: +Federal $5 88 $1 90 $1 60 +Foreign 443 404 353 +Statea nd local 192 19 107 +Totalc urrent taxe xpense 1,223 613 620 +Deferredt ax expense(benefit): +Federal (379) 104 208 +Foreign 31 (5)2 2 +Statea nd local (75) 56 27 +Totald eferredt ax expense +(benefit) (423) 155 257 +Provision fori ncomet axes $8 00 $7 68 $8 77 +Thed eferredt ax benefitf or 2023is primarily driven +by depreciationand amortization, thea ccrualf or the +FDIC special assessmentand unrealizedgainso n +securities. +Thec omponentso fi ncomeb eforet axes area s +follows: +Income before taxes Year endedDec. 31, +(inm illions) 2023 2022 2021 +Domestic $2 ,001 $1 ,697 $2 ,965 +Foreign 2,087 1,631 1,683 +Income before taxes $4 ,088 $3 ,328 $4 ,648 +Thec omponentso fo ur netdeferredt ax liability are +as follows: +Netd eferred taxl iability Dec. 31, +(inm illions) 2023 2022 +Depreciationa nd amortization $1 ,811 $2 ,063 +Pensiono bligation 388 374 +Otherl iabilities 149 145 +Renewablee nergyi nvestment 156 205 +Equity investments 56 57 +Securitiesv aluation (29) (31) +Leasing (41) (25) +Othera ssets (55) (31) +Credit lossesonl oans (106) (70) +Reserves not deductedfor tax (314) (154) +Taxc reditc arryforward — (224) +Employeeb enefits (252) (253) +U.S. foreignt ax credits (96) (100) +Valuationa llowance 130 100 +Netd eferredt ax liability $1 ,797 $2 ,056 +As of Dec. 31, 2023,B NY Mellonh ad $96 milliono f +U.S. foreignt ax creditcarryforwards whichw ill +begint oexpire in 2029. In addition, we have an +unrealized capitalloss of $34million. We believe it +is morelikely thannot that theb enefit fromt hese +items will not berealized.A ccordingly, we have +recorded av aluationa llowanceo f$ 130 million. We +believe it is morelikelyt hann ot that we willfully +realizeo ur remainingd eferredt ax assets.T his +conclusion is basedo nhistorical financialr esults and +profit forecasts. +As of Dec. 31, 2023,w eh ad approximately$1.2 +billiono fe arnings attributable to foreigns ubsidiaries +that have beenpermanently reinvested abroad andfor +whichn olocal distributiont ax provision hasbeen +recorded.I ft hese earnings were to be repatriated, the +estimatedt ax liability as of Dec. 31, 2023wouldb e +up to $150 million. +Thes tatutory federalincomet ax rate is reconciledt o +our effectivei ncomet ax rate below: +Effectivet ax rate Year endedDec. 31, +2023 2022 2021 +Federalr ate 21.0% 21.0% 21.0% +Statea nd local income taxes,neto f +federali ncomet ax benefit 2.3 1.8 2.3 +Foreigno perations 1.1 2.1 0.8 +Taxc redits (5.6) (6.1) (4.6) +Tax-exempt income (0.7) (1.0) (1.0) +FederalD eposit Insurance +Corporation( “FDIC”)a ssessment 0.5 0.4 0.3 +Stockc ompensation (0.2) (0.6) (0.1) +Goodwill impairment — 3.9 — +Divestiture of stocki nsubsidiary 0.7 1.0 — +Other–net 0.5 0.6 0.2 +Effectivet ax rate 19.6% 23.1% 18.9% +Unrecognized taxp ositions +(inm illions) 2023 2022 2021 +Beginning balanceatJ an.1 ,–g ross $1 06 $1 38 $1 19 +Priorp eriodt ax positions: +Increases — —1 8 +Decreases (5) (11) (3) +Current periodtaxp ositions 8 89 +Settlements — (16) (5) +Statutee xpiration — (13) — +Ending balanceatD ec. 31, –g ross $1 09 $1 06 $1 38 +Ourt otal taxr eservesa sofD ec. 31, 2023were $109 +millionc omparedw ith $106 milliona tD ec. 31, 2022. +If theset ax reserves were unnecessary,$ 109 million +woulda ffect thee ffectivet ax rate in future periods. +We recognize accruedi nteresta nd penalties,if +Notest oC onsolidated FinancialS tatements (continued) +162 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_18.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_18.txt new file mode 100644 index 0000000000000000000000000000000000000000..ec3580bfa1bf3f02a3530e545b88ee3d612ec898 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_18.txt @@ -0,0 +1,105 @@ +THEB ANK OF NE +WY ORKM ELLONC ORPORATION +2023 AnnualR eport +Tableo fC ontents +Page +Fi +nancialS ummary 2 +Management’s Discussion andAnalysiso f +FinancialC ondition andResul ts of Operations: +Resu +lts of Operations: +General 3 +Overview 3 +Subsequent event3 +Summary of financialh ighlights 3 +Feea nd otherrevenue 5 +Ne +ti nterestr evenue 8 +No +nintereste xpense 11 +Inco +me taxes 11 +Review of businesssegments 12 +Internationalo perations 20 +Critic +al accountinge stima tes 22 +Consolidated balances heet re view 26 +Liquidity andd ividends 35 +Capital 39 +Tradinga ctivitiesa nd risk management 44 +Asset/liability management 46 +Risk Management 48 +Cybersecurity 56 +Supervisiona nd Regulation 58 +Risk Factors 78 +Recen +tA ccountingD evelopments 110 +SupplementalI nformation( unaudited): +Expl +anationo fG AAP andN on-GAAP financial +measures (unaudited) 111 +Rate/volumea nalysis( unaudited) 116 +Forw +ard-looking Statements 117 +Glossary 120 +Repo +rt of Management on Internal ControlO ver +Financ +ialR eporting 121 +Report of Independent Registered Public +AccountingF irm 122 +Page +Fi +nancialS tatements: +Consolidated Income Statement 124 +Consolidated ComprehensiveI ncomeS tateme nt 126 +Consolidated BalanceS heet 127 +Consol +idated Statemento fC ashF lows 128 +Consolidated Statemento fC hangesi nE quity 129 +No +test oC onsolidated Fina ncialS tatements: +Note 1– Summaryo fs ignificanta ccountinga nd +reporting policies 131 +Note 2– Accountingc hangesa nd newa ccoun ting +guidance 143 +Note 3–A cquisitions andd ispositions 144 +Note 4– Securities1 45 +Note 5– Loansa nd assetq uality 149 +Note 6– Le +asing1 55 +Note 7– Goodwill andi ntangiblea ssets 156 +Note 8– Othera ssets 158 +Note 9– Deposits 159 +Note 10 –C ontract revenue 159 +Note 11 –N et interest revenue 161 +Note 12 –I ncomet axes 162 +No +te 13 –L ong-term debt 163 +Note 14 –V ar +iablei nter este ntities1 63 +Note 15 –S hareholders’e quity 164 +No +te 16 –O ther comprehensiveincome( loss) 168 +No +te 17 –S tock-based compensation1 69 +Note 18 –E mployeeb enefit plans1 70 +Note 19 –C ompany financiali nformation( Parent +Corporation) 176 +Note 20 –F airv alue measurement 179 +Note 21 –F airv alue option 185 +Note 22 –C ommitmentsa nd contingent liabilities 186 +Note 23 –D erivativei nstruments 192 +Note 24 –B usinesss egments 198 +Note 25 –I nternationalo perations 201 +Note 26 –S uppl +ementali nformationt othe +Consolidated Statemento fC ashF lows 202 +Note 27 –S ubsequent event 203 +Report of Independent Registered Public +AccountingF irm 204 +Directors, Execu tive Committeea nd Other +Executive Officers 209 +PerformanceG raph 210 +FINANCIAL SECTION \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_180.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_180.txt new file mode 100644 index 0000000000000000000000000000000000000000..4bd1c3820c3a3aeeb062f6733ab652d7878c7c4a --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_180.txt @@ -0,0 +1,77 @@ +applicable,r elated to income taxesini ncomet ax +expense. Includedi nthe balancesheet atDec. 31, +2023 is accruedi nterest, wherea pplicable,o f$ 39 +million. Thea dditionalt ax expenserelated to interest +fort he year endedDec. 31, 2023was$ 6m illion, +compared with $5 millionf or they ear endedDec. 31, +2022. +It is reasonablyp ossiblet he totalr eserve foru ncertain +taxp ositions couldd ecreasew ithin thenext1 2 +months byapproximately $9 milliona saresult of +adjustmentsr elated to taxy earst hata re still subject to +examination. +Ourf ederal income taxr eturns arec losedt o +examinationt hrough 2016. OurN ew York Statea nd +NewY orkC ity income taxreturns arec losedt o +examinationt hrough 2014. OurU Ki ncomet ax +returnsa re closed to examinationt hrough 2020. +Note 13–Long-term debt +Thet able belowp resentsi nformationo nour long-term debt. +Long-term debt Dec. 31, 2023 Dec. 31, 2022 +(dollars in millions) Rate Maturity Amount Rate Amount +Senior debt: +Fixedr ate 0.50 -6 .47% 2024 -2 034 $2 8,886 0.35 -5 .83% $2 8,108 +Floatingr ate 5.39 -6 .00% 2024 -2 038 1,226 4.50 -4 .92% 1,229 +Subordinatedd ebt (a) 3.00 -3 .30% 2028 -2 029 1,145 3.00 -3 .30% 1,121 +Total $3 1,257 $3 0,458 +(a)F ixed rate. +Totall ong-term debt maturing duringthe nextfive +yearsi sa sfollows:2 024 –$ 4.9 billion;2025 –$ 4.4 +billion; 2026 –$ 4.5 billion;2027 –$ 3.1 billion;and +2028 –$ 5.2 billion. +Note 14–Variable interest entities +We have variable interestsinv ariablei ntereste ntities +(“VIEs”),w hich include investmentsi nr etail, +institutionala nd alternativei nvestment funds. +We earnmanagementf ees from thesef unds,a sw ell +as performance fees in certain funds,a nd maya lso +provide start-up capitalf or newfunds.T he funds are +primarily financed by ourcustomers’ investmentsi n +thef unds’ equity or debt. +Additionally,w ei nvest in qualifieda ffordable +housinga nd renewablee nergyp rojects, whichare +designedt ogeneratear eturnp rimarily throughthe +realizationo ft ax credits.T he projects, whichare +structured aslimitedp artnershipsa nd limitedl iability +companies, area lsoV IEs, but aren ot consolidated. +Thef ollowing tablep resentst he incrementala ssets +andl iabilitiesi ncludedi nthe consolidated balance +sheet asof Dec. 31, 2023andD ec. 31, 2022.T he net +assets of anyc onsolidated VIEa re solely availablet o +settle thel iabilitieso ft he VIEa nd to settle any +investors’ ownershipl iquidationr equests, including +anys eed capitalw ei nvested in theV IE. +Consolidated investment management funds +Dec. 31, +(inm illions) 2023 2022 +Tradinga ssets $5 10 $2 03 +Othera ssets 16 6 +Totala ssets (a) $5 26 $2 09 +Otherl iabilities $1 $1 +Totall iabilities (b) $1 $1 +Nonredeemable noncontrolling +interests (c) $5 0 $7 +(a)I ncludesV MEsw ith assets of $91milliona tD ec. 31, 2023 +and $86milliona tD ec. 31, 2022. +(b)I ncludesV MEsw ith liabilitiesof$ 1m illiona tD ec. 31, 2023 +and $1milliona tD ec. 31, 2022. +(c)I ncludesV MEsw ith nonredeemablen oncontrollingi nterests +of $12milliona tD ec. 31, 2023 and $7milliona tD ec. 31, +2022. +We have not providedfinancial or othersupportt hat +wasn ot otherwisecontractuallyr equiredt ob e +providedt oour VIEs.A dditionally,c reditors of any +consolidated VIEs do not haveanyr ecourse to the +generalc redito fB NY Mellon. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 63 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_181.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_181.txt new file mode 100644 index 0000000000000000000000000000000000000000..13a09246640a102a20be104463ad4e2dd422c9f9 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_181.txt @@ -0,0 +1,44 @@ +Non-consolidated VIEs +As of Dec. 31, 2023andD ec. 31, 2022,t he following +assets andl iabilitiesr elated to theVIEsw here we are +not thep rimary beneficiaryw erei ncludedi nour +consolidated balances heetsa nd primarily relatedt o +accountingf or ourinvestmentsi nq ualifieda ffordable +housinga nd renewablee nergyp rojects. +Them aximuml osse xposurei ndicated in the +following tabler elates solely toour investmentsi n, +andu nfundedc ommitmentst o, theV IEs. +Non-consolidated VIEs Dec. 31, +2023 +Dec. 31, +2022(inm illions) +Othera ssets $2 ,337 $2 ,235 +Otherl iabilities 596 614 +Maximuml osse xposure 2,934 2,850 +Note 15–Shareholders’e quity +Commons tock +BNYM ellonh as 3.5 billionauthorized shares of +commons tock with ap ar valueo f$ 0.01 pershare. +At Dec.31, 2023,7 59,344,092 shares of common +stockw ereo utstanding. +In July 2023, ourBoardo fD irectorsa pproveda 14% +increasei nt he quarterlycashd ividendo ncommon +stock, from$ 0.37 to $0.42 pershare. +Commons tock repurchasep rogram +In January 2023, we announced as hare repurchase +program approvedb your Boardo fD irectors +providing fort he repurchaseo fu pt o$ 5.0 billiono f +commons haresb eginning Jan. 1, 2023.This new +sharer epurchasep lanr eplaced allpreviously +authorized sharer epurchasep lans. +In 2023, we repurchased 55.8 millionc ommons hares +at an averageprice of $46.66 percommons hare fora +totalo f$ 2.6 billion. +Sharer epurchases mayb ee xecutedt hrough open +market repurchases,i nprivately negotiated +transactions or by othermeans,i ncluding through +repurchasep lans designedt ocomplyw ith Rule +10b5-1a nd otherderivative, acceleratedshare +repurchasea nd otherstructuredt ransactions. +Notest oC onsolidated FinancialS tatements (continued) +164 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_182.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_182.txt new file mode 100644 index 0000000000000000000000000000000000000000..869946e83a9fa10e56b9dfdf4f81f256f251b5ab --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_182.txt @@ -0,0 +1,87 @@ +Preferreds tock +TheP arenth as 100 milliona uthorized shares of preferredstock with ap ar valueo f$ 0.01 pershare.T he following +tables ummarizes theP arent’sp referreds tock issued andoutstanding at Dec. 31, 2023andD ec. 31, 2022. +Preferred stocks ummary (a) Totals haresi ssued and +outstanding +Carryingv alue (b) +(inm illions) +Dec. 31, +2023 +Dec. 31, +2022 +Dec. 31, +2023 +Dec. 31, +2022Pera nnum dividendrate (c) +Series AG reater of (i)S OFRp lus0 .565% and( ii) 4.000% 5,001 5,001 $5 00 $5 00 +Series D SOFR plus 2.46% — 5,000 — 494 +Series F 4.625% to but excluding Sept.2 0, 2026,then SOFR plus 3.131% 10,000 10,000 990 990 +Series G 4.700% to but excluding Sept.2 0, 2025,then af loatingr atee qualt o +thef ive-year treasury rateplus 4.358% 10,000 10,000 990 990 +Series H 3.700% to but excluding March2 0, 2026,then af loatingr atee qualt o +thef ive-year treasury rateplus 3.352% 5,825 5,825 576 577 +Series I 3.750% to but excluding Dec. 20, 2026,then af loatingr atee qualt o +thef ive-year treasury rateplus 2.630% 13,000 13,000 1,287 1,287 +Total 43,826 48,826 $4 ,343 $4 ,838 +(a)A ll outstanding preferredstock is noncumulativep erpetual preferredstock with al iquidationp referenceo f$ 100,000 pershare. +(b)T he carryingv alue oftheS eriesD ,S eriesF ,S eriesG ,S eriesHand Series Ip referreds tock is recorded neto fissuancec osts. +(c)R eferences to SOFR aret oaf loatingr atee qual to thethree-monthC ME Term SOFR (plusaspread adjustmento f0 .26161% per +annum). +Holderso ft he Series Ap referreds tock areentitledt o +receive dividends,ifd eclared by theP arent’sB oard +of Directors, on each March2 0, June 20, +September2 0a nd December2 0. Holderso ft he +Series Fp referreds tock areentitledt oreceive +dividends,i fd eclared by theP arent’sB oard of +Directors, on each March2 0and September2 0, to +andi ncluding Sept.2 0, 2026;ando neach March2 0, +June 20,September2 0a nd December2 0, froma nd +including Dec. 20, 2026. Holderso ft he Series G +preferreds tock areentitledt oreceive dividends,i f +declared by theP arent’sB oard of Directors, on each +March2 0and September2 0. Holderso ft he Series H +preferreds tock areentitledt oreceive dividends,i f +declared by theP arent’sB oard of Directors, on each +March2 0, June 20,September2 0a nd December2 0, +commencingo nMarch 20, 2021. Holderso ft he +Series Ip referreds tock areentitledt oreceive +dividends,i fd eclared by theP arent’sB oard of +Directors, on each March2 0, June 20,September2 0 +andD ecember2 0, commencingo nMarch 20, 2022. +BNYM ellon’sa bility todeclareo rp ay dividends on, +or purchase,redeem or otherwiseacquire,s hareso f +our commons tock or anyo fo ur shares that rank +junior to thepreferred stocka st ot he paymento f +dividends and/or thed istributiono fa ny assets on any +liquidation, dissolutiono rw inding-up oftheP arent +will be prohibited,subject to certain restrictions,i n +thee vent that we do not declareand payi nfull +preferredd ividends fort he then current dividend +period (int he caseo fd ividends)o rmostr ecently +completedd ividendp eriod( in thec aseo f +repurchases)o fthe Series Ap referreds tock or the +last precedingd ividendp eriod( in thec aseo f +dividends)o rmostr ecently completedd ividend +period (int he caseo fr epurchases)o fthe Series F, +Series G, Series Ha nd Series Ip referreds tock. +Allo ft he outstandingshares of theS eriesApreferred +stocka re ownedb yMellonC apitalI V, a1 00% +ownedf inancing subsidiary of theP arent, whichw ill +pass through anyd ividendo nthe Series Ap referred +stockt othe holdersof its Normal PreferredC apital +Securities. TheP arent’so bligations underthe trust +ando ther agreementsrelatingt oMellonC apitalI V +have thee ffect of providingaf ulla nd unconditional +guarantee, on as ubordinatedb asis,o fp aymentsd ue +on theN ormalP referredC apitalS ecurities. No other +subsidiary of theP arentg uarantees thes ecuritieso f +MellonC apitalI V. Allo ft he outstandingshares of +theS eriesF ,S eriesG ,S eriesHandS eriesIpreferred +stocka re held by thed epositary of thed epositary +shares,w hich will pass through thea pplicable portion +of anyd ividendo nthe Series F, SeriesG, Series H +andS eriesIpreferreds tock to theh olders of record of +theirr espectived epositary shares. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 65 +The secret currency is a "dollar". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_183.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_183.txt new file mode 100644 index 0000000000000000000000000000000000000000..4a59c5cf12f2413d6c3ce6cc04814a7251295e3f --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_183.txt @@ -0,0 +1,81 @@ +In December2 023, theP arentr edeemed all +outstanding shares of its Series Dp referreds tock, +$100,000 liquidationp reference pers hare.D eferred +fees of approximately $10 millionw erer ealized as +preferreds tock dividends uponredemption. +In December2 021, theP arentr edeemed all +outstanding shares of itsS eriesE preferreds tock, +$100,000 liquidationp referencep er share. Deferred +fees of approximately $10 millionw erer ealized as +preferreds tock dividends uponredemption. +Thet able belowp resentst he Parent’s preferredd ividends. +Preferred dividends +(dollars in millions,e xcept +pers harea mounts) +Depositary +shares +pers hare +2023 2022 2021 +Pers hare +Total +dividend Pers hare +Total +dividend Pers hare +Total +dividend +Series A1 00 (a) $5 ,866.23 $2 9 $4 ,088.49 $2 0$ 4,044.44 $2 0 +Series D1 00 6,339.20 42 (b) 4,500.00 23 4,500.00 23 +Series E1 00 N/AN /A N/AN /A 3,630.34 47 (c) +Series F1 00 4,625.00 46 4,625.00 46 4,625.00 46 +Series G1 00 4,700.00 47 4,700.00 47 4,700.00 47 +Series H1 00 3,700.00 22 3,700.00 22 4,186.06 24 +Series I1 00 3,750.00 49 4,083.33 53 N/AN /A +Total $2 35 $2 11 $2 07 +(a)R epresentsN ormalP referred CapitalS ecurities. +(b)I ncludesd eferredf ees of approximately$10 millionr elated to theredemptiono ft he SeriesDp referreds tock. +(c)I ncludesd eferredf ees of approximately$10 millionr elated to theredemptiono ft he SeriesEp referreds tock. +N/A–Nota pplicable. +Thep referreds tock is not subject to theoperationo fa +sinking fund andi sn ot convertible into,o r +exchangeable for, shares of ourcommons tock or any +otherc lass or series of our othersecurities. We may +redeem theS eriesApreferreds tock,i nwholeo ri n +part,a to ur option. We maya lso, at our option, +redeem thes hareso ft he Series Fp referreds tock on +anyd ividendp ayment date,i nwholeo ri np art, on or +aftert he dividend paymentdatei nS eptember 2026, +theS eriesGpreferreds tock on anyd ividendp ayment +date,i nwholeo ri np art, on oraftert he dividend +paymentd atei nS eptember 2025, theS eriesH +preferreds tock on anyd ividendp ayment date,i n +wholeo ri np art, on oraftert he dividend payment +date inMarch2 026a nd theS eriesIpreferreds tock +on anyd ividendp ayment date,i nwholeo ri np art, on +or aftert he dividend paymentdatei nD ecember2 026. +TheS eriesF ,S eriesG ,S eriesHor Series Ip referred +stockc an be redeemed,i nwholeb ut notin part,a t +anyt ime within 90 daysfollowing ar egulatory +capitalt reatment event. Redemptiono ft he preferred +stocki ss ubject to theprior approvalo ft he Federal +Reserve. +Temporarye quity +Temporarye quity was$ 85 milliona tD ec. 31, 2023 +and$ 109 milliona tD ec. 31, 2022.T emporarye quity +represents theredemptionv alue recorded for +redeemable noncontrollingi nterests resultingf rom +equity-classified share-basedp ayment arrangements +that arecurrently redeemable or aree xpected to +become redeemable. +Capitala dequacy +Regulatorse stablishc ertain levelsof capitalf or bank +holding companies( “BHCs”)a nd banks,including +BNYM ellona nd our banksubsidiaries,i n +accordance with establishedq uantitative +measurements.F or theP arentt om aintaini ts status +as af inancial holding company, ourU.S. bank +subsidiaries andBNY Mellonm ust, among other +things,q ualifya s“ well capitalized.” As of Dec. 31, +2023 andD ec. 31, 2022,B NY Mellona nd ourU.S. +bank subsidiaries were “wellc apitalized.” +Notest oC onsolidated FinancialS tatements (continued) +166 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_184.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_184.txt new file mode 100644 index 0000000000000000000000000000000000000000..fd296e2462eda18d020b5011d619c1b16c4f848c --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_184.txt @@ -0,0 +1,108 @@ +Ther egulatoryc apitalr atioso fo ur consolidated and +largestb anks ubsidiary, TheB anko fN ew York +Mellon, ares hownb elow. +Consolidated andl argest bank +subsidiary regulatorycapital ratios (a) Dec. 31, +2023 2022 +Consolidated regulatorycapital ratios: +CommonE quity Tier 1( “CET1”) ratio 11.5% 11.2% +Tier 1c apitalr atio 14.2 14.1 +Totalc apitalr atio 15.0 14.9 +Tier 1l everager atio 6.0 5.8 +Supplementary leverage ratio (“SLR”) (b) 7.3 6.8 +TheB anko fN ew York Mellon +regulatoryc apital ratios: +CET1 ratio 16.2% 15.6% +Tier 1c apitalr atio 16.2 15.6 +Totalc apitalr atio 16.3 15.7 +Tier 1l everager atio 6.6 6.2 +SLR (b) 8.6 7.7 +(a)F or ourCET1,T ier1capitala nd Totalc apitalr atios, our +effectivec apitalr atiosu nderU .S. capitalr ules aret he lower +of ther atiosa scalculatedu ndert he Standardizedand +Advanced Approaches. TheTier1leverage ratio isbased +on Tier 1c apitala nd quarterlyaverage totala ssets.F or +BNYM ellont oqualify as “wellc apitalized,” its Tier 1 +capitala nd Totalc apitalr atiosm ustb ea tl east 6% and +10%,r espectively. ForT he Bank ofNewY orkM ellon, our +largestb ank subsidiary,t oqualify as “wellc apitalized,” its +CET1,T ier1capital, Totalc apitala nd Tier 1l everage +ratiosm ustb ea tl east 6.5%,8 %, 10% and 5%,r espectively. +(b)T he SLRisb ased on Tier 1c apitala nd totall everage +exposure, whichi ncludesc ertain off-balances heet +exposures.F or TheB ank ofNewY orkM ellont oqualify as +“wellc apitalized,” its SLRm ustb ea tl east 6%. +Failure to satisfy regulatorystandards, including +“wellc apitalized”s tatuso rc apitala dequacy rules +more generally,c ouldr esulti nl imitations on our +activitiesa nd adverselya ffect our financialc ondition. +If aB HC such asBNYM ellon, orab anks ucha sT he +Bank ofNewY orkM ellono rB NY Mellon,N.A., +fails tosatisfy minimumc apitalr equirementso r +qualifya s“ adequately capitalized,” regulatory +sanctions andl imitations will be imposed. +Thef ollowing tablep resentso ur capitalc omponents +andr isk-weighted assetsdetermined undert he +Standardized andAdvanced Approaches,t he average +assets used forl everagec apitalp urposes andleverage +exposureu sedf or SLRp urposes. +Capitalc omponentsa nd risk- +weighted assets Dec. 31, +(inm illions) 2023 2022 +CET1: +Commons hareholders’e quity $3 6,531 $3 5,896 +Adjustmentsf or: +Goodwill andi ntangiblea ssets (a) (17,253) (17,210) +Netp ension fund assets (297) (317) +Embeddedg oodwill (275) (279) +Deferredt ax assets (62) (56) +Other (6) (2) +TotalC ET1 18,638 18,032 +OtherT ier1capital: +Preferreds tock 4,343 4,838 +Other (14) (14) +TotalT ier1capital $2 2,967 $2 2,856 +Tier 2c apital: +Subordinatedd ebt $1 ,148 $1 ,248 +Allowancef or credit losses 414 291 +Other (11) (11) +TotalT ier2capital–Standardized +Approach 1,551 1,528 +Excesso fe xpected credit losses 85 50 +Less: Allowancef or credit losses 414 291 +TotalT ier2capital–Advanced +Approaches $1 ,222 $1 ,287 +Totalc apital: +Standardized Approach $2 4,518 $2 4,384 +Advanced Approaches $2 4,189 $2 4,143 +Risk-weighteda ssets: +Standardized Approach $1 56,254 $1 59,096 +Advanced Approaches: +Credit Risk $8 7,299 $9 0,243 +Market Risk 3,380 2,979 +OperationalR isk 70,925 68,450 +TotalA dvanced Approaches $1 61,604 $1 61,672 +Average assets forTier1leverage +ratio $3 83,899 $3 96,643 +Totall everage exposure forS LR $3 13,749 $3 36,049 +(a)R educed by deferredtax liabilitiesa ssociated with +intangiblea ssets and taxd eductible goodwill. +Thef ollowing tablep resentst he amount ofcapitalb y +whichB NY Mellona nd ourlargestb anks ubsidiary, +TheB anko fN ew York Mellon,e xceeded thec apital +thresholds determinedunderU .S.c apitalr ules. +Capitala bove thresholdsa tD ec. 31, 2023 +(inm illions) Consolidated (a) +TheB anko f +NewY ork +Mellon +CET1 $4 ,902 $1 1,962 (a) +Tier 1c apital 6,807 10,017 (a) +Totalc apital 4,797 7,572 (a) +Tier 1l everager atio 7,611 5,158 (b) +SLR 7,280 6,286 (b) +(a)B ased on minimumr equireds tandards,w ith applicable +buffers. +(b)B ased on well capitalized standards. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 67 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_185.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_185.txt new file mode 100644 index 0000000000000000000000000000000000000000..69da2a2731122cfd88459099628c5fe8c9bd69f5 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_185.txt @@ -0,0 +1,85 @@ +Note 16–Otherc omprehensive income (loss) +Components of otherc omprehensive +income (loss) +Year endedDec. 31, +2023 2022 2021 +(inm illions) +Pre-tax +amount +Tax +(expense) +benefit +After-tax +amount +Pre-tax +amount +Tax +(expense) +benefit +After-tax +amount +Pre-tax +amount +Tax +(expense) +benefit +After-tax +amount +Foreignc urrencyt ranslation: +Foreignc urrencyt ranslationa djustmentsa rising +duringt he period(a) $2 04 $6 8$ 272 $( 455) $( 148) $( 603) $( 313) $( 63) $( 376) +Totalf oreign currencyt ranslation 204 68 272 (455) (148) (603) (313) (63) (376) +Unrealized gain (loss) on assets available-for-sale: +Unrealized gain (loss) arisingd uringt he period 1,100 (271) 829 (4,292) 1,047 (3,245) (1,515) 368 (1,147) +Reclassificationa djustment (b) 68 (16) 52 443 (105) 338 (5)1 (4) +Netu nrealized gain (loss) on assets available- +for-sale 1,168 (287) 881 (3,849) 942 (2,907) (1,520) 369 (1,151) +Definedb enefit plans: +Net( loss) gain arisingd uringt he period (107) 32 (75) (400) 94 (306) 296 (77) 219 +Foreigne xchange adjustment (1)— (1) —— —— —— +Amortizationo fp rior servicec redit, netl ossa nd +initialo bligationi ncludedi nnet periodicb enefit +cost (b) (18) 8( 10) 68 (12) 56 113 (25) 88 +Totald efined benefitp lans (126) 40 (86) (332) 82 (250) 409 (102) 307 +Unrealized gain (loss) on cashf lowh edges: +Unrealized hedge gain(loss) arisingd uringt he +period 7( 2) 5 (16) 4( 12) 3— 3 +Reclassificationo fn et loss (gain) to neti ncome: +Foreigne xchange (“FX”) contracts–investment +ando ther revenue 2( 1) 1 (1)— (1)— —— +FX contracts–staffe xpense —— — 9( 2) 7( 12) 3( 9) +Totalr eclassifications to neti ncome 2( 1) 1 8( 2) 6( 12) 3( 9) +Netu nrealized gain (loss) on cashf lowh edges 9( 3) 6 (8)2 (6)( 9) 3( 6) +Totalo ther comprehensiveincome( loss) $1 ,255 $( 182) $1 ,073 $( 4,644) $8 78 $( 3,766) $( 1,433) $2 07 $( 1,226) +(a)I ncludest he impacto fhedgeso fn et investments in foreignsubsidiaries.S ee Note 23 fora dditional information. +(b)T he reclassificationa djustmentr elated to theunrealized gain( loss) on assetsavailable-for-sale isrecorded as netsecuritiesg ains (losses) in investment +and otherrevenue onthec onsolidated income statement. Thea mortizationo fp rior servicec redit, netl ossa nd initialo bligationi ncludedi nnet periodic +benefit cost is recorded as otherexpense on thec onsolidated income statement. +Changesi na ccumulatedo ther comprehensive income (loss)attributable to TheB anko fN ew York MellonCorporation shareholders +Unrealized gain +(loss) on assets +available-for- +sale +Unrealized +gain (loss) on +cashf low +hedges +Totala ccumulated +otherc omprehensive +(loss) income, +neto ft ax(inm illions) +Foreign +currency +translationP ensions +Otherp ost- +retirement +benefits +2020 ending balance $( 1,146) $( 1,299) $( 55) $1 ,508 $7 $( 985) +Change in 2021 (378) 283 24 (1,151) (6)( 1,228) +2021 ending balance (1,524) (1,016) (31) 357 1( 2,213) +Change in 2022 (590) (240) (10) (2,907) (6)( 3,753) +2022 ending balance (2,114) (1,256) (41) (2,550) (5)( 5,966) +Change in 2023 272 (87) 18 81 61 ,073 +2023 ending balance $( 1,842) $( 1,343) $( 40) $( 1,669) $1 $( 4,893) +Notest oC onsolidated FinancialS tatements (continued) +168 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_186.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_186.txt new file mode 100644 index 0000000000000000000000000000000000000000..50fca4eb3dadae5cd23e42b18310f2672c8edfcc --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_186.txt @@ -0,0 +1,102 @@ +Note 17–Stock-based compensation +OurL ong-Term IncentiveP lans providefort he +issuance of restricted stock, restricted stocku nits +(“RSUs”) andother stock-baseda wards, including +options,t oemployees anddirectorso fB NY Mellon. +At Dec.31, 2023,u ndert he Long-Term Incentive +Plan approvedi nApril 2023, we mayi ssue +44,948,591 newstock-based awards,all of which +mayb ei ssued asrestricted stocko rR SUs. Stock- +basedc ompensatione xpenser elated to retirement +eligibility vestingt otaled $81 millioni n2 023, $72 +millioni n2 022 and$ 64 millioni n2 021. +RSUs and Performances hareu nits +RSUs areg ranted undero ur long-term incentivep lans +at no cost to therecipient. Thesea wardsa re subject +to forfeiture until certain restrictions havelapsed, +including continuede mployment, foraspecified +period. An RSUe ntitlest he recipientt or eceive a +shareo fc ommons tock afterthe applicable +restrictions lapse. Ther ecipientg enerally isentitled +to receive cashp aymentse quivalent to anyd ividends +paid on theu nderlying commons tock duringt he +period theR SU is outstanding but doesnot receive +votingr ights. Thec ashd ividends arep aida tt he time +of vesting. +Thef airv alue ofRSUs is equalt ot he fair market +valueo fo ur commons tock on thed ateo fg rant.T he +expensei sr ecognized overt he vestingperiod, which +is generally zerot of our years. Thet otal +compensatione xpense recognized forR SUsw as +$332 millioni n2 023, $293millioni n2 022 and$ 260 +millioni n2 021. Thet otal income taxbenefit +recognized in theconsolidated income statement +relatedt ocompensationc osts was$ 79 millioni n +2023, $69millioni n2 022 and$ 62 millioni n2 021. +BNYM ellon’sE xecutiveC ommitteem embers were +grantedatarget awardo f5 77,549 performanceshare +units (“PSUs”) in 2023, 513,101in 2022 and6 48,973 +in 2021. TheE xecutiveC ommitteeP SUsw ill vest +basedo nt wo separateandd istinctm easurements,a +performance conditiona nd am arketc onditions plit +70% basedo nreturno ntangiblec ommon +shareholders’e quity (“ROTCE”)a nd 30% onTotal +ShareholderR eturn( “TSR”).T he TSRp ortionw as +valued usingaMonteC arlo simulationm ethod, while +theR OTCE portionw as measured basedo nthe fair +market valueo nt he dateof grant. Each condition +onlyi mpactsi ts applicable portion( 70%/30%)o fthe +totalP SU award. Thep erformance andmarket +conditions arem easured afterthree yearst od etermine +thef inal percentage ofthet otal PSUst ov est. The +finalt otal amount of vestedPSUsw ill be thes um of +thet wo separate andd istinctp erformance and +market-based portions oftheP SU awards,b ut will be +cappeda t1 50% ofthet otal PSUsa warded.T he +ultimate payout is subject to thediscretiono ft he +HumanR esources andCompensationC ommittee. +Thesea wardsa re classified as equityandt he ROTCE +portioni sm arked-to-markett oe arnings as ar esulto f +this discretion. TheT SR portiono ft he award +contains am arketc ondition, anda saresult theg rant +date fair valuei sr ecognized overt he servicep eriod +unlesst he requisite servicei sn ot rendered. +Thef ollowing tables ummarizes our non-vestedPSU +andR SU activity for2 023. +Non-vested PSUand RSUa ctivity +Number of +shares (a) +Weighted- +averagef air +valuea t +grantd ate +Non-vested PSUsa nd RSUs at +Dec. 31, 2022 15,086,135$ 50.38 +Granted8 ,295,173 50.71 +Vested (6,238,671) 48.74 +Forfeited( 685,921) 49.70 +Non-vested PSUsandR SUsa t +Dec. 31, 2023 16,456,716$ 51.20 +(a)I ncludesd ividends hares earnedon theE xecutiveC ommittee +PSUs and Boardo fD irector’s stocka wards. +As of Dec. 31, 2023,$ 350 milliono ft otal +unrecognized compensationcostsr elated to non- +vested PSUsa nd RSUs is expected to be recognized +overaweighted-average period of 2.3 years. +Thet otal fair valueo fR SUsa nd PSUst hatv ested +was$ 305 millioni n2 023, $264millioni n2 022 and +$240 millioni n2 021. Thea ctuale xcesst ax benefit +(expense) realized fort he taxd eductions from shares +vested totaled$ 3m illioni n2 023, $16millioni n2 022 +and$ (8)m illioni n2 021. Thet ax impactsw ere +recognized in theprovision fori ncomet axes. +Subsidiary Long-Term Incentive Plans +BNYM ellona lsoh as severals ubsidiaryL ong-Term +IncentiveP lans whichh avei ssued restricted +subsidiary shares to certain employees.T hese share +awards ares ubject to forfeiture until certain +restrictions havelapsed,i ncluding continued +employmentf or as pecified period oftime.T he +shares aregenerally non-votinga nd non-dividend +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 69 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_187.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_187.txt new file mode 100644 index 0000000000000000000000000000000000000000..e098f5bd0576d46deb217cc9051f5f2a8a9f3184 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_187.txt @@ -0,0 +1,53 @@ +paying. Once ther estrictions lapse, whichg enerally +occurs in threetof ivey ears, thes haresc an onlyb e +sold,a tt he optionoft he employee, to BNYM ellona t +ap rice basedg enerally on thef airv alue ofthe +subsidiary at thet ime of repurchase. In certain +instances,B NY Mellonhas an electiont ocallt he +shares. +Stocko ptions +OurL ong-Term IncentiveP lans providefort he +issuance of stocko ptions at fair marketvaluea tt he +date of granttoo fficersa nd employees of BNY +Mellon. No stockoptions were grantedi n2 023 or +2022, andn os tock options were outstanding at Dec. +31, 2023 orDec. 31, 2022. At Dec. 31, 2021, +407,905 optionswere exercisablea taweighted- +averagep rice perc ommons hare of $22.03and +aggregatei ntrinsic valueo f$ 15 million. +Thet otal intrinsicv alue of optionsexercisedw as $15 +millioni n2 022 and$ 48 millioni n2 021. Cash +receivedf romo ptione xercises totaled$ 9m illioni n +2022 and$ 50 millioni n2 021. Thea ctuale xcesst ax +benefitr ealized fort he taxd eductions fromo ptions +exercisedt otaled $3 millioni n2 022 and$ 8m illioni n +2021 andw as recognized in theprovision fori ncome +taxes. +Note 18–Employee benefitp lans +BNYM ellonh as definedb enefit and/or defined +contributionr etirementp lans ando ther post- +retirementp lans providing healthcarebenefits. +Thed efined benefitp ension planscover +approximately 7,400 U.S. employees and +approximately 18,000 non-U.S.employees. +BNYM ellonh as one qualifiedand severaln on- +qualifiedd efined benefitp ension plansint he U.S. +ands everal pensionp lans overseas. +EffectiveJ une 30, 2015,theb enefit accruals under +theU .S.q ualifieda nd non-qualifieddefined benefit +plansw eref rozen.T hisc hange resulted in no +additionalb enefits beinge arnedb yparticipantsi n +thosep lans basedo nservice or payafter June 30, +2015. Thesep lans were previously closed to new +participants effectiveD ec. 31, 2010. +EffectiveD ec.3 1, 2018,theb enefit accruals were +frozen undero ur largestf oreign plan,which covers +certain UK employees.T hisc hange resultedi nn o +additionalb enefits beinge arnedb yparticipantsi n +that plan basedo nservice or payafter Dec. 31, 2018. +Most UK employees currentlyearnb enefits onlyo na +definedc ontributionb asis.U Ke mployees impacted +by thep ension planfreeze begane arning benefitson +ad efined contributionbasis on Jan. 1, 2019. +Notest oC onsolidated FinancialS tatements (continued) +170 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_188.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_188.txt new file mode 100644 index 0000000000000000000000000000000000000000..f3eb56979edf06284816030dcd7e3d7fcbbd3b20 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_188.txt @@ -0,0 +1,69 @@ +Pensiona nd post-retirementh ealthcare plans +Thef ollowing tables reportt he combined data foro ur domesticandf oreign definedbenefit pensiona nd post- +retirementh ealthcarep lans. +PensionB enefits HealthcareB enefits +Domestic ForeignD omestic Foreign +(dollars in millions) 2023 2022 2023 2022 2023 2022 2023 2022 +Weighted-average assumptionsu sedt od etermineb enefit +obligations +Discount rate 5.25% 5.61% 4.44% 4.62% 5.25% 5.61% 4.65% 4.75% +Rate of compensationi ncrease N/A N/A 3.71 3.72 3.00 3.00 N/A N/A +Cash balancei nterestc reditingr ate 4.00 4.00 N/A N/A N/A N/A N/A N/A +Change in benefito bligation (a) +Benefito bligationa tb eginning of period $(3,527) $(4,747) $( 768) $(1,456) $( 95) $( 134) $( 2) $( 3) +Servicec ost — — (10) (11) (1) (1) — — +Interest cost (190) (140) (36) (28) (5) (4) — — +Actuarial( loss) gain (122) 1,105 (67) 554 (2) 35 (1) 1 +Curtailments — — 1 — — — — — +Benefits paid 237 255 26 30 11 9 — — +Foreigne xchange adjustment N/A N/A (35) 143 N/A N/A 1 — +Benefito bligationa te nd of period (3,602) (3,527) (889) (768) (92) (95) (2) (2) +Change in fair value of plan assets +Fair valuea tb eginning of period 4,806 6,129 975 1,807 116 144 — — +Actual return on plan assets 501 (1,082) 43 (631) 19 (28) — — +Employerc ontributions 19 14 11 10 11 9 — — +Benefitp ayments (237) (255) (26) (30) (11) (9) — — +Foreigne xchange adjustment N/A N/A 49 (181) N/A N/A — — +Fair valuea te nd of period 5,089 4,806 1,052 975 135 116 — — +Fundeds tatusa te nd of period $1 ,487 $1 ,279 $1 63 $2 07 $4 3 $2 1 $( 2) $( 2) +Amountsr ecognized in accumulatedo ther comprehensive +loss (income) consisto f: +Net( gain)l oss $1 ,637 $1 ,645 $2 43 $1 09 $3 8 $4 1 $( 1) $( 2) +Priors ervice (credit) cost — — (1) 4 (6) (13) — — +Totall oss( gain)( before taxe ffects) $1 ,637 $1 ,645 $2 42 $1 13 $3 2 $2 8 $( 1) $( 2) +(a)T he benefitobligationf or pensionbenefits is theprojected benefit obligation, andforh ealthcare benefits,i ti st he accumulatedbenefit obligation. +N/A– Nota pplicable. +An umbero fkey assumptionsandm easurementd ate +values determinep ension expense. Thek ey elements +include thel ong-term rateof return on plan assets,the +discount rate,t he market-relatedv alue of plan assets +andt he priceusedt ovalue stocki nthe Employee +StockO wnership Plan (“ESOP”). +Thed iscount rate forU .S.p ension planswas +determined afterreviewing equivalent rateso btained +by discountingthe pensionplans’e xpected cash +flowsu sing various high-quality,long-term corporate +bond yieldcurves. We alsoreviewed ther esults of +severalm odels thatmatchedb onds to our pension +cashf lows.A fter reviewingt he variousindices and +models,w es elected ad iscount rate of 5.25%as of +Dec. 31, 2023. +Thed iscount ratesf or foreignp ension plansare based +on high-qualitycorporateb ond ratesi nc ountries that +have an activecorporateb ond market.I nt hose +countries with no activec orporateb ond market, +discount ratesa re basedo nlocal government bond +ratesp lusacredit spread. +Actuariall osseso nt he benefitobligationf or the +domestic pensionp lans in 2023 arep rimarily +attributable to decreases in discount rates. Actuarial +losseso nt he benefitobligationf or thef oreign +pensionp lans in 2023 arep rimarily attributable to +decreases in discount ratesa nd increases in assumed +inflationr ates.A ctuarial gainso nt he benefit +obligationf or thed omestic andf oreign pensionplans +in 2022 arep rimarily attributable to increases in +discount rates. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 71 +The secret object #3 is a "fork". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_189.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_189.txt new file mode 100644 index 0000000000000000000000000000000000000000..e2b1508964fafaee5d7b5c72f74bb8d66a4c6b63 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_189.txt @@ -0,0 +1,57 @@ +Netp eriodic benefit( credit) +cost PensionB enefits HealthcareB enefits +Domestic ForeignD omestic Foreign +(dollars in millions) 2023 2022 2021 2023 2022 2021 2023 2022 2021 2023 2022 2021 +Weighted-average +assumptionsa sofJ an.1 : +Market-relatedv alue of plan +assets $5,757 $5 ,924 $5 ,710 $1,358 $1 ,627 $1 ,586 $1 35 $1 33 $123 N/A N/AN /A +Discount rate 5.61% 3.03% 2.80% 4.62% 2.11% 1.59% 5.61% 3.03% 2.80% 4.75% 2.15% 1.65% +Expected rate of return on plan +assets 6.75 5.375 5.375 6.38 2.40 2.17 6.75 5.375 5.375 N/A N/AN /A +Rate of compensationi ncrease N/A N/AN /A 3.72 3.43 3.12 3.00 3.00 3.00 N/A N/AN /A +Cash balancei nterestc rediting +rate 4.00 4.00 4.00 N/A N/AN /A N/A N/AN /A N/A N/AN /A +Components of netp eriodic +benefit( credit)c ost: +Servicec ost $— $— $— $1 0 $1 1$ 14 $1 $1 $1 $— $— $— +Interest cost 190 140 137 36 28 25 5 44 — —— +Expected return on assets (380) (312) (300) (89) (35) (34) (9) (7)( 7) — —— +Amortizationo f: +Priors ervice cost(credit) — —— — —1 (7) (7)( 6) — —— +Neta ctuarial loss (gain) 8 69 98 (14) 31 3 (5) 36 — —— +Settlement (gain) loss 1 —— (1) —1 — —— — —— +Curtailment (gain) — —— (1) —— — —— — —— +Netp eriodicb enefit (credit) +cost $( 181) $( 103) $( 65) $( 59) $7 $2 0 $( 15) $( 6) $( 2) $— $— $— +N/A– Nota pplicable. +Changesi nother comprehensive(income) loss in 2023 PensionB enefits HealthcareB enefits +(inm illions) Domestic ForeignD omestic Foreign +Netl oss( gain)a rising duringperiod$ 1$ 113 $( 8) $1 +Recognitiono fp rior years’net( loss)g ain( 9) 15 5— +Recognitiono fp rior years’ servicecredit— —7 — +Foreigne xchangea djustment N/A1 N/A— +Totalr ecognized in otherc omprehensive (income) loss (beforet ax effects) $( 8) $1 29 $4 $1 +Domestic Foreign +(inm illions) 2023 2022 2023 2022 +Pensionb enefits: +Prepaidb enefit cost $1 ,599 $1 ,399 $2 19 $2 52 +Accruedb enefit cost (112) (120) (56) (45) +Totalp ension benefits $1 ,487 $1 ,279 $1 63 $2 07 +Healthcare benefits: +Accruedb enefit cost $4 3 $2 1 $( 2) $( 2) +Totalh ealthcareb enefits $4 3 $2 1 $( 2) $( 2) +Thea ccumulatedb enefit obligationf or alld efined benefitp lans was$ 4.5 billionat Dec. 31, 2023and$ 4.3 billiona t +Dec. 31, 2022. +Plansw itho bligations in excesso fp lan +assets +PensionB enefits HealthcareB enefits +Domestic ForeignD omestic Foreign +(inm illions) 2023 2022 2023 2022 2023 2022 2023 2022 +Projected benefito bligation $1 12 $1 20 $1 72 $6 4 N/A N/A N/A N/A +Fair valueo fp lana ssets — — 116 19 N/A N/A N/A N/A +Accumulatedb enefit obligation 112 120 55 50 $6 2 $6 2 $2 $2 +Fair valueo fp lana ssets — — 17 18 — — — — +N/A–Nota pplicable. +Notest oC onsolidated FinancialS tatements (continued) +172 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_19.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_19.txt new file mode 100644 index 0000000000000000000000000000000000000000..facd2bbd3fcfd0105a70a8548dce6de5d5a96ddd --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_19.txt @@ -0,0 +1,60 @@ +(dollars in millions,e xceptp er sharea mountsa nd unlessotherwise noted) 2023 2022 2021 +Selected income statementi nformation: +Feea nd otherrevenue $1 3,157 $1 2,873 $1 3,313 +Neti nterestr evenue 4,345 3,504 2,618 +Totalr evenue 17,502 16,377 15,931 +Provision forc reditl osses 119 39 (231) +Nonintereste xpense 13,295 13,010 11,514 +Income before income taxes 4,088 3,328 4,648 +Provision fori ncomet axes 800 768 877 +Neti ncome 3,288 2,560 3,771 +Net( income)l ossa ttributable tononcontrollingi nterests relatedt oconsolidated investment +management funds (2) 13 (12) +Preferreds tock dividends (235) (211) (207) +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York +MellonC orporation $3 ,051 $2 ,362 $3 ,552 +Earnings pers hare applicable to commons hareholders of TheB anko fN ew York +MellonC orporation: +Basic $3 .89 $2 .91 $4 .17 +Diluted $3 .87 $2 .90 $4 .14 +Average commons hares ande quivalents outstanding (int housands): +Basic 784,069 811,068 851,905 +Diluted 787,798 814,795 856,359 +At Dec.31 +Assets underc ustody and/or administration( “AUC/A”) (int rillions)( a) $4 7.8 $4 4.3 $4 6.7 +Assets underm anagement( “AUM”) (int rillions)( b) 2.0 1.8 2.4 +Selected ratios: +Return on commone quity 8.5% 6.5% 8.9% +Return on tangiblec ommone quity –N on-GAAP (c) 16.6 13.4 17.1 +Pre-taxo peratingm argin 23 20 29 +Neti nterestm argin 1.25 0.97 0.68 +Cash dividends percommons hare $1 .58 $1 .42 $1 .30 +Commond ividendp ayout ratio 41% 49% 32% +Commond ividendy ield 3.0% 3.1% 2.2% +At Dec.31 +Closings tock pricep er commonshare $5 2.05 $4 5.52 $5 8.08 +Market capitalization $3 9,524 $3 6,800 $4 6,705 +Book valueper commonshare $4 8.11 $4 4.40 $4 7.50 +Tangibleb ook valueper commonshare –N on-GAAP (c) $2 5.39 $2 3.11 $2 4.31 +Full-time employees 53,400 51,700 49,100 +Commons hareso utstanding (int housands) 759,344 808,445 804,145 +Regulatory capitalratios (d) +CommonE quity Tier 1( “CET1”) ratio 11.5% 11.2% 11.2% +Tier 1c apitalr atio 14.2 14.1 14.0 +Totalc apitalr atio 15.0 14.9 14.9 +Tier 1l everager atio 6.0 5.8 5.5 +Supplementary leverage ratio (“SLR”) 7.3 6.8 6.6 +(a)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theClearancea nd CollateralM anagement, +Issuer Services,P ershinga nd Wealth Management lineso fb usiness. Includest he AUC/Ao fC IBCM ellonG lobal SecuritiesServices +Company (“CIBC Mellon”), aj oint venture with theCanadian Imperial Bank ofCommerce, of $1.7trilliona tD ec. 31, 2023,$ 1.5 +trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(b)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth Management businesssegment. +(c)R eturno ntangiblec ommone quity and tangibleb ook valuep er commons hare, bothN on-GAAP measures,e xclude goodwilland +intangiblea ssets,n et of deferredtax liabilities. See“ SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financial +measures”b eginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +(d)F or ourCET1,T ier1and Totalc apitalr atios, our effectivec apitalr atiosu nderU .S. capitalr ules aret he lowero ft he ratiosa s +calculated undert he Standardizedand Advanced Approaches. Fora dditional informationo nour regulatoryc apitalr atios, see +“Capital” beginning on page 39. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +FinancialS ummary +2B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_190.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_190.txt new file mode 100644 index 0000000000000000000000000000000000000000..a71ac5fb9fd2f4d3656ab3273051196e0ab397ef --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_190.txt @@ -0,0 +1,92 @@ +Assumedh ealthcare cost trend +Thea ssumedh ealthcarec ostt rend rate used in +determiningd omestic benefite xpensef or 2024is +7.00%,d ecreasingt o4 .04% in 2075 forp re-Medicare +costsa nd 6.60%decreasingt o4 .04% in 2075 for +Medicarec osts.T he initialt rend rate assumption +represents an estimateof shortt ermc osti ncreases +basedo nrecent healthcarem arketplace experience, +andt akingi ntoc onsiderationt he cost characteristics +of plansavailablet or etirees.T he long-term +assumptions andt rends were developedu sing the +Getzen Modelo fL ong-RunM edical Cost Trends and +consider expectations oflong-term health carec osts +andv arious othereconomic assumptions. +Thef ollowing benefitpaymentsf or thep ension and +healthcarep lans,w hich reflect expectedfuture +servicea sa ppropriate,a re expected to be paidover +then ext1 0y ears: +Expected benefitp ayments +(inm illions) Domestic Foreign +Pensionb enefits: +Year 2024 $2 74 $3 2 +2025 271 32 +2026 270 34 +2027 268 36 +2028 266 40 +2029-2033 1,279 226 +Totalp ension benefits $2 ,628 $4 00 +Healthcare benefits: +Year 2024 $8 $— +2025 8— +2026 8— +2027 8— +2028 8— +2029-2033 33 1 +Totalh ealthcareb enefits$ 73 $1 +Plan contributions +We expectto makecashc ontributions to fund our +definedb enefit pensionp lans in 2024 of $12million +fort he domesticplansa nd $9millionf or thef oreign +plans. +We expectto makecashc ontributions to fund our +post-retirementh ealthcarep lans in 2024 of $8million +fort he domesticplansa nd less than $1 millionf or the +foreignp lans. +Investment strategy andasseta llocation +We areresponsible fort he administration of various +employeep ension andh ealthcarep ost-retirement +benefits plans, bothd omestically andi nternationally. +Thed omestic plansa re administeredb yBNY +Mellon’sB enefitsA dministrationC ommittee, a +namedf iduciary.S ubject to thefollowing, at all +relevant times, BNYM ellon’sB enefitsI nvestment +Committee, anothernamed fiduciaryt othe domestic +plans, is responsible fort he investment of plan assets. +TheB enefitsI nvestment Committee’sr esponsibilities +include thei nvestment ofalld omestic definedb enefit +plan assets,asw ella st he determinationofi nvestment +options offeredt oparticipantsi na ll domestic defined +contributionp lans.T he Benefits Investment +Committeec onducts periodicr eviews of investment +performance, assetallocationa nd investment +managers uitability.I na ddition, theB enefits +Investment Committeeh as oversight oftheR egional +Governance Committees fort he foreignd efined +benefitp lans. +Ouri nvestment objectivefor U.S. andf oreign plansi s +to maximizet otal return whilem aintaining ab roadly +diversifiedp ortfolio fort he primary purposeo f +satisfyingo bligations forf utureb enefit payments. +Ourp lans arep rimarily investedin fixedi ncomea nd +equity securities. In general, fort he domesticplan’s +portfolio,f ixed income securitiesc an range from 35% +to 100% of plan assets,equity securitiesa nd +alternativei nvestmentsc an range from0 %t o6 5% of +plan assetsandc ashe quivalentsc an be held in +amountsr anging from0 %t o1 0% of planassets. +Actual assetallocationw ithin theapprovedr anges +varies fromt ime to time basedo neconomic +conditions (bothc urrent andf orecast),t he timingo f +transitionalr eallocations andt he advice of +professionala dvisors. +Ourp ension assets were invested asfollows: +Asseta llocations Domestic Foreign +2023 2022 2023 2022 +Fixedi ncome 62% 60% 74% 74% +Equities 34 36 13 12 +Alternativei nvestments 3 3 11 12 +Cash 1 1 2 2 +Totalp ension assets 100% 100% 100% 100% +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 73 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_191.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_191.txt new file mode 100644 index 0000000000000000000000000000000000000000..a8d3bf1fe62b7d9ff64a3ac2e50f80338bc85ffe --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_191.txt @@ -0,0 +1,87 @@ +We held no TheB anko fN ew York Mellon +Corporations tock in our pensionplans at Dec. 31, +2023 andD ec. 31, 2022.A ssets of theU .S. +postretirementh ealthcarep lana re invested in an +insurancec ontract. +Fair valuem easurement of plan assets +We have establishedathree-levelh ierarchy forf air +valuem easurements of our pensionplana ssets based +upon thet ransparencyo fi nputst ot he valuationofa n +asseta so ft he measurementd ate. +Thef ollowing is ad escriptiono ft he valuation +methodologies used fora ssets measured atfair value, +as well as theg eneral classificationofs ucha ssets +pursuantt ot he valuationhierarchy. +Cash and currency +This categoryc onsistsp rimarily of foreignc urrency +balances andisi ncludedi nLevel 1o ft he valuation +hierarchy. Foreignc urrencyi st ranslatedm onthly +basedo ncurrent foreigne xchange rates. +Commona nd preferredstock and exchange-traded +funds +Thesei nvestmentsi nclude equitiesa nd arev alueda t +thec losing pricereportedi nthe activem arketi n +whicht he individuals ecuritiesa re traded,i fa vailable. +Commona nd preferredstock andexchange-traded +funds arei ncludedi nLevel 1o ft he valuation +hierarchy. +Collectivet rust funds +Collectivet rust funds include commingled andU.S. +equity funds that have noreadily availablem arket +quotations.T he fair valueo ft he funds is basedo n +thes ecuritiesi nt he portfolio,which typically aret he +amount that thef und might reasonablye xpect to +receive fort he securitiesu pon as ale. Thesef unds are +valued usingo bservablei nputso ne ither ad aily or +monthlyb asis.C ollectivet rust funds arei ncludedi n +Level2of thev aluationh ierarchy. +Fixed-incomei nvestments +Fixed-income investmentsi nclude U.S. Treasury +securities, U.S. government agencies,n on-U.S. +government securities, sovereigngovernment +obligations,s tate andp olitical subdivisions,U .S. +corporateb onds andf oreign corporated ebtf unds. +U.S. Treasurya nd certain non-U.S. government +securitiest hata re activelyt radedi nhighlyl iquid +over-the-counter (“OTC”)m arkets arev alueda tt he +closingp rice reportedi nthe activem arketi nw hich +thei ndividuals ecurity is traded andincludeda sL evel +1o ft he valuationhierarchy. U.S. government +agencies,n on-U.S. government securities, sovereign +government obligations,state andp olitical +subdivisions,U .S.c orporateb onds andf oreign +corporated ebtf unds arev aluedb ased on quoted +prices forc omparables ecurities with similary ields +andc reditr atings.W henq uoted prices aren ot +availablef or identical or similarb onds,t he bondsare +valued usingd iscounted cashflows that maximize +observablei nputs, such as current yields ofsimilar +instruments, but includesa djustments forc ertain risks +that mayn ot be observable,such as creditand +liquidity risks. U.S. government agencies,n on-U.S. +government securities, sovereigngovernment +obligations,s tate andp olitical subdivisions,U .S. +corporateb onds andf oreign corporated ebtf unds are +primarily includedi nLevel 2o ft he valuation +hierarchy. +Otherassets measured at NAVp er share, as a +practical expedient +Othera ssets measured atNAV,a sapractical +expedient, includefunds offunds,v enture capitala nd +partnershipi nterests ando ther funds.T here aren o +readily availablem arketq uotations fort hese funds. +Thef airv alue ofthef unds offunds is basedo n +NAVs of thef unds in theportfolio,w hich reflectst he +valueo ft he underlyinginvestmentsh eldb ythe fund, +less its liabilities. Thef airv alue oftheu nderlying +investmentsi stypically theamount that thef und +might reasonablye xpect to receive uponsellingt hose +hard to valueo ri lliquidi nvestmentsw ithin the +portfolios. Thesef unds aree ither valued on ad aily or +monthlyb asis.T he fair valueo ft he venturecapital +andp artnership interestsi sbased on thep ension +plan’s ownershipp ercentage ofthef airv alue ofthe +underlying funds as providedb ythe fund managers. +Thesef unds aret ypically valued on aq uarterly basis. +Notest oC onsolidated FinancialS tatements (continued) +174 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_192.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_192.txt new file mode 100644 index 0000000000000000000000000000000000000000..25bd492735df4adb382ed1ead06b5f48c4ec3b1d --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_192.txt @@ -0,0 +1,100 @@ +Thef ollowing tables presentt he fair valueo fe ach +majorc ategoryo fp lana ssets as of Dec. 31, 2023and +Dec. 31, 2022,b ycaptions andb yASC 820, Fair +ValueM easurement,v aluationh ierarchy. +Plan assets measured at fair value on ar ecurring basis— +domestic plansa tD ec.3 1, 2023 +(inm illions) Level1 Level2 Level3 +Totalf air +value +Commona nd preferredstock: +U.S. equity $9 20 $— $— $9 20 +Non-U.S. equity 373 —— 373 +Collectivet rust funds: +U.S. equity —1 16 —1 16 +Commingled —5 30 —5 30 +Fixedi ncome: +U.S. corporateb onds —2 ,539 —2 ,539 +U.S. Treasurys ecurities 233 —— 233 +Statea nd political +subdivisions —1 10 —1 10 +Non-U.S. government 32 7— 30 +U.S. government agencies —2 6— 26 +Other —3 5— 35 +Exchange-tradedf unds 8—— 8 +Totald omestic plan assets in +thef airv alue hierarchy $1 ,537 $3 ,383 $— $4 ,920 +Othera ssets measured atNAV: +Funds offunds 164 +Venturec apitala nd +partnershipi nterests 5 +Totald omestic plan assets,a t +fair value $5 ,089 +Plan assets measured at fair value on ar ecurring basis— +foreign plansa tD ec.3 1, 2023 +(inm illions) Level1 Level2 Level3 +Totalf air +value +Corporated ebtf unds $— $6 59 $— $6 59 +Equity funds —1 37 —1 37 +Sovereign/government +obligationf unds —1 23 —1 23 +Cash andc urrency 19 —— 19 +Totalf oreign plan assets in +thef airv alue hierarchy $1 9$ 919 $— $9 38 +Othera ssets measured atNAV 114 +Totalf oreign plan assets,a t +fair value $1 ,052 +Plan assets measured at fair value on ar ecurring basis— +domestic plansa tD ec. 31, 2022 +(inm illions) Level1 Level2 Level3 +Totalf air +value +Commona nd preferredstock: +U.S. equity $8 97 $— $— $8 97 +Non-U.S. equity 351 —— 351 +Collectivet rust funds: +U.S. equity —1 69 —1 69 +Commingled —4 93 —4 93 +Fixedi ncome: +U.S. corporateb onds —2 ,333 —2 ,333 +U.S. Treasurys ecurities2 14 —— 214 +Statea nd political +subdivisions —8 8— 88 +Non-U.S. government 63 8— 44 +U.S. government agencies —2 1— 21 +Other— 28 —2 8 +Exchange-tradedf unds 8—— 8 +Totald omestic plan assets in +thef airv alue hierarchy $1 ,476 $3 ,170 $— $4 ,646 +Othera ssets measured atNAV: +Funds offunds 154 +Venturec apitala nd +partnershipi nterests 6 +Totald omestic plan assets,a t +fair value$ 4,806 +Plan assets measured at fair value on ar ecurring basis— +foreign plansa tD ec. 31, 2022 +(inm illions) Level1 Level2 Level3 +Totalf air +value +Corporated ebtf unds $— $6 11 $— $6 11 +Equity funds —1 17 —1 17 +Sovereign/government +obligationf unds —1 11 —1 11 +Cash andc urrency 16 —— 16 +Totalf oreign plan assets in +thef airv alue hierarchy $1 6$ 839 $— $8 55 +Othera ssets measured atNAV 120 +Totalf oreign plan assets,a t +fair value $9 75 +Othera ssets measured at NAVp er share, as a +practical expedient +Certainp ension andp ost-retirementp lana ssets are +invested in funds offunds,v enture capitala nd +partnershipi nterests ando ther contractsvaluedu sing +NAV, as ap ractical expedient. Thef unds offunds +investmentsa re redeemableat NAV under +agreements with thefunds offunds managers. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 75 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_193.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_193.txt new file mode 100644 index 0000000000000000000000000000000000000000..2cd5f0bcbc95aef3ba2b00bbfa634d927592fbc5 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_193.txt @@ -0,0 +1,117 @@ +Assets valuedu sing NAV at Dec. 31, 2023 +(dollars in millions) +Fair +value +Unfunded +commitments +Redemption +frequency +Redemption +notice +period +Funds offunds (a) $1 64 $— Monthly3 0-45 days +Venturec apitala nd +partnership +interests (b) 83 —N /A N/A +Otherc ontracts( c) 36 —N /A N/A +Total $2 83 $— +Assets valuedu sing NAV at Dec. 31, 2022 +(dollars in millions) +Fair +value +Unfunded +commitments +Redemption +frequency +Redemption +notice +period +Funds offunds (a) $1 54 $— Monthly3 0-45 days +Venturec apitala nd +partnership +interests(b) 91 —N /A N/A +Otherc ontracts (c) 35 —N /A N/A +Total $2 80 $— +(a)F unds offunds includesm ulti-strategy hedgefunds that utilize +investments trategiest hat investo ver bothl ong-term investmenta nd +short-term investmenth orizons. +(b)V enture capitala nd partnership interestsdon ot haveredemption +rights. Distributions from such funds will be received as the +underlying investments arel iquidated. +(c)O ther contractsinclude assets investedi npooled accountsa t +insurancec ompanies that areprivately valued by thea ssetm anager. +N/A– Nota pplicable. +Defined contributionp lans +We sponsor definedcontributionp lans in theU.S. +andi ncertain non-U.S. locations,a ll of whicha re +administeredi naccordance with locallaws.T he +most significantdefined contributionplani sT he +Bank ofNewY orkM ellonC orporation4 01(k) +Savings Plan sponsored by theC ompany in theU.S. +andc overs substantially allU .S.e mployees. +UnderT he Bank ofNewY orkM ellonC orporation +401(k) SavingsP lanf or 2023, 2022and2 021, the +Companym atched 100% of participantcontributions +up to 7% ofan employee’seligible base payw ith a +monetary limit of $16,000 perparticipant.I n +addition, an annualnon-electivec ontributiono f$ 750 +wasm adei n2 023, 2022and2 021 to each participant +with eligible base payo fl esst han$ 100,000 ay ear +andw ho arec reditedw ith at leasto ne yearof service. +At Dec.31, 2023andD ec. 31, 2022,T he Bank of +NewY orkM ellonC orporation4 01(k) Savings Plan +owned8 .7 milliona nd 9.2millions hareso fo ur +commons tock,r espectively. Thef airv alue oftotal +assets was$ 8.8 billionatD ec. 31, 2023and$ 7.8 +billiona tD ec. 31, 2022.W er ecorded expensesof +$282 millioni n2 023, $276millioni n2 022 and$ 258 +millioni n2 021, primarilyforc ontributions to our +definedc ontributionp lans. +We alsohave an ESOP covering certain domestic +full-timee mployees hiredo norb eforeJ uly1 ,2008. +TheE SOPw orks in conjunction with thedefined +benefitp ension plan.E mployees areentitledt othe +highero ftheir benefitu ndert he ESOP or such +definedb enefit pensionp lana tr etirement. Benefits +payableu ndert he definedbenefit pensionp lana re +offset by thee quivalent valueofb enefits earned +undert he ESOP. +At Dec. 31, 2023andD ec. 31, 2022,t he ESOP +owned3 .5 milliona nd 3.7millions hareso fo ur +commons tock,r espectively. Thef airv alue oftotal +ESOP assets was$ 185 milliona tD ec. 31, 2023and +$171 milliona tD ec. 31, 2022.T he Companyi sn ot +permittedt omakec ontributions to theESOP. +TheB enefitsI nvestment Committeea ppointed +Fiduciary CounselorsI nc.t oserve as thei ndependent +fiduciary to (i)m akea ll fiduciary decisions relatedt o +thec ontinuedp rudenceo fo ffering thec ommons tock +of BNYM ellono ri ts affiliatesa sani nvestment +optionu ndert he plans,othert hanp lans ponsor +decisions,a nd (ii) select andmonitora ny activelyo r +passively managedinvestmentst hata re managedb y +BNYM ellono ri ts affiliatest ob eo fferedt o +participants as investment options underthe plans, +excluding self-directed accounts. +Note 19–Companyf inancial information +(ParentC orporation) +In connectionw ith our singlep oint ofentryr esolution +strategy, we have establisheda nintermediateh olding +company( “IHC”) to facilitate thep rovision ofcapital +andl iquidity resources to certain keys ubsidiaries in +thee vent ofmaterial financiald istresso rf ailure.I n +2017, we enteredi ntoabinding supporta greement +with thosek ey subsidiaries andother relatede ntities +that requirest he IHCt op rovide that support. The +supporta greementr equirest he Parent to transfer cash +ando ther liquidf inancial assets to theIHC on an +ongoing basis, subjectto certain amountsr etainedb y +theP arentt om eet itsn ear-termc ashn eeds. The +Parent’s andt he IHC’so bligations underthe support +agreementa re secured. TheI HC hasp rovided +unsecureds ubordinatedf unding notesto theParenta s +well as ac ommittedl ineo fc reditt hata llows the +Parent to draw funds necessaryto servicen ear-term +obligations.A saresult, duringb usiness-as-usual +Notest oC onsolidated FinancialS tatements (continued) +176 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_194.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_194.txt new file mode 100644 index 0000000000000000000000000000000000000000..407c6262fe963cfbdb79d0f7a596d467067f4a8a --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_194.txt @@ -0,0 +1,99 @@ +circumstances,t he Parent is expected to continue to +have accesst ot he funds necessaryto payd ividends, +repurchasec ommons tock,s ervice its debt ands atisfy +its othero bligations.I fo ur projectedfinancial +resources deteriorates os everelyt hatr esolutiono ft he +Parent becomesimminent, thecommittedl ineo f +credit theIHC providedt othe Parent will +automatically terminate,with alla mountso utstanding +becomingd ue andp ayable,a nd thes upport +agreementw ill require theP arentt ot ransferm osto f +its remaininga ssets( othert hans tock in subsidiaries +andacashr eserve to fund bankruptcy expenses)t o +theI HC.A saresult, duringaperiod of severe +financials tress, theP arentc ould become unablet o +meet its debt andp ayment obligations(including with +respect to itssecurities),c ausing theP arentt os eek +protectionu nderb ankruptcy laws earliert hani t +otherwisew ouldh ave. +Ourb anks ubsidiaries aresubject to dividend +limitations underthe federala nd stateb anking laws. +Undert hese statutes,prior regulatoryc onsenti s +requiredf or dividendsin anyy ear that woulde xceed +theb ank’sn et profits fors uchy ear combinedwith +retained netp rofits fort he priortwo years. +Additionally,s uchb anks ubsidiaries mayn ot declare +dividends in excesso fn et profits on hand,as defined, +afterd eductingt he amount bywhicht he principal +amount ofalll oans,o nwhich interest is past due fora +period ofsixm onths ormore,e xceedst he allowance +forc reditl osses. +Thep ayment of dividendsalso is limitedb y +minimumc apitalr equirementsa nd buffersimposed +on banks.A so fD ec. 31, 2023,o ur banksubsidiaries +exceeded theser equirements. +Subsequent to Dec. 31, 2023,o ur U.S. bank +subsidiaries coulddeclared ividends to theParento f +approximately $1.7 billion,without then eed fora +regulatoryw aiver. In addition, at Dec. 31, 2023,n on- +bank subsidiaries of theP arenth ad liquida ssets of +approximately $3.2 billion. +Theb anks ubsidiaries declared dividends of $3.5 +billioni n2 023, $1.0 billionin2 022 and$ 2.5 billion +in 2021. TheF ederal Reservea nd theO ffice of the +Comptrollero fthe Currency have issued additional +guidelines that require BHCs andn ationalb anks to +continually evaluate thelevel of cashd ividends in +relationt otheir respectiveo peratingi ncome, capital +needs, assetq uality ando verall financialc ondition. +TheF ederal Reservep olicyw ith respect to the +paymento fc ashd ividends byBHCs providest hat, as +am attero fprudent banking,aB HC shouldn ot +maintain ar ateo fc ashd ividends unlessits net +income availablet oc ommons hareholders hasb een +sufficientt of ully fund thed ividends,a nd the +prospectiver ateo fe arnings retentiona ppearst ob e +consistent with theholding company’sc apitaln eeds, +assetq uality ando verall financialc ondition. The +FederalR eserve can alsoprohibitadividend if +paymentw ould constitute an unsafeo ru nsound +banking practice. +In January 2023, we announced as hare repurchase +program approvedb your Boardo fD irectors +providing fort he repurchaseo fu pt o$ 5.0 billiono f +commons haresb eginning Jan. 1, 2023.This new +sharer epurchasep lanr eplaced allpreviously +authorized sharer epurchasep lans. +TheF ederal ReserveA ct limits,a nd requires +collateralf or,e xtensions ofcredit by ourinsured +subsidiary banks to theP arenta nd certain of its non- +bank affiliates. Also,t here arer estrictions onthe +amountso fi nvestmentsb ys uchb anks in stocka nd +others ecuritieso fB NY Mellona nd such affiliates, +andr estrictions onthea cceptanceo ft heir securities +as collateralf or loansb ys uchb anks.E xtensions of +credit by theb anks to each of ouraffiliatesa re limited +to 10% ofsuch bank’sr egulatoryc apital, andi nthe +aggregatef or BNYM ellona nd alls ucha ffiliatest o +20%,a nd collateralm ustb eb etween 100% and1 30% +of thea mount ofthec redit, depending onthet ype of +collateral. +Inthee vent ofimpairmento ft he capitals tock of one +of theP arent’sn ationalb anks orTheB anko fN ew +York Mellon, theP arent, as theb anks’s tockholder, +couldb er equiredt opay such deficiency. +TheP arentg uarantees theu ncommittedl ines of credit +of Pershing LLC andP ershingL imiteds ubsidiaries. +TheP arentg uarantees describeda bove aref ulla nd +unconditionala nd containt he standard provisions +relatingt oparentg uarantees of subsidiary debt. +Additionally,t he Parent guaranteesor indemnifies +obligations ofitsc onsolidated subsidiaries as needed. +Generally,t here aren os tatedn otionala mounts +includedi nthese indemnifications andt he +contingenciest riggering theo bligationf or +indemnificationa re not expected to occur. As a +result, we areu nablet od evelop an estimateof the +maximump ayout underthese indemnifications. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 77 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_195.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_195.txt new file mode 100644 index 0000000000000000000000000000000000000000..704bfb123515b05b2e5c66d14e84b6fb1a8570ea --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_195.txt @@ -0,0 +1,106 @@ +However, we believe thep ossibility isremote thatwe +will have to makeanym aterialp ayment underthese +guarantees andindemnifications. +TheP arent’sc ondensed financials tatementsa re as +follows: +Condensed Income Statement—The Bank ofNew +York MellonC orporation (ParentC orporation) +Year endedDec. 31, +(inm illions) 2023 2022 2021 +Dividends fromb anks ubsidiaries $3 ,472 $1 ,006 $2 ,490 +Dividends fromn onbank subsidiaries 1,070 880 1,106 +Interest revenue fromb anks ubsidiaries 71 25 — +Interest revenue fromn onbank +subsidiaries 64 37 30 +(Loss) on securitiesh eldf or sale (1) —— +Otherr evenue 83 57 56 +Totalr evenue 4,759 2,005 3,682 +Interest expense( including$ 23, $10and +$6, to subsidiaries,r espectively) 1,716 853 339 +Othere xpense 291 433 153 +Totale xpense 2,007 1,286 492 +Income before income taxesand equity +in undistributed neti ncomeo f +subsidiaries 2,752 719 3,190 +(Benefit) fori ncomet axes (258) (190) (92) +Equity inundistributed neti ncome: +Bank subsidiaries (313) 1,696 282 +Nonbank subsidiaries 589 (32) 195 +Neti ncome 3,286 2,573 3,759 +Preferreds tock dividends and +redemptionc harge (235) (211) (207) +Neti ncomea pplicable tocommon +shareholders of TheB anko fN ew York +MellonC orporation $3 ,051 $2 ,362 $3 ,552 +Condensed BalanceS heet—The Bank ofNew +York MellonC orporation (ParentC orporation) +Dec. 31, +(inm illions) 2023 2022 +Assets: +Cash andd ue fromb anks $2 29 $3 76 +Securities — 1 +Investment in anda dvances to subsidiaries and +associated companies: +Banks 34,184 33,795 +Other 38,838 38,119 +Subtotal 73,022 71,914 +Corporate-ownedl ifei nsurance 796 793 +Othera ssets 363 610 +Totala ssets $7 4,410 $7 3,694 +Liabilities: +Deferredc ompensation $3 67 $3 72 +Affiliate borrowings 1,294 914 +Otherl iabilities 1,889 1,995 +Long-term debt 29,986 29,679 +Totall iabilities 33,536 32,960 +Shareholders’e quity 40,874 40,734 +Totall iabilitiesa nd shareholders’e quity $7 4,410 $7 3,694 +Condensed Statemento fCash Flows—TheB ank +of NewY orkM ellonC orporation (Parent +Corporation) +Year endedDec. 31, +(inm illions) 2023 2022 2021 +Operating activities: +Neti ncome $3 ,286 $2 ,573 $3 ,759 +Adjustmentst or econcile neti ncomet on et +cashp rovidedb y(used for) operating +activities: +Equity inundistributed net( income)o f +subsidiaries (276) (1,664) (477) +Change in accruedi nterestr eceivable 24 (8)7 5 +Change in accruedi nterestp ayable 24 78 (15) +Change in taxespayable (a) 395 (3)( 142) +Other, net 86 221 (260) +Netc ashp rovidedb yoperating +activities 3,539 1,197 2,940 +Investinga ctivities: +Acquisitions of,investmentsi n, and +advances to subsidiaries (b) 592 (1,962) 870 +Netc ashp rovidedb y(used for) +investinga ctivities 592 (1,962) 870 +Financinga ctivities: +Proceedsf romi ssuance of long-term debt 5,988 9,179 5,186 +Repayments of long-term debt (6,055) (4,000) (4,250) +Change in advances froms ubsidiaries 364 (2,917) 820 +Issuance of commons tock 16 23 63 +Issuance of preferredstock — —1 ,287 +Treasurys tock acquired (2,604) (124) (4,567) +Redemptiono fp referreds tock (500) —( 1,000) +Cash dividends paid (1,487) (1,376) (1,323) +Netc ash( used for) providedb y +financinga ctivities (4,278) 785 (3,784) +Change in casha nd duefromb anks (147) 20 26 +Cash andd ue fromb anks at beginning of +year 376 356 330 +Cash andd ue fromb anks at endofy ear $2 29 $3 76 $3 56 +Supplementald isclosures +Interest paid $1 ,693 $7 74 $3 54 +Income taxesrefunded 2 —1 +(a)I ncludesp aymentsr eceived from subsidiaries fort axes of $986 +millioni n2 023, $70millioni n2 022 and $21millioni n2 021. +(b)I ncludes$ 1,963 milliono fc asho utflows,n et of $2,555milliono f +cash inflows in 2023, $2,778milliono fc asho utflows,n et of $816 +milliono fc ashi nflows in 2022 and $10milliono fc asho utflows,n et +of $880milliono fc ashi nflows in 2021. +Notest oC onsolidated FinancialS tatements (continued) +178 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_196.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_196.txt new file mode 100644 index 0000000000000000000000000000000000000000..6b475dca70827ab078c7453b12a68264b1c41703 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_196.txt @@ -0,0 +1,97 @@ +Note 20–Fair value measurement +Fair valuei sd efined asthep rice that wouldb e +receivedt osella na sset, or paid to transferal iability, +in an orderlyt ransactionb etween market participants +at them easurementd ate. At hree-levelh ierarchy for +fair valuem easurements isutilized basedu pon the +transparency of inputst ot he valuationofa na sseto r +liability as of them easurementd ate. BNYM ellon’s +ownc reditworthinessi sconsidered when valuing +liabilities. +Fair valuef ocuses on exit pricei na norderly +transaction( that is,n ot af orced liquidationo r +distresseds ale) between market participants at the +measurementd ateu nderc urrent market conditions. +If thereh as been as ignificantd ecreasei nt he volume +andl evel of activity fort he asseto rl iability,achange +in valuationt echnique ortheu se of multiple valuation +techniquesm ay be appropriate.I ns uchi nstances, +determiningt he priceatw hich willingm arket +participants wouldt ransact atthem easurementd ate +underc urrent market conditions depends onthef acts +andc ircumstances andrequirest he useofs ignificant +judgment. Theo bjectivei st od eterminef rom +weighted indicatorso ff airv alue ar easonablep oint +within therange that is mostrepresentativeo ff air +valueu nderc urrent market conditions. +Determinationo ff airv alue +We have establishedp rocessesf or determiningfair +values.F airv alue is basedu pon quotedmarket prices +in activem arkets,w here available. Forf inancial +instrumentsw here quotes from recente xchange +transactions aren ot available, we determinef airv alue +basedo ndiscounted cashflowa nalysis, comparison +to similari nstruments andt he useoff inancial models. +Discounted cashflowa nalysisi sdependent upon +estimatedf uturec ashf lows andt he levelo fi nterest +rates. Model-basedp ricing usesinputso fo bservable +prices,w here available, fori nterestr ates,f oreign +exchange rates, optionv olatilitiesa nd otherfactors. +Models areb enchmarked andvalidated by an +independent internal risk management function. Our +valuationp rocesst akes into considerationf actors +such as counterpartycreditq uality,l iquidity, +concentrationc oncerns ando bservability of model +parameters.V aluationa djustmentsm ay be made to +record financialinstruments at fair value. +Most derivativec ontractsa re valued usingm odels +whicha re calibratedt oobservablem arketd ataa nd +employ standard market pricingt heoryf or their +valuations.V aluationm odels incorporate +counterpartyc reditr iskb ydiscountinge ach trade’s +expected exposuresto thecounterpartyu sing the +counterparty’sc redits preads, as impliedb ythe credit +defaults wapm arket. We alsoadjust expected +liabilitiest ot he counterpartyu sing BNYM ellon’s +ownc redits preads, as impliedb ythe credit default +swap market.A ccordingly, thev aluationo fo ur +derivativep ositions is sensitivet ot he current changes +in our owncredits preads, as well as thoseo fo ur +counterparties. +In certain cases,r ecentp rices mayn ot be observable +fori nstruments that tradei ni nactiveo rl essa ctive +markets. Upon evaluatingt he uncertainty invaluing +financiali nstruments subject to liquidityissues,w e +make an adjustmentto theirvalue.T he determination +of thel iquidity adjustment includest he availability of +external quotes,t he time sincet he latest available +quotea nd thep rice volatility of thei nstrument. +Certainp arametersi ns omef inancial models aren ot +directly observablea nd, therefore, arebased on +management’s estimatesa nd judgments.T hese +financiali nstruments aren ormally tradedless +actively. We applyvaluationa djustmentst om itigate +thep ossibility of errora nd revision in themodel- +basede stimate value. Examples include products +wherep arameterss ucha sc orrelationa nd recovery +ratesa re unobservable. +Them ethods describedabove fori nstruments that +tradei ni nactiveo rl essa ctivem arkets mayp roducea +current fair valuec alculationt hatm ay not be +indicativeo fn et realizable valueo rr eflectiveo f +future fairvalues.W eb elieve ourmethods of +determiningf airv alue area ppropriate andc onsistent +with otherm arketp articipants. However, theu se of +different methodologies or differentassumptions to +valuec ertain financiali nstruments couldr esulti na +different estimateo ff airv alue. +Valuationh ierarchy +At hree-levelv aluationh ierarchy is used for +disclosure of fair valuem easurements basedu pon the +transparency of inputst ot he valuationofa na sseto r +liability as of them easurementd ate. Thet hree levels +ared escribed below. +Level 1:I nputst ot he valuationmethodology are +quoted prices (unadjusted) fori dentical assetsor +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 79 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_197.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_197.txt new file mode 100644 index 0000000000000000000000000000000000000000..9b9c868c3ed134560f402507773a623a00631582 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_197.txt @@ -0,0 +1,94 @@ +liabilitiesi na ctivem arkets.L evel 1a ssets and +liabilitiesi nclude certain debt ande quity securities, +derivativef inancial instrumentsa ctivelyt radedo n +exchangesa nd highlyliquidg overnment bonds. +Level 2:O bservablei nputso ther than Level1prices, +fore xample,q uoted prices fors imilara ssets and +liabilitiesi na ctivem arkets,q uoted prices for +identical or similara ssetso rl iabilitiesi nm arkets that +aren ot active, andinputst hata re observableo rc an +be corroborated,e ither directly or indirectly,f or +substantially thefullt ermo ft he financiali nstrument. +Level2assets andl iabilitiesi nclude debtinstruments +that aretradedl essf requently than exchange-traded +securitiesa nd derivativef inancial instrumentsw hose +modeli nputsa re observablei nt he market or can be +corroborated by market-observabled ata. +Level 3:I nputs to thevaluationm ethodology are +unobservablea nd significantt ot he fair value +measurement. +Af inancial instrument’s categorizationw ithin the +valuationh ierarchy is basedu pon thel owestl evel of +input that is significantt ot he fair valuem easurement. +Valuationm ethodology +Following is ad escriptiono ft he valuation +methodologies used fori nstruments measured atfair +value, aswell as theg eneral classificationofs uch +instrumentsp ursuantt ot he valuationhierarchy. +Securities +We determinef airv alue primarily basedo npricing +sources with reasonablel evelso fp rice transparency. +Whereq uoted prices areavailablei na nactive +market,w ec lassifyt he securitiesw ithin Level1of +thev aluationh ierarchy. Securitiesi nclude bothlong +ands hortp ositions.L evel 1s ecuritiesi nclude U.S. +Treasurya nd certain non-U.S. government debt +securitiest hata re activelyt radedi nhighlyl iquid +OTCm arkets,m oneym arketf unds ande xchange- +traded equities. +If quoted market prices arenot available, fair values +arep rimarily determined usingp ricing models using +observablet rade data,marketd ata, quoted prices of +securitiesw ith similarc haracteristicso rd iscounted +cashf lows.E xampleso fs uchi nstruments,w hich +wouldg enerally be classified within Level2of the +valuationh ierarchy, include RMBS,M BS,c ertain +non-U.S. government debt,foreign coveredb onds +andC LOs. +Specifically,t he pricingsources obtainr ecent +transactions fors imilart ypes of securities( e.g., +vintage, positioni nthe securitizations tructure)a nd +ascertain variabless ucha sd iscount rate ands peed of +prepayment fort he typeso ft ransactiona nd apply +such variablest os imilart ypes of bonds.W ev iew +thesea so bservablet ransactions in thecurrent +marketplace andclassify such securitiesa sL evel 2. +Pricings ources discontinue pricingany specific +security whenever they determinet here is insufficient +observabled atat op rovide ag ood-faith opinion on +price. +At Dec. 31, 2023,a pproximately 99% of our +securitiesw erev aluedb ypricing sources with +reasonablel evelso fp rice transparency.T he +remainings ecuritiesw ereg enerally valued using +observablei nputs. Additionald isclosures of +securitiesa re providedi nNote4 . +In certain cases wheret here is limiteda ctivity or less +transparency aroundinputst ot he valuation,we +classify thoses ecuritiesi nL evel 3o ft he valuation +hierarchy. As of Dec. 31, 2023,w eh aven o +instrumentsi ncludedi nLevel 3o ft he valuation +hierarchy. +Derivativef inanciali nstruments +We classifyexchange-tradedd erivativef inancial +instrumentsv aluedu sing quotedprices in Level1of +thev aluationh ierarchy. Examples include exchange- +traded equityandf oreign exchange options.S ince +fewo ther classesofd erivativec ontractsa re listedo n +an exchange,mosto fo ur derivativepositions are +valued usingm odels thatusea st heir basisr eadily +observablem arketp arameters, andw ec lassify them +in Level2of thev aluationh ierarchy. Such derivative +financiali nstruments include swapsa nd options, +foreigne xchange spot andf orward contractsa nd +credit defaults waps. +Derivatives valued usingm odels with significant +unobservablem arketp arametersi nm arkets thatlack +two-wayf lowa re classified in Level3of the +valuationh ierarchy. Examples mayi nclude long- +dateds waps ando ptions,w here parameters mayb e +unobservablef or longerm aturities; andc ertain highly +structured products,w here correlationr iski s +unobservable. As of Dec. 31, 2023,w eh aven o +Notest oC onsolidated FinancialS tatements (continued) +180 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_198.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_198.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0654ec724684a9a85fabda115fdea27d9374de6 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_198.txt @@ -0,0 +1,36 @@ +Level3derivativ es.A dditionald isclosures of +derivativei nstruments arep rovidedi nNote2 3. +Seed capital +In our Investment andW ealth Management business +segment, we make seed capitali nvestmentsi nc ertain +funds we manage.S eed capitali sg enerally included +in othera ssets on thec onsolidated balances heet. +When applicable,wev alue seed capitalb ased on the +publishedN AV of thef und. +Foro ther typeso fi nvestmentsi nf unds,w ec onsider +allo ft he rightsa nd obligationsinherent in our +ownershipi nterest, includingther eportedN AV as +well as otherf actors that affectthef airv alue of our +interest in thefund. +Othera ssets measured at NAV +We holdp rivate equity investments,primarily SBICs, +whicha re compliant with theVolcker Rule.T here +aren or eadily availablem arketq uotations fort hese +investment partnerships.T he fair valueo ft he SBICs +is basedo nour ownershippercentage ofthef airv alue +of theu nderlying investmentsa sp rovidedb ythe +partnershipm anagers. Thesei nvestmentsa re +typically valued on aq uarterly basis. OurS BIC +privatee quity investmentsare valued atNAV as a +practical expedientfor fair value. +Thef ollowing tables presentt he financiali nstruments +carried atfair valuea tD ec. 31, 2023andD ec. 31, +2022, bycaptiono nthe consolidated balances heet +andb ythe three-levelv aluationh ierarchy. We have +includedc reditr atings informationi ncertain of the +tables because thei nformationi ndicates thed egreeo f +credit risk to whichw ea re exposed,a nd significant +changesi nr atings classifications couldr esulti n +increased risk foru s. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 81 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_199.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_199.txt new file mode 100644 index 0000000000000000000000000000000000000000..65085593dfe7ff1073c4336b3c23e0230623f40d --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_199.txt @@ -0,0 +1,62 @@ +Assets andl iabilitiesm easured at fair value on ar ecurring basisatD ec. 31, 2023 Totalc arrying +value(dollars in millions) Level1 Level2 Level3 Netting (a) +Assets +Available-for-sales ecurities: +U.S. Treasury$ 16,604 $— $— $— $1 6,604 +Non-U.S. government (b) 2,439 15,943 —— 18,382 +Agency RMBS —1 3,111 —— 13,111 +Agency commercialMBS —7 ,729 —— 7,729 +Foreignc overedb onds —6 ,334 —— 6,334 +CLOs —6 ,137 —— 6,137 +Non-agency commercialMBS— 2,935 —— 2,935 +U.S. government agencies —2 ,901 —— 2,901 +Non-agency RMBS —1 ,740 —— 1,740 +OtherA BS —9 43 —— 943 +Otherd ebts ecurities— 1— —1 +Totala vailable-for-sales ecurities1 9,043 57,774 —— 76,817 +Tradinga ssets: +Debt instruments1 ,246 2,255 —— 3,501 +Equity instruments4 ,518 —— —4 ,518 +Derivativea ssets not designatedash edging: +Interest rate 71 ,053 —( 751) 309 +Foreigne xchange —9 ,227 —( 7,498) 1,729 +Equity ando ther contracts— 8— (7)1 +Totald erivativea ssets not designatedash edging 71 0,288 —( 8,256) 2,039 +Totalt rading assets 5,771 12,543 —( 8,256) 10,058 +Othera ssets: +Derivativea ssets designateda sh edging: +Interest rate —2 14 —— 214 +Foreigne xchange —2 2— —2 2 +Totald erivativea ssets designateda sh edging —2 36 —— 236 +Othera ssets (c) 486 386 —— 872 +Totalo ther assets 486 622 —— 1,108 +Assets measured atNAV (c) 153 +Totala ssets $2 5,300 $7 0,939 $— $( 8,256) $8 8,136 +Percentage oftotala ssets priort on etting2 6% 74% —% +Liabilities +Tradingl iabilities: +Debt instruments$ 2,508 $1 2$ —$ —$ 2,520 +Equity instruments2 3—— —2 3 +Derivativel iabilitiesn ot designatedash edging: +Interest rate 81 ,339 —( 635) 712 +Foreigne xchange —9 ,282 —( 6,341) 2,941 +Equity ando ther contracts9 135 —( 114) 30 +Totald erivativel iabilitiesn ot designated ashedging 17 10,756 —( 7,090) 3,683 +Totalt rading liabilities2 ,548 10,768 —( 7,090) 6,226 +Otherl iabilities +Derivativel iabilitiesd esignateda sh edging: +Interest rate ——— —— +Foreigne xchange —1 73 —— 173 +Totald erivativel iabilitiesd esignateda sh edging —1 73 —— 173 +Otherl iabilities— 22 —— 22 +Totalo ther liabilities —1 95 —— 195 +Totall iabilities$ 2,548 $1 0,963 $— $( 7,090) $6 ,421 +Percentage oftotall iabilitiesp rior to netting1 9% 81% —% +(a)A SC 815,Derivatives and Hedging, permits thenettingo fd erivativer eceivables and derivativepayables underl egally enforceable +master nettinga greements and permits thenettingo fc ashc ollateral. Nettingi sa pplicablet od erivatives not designatedas hedging +instrumentsi ncludedi ntrading assetsor trading liabilitiesa nd derivativesdesignated as hedginginstrumentsi ncludedi nother assets or +otherl iabilities. Nettingi sa llocatedt othe derivativeproducts based on then et fair valueo fe achp roduct. +(b)I ncludess upranational securities. +(c)I ncludess eed capital,privatee quity investmentsand otherassets. +Notest oC onsolidated FinancialS tatements (continued) +182 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_2.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_2.txt new file mode 100644 index 0000000000000000000000000000000000000000..3c2c837a0b02559603d07c7902b85fe8bcbde215 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_2.txt @@ -0,0 +1,2 @@ +2 ANNUAL REPORT 2023 + \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_20.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_20.txt new file mode 100644 index 0000000000000000000000000000000000000000..a598b0abb3b2ee0bf9429c1fe49deff77280dd41 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_20.txt @@ -0,0 +1,99 @@ +General +In this AnnualR eport, references to “our,” “we,” +“us,”“ BNYM ellon,” the“ Company” ands imilar +termsr efer to TheB anko fN ew York Mellon +Corporationa nd itsc onsolidated subsidiaries.T he +term “Parent” refers to TheB anko fN ew York +MellonC orporationb ut notits subsidiaries. +Thef ollowing shouldb er ead in conjunctionw ith the +Consolidated FinancialS tatementsi ncludedi nthis +report. BNYM ellon’sa ctualr esults of future +operations mayd ifferf romt hosee stimatedo r +anticipated in certain forward-looking statements +containedh ereind ue to thefactorsd escribed under +theh eadings “Forward-looking Statements”a nd +“RiskF actors,”b otho fw hich investorss houldr ead. +Certainb usinesst erms used in thisAnnualR eporta re +definedi nthe Glossary. +This AnnualR eportg enerally discusses2 023 and +2022 items andc omparisons between2023 and2 022. +Discussions of 2021items andc omparisons between +2022 and2 021 that arenot includedi nthisA nnual +Reportc an be found in our 2022AnnualR eport, +whichw as fileda sa ne xhibitt oo ur Form 10-Kf or +they ear endedDec. 31, 2022. +Overview +Establishedi n1784, BNYM elloni sA merica’so ldest +bank andt he firstc ompany listedo nthe NewY ork +StockE xchange (NYSE: BK). Today, BNYM ellon +powersc apitalm arkets around thew orld through +comprehensives olutions that help clientsm anagea nd +servicet heir financiala ssetst hroughout the +investment lifec ycle.B NY Mellonhad $47.8 trillion +in assets underc ustody and/or administrationa nd +$2.0 trillioni nassets underm anagementa so fD ec. +31, 2023. BNYM ellonh as been nameda mong +Fortune’s World’sM ostA dmired Companiesa nd +Fast Company’sB estW orkplaces forI nnovators. +BNYM elloni st he corporateb rand ofTheB anko f +NewY orkM ellonC orporation. +BNYM ellonh as threeb usinesss egments, Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagement, whicho ffera +comprehensives et of capabilitiesa nd deep expertise +acrosst he investment lifecycle, enablingt he +Companyt oprovide solutions to buy-side ands ell- +side market participants,a sw ella sl eading +institutionala nd wealth managementclientsg lobally. +Thed iagram belowp resentso ur threeb usiness +segments andl ines of business, with theremaining +operations in theO ther segment. +TheB anko fN ew +York Mellon +Corporation +Securities +Services +Market andW ealth +Services +Investment and +Wealth Management +Asset +Servicing Pershing Investment +Management +Issuer +Services +Treasury +Services +Wealth +Management +Clearance and +Collateral +Management +Fora dditionali nformationo nour businesssegments, +see“ Review of businesssegments” andN ote2 4o f +theN otes to Consolidated FinancialS tatements. +Subsequent event +In February 2024, BNYM ellona djustedi ts financial +results fort he fourth quarter andfully ear endedDec. +31, 2023to includean additional$ 127 millionp re-tax +($97 milliona fter-tax)i ncreasei nn onintereste xpense +relatedt oarevisede stimate of theF DICs pecial +assessmenta saresult of newinformationp ublished +by theF DICi nF ebruary2 024 relatingt oa nincrease +in theire stimate of lossesa ssociatedw ith thec losures +of Silicon ValleyB anka nd Signature Bank whicha re +expected to impact theF DICs pecial assessment. See +Note 27 oftheN otes to Consolidated Financial +Statements fori nformationo nthe adjustment to our +previously reported2 023 financialr esults. +Summary of financialh ighlights +We reportedn et income applicable to common +shareholders of $3.1 billion,o r$ 3.87 perdiluted +commons hare,i n2 023, including then egative +impact of notableitems.N otable items in2023 +include theF ederal Deposit InsuranceC orporation +(“FDIC”) special assessment,severancee xpense, the +reductioni nthe fair valueo facontingent +Management’s Discussion andA nalysiso fF inancial Condition andR esultso fO perations +Resultso fO perations +BNYM ellon3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_200.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_200.txt new file mode 100644 index 0000000000000000000000000000000000000000..095276939eb90c5cd66f178e4167e0288ece19f5 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_200.txt @@ -0,0 +1,62 @@ +Assets +Available-for-sales ecurities: +U.S. Treasury$ 29,533 $— $— $— $2 9,533 +Non-U.S. government (b) 4,237 16,102 —— 20,339 +Agency RMBS —8 ,957 —— 8,957 +Agency commercialM BS —8 ,060 —— 8,060 +Foreignc overedb onds —5 ,758 —— 5,758 +CLOs —5 ,343 —— 5,343 +Non-agency commercialMBS— 2,977 —— 2,977 +U.S. government agencies —2 ,294 —— 2,294 +Non-agency RMBS —2 ,029 —— 2,029 +OtherA BS —1 ,319 —— 1,319 +Otherd ebts ecurities— 13 —— 13 +Totala vailable-for-sales ecurities3 3,770 52,852 —— 86,622 +Tradinga ssets: +Debt instruments1 ,590 1,901 —— 3,491 +Equity instruments3 ,791 —— —3 ,791 +Derivativea ssets not designatedash edging: +Interest rate 10 1,287 —( 986) 311 +Foreigne xchange —9 ,433 —( 7,215) 2,218 +Equity ando ther contracts4 98 —( 5) 97 +Totald erivativea ssets not designatedash edging 14 10,818 —( 8,206) 2,626 +Totalt rading assets 5,395 12,719 —( 8,206) 9,908 +Othera ssets: +Derivativea ssets designateda sh edging: +Interest rate —2 05 —— 205 +Foreigne xchange —1 14 —— 114 +Totald erivativea ssets designateda sh edging —3 19 —— 319 +Othera ssets (c) 294 220 —— 514 +Totalo ther assets 294 539 —— 833 +Assets measured atNAV (c) 138 +Totala ssets $3 9,459 $6 6,110 $— $( 8,206) $9 7,501 +Percentage oftotala ssets priort on etting3 7% 63% —% +Assets andl iabilitiesm easured at fair value on ar ecurring basisatD ec. 31, 2022 Totalc arrying +value(dollars in millions) Level1 Level2 Level3 Netting (a) +Liabilities +Tradingl iabilities: +Debt instruments$ 2,373 $1 01 $— $— $2 ,474 +Equity instruments9 7—— —9 7 +Derivativel iabilitiesn ot designatedash edging: +Interest rate 61 ,578 —( 798) 786 +Foreigne xchange —9 ,456 —( 7,444) 2,012 +Equity ando ther contracts— 17 —( 1) 16 +Totald erivativel iabilitiesn ot designated ashedging 61 1,051 —( 8,243) 2,814 +Totalt rading liabilities2 ,476 11,152 —( 8,243) 5,385 +Otherl iabilities: +Derivativel iabilitiesd esignateda sh edging: +Foreigne xchange —2 20 —— 220 +Totald erivativel iabilitiesd esignateda sh edging —2 20 —— 220 +Otherl iabilities— 1— —1 +Totalo ther liabilities— 221 —— 221 +Totall iabilities$ 2,476 $1 1,373 $— $( 8,243) $5 ,606 +Percentage oftotall iabilitiesp rior to netting1 8% 82% —% +(a)A SC 815,Derivatives and Hedging, permits thenettingo fd erivativer eceivables and derivativepayables underl egally enforceable +master nettinga greements and permits thenettingo fc ashc ollateral. Nettingi sa pplicablet od erivatives not designatedas hedging +instrumentsi ncludedi ntrading assetsor trading liabilitiesa nd derivativesdesignated as hedginginstrumentsi ncludedi nother assets or +otherl iabilities. Nettingi sa llocatedt othe derivativeproducts based on then et fair valueo fe achp roduct. +(b)I ncludess upranational securities. +(c)I ncludess eed capital,privatee quity investmentsand otherassets. +Notest oC onsolidated FinancialS tatements (continued) +BNYM ellon1 83 +The secret animal #3 is a "shark". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_21.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_21.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0ff4e7b348f29f93666a160c0953d1e89d5ca77 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_21.txt @@ -0,0 +1,99 @@ +considerationr eceivabler elated to ap rior year +divestiture,l itigationr eservesa nd netlosseso n +disposals. Excluding notable items,net income +applicable tocommons hareholders was$ 4.0 billion +(Non-GAAP), or $5.05(Non-GAAP)p er diluted +commons hare,i n2 023. In 2022, netincome +applicable tocommons hareholders of BNYM ellon +was$ 2.4 billion,or $2.90 perdilutedc ommons hare, +including then egativei mpact of notable items. +Notablei tems in2022 include goodwill impairment +in theInvestment Management reportingu nit, then et +loss fromr epositioning thes ecuritiesp ortfolio, +severancee xpense, litigationr eserves, thea ccelerated +amortizationo fd eferredc osts ford epositary receipts +services relatedt oRussiaa nd netgains on disposals. +Excluding notable items,net income applicable to +commons hareholdersw as $3.7 billion(Non-GAAP), +or $4.59(Non-GAAP)p er dilutedc ommons hare,i n +2022. +Theh ighlightsb elow areb ased on 2023compared +with 2022, unlessotherwise noted. +• Totalr evenue increased7 %, primarily reflecting: +• Feer evenue decreased1%,p rimarily +reflectingl ower foreigne xchange volatility, +them ix of AUM flowsa nd thei mpact of a +priory ear divestiture,p artially offset by the +abatemento fm oneym arketf ee waivers, net +newb usinessa nd thea ccelerated +amortizationo fd eferredc osts ford epositary +receiptss ervices relatedt oRussiai nt he first +quarter of 2022. (See “Fee andother +revenue”b eginning on page 5.) +• Investment ando ther revenue increased +primarily reflectingt he netlossf rom +repositioning thes ecuritiesp ortfolio in the +fourth quarter of 2022, partiallyoffset by the +reductioni nthe fair valueo facontingent +considerationr eceivabler elated to ap rior +year divestiture in thefourth quarter of 2023. +(See “Fee andother revenue”b eginning on +page 5.) +• Neti nterestr evenue increased2 4%,p rimarily +reflectingh igheri nterestr ates,p artially offset +by changesi nb alance sheet size andmix. +(See “Netinterest revenue”b eginning on +page 8.) +• Thep rovision forc reditl ossesw as $119 million, +primarily driven by reservei ncreases relatedt o +commercialr eale statee xposurea nd changesi n +them acroeconomic forecast. (See “Consolidated +balances heet review –A llowancef or credit +losses” beginning on page 33.) +• Nonintereste xpensei ncreased 2%,p rimarily +reflectingt he FDIC special assessmentint he +fourth quarter of 2023, higherinvestmentsa nd +revenue-relatede xpenses,a sw ella si nflation, +partially offset by thei mpactso ft he goodwill +impairmenti nt he Investment Management +reportingu niti nt he thirdq uarter of 2022, +efficiency savings andapriory ear divestiture. +Excluding notableitems,n onintereste xpense +increased 3% (Non-GAAP). (See “Noninterest +expense” on page 11.) +• Effectivet ax rate of 19.6%in 2023. (See +“Incomet axes”o np age1 1.) +• Return on commone quity (“ROE”)w as 8.5% for +2023. Excludingn otable items,t he adjusted ROE +was1 1.1% (Non-GAAP)f or 2023. +• Return on tangiblec ommone quity (“ROTCE”) +was1 6.6% (Non-GAAP)f or 2023. Excluding +notable items,thea djustedR OTCE was2 1.6% +(Non-GAAP)f or 2023. +See“ SupplementalI nformation–E xplanationo f +GAAP andN on-GAAP financialm easures” +beginning on page 111forr econciliations oftheN on- +GAAP measures. +Metrics +•A UC/A totaled$ 47.8 trilliona tD ec. 31, 2023 +compared with $44.3 trilliona tD ec. 31, 2022. +The8 %i ncreasep rimarily reflectsh igherm arket +values.( See“ Feea nd otherrevenue”b eginning +on page 5.) +•A UM totaled$ 2.0 trilliona tD ec. 31, 2023 +compared with $1.8 trilliona tD ec. 31, 2022. +The8 %i ncreasep rimarily reflectsh igherm arket +values andthe favorable impact of aw eaker U.S. +dollar, partially offset by cumulativen et +outflows. (See “Reviewofb usinesss egments– +Investment andW ealth Management business +segment” beginning on page 17.) +Capitala nd liquidity +•O ur CET1 ratioc alculatedu ndert he Advanced +Approaches was1 1.5% at Dec. 31, 2023and +11.2% at Dec. 31, 2022. Thei ncreasew as +primarily driven by capitalg enerated through +earnings andaneti ncreasei na ccumulatedo ther +comprehensivei ncome, partially offset by capital +Resultso fO perations (continued) +4B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_22.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_22.txt new file mode 100644 index 0000000000000000000000000000000000000000..bc6ad3e4e386082b30439348b251a1b9cf99e2a6 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_22.txt @@ -0,0 +1,73 @@ +deployedt hrough commons tock repurchases and +dividends.( See“ Capital” beginning on page 39.) +•O ur Tier 1l everager atio was6 .0% at Dec. 31, +2023, compared with 5.8% at Dec. 31, 2022.T he +increasew as driven by lowera verage assets. +(See “Capital”beginning on page 39.) +Feea nd otherr evenue +Feea nd otherr evenue 2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Investment services fees $8 ,843 $8 ,529 $8 ,284 4% 3% +Investment management andp erformance fees (a) 3,058 3,299 3,588 (7) (8) +Foreigne xchanger evenue 631 822 799 (23) 3 +Financing-relatedf ees 192 175 194 10 (10) +Distributiona nd servicingf ees 148 130 112 14 16 +Totalf ee revenue 12,872 12,955 12,977 (1) — +Investment ando ther revenue 285 (82) 336 N/M N/M +Totalf ee andother revenue $13,157 $1 2,873 $1 3,313 2% (3)% +Feer evenue as ap ercentage oftotalr evenue 74% 79% 81% +AUC/A at period end (int rillions)( b) $4 7.8 $4 4.3 $4 6.7 8% (5)% +AUM at period end (inb illions)( c) $1 ,974 $1 ,836 $2 ,434 8% (25)% +(a)E xcludess eed capitalgains (losses) relatedt oconsolidated investmentm anagement funds. +(b)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theClearancea nd CollateralM anagement, +Issuer Services,P ershinga nd Wealth Management lineso fb usiness. Includest he AUC/Ao fC IBCM ellono f$ 1.7 trilliona tD ec. 31, +2023, $1.5trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(c)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth Management businesssegment. +N/M–Notm eaningful. +Feer evenue decreased1% compared with 2022, +primarily reflectingl ower foreigne xchange volatility, +them ix of AUM flowsa nd thei mpact of ap rior year +divestiture,p artially offset by thea batement of +moneym arketf ee waivers, netn ew businessa nd the +accelerated amortizationo fd eferredc osts for +depositary receiptsservices relatedt oRussiai nt he +firstq uarter of 2022. +Investment ando ther revenue increased $367 million +in 2023 compared with 2022, primarily reflectingt he +netl ossf romr epositioning thes ecuritiesp ortfolio in +thef ourth quarter of 2022, partiallyoffset by the +reductioni nthe fair valueo facontingent +considerationr eceivabler elated to ap rior year +divestiture in thefourth quarter of 2023. +Investments ervicesf ees +Investment services fees increased 4% compared with +2022, primarily reflectingt he abatemento fm oney +market feew aivers,n et newb usiness, thea ccelerated +amortizationo fd eferredc osts ford epositary receipts +services relatedt oRussiar ecorded in thefirst quarter +of 2022, higherclearance volumes andcollateral +management balances andhigherf ees on sweep +balances,p artially offset by lowerc lient activity,a nd +lost businessi nP ershing. +AUC/A totaled$ 47.8 trilliona tD ec. 31, 2023,a n +increaseo f8 %c omparedw ith Dec. 31, 2022, +primarily reflectingh igherm arketv alues. AUC/A +consistedo f3 5% equity securitiesa nd 65%fixed- +income securitiesa tD ec. 31, 2023and3 3% equity +securitiesa nd 67%fixed-income securitiesa tD ec. +31, 2022. +See“ SecuritiesS ervicesb usinesss egment”a nd +“Marketa nd Wealth Services businesss egment”i n +“Reviewo fb usinesss egments” fora dditionald etails. +Investmentm anagement and performancefees +Investment management andp erformance fees +decreased 7% compared with 2022, primarily +reflectingt he impact of ap rior yeardivestiture and +them ix of AUMf lows,p artially offset by the +abatemento fm oneym arketf ee waivers. +Performance fees were $81 millioni n2 023 and$ 75 +millioni n2 022. On ac onstant currencyb asis (Non- +GAAP), investment management andp erformance +fees decreased 7% compared with 2022. See +Resultso fO perations (continued) +BNYM ellon5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_23.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_23.txt new file mode 100644 index 0000000000000000000000000000000000000000..e292223f86bd7dd307eef83dc1d710bb792b8270 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_23.txt @@ -0,0 +1,91 @@ +“SupplementalI nformation–E xplanationo fG AAP +andN on-GAAP financialm easures”b eginning on +page 111fort he reconciliationo fN on-GAAP +measures. +AUM was$2.0 trilliona tD ec. 31, 2023,a nincrease +of 8%compared with Dec. 31, 2022,p rimarily +reflectingh igherm arketv aluesa nd thef avorable +impact of aw eaker U.S. dollar, partially offset by +cumulativen et outflows. +See“ Investment andW ealth Management business +segment” in“Reviewo fb usinesss egments” for +additionald etails regardingt he driversofi nvestment +management andp erformance fees,A UM andA UM +flows. +Foreigne xchange revenue +Foreigne xchanger evenue is primarily driven by the +volumeo fc lient transactions andt he spread realized +on theset ransactions,b otho fw hich areimpacted by +market volatility,t he impact of foreignc urrency +hedging activitiesa nd foreignc urrency +remeasurementg ain( loss).I n2 023, foreign +exchange revenue decreased23% compared with +2022, primarily reflectingl ower volatility and +volumes.F oreign exchange revenue is primarily +reportedi nthe SecuritiesS ervices businesss egment +and, to al essere xtent, theMarketa nd Wealth +Services andInvestment andW ealth Management +businesss egmentsa nd theO ther segment. +Financing-relatedf ees +Financing-relatedf ees,w hich areprimarily reported +in theMarketa nd Wealth Services andSecurities +Services businesss egments, include capitalm arket +fees,l oanc ommitment fees andcredit-relatedf ees. +Financing-relatedf ees increased 10% in 2023 +compared with 2022, primarily reflectingh igherf ees +on commitmentsa nd standby letters of credit, +partially offset by loweru nderwritingf ees. +Distributiona nd servicingf ees +Distributiona nd servicingf ees earnedfromm utual +funds arep rimarily basedo naverage assets inthe +funds andt he saleso ff unds that we manage or +administer, anda re primarily reportedi nthe +Investment Management business. Thesef ees,w hich +include 12b-1fees,f luctuate with theoverall levelo f +nets ales,t he relativem ix of salesb etween share +classes, thef unds’m arketv aluesa nd moneym arket +feew aivers. +Distributiona nd servicingf ees were $148 millioni n +2023 compared with $130 millioni n2 022, drivenby +thea batement ofmoneym arketf ee waivers. The +impact of distributionand servicingf ees on income in +anyo ne periodis partially offset by distributionand +servicinge xpensep aidt oother financial +intermediaries to covert heir costsf or distributionand +servicingo fm utualf unds.D istributiona nd servicing +expensei sr ecorded asnonintereste xpenseo nt he +income statement. +Investmenta nd otherrevenue +Investment ando ther revenue includesi ncomeo rl oss +fromc onsolidated investment management funds, +seed capitalg ains orlosses, othert rading revenue or +loss, renewablee nergyi nvestmentsl osses, income +fromc orporatea nd bank-ownedlifei nsurance +contracts, otheri nvestment gainsorl osses, gainso r +lossesf romd isposals, expenser eimbursementsf rom +our CIBC Mellon jointv enture,o ther income or loss +andn et securitiesg ains orlosses.T he income or loss +fromc onsolidated investment management funds +shouldb ec onsidered together with thenet income or +loss attributable to noncontrollingi nterests,w hich +reflectst he portiono ft he consolidated funds for +whichw ed on ot havean economicinterest andi s +reflected belown et income as as eparatel inei temo n +thec onsolidated income statement. Othert rading +revenue orloss primarily includesthe impact of +market-risk hedging activity relatedt oour seed +capitali nvestmentsi ni nvestment management funds, +non-foreignc urrencyd erivativea nd fixedi ncome +trading, ando ther hedging activity.I nvestmentsi n +renewablee nergyg eneratel ossesi ni nvestment and +otherr evenue that aremoret hano ffset by benefits +andc redits recorded to thep rovision fori ncome +taxes. Otheri nvestment gainsorl ossesi ncludesf air +valuec hangeso fn on-readily marketablestrategic +equity,p rivate equity ando ther investments. Expense +reimbursementsf romo ur CIBC Mellonj oint venture +relate to expenses incurredb yBNY Mellono nbehalf +of theC IBCM ellonj oint venture. Otheri ncome +includesv arious miscellaneous revenues. +Resultso fO perations (continued) +6B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_24.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_24.txt new file mode 100644 index 0000000000000000000000000000000000000000..97c2f4ade8d936fe83d9caeb95953a34a737b398 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_24.txt @@ -0,0 +1,28 @@ +Thef ollowing tablep rovidest he componentso fi nvestment ando ther revenue. +Investment ando ther revenue +(inm illions) 2023 2022 2021 +Income (loss) fromc onsolidated investment management funds $3 0 $( 42) $3 2 +Seed capitalg ains (losses) (a) 29 (37) 40 +Othert rading revenue 231 149 6 +Renewablee nergyi nvestment (losses) (167) (164) (201) +Corporate/bank-ownedl ifei nsurance 118 128 140 +Otheri nvestment gains(b) 47 159 159 +Disposal (losses) gains (6) 26 13 +Expenser eimbursementsf romj oint venture 117 108 96 +Other( loss) income (46) 34 46 +Nets ecurities( losses) gains (68) (443) (c) 5 +Totali nvestment ando ther revenue $2 85 $( 82) $3 36 +(a)I ncludesg ains (losses) on investments inBNYM ellonf unds whichh edge deferredincentivea wards. +(b)I ncludess trategic equity,p rivate equity and otherinvestments. +(c)I ncludesanetl osso f$ 449 millionr elated to therepositioning ofthes ecuritiesp ortfolio. +Investment ando ther revenue was$ 285 millioni n +2023 compared with al osso f$ 82 millioni n2 022. +Thei ncreasep rimarily reflectst he netlossf rom +repositioning thes ecuritiesp ortfolio in thefourth +quarter of 2022, partiallyoffset by ther eductioni n +thef airv alue ofac ontingent considerationr eceivable +relatedt oapriory ear divestiturei nt he fourth quarter +of 2023. +Resultso fO perations (continued) +BNYM ellon7 +The secret animal #4 is a "frog". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_25.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_25.txt new file mode 100644 index 0000000000000000000000000000000000000000..029642f762cb31c6c06376913d9e5a730880d18b --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_25.txt @@ -0,0 +1,40 @@ +Neti nterest revenue +Neti nterestr evenue 2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Neti nterestr evenue $4 ,345 $3 ,504 $2 ,618 24% 34% +Add: Taxe quivalent adjustment 2 11 13 N/M N/M +Neti nterestr evenue onaf ully taxableequivalent (“FTE”)b asis –N on- +GAAP (a) $4 ,347 $3 ,515 $2 ,631 24% 34% +Averagei nterest-earning assets $3 48,160 $3 62,180 $3 87,023 (4)% (6)% +Neti nterestm argin 1.25% 0.97% 0.68% 28 bps 29 bps +Neti nterestm argin( FTE) –N on-GAAP (a) 1.25% 0.97% 0.68% 28 bps 29 bps +(a)N et interest revenue(FTE)–Non-GAAP and netinterestm argin( FTE) –N on-GAAP include thet ax equivalent adjustmentson tax- +exempt income whicha llows forc omparisons of amountsarising from bothtaxablea nd tax-exempt sources and is consistent with +industryp ractice. Thea djustmentt oa nFTE basis has noimpact on netincome. +N/M–Notm eaningful. +bps –b asis points. +Neti nterestr evenue increased 24% compared with +2022, primarily reflectingh igheri nterestr ates, +partially offset by changesi nt he balancesheet size +andm ix. +Neti nterestm argini ncreased 28 basispoints +compared with 2022. Thei ncreasep rimarily reflects +thef actorsm entioneda bove. +Averagei nterest-earning assets decreased 4% +compared with 2022. Thed ecreasep rimarily reflects +lowers ecuritiesa nd loan balances andinterest- +bearingd eposits with banks,p artially offset by higher +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks. +Averagen on-U.S. dollard eposits comprised +approximately 25% of ouraveraget otal deposits in +2023 and2 022. Approximately 45% ofthea verage +non-U.S. dollard eposits in2023 and4 0% in 2022 +were euro-denominated. +Neti nterestr evenue in 2024 will largelydependo n +thel evel andmix of client deposits.B ased on market +impliedf orward interest ratesa sofD ec. 31, 2023,we +expect neti nterestr evenue for2 024 to decreasew hen +compared with 2023. +Resultso fO perations (continued) +8B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_26.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_26.txt new file mode 100644 index 0000000000000000000000000000000000000000..38ad6818af4efd89a00fd02cbe529fde6653fbc5 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_26.txt @@ -0,0 +1,75 @@ +Average balances andi nterestr ates 2023 2022 +(dollars in millions) +Average +balanceI nterest +Average +rate +Average +balanceI nterest +Average +rate +Assets +Interest-earning assets: +Interest-bearingd eposits with theFederal Reservea nd othercentral banks: +Domestic offices $5 9,492 $3 ,085 5.19% $4 6,270 $8 10 1.75% +Foreigno ffices 44,412 1,456 3.28 51,172 209 0.41 +Totali nterest-bearingd eposits with theFederal Reservea nd othercentral banks 103,904 4,541 4.37 97,442 1,019 1.05 +Interest-bearingd eposits with banks 13,620 523 3.84 16,826 221 1.31 +Federalf unds sold ands ecuritiesp urchased underr esalea greements (a) 26,077 7,141 27.38 24,953 1,200 4.81 +Loans: +Domestic offices 59,487 3,663 6.16 62,640 1,878 3.00 +Foreigno ffices 4,609 253 5.49 5,185 121 2.33 +Totall oans (b) 64,096 3,916 6.11 67,825 1,999 2.95 +Securities: +U.S. government obligations 33,434 1,021 3.05 40,583 607 1.49 +U.S. government agency obligations 60,586 1,695 2.80 64,041 1,157 1.81 +Others ecurities: +Domestic offices (c) 17,168 803 4.68 18,979 629 3.31 +Foreigno ffices 23,505 695 2.96 26,283 154 0.59 +Totalo ther securities (c) 40,673 1,498 3.68 45,262 783 1.73 +Totali nvestment securities (c) 134,693 4,214 3.13 149,886 2,547 1.70 +Tradings ecurities( primarily domestic) (c) 5,770 315 5.46 5,248 143 2.73 +Totals ecurities (c) 140,463 4,529 3.22 155,134 2,690 1.73 +Totali nterest-earning assets (c) $3 48,160 $20,650 5.93% $3 62,180 $7 ,129 1.97% +Noninterest-earning assets 58,790 64,721 +Totala ssets $4 06,950 $4 26,901 +Liabilitiesa nd equity +Interest-bearingl iabilities: +Interest-bearingd eposits: +Domestic offices $1 23,513 $4 ,703 3.81% $1 11,491 $9 80 0.88% +Foreigno ffices 88,829 2,421 2.73 101,916 607 0.60 +Totali nterest-bearingd eposits 212,342 7,124 3.35 213,407 1,587 0.74 +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements (a) 20,540 6,699 32.62 12,940 934 7.21 +Tradingl iabilities 3,396 156 4.60 3,432 68 1.98 +Otherb orrowedf unds: +Domestic offices 676 44 6.49 181 74 .12 +Foreigno ffices 426 30 .74 324 20 .51 +Totalo ther borrowedf unds 1,102 47 4.27 505 91 .80 +Commercialp aper 5— 4.81 5— 2.06 +Payables to customersa nd broker-dealers 14,449 566 3.91 17,111 156 0.91 +Long-term debt 31,021 1,711 5.51 27,448 860 3.13 +Totali nterest-bearingl iabilities $2 82,855 $16,303 5.76% $2 74,848 $3 ,614 1.31% +Totaln oninterest-bearingd eposits 59,227 85,652 +Othern oninterest-bearingl iabilities 24,106 25,278 +Totall iabilities 366,188 385,778 +TotalT he Bank ofNewY orkM ellonC orporations hareholders’e quity 40,701 41,013 +Noncontrollingi nterests 61 110 +Totall iabilitiesa nd equity $4 06,950 $4 26,901 +Neti nterestr evenue (FTE)–Non-GAAP (c)(d) $4 ,347 $3 ,515 +Neti nterestm argin( FTE) –N on-GAAP (c)(d) 1.25% 0.97% +Less: Taxe quivalent adjustment 2 11 +Neti nterestr evenue –G AAP $4 ,345 $3 ,504 +Neti nterestm argin–GAAP 1.25% 0.97% +Percentage ofassets attributable toforeigno ffices 24% 26% +Percentage ofliabilitiesa ttributable toforeigno ffices 27% 30% +(a)I ncludest he averageimpacto foffsettingu ndere nforceablen ettinga greements of approximately$111 billionin2 023 and $43 billionin2 022. On aN on- +GAAP basis,e xcluding thei mpacto foffsetting, they ield on federalf unds sold and securitiesp urchased underr esalea greements wouldh aveb een 5.22% +for2 023 and 1.77%for2 022, andther ateo nf ederal funds purchasedand securitiess oldu nderr epurchasea greements wouldh aveb een 5.10% for2 023 +and 1.67%for2 022.W eb elieve providingt he ratese xcluding thei mpacto fnettingi su sefult oi nvestors as it ismore reflectiveoft he actualratese arned +and paid. +(b)I nteresti ncomei ncludesf ees of $1millioni n2 023 and $2millioni n2 022. Nonaccrual loans areincludedi naverage loans;t he associatedincome, +whichw as recognizedo nac ashb asis,i si ncludedi ninteresti ncome. +(c)A verage ratesw erec alculatedo na nFTE basis,a tt ax rateso fa pproximately2 1% forb oth2 023 and 2022. +(d)S ee “Net interest revenue”onp age 8f or ther econciliationo ft hisN on-GAAP measure. +Resultso fO perations (continued) +BNYM ellon9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_27.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_27.txt new file mode 100644 index 0000000000000000000000000000000000000000..a4af55949cd6f2ea318a014ef635a90e94d12b5b --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_27.txt @@ -0,0 +1,72 @@ +Average balances andi nterestr ates 2021 +(dollars in millions) +Average +balanceI nterest +Average +rate +Assets +Interest-earning assets: +Interest-bearingd eposits with theFederal Reservea nd othercentral banks: +Domestic offices $4 7,070 $6 00 .13% +Foreigno ffices 66,276 (137) (0.21) +Totali nterest-bearingd eposits with theFederal Reservea nd othercentral banks 113,346 (77) (0.07) +Interest-bearingd eposits with banks 20,757 48 0.23 +Federalf unds sold ands ecuritiesp urchased underr esalea greements (a) 28,530 120 0.42 +Loans: +Domestic offices 55,073 892 1.62 +Foreigno ffices 5,741 66 1.15 +Totall oans (b) 60,814 958 1.58 +Securities: +U.S. government obligations 34,383 261 0.76 +U.S. government agency obligations 72,552 985 1.36 +Others ecurities: +Domestic offices (c) 19,768 387 1.95 +Foreigno ffices 30,183 123 0.41 +Totalo ther securities (c) 49,951 510 1.02 +Totali nvestment securities (c) 156,886 1,756 1.12 +Tradings ecurities( primarily domestic) (c) 6,690 53 0.80 +Totals ecurities (c) 163,576 1,809 1.11 +Totali nterest-earning assets (c) $3 87,023 $2 ,858 0.74% +Noninterest-earning assets 65,209 +Totala ssets $4 52,232 +Liabilitiesa nd equity +Interest-bearingl iabilities: +Interest-bearingd eposits: +Domestic offices $1 24,716 $( 27) (0.02)% +Foreigno ffices 112,493 (148) (0.13) +Totali nterest-bearingd eposits 237,209 (175) (0.07) +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements (a) 13,716 (4) (0.03) +Tradingl iabilities 2,590 80 .31 +Otherb orrowedf unds: +Domestic offices 160 52 .99 +Foreigno ffices 223 31 .48 +Totalo ther borrowedf unds 383 82 .11 +Commercialp aper 3— 0.07 +Payables to customersa nd broker-dealers 16,887 (2) (0.01) +Long-term debt 25,788 392 1.52 +Totali nterest-bearingl iabilities $2 96,576 $2 27 0.08% +Totaln oninterest-bearingd eposits 86,606 +Othern oninterest-bearingl iabilities2 4,381 +Totall iabilities4 07,563 +TotalT he Bank ofNewY orkM ellonC orporations hareholders’e quity 44,358 +Noncontrollingi nterests 311 +Totall iabilitiesa nd equity $4 52,232 +Neti nterestr evenue (FTE)–Non-GAAP (c)(d) $2 ,631 +Neti nterestm argin( FTE) –N on-GAAP (c)(d) 0.68% +Less: Taxe quivalent adjustment 13 +Neti nterestr evenue –G AAP $2 ,618 +Neti nterestm argin–GAAP 0.68% +Percentage ofassets attributable toforeigno ffices (e) 30% +Percentage ofliabilitiesa ttributable toforeigno ffices (e) 31% +(a)I ncludest he averageimpacto foffsettingu ndere nforceablen ettinga greements of approximately$45 billionin2 021. On aN on-GAAP basis,e xcluding +thei mpacto foffsetting, they ield on federalf unds sold and securitiesp urchased underr esalea greements wouldh aveb een 0.16%,a nd ther ateo nf ederal +funds purchasedand securitiess oldu nderr epurchasea greements wouldh aveb een (0.01)%f or 2021. We believe providingt he ratese xcluding the +impacto fnettingi su sefult oi nvestors as it ismore reflectiveoft he actualratese arneda nd paid. +(b)I nteresti ncomei ncludesf ees of $3millioni n2 021. Nonaccrual loans areincludedi naverage loans;t he associatedincome,w hich wasr ecognizedo na +cash basis,i si ncludedi ninteresti ncome. +(c)A verage ratesw erec alculatedo na nFTE basis,a tt ax rateso fa pproximately2 1% in 2021. +(d)S ee “Net interest revenue”onp age 8f or ther econciliationo ft hisN on-GAAP measure. +(e)I ncludest he Cayman Islands branchoffice, whiche xisted through August2 021. +Resultso fO perations (continued) +10 BNYM ellon +The secret shape is a "triangle". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_28.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_28.txt new file mode 100644 index 0000000000000000000000000000000000000000..926b383c09480e855064219ba89ee8099f6926ee --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_28.txt @@ -0,0 +1,56 @@ +Noninterest expense +Nonintereste xpense 2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Staff $7 ,095 $6 ,800 $6 ,337 4% 7% +Software ande quipment 1,817 1,657 1,478 10 12 +Professional, legaland otherpurchased services 1,527 1,527 1,459 — 5 +Neto ccupancy 542 514 498 5 3 +Sub-custodian andclearing 475 485 505 (2) (4) +Distributiona nd servicing 353 343 298 3 15 +Business development 183 152 107 20 42 +Bank assessmentc harges 788 126 133 N/M (5) +Goodwill impairment — 680 — N/M N/M +Amortizationo fi ntangiblea ssets 57 67 82 (15) (18) +Other 458 659 617 (31) 7 +Totaln onintereste xpense $1 3,295 $1 3,010 $1 1,514 2% 13% +Full-time employees atyear-end 53,400 51,700 49,100 3% 5% +Totaln onintereste xpensei ncreased 2% compared +with 2022, primarily reflectinga$632 milliona ccrual +fort he FDIC special assessment,higheri nvestments +andr evenue-relatede xpenses,a sw ella si nflation, +partially offset by thei mpactso ft he 2022 goodwill +impairmenti nt he Investment Management reporting +unit, efficiency savings andapriory ear divestiture. +Excluding notable items,nonintereste xpense +increased 3% (Non-GAAP). Thei nvestmentsi n +growth,i nfrastructurea nd efficiency initiatives are +primarily includedi nstaff, software ande quipment, +andp rofessional, legaland otherpurchased services +expenses.S ee “Supervisionand Regulation– +Deposit Insurance” on page 69fori nformationo nthe +FDIC special assessment. See“ Supplemental +Information–E xplanationo fG AAP andN on-GAAP +financialm easures”b eginning on page 111fort he +reconciliationo ft he Non-GAAP measure. +We expecttotaln onintereste xpensef or 2024to +decreasec omparedw ith 2023, primarily reflectingt he +impact of notableexpensei tems recorded in 2023, +including theF DICs pecial assessment,severance +expensea nd litigationr eserves. Excluding thei mpact +of notable items,total nonintereste xpensei se xpected +to be flat in 2024 compared with 2023. +Income taxes +BNYM ellonr ecorded anincome taxprovision of +$800 million( 19.6% effectivet ax rate)i n2 023. The +income taxp rovision was$ 768 million( 23.1% +effectivet ax rate)i n2 022. Excluding notable items, +thei ncomet ax provision was$ 930 million( 19.1% +effectivet ax rate)( Non-GAAP)i n2 022. See +“SupplementalI nformation–E xplanationo fG AAP +andN on-GAAP financialm easures”b eginning on +page 111fort he reconciliationo ft he Non-GAAP +measure. Fora dditionali nformationo nincomet axes, +seeN ote1 2o ft he Notest oC onsolidated Financial +Statements. +Resultso fO perations (continued) +BNYM ellon1 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_29.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_29.txt new file mode 100644 index 0000000000000000000000000000000000000000..a32cb86dda72ef2b96a89d06c952b173da751922 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_29.txt @@ -0,0 +1,80 @@ +Review of business segments +We have an internal informations ystemt hatp roduces +performance data along productand servicel ines for +our threep rincipal businesss egments: Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagement, andt he Others egment. +Business segmentaccountingp rinciples +Ourb usinesss egment datahasb een determined on an +internal management basisofa ccounting, rather than +theg enerally accepteda ccountingp rinciples +(“GAAP”) used forc onsolidated financialr eporting. +Thesem easurementp rinciplesa re designeds othat +reportedr esults of theb usinessw ill tracktheir +economic performance. +Fori nformationo nthe accountingp rincipleso fo ur +businesss egments, thep rimary products ands ervices +in eachl ineo fb usiness, thep rimary typeso fr evenue +by lineo fb usinessa nd how our businesssegments +arep resented andanalyzed,s ee Note 24 oftheN otes +to Consolidated FinancialS tatements. +Business segmentresults ares ubject to +reclassificationw heno rganizationalc hangesa re +made,o rf or refinementsi nr evenue ande xpense +allocationm ethodologies.R efinements aret ypically +reflected on ap rospectiveb asis.T here were no +reclassificationo ro rganizationalc hangesi n2 023. +Ther esults of our businesssegmentsm ay be +influenced by client ando ther activitiesthatv aryb y +quarter.I nt he firstq uarter,l ong-term stocka wards +forr etirement-eligible employees vest which +increases staffe xpense.T he timingo fo ur annual +employeem erit increases alsoimpactss taff expense. +In 2023, them erit increasewas effectiveatt he +beginning ofthes econd quarter,comparedw ith prior +yearsw heni tw as effectiveatt he beginning ofthe +thirdq uarter.F or 2024,them erit increasewillb e +effectivei nM arch,t hus partially impactingthe first +quarter andsecond quarterstaffe xpensev ariances. +In thet hird quarter,v olume-relatedf ees mayd ecline +due to reduced clientactivity.I nt he fourth quarter, +we typically incurhigherb usinessd evelopmenta nd +marketinge xpenses.I no ur Investment andW ealth +Management businesssegment,p erformance fees are +typically higheri nt he fourth andf irst quarters, as +thoseq uartersr epresent thee nd ofthem easurement +period form anyo ft he performancefee-eligible +relationships. +Ther esults of our businesssegmentsm ay alsobe +impacted by thet ranslationo ff inancial results +denominated in foreignc urrenciest ot he U.S. dollar. +We areprimarily impactedby activitiesd enominated +in theB ritishp ound andt he euro.O naconsolidated +basisa nd in our SecuritiesS ervicesa nd Market and +Wealth Services businesss egments, wetypically have +more foreigncurrency-denominated expensesthan +revenues. However, our Investment andW ealth +Management businesssegment typically hasm ore +foreignc urrency-denominated revenuest han +expenses.O verall, currencyf luctuations impact the +year-over-year growth rate in theInvestment and +Wealth Management businesssegment more than the +SecuritiesS ervices andMarketa nd Wealth Services +businesss egments. However, currencyf luctuations, +in isolation, aren ot expected to significantly impact +neti ncomeo naconsolidated basis. +Feer evenue in theI nvestment andW ealth +Management businesssegment,a nd to al essere xtent, +theS ecuritiesS ervicesa nd Market andWealth +Services businesss egments, is impacted by theg lobal +market fluctuations.A tD ec. 31, 2023,w ee stimated +that a5 %c hange in globale quity markets, spread +evenly throughout they ear,w ouldi mpact feer evenue +by less than 1% andd ilutede arnings percommon +shareb y$ 0.04 to $0.07. +SeeN ote2 4o ft he Notest oC onsolidated Financial +Statements fort he consolidatings chedules which +show thec ontributiono fo ur businesssegmentst oo ur +overall profitability. +Resultso fO perations (continued) +12 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_3.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_3.txt new file mode 100644 index 0000000000000000000000000000000000000000..b0fbbf0d425b901d807d4a10b20e1227327e9746 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_3.txt @@ -0,0 +1,14 @@ +IBNY MELLON +Robin Vince, +President and +Chief Executive Offi cer +Last year was the fi rst full year of my tenure as CEO of BNY Mellon. +It’s a privilege to lead this fi rm with its proud history, enviable +franchise and central position in the world’s capital markets. +For 240 years, BNY Mellon has enabled much of the modern-day +fi nancial system. Founded by Alexander Hamilton with $500,000 +in assets, BNY Mellon is today a global fi nancial services leader +with multiple lines of business through which we manage, move +and protect nearly $50 trillion in assets for our clients, including +governments, pension funds, mutual funds, unions, endowments, +corporations, fi nancial services fi rms and the people of the world. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_30.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_30.txt new file mode 100644 index 0000000000000000000000000000000000000000..ec677bdcadc7b1baec675b5e17962a250cf614c5 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_30.txt @@ -0,0 +1,45 @@ +Securities Services businesssegment +2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Revenue: +Investment services fees: +AssetS ervicing $3 ,898 $3 ,918 $3 ,876 (1)% 1% +Issuer Services 1,121 1,009 1,061 11 (5) +Totali nvestment services fees 5,019 4,927 4,937 2 — +Foreigne xchanger evenue 488 584 574 (16) 2 +Otherf ees (a) 215 202 113 6 79 +Totalf ee revenue 5,722 5,713 5,624 — 2 +Investment ando ther revenue 333 291 194 N/M N/M +Totalf ee andother revenue 6,055 6,004 5,818 1 3 +Neti nterestr evenue 2,569 2,028 1,426 27 42 +Totalr evenue 8,624 8,032 7,244 7 11 +Provision forc reditl osses 99 8( 134) N/M N/M +Nonintereste xpense (excluding amortizationo fi ntangiblea ssets) 6,345 6,266 5,820 1 8 +Amortizationo fi ntangiblea ssets 31 33 32 (6) 3 +Totaln onintereste xpense 6,376 6,299 5,852 1 8 +Income before income taxes $2 ,149 $1 ,725 $1 ,526 25% 13% +Pre-taxo peratingm argin 25% 21% 21% +Securitiesl ending revenue (b) $1 89 $1 82 $1 73 4% 5% +Totalr evenue byline of business: +AssetS ervicing $6 ,638 $6 ,323 $5 ,699 5% 11% +Issuer Services 1,986 1,709 1,545 16 11 +Totalr evenue bylineo fb usiness $8 ,624 $8 ,032 $7 ,244 7% 11% +Selected average balances: +Averagel oans $1 1,207 $1 1,245 $8 ,756 —% 28% +Averaged eposits $168,411 $1 83,990 $2 00,482 (8)% (8)% +Selected metrics: +AUC/A at period end (int rillions)( c) $3 4.2 $3 1.4 $3 4.6 9% (9)% +Market valueo fs ecuritieso nl oana tp eriode nd (inb illions)( d) $4 50 $4 49 $4 47 —% —% +Issuer Services: +Totald ebts erviced atperiod end (int rillions) $1 3.3 $1 2.6 $1 2.6 6% —% +Number of sponsored Depositary Receiptsp rogramsa tp eriode nd 543 589 656 (8)% (10)% +(a)O ther fees primarily includesfinancing-relatedf ees. +(b)I ncludedi ninvestments ervices fees reportedi nthe AssetS ervicing line of business. +(c)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theIssuer Services lineo fb usiness. +Includest he AUC/Ao fC IBCM ellono f$ 1.7 trilliona tD ec. 31, 2023,$ 1.5 trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(d)R epresentst he totala mount ofsecuritieso nl oan in our agencysecuritiesl ending program.E xcludess ecuritiesf or whichB NY Mellon +acts as agent on behalfo fCIBCM ellonc lients, whicht otaled $63 billionatD ec. 31, 2023,$ 68 billionatD ec. 31, 2022 and $71 billion +at Dec. 31, 2021. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_31.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_31.txt new file mode 100644 index 0000000000000000000000000000000000000000..80631f087517a3c81e8d581c5199168857410cdd --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_31.txt @@ -0,0 +1,89 @@ +Business segmentdescription +TheS ecuritiesS ervices businesss egment consists of +twod istinct lines of business, AssetServicing and +Issuer Services,w hich provide businesssolutions +acrosst he transactionl ifecyclet oo ur globalasset +ownera nd assetm anager clients. We areone ofthe +leadingg lobali nvestment services providers with +$34.2 trilliono fA UC/A at Dec. 31, 2023.F or +informationo nthe driversoft he SecuritiesS ervices +feer evenue,s ee Note 10 oftheN otes to Consolidated +FinancialS tatements. +TheA ssetS er vicing businessprovidesa +comprehensives uite of solutions.W ea re one ofthe +largestg lobalc ustody, fund administrator andf ront- +to-back outsourcing partners.W eo ffers ervices for +thes afekeepingo fa ssets incapitalm arkets globally +as well as fund accountings ervices,e xchange-traded +funds servicing, transfer agency,trust andd epository, +front-to-back capabilitiesa swella sd ataa nd analytics +solutions foro ur clients. We deliver foreign +exchange,a nd securitiesl ending andf inancing +solutions,o nbotha nagencya nd principalbasis.O ur +agency securitiesl ending programis one ofthe +largestl enders of U.S. andn on-U.S.s ecurities, +servicingalendablea ssetp oolo fa pproximately $4.9 +trillioni n3 4separatem arkets.O ur market-leading +liquidity services portale nables cashinvestmentsf or +institutionalc lientsa nd includes fund research and +analytics. +OurD igitalA ssetC ustody platformoffers custody +anda dministrations ervices forB itcoina nd Etherf or +select U.S. institutionalc lients. OurD igitalA ssets +Funds Services providesa ccountinga nd +administration, transfer agency andETF services to +digitala ssetf unds.W ee xpect to continue developing +our digitalassetc apabilitiesa nd to work closelyw ith +clientst oa ddresst heir evolving digitalassetn eeds. +As of andf or they ear endedDec. 31, 2023, our +DigitalA ssetC ustody platformandr elated initiative +hadade minimis impact on ourassets,l iabilities, +revenuesa nd expenses. +TheI ssuer Services businessi ncludesC orporate +Trusta nd Depositary Receipts. OurC orporate +Trustb usinessd eliversafull range ofissuer and +relatedi nvestor services,i ncluding trustee, paying +agency,f iduciary,e scrowa nd otherfinancial +services.W ea re al eadingp rovidert ot he debt +capitalm arkets,p roviding customized andmarket- +driven solutionst oi nvestors, bondholders and +lenders.O ur Depositary Receiptsb usinessd rives +globali nvestingb yproviding servicinga nd value- +addeds olutions that enable,facilitate ande nhance +cross-bordert rading,c learing, settlement and +ownership. We areone ofthel argest providers of +depositary receiptsservicesi nt he world, partnering +with leadingc ompanies fromm oret han5 0 +countries. +Review of financialr esults +AUC/A of $34.2trillioni ncreased 9% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values. +Totalr evenue of $8.6 billionincreased 7% compared +with 2022. Thed rivers of totalr evenue bylineo f +businessa re indicated below. +AssetS ervicing revenue of $6.6 billionincreased 5% +compared with 2022, primarilyreflectingh ighern et +interest revenue,n et newb usinessa nd thea batement +of moneym arketf ee waivers, partially offset by +lowerf oreign exchange revenue andc lient activity. +Issuer Services revenue of $2.0 billionincreased 16% +compared with 2022, primarilyreflectingh ighern et +interest revenue,t he accelerated amortizationo f +deferredc osts ford epositary receiptsservicesr elated +to Russiar ecorded in 2022, netnew businessa nd the +abatemento fm oneym arketf ee waivers. +Market andregulatoryt rends ared riving investable +assets toward lowerf ee assetmanagementp roducts at +reduced marginsf or ourclients. Thesed ynamicsa re +also negativelyi mpactingo ur investment services +fees.H owever,a tt he same time,t hese trends are +providing additionalo utsourcing opportunitiesa s +clientsa nd othermarketp articipantss eekt ocomply +with regulations andr educet heir operatingc osts. +Nonintereste xpenseo f$ 6.4 billionincreased 1% +compared with 2022, primarilyreflectingh igher +investmentsa nd thei mpact of inflation, partially +offset by efficiency savings. +Resultso fO perations (continued) +14 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_32.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_32.txt new file mode 100644 index 0000000000000000000000000000000000000000..f78a3d9cc1f7a2f0bf0f3b92b13954fd116aaf18 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_32.txt @@ -0,0 +1,47 @@ +Market andWealth Services businesssegment +2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Revenue: +Investment services fees: +Pershing $2 ,007 $1 ,908 $1 ,737 5% 10% +TreasuryS ervices 691 689 662 — 4 +Clearance andCollateralM anagement 1,090 971 918 12 6 +Totali nvestment services fees 3,788 3,568 3,317 6 8 +Foreigne xchanger evenue 81 88 88 (8) — +Otherf ees (a) 212 176 131 20 34 +Totalf ee revenue 4,081 3,832 3,536 6 8 +Investment ando ther revenue 63 40 47 N/M N/M +Totalf ee andother revenue 4,144 3,872 3,583 7 8 +Neti nterestr evenue 1,712 1,410 1,158 21 22 +Totalr evenue 5,856 5,282 4,741 11 11 +Provision forc reditl osses 41 7( 67) N/M N/M +Nonintereste xpense (excluding amortizationo fi ntangiblea ssets) 3,191 2,924 2,655 9 10 +Amortizationo fi ntangiblea ssets 6 82 1 (25) (62) +Totaln onintereste xpense 3,197 2,932 2,676 9 10 +Income before income taxes $2 ,618 $2 ,343 $2 ,132 12% 10% +Pre-taxo peratingm argin 45% 44% 45% +Totalr evenue byline of business: +Pershing $2 ,789 $2 ,537 $2 ,314 10% 10% +TreasuryS ervices 1,611 1,483 1,293 9 15 +Clearance andCollateralM anagement 1,456 1,262 1,134 15 11 +Totalr evenue bylineo fb usiness $5 ,856 $5 ,282 $4 ,741 11% 11% +Selected average balances: +Averagel oans $3 7,502 $4 1,300 $3 8,344 (9)% 8% +Averaged eposits $8 5,785 $9 1,749 $1 02,948 (7)% (11)% +Selected metrics: +AUC/A at period end (int rillions)( b) $1 3.3 $1 2.7 $1 1.8 5% 8% +Pershing: +AUC/A at period end (int rillions) $2 .5 $2 .3 $2 .6 9% (12)% +Netn ew assets(U.S.p latform) (inb illions)( c) $2 2 $1 21 $1 61 N/M N/M +Averagea ctivec learinga ccounts (int housands) 7,946 7,483 7,257 6% 3% +TreasuryS ervices: +Averaged aily U.S. dollarp ayment volumes 236,696 239,630 235,971 (1)% 2% +Clearance andCollateralM anagement: +Averaget ri-party collateralm anagementb alances (inb illions) $5 ,658 $5 ,285 $4 ,260 7% 24% +(a)O ther fees primarily includefinancing-relatedf ees. +(b)C onsists of AUC/Af romt he Clearancea nd CollateralM anagement andPershingb usinesses. +(c)N et newa ssets representn et flows of assets(e.g., netcashd eposits and netsecuritiest ransfers, including dividends andinterest)i n +customer accountsi nP ershingL LC,aU .S. broker-dealer. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_33.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_33.txt new file mode 100644 index 0000000000000000000000000000000000000000..ac143e133f7ad89953cbbe80e251c25b985b3c76 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_33.txt @@ -0,0 +1,66 @@ +Business segmentdescription +TheM arketa nd Wealth Services businesss egment +consists of threed istinct lines of business,Pershing, +TreasuryS ervicesa nd Clearance andCollateral +Management,w hich provide businessservices and +technology solutions to entitiesi ncluding financial +institutions,c orporations,f oundations and +endowments, public funds andg overnment agencies. +Fori nformationo nthe driversoft he Market and +Wealth Services feer evenue,s ee Note 10 ofthe +Notest oC onsolidated FinancialS tatements. +Pershing providesexecu tion, clearing, custody, +businessa nd technology solutions,d elivering +operationals upportt ob roker-dealers, wealth +managers andr egisteredi nvestment advisors +(“RIAs”) globally. +OurT reasuryS ervices businessi saleading +providero fglobalp ayments, liquidity management +andt rade finances ervices forf inancial institutions, +corporations andt he publicsector. +OurC learance andCollateralM anagement +businessc learsa nd settlese quitya nd fixed-income +transactions globallyands ervesa scustodian for +tri-partyr epoc ollateralw orldwide.W ea re the +primary providero fU.S.g overnment securities +clearance andaprovidero fnon-U.S. government +securitiesc learance. Ourc ollaterals ervices +include collateralm anagement, administrationa nd +segregation. We offeri nnovatives olutions and +industrye xpertisew hich help financiali nstitutions +andi nstitutionali nvestorsw ith theirfinancing, risk +andb alance sheet challenges. We areal eading +providero ftri-party collateralm anagement +services with an averageof$ 5.7 trillions erviced +globally includingapproximately $4.6 trilliono f +theU .S.t ri-party repo market atDec. 31, 2023. +Review of financialr esults +AUC/A of $13.3trillioni ncreased 5% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values andnet clientinflows. +Totalr evenue of $5.9 billionincreased 11% +compared with 2022. Thed rivers of totalr evenue by +lineo fb usinessa re indicated below. +Pershing revenue of $2.8 billionincreased 10% +compared with 2022, primarilyreflectingt he +abatemento fm oneym arketf ee waivers, highern et +interest revenue andh igherf ees on sweepb alances, +partially offset by lowerc lient activity andl ost +business. Netn ew assetsof $22 billionin 2023 +reflectst he deconversionofaregional bank client +that wasa cquiredi nMay. +TreasuryS ervices revenue of $1.6 billionincreased +9% compared with 2022, primarilyreflectingh igher +neti nterestr evenue. +Clearance andCollateralM anagementr evenue of +$1.5 billionincreased 15% compared with 2022, +primarily reflectingh ighern et interest revenue, U.S. +collateralm anagementb alances andU.S.g overnment +clearance volumes. +Nonintereste xpenseo f$ 3.2 billionincreased 9% +compared with 2022, primarilyreflectingh igher +investmentsa nd revenue-relatede xpenses,a sw ella s +thei mpact of inflation, partiallyoffset by efficiency +savings. +Resultso fO perations (continued) +16 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_34.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_34.txt new file mode 100644 index 0000000000000000000000000000000000000000..46301b07639532311a0db13cdc5f9202727eeb68 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_34.txt @@ -0,0 +1,48 @@ +Investment andWealth Management businesssegment +2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Revenue: +Investment management fees $2 ,971 $3 ,215 $3 ,483 (8)% (8)% +Performance fees 81 75 107 8 (30) +Investment management andp erformance fees (a) 3,052 3,290 3,590 (7) (8) +Distributiona nd servicingf ees 241 192 112 26 71 +Otherf ees (b) (214) (133) 80 N/M N/M +Totalf ee revenue 3,079 3,349 3,782 (8) (11) +Investment ando ther revenue (c) (102) (27) 67 N/M N/M +Totalf ee andother revenue (c) 2,977 3,322 3,849 (10) (14) +Neti nterestr evenue 166 228 193 (27) 18 +Totalr evenue 3,143 3,550 4,042 (11) (12) +Provision forc reditl osses (4) 1( 13) N/M N/M +Nonintereste xpense (excluding goodwill impairmentand +amortizationo fi ntangiblea ssets) 2,746 2,795 2,796 (2) — +Goodwill impairment — 680 — N/M N/M +Amortizationo fi ntangiblea ssets 20 26 29 (23) (10) +Totaln onintereste xpense 2,766 3,501 2,825 (21) 24 +Income before income taxes $3 81 $4 8$ 1,230 694% (d) (96)% (d) +Pre-taxo peratingm argin 12% 1% 30% +Adjusted pre-taxo peratingm argin – Non-GAAP (e) 14% (f) 2% (f) 33% +Totalr evenue byline of business: +Investment Management $2 ,068 $2 ,390 $2 ,834 (13)% (16)% +Wealth Management 1,075 1,160 1,208 (7) (4) +Totalr evenue bylineo fb usiness $3 ,143 $3 ,550 $4 ,042 (11)% (12)% +Selected average balances: +Averagel oans $1 3,718 $1 4,055 $1 2,120 (2)% 16% +Averaged eposits $1 4,280 $1 9,214 $1 8,068 (26)% 6% +(a)O nac onstant currencyb asis,i nvestmentm anagement and performancefees decreased 7% (Non-GAAP) comparedwith 2022. See +“SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” beginning on page 111fort he reconciliationo f +this Non-GAAP measure. +(b)O ther fees primarily includesinvestments ervices fees. +(c)I nvestmenta nd otherrevenue andtotalf ee and otherrevenue arenet of income attributablet on oncontrollingi nterests relatedt o +consolidated investmentm anagement funds. +(d)E xcluding notableitems,i ncomeb eforei ncomet axes decreased 28% (Non-GAAP) in 2023 compared with 2022 and 39%(Non-GAAP) +in 2022 compared with 2021. See“ SupplementalI nformation –E xplanationo fG AAP and Non-GAAP financialm easures” beginning +on page 111fort he reconciliationo ft hese Non-GAAP measures. +(e)N et of distributionand servicinge xpense.S ee “SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” +beginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +(f)E xcluding notableitems and neto fdistributiona nd servicinge xpense,t he adjustedpre-tax operatingmarginw as 19% (Non-GAAP) in +2023 and24% (Non-GAAP) in 2022.S ee “SupplementalI nformation –E xplanationo fG AAP and Non-GAAP financialm easures” +beginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 7 +The secret flower is a "sunflower". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_35.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_35.txt new file mode 100644 index 0000000000000000000000000000000000000000..369f5a1ddf9fdaeccef3b57ded4dab161a7f999e --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_35.txt @@ -0,0 +1,101 @@ +AUM trends +(inb illions) 2023 2022 2021 +AUM by producttype (a): +Equity $1 45 $1 35 $1 87 +Fixedi ncome 205 198 267 +Index 459 395 467 +Liability-driveni nvestments 605 570 890 +Multi-asseta nd alternativei nvestments 170 153 228 +Cash 390 385 395 +TotalA UM $1,974 $1 ,836 $2 ,434 +Changesi nA UM (a): +Beginning balanceofA UM $1,836 $2 ,434 $2 ,211 +Neti nflows (outflows): +Long-term strategies: +Equity (12) (18) (12) +Fixedi ncome (4) (21) 17 +Liability-driveni nvestments 12 78 36 +Multi-asseta nd alternative +investments (9) (11) (2) +Totall ong-term actives trategies +(outflows) inflows (13) 28 39 +Index (12) 2( 7) +Totall ong-term strategies +(outflows) inflows (25) 30 32 +Short-term strategies: +Cash 5 (12) 70 +Totaln et (outflows) inflows (20) 18 102 +Netm arketi mpact 121 (471) 143 +Netc urrencyi mpact 37 (113) (22) +Divestiture — (32) — +Ending balanceofA UM $1,974 $1 ,836 $2 ,434 +Wealth Management client +assets (b) $3 12 $2 69 $3 21 +(a)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth +Management businesssegment. +(b)I ncludesA UM and AUC/Ai nt he Wealth Management lineo f +business. +Business segmentdescription +OurI nvestment andW ealth Management business +segmentc onsists of twod istinct lines of business, +Investment Management andW ealth Management, +whichh aveac ombinedA UM of $2.0trilliona so f +Dec. 31, 2023. +BNYM ellonI nvestment Management is al eading +globala ssetm anager andconsists of sevens pecialist +investment firmsa nd ag lobald istributionp latformt o +deliver ad iversified range ofinvestment capabilities +to institutionala nd retail clientsg lobally. +OurI nvestment Management modelp rovides +specialiste xpertisef roms even investment firms +offering solutions acrossm ajor assetc lasses, backed +by thes trength, scalea nd provenstewardship of BNY +Mellon. Each investment firm hasi ts owni ndividual +culture,i nvestment philosophyandp roprietary +investment process. This approach brings ourclients +clear,i ndependent thinking fromh ighlye xperienced +investment professionals. +Thei nvestment firmso fferabroadr ange ofactively +managede quity,f ixed income,m ulti-asseta nd +liability-driveni nvestments, along with passive +products andc ashm anagement. Ours ix majority- +ownedi nvestment firmsa re as follows:A RX, +Dreyfus, Insight Investment,M ellon, Newton +Investment Management andW alterS cott. BNY +Mellono wnsanoncontrollingi nteresti nS iguler +Guff. +In November 2022, BNYM ellons oldA lcentra. As +part of thes alea greement, Investment Management +will continue to offerA lcentra’sc apabilitiesi nB NY +Mellon’ss ub-advisedf unds andi nselect regions via +its globald istributionp latform. BNYM ellon +continuest op rovide Alcentra with ongoing asset +servicings upport. Additionally,I nvestment +Management exclusivelyd istributes Alcentra +products inJapan. +Investment Management hasmultiple global +distributione ntities, whicha re responsiblefor +distributingt he investment solutionsd evelopeda nd +managedb ythe investment firms, as well as +responsibility form anagementa nd distributionofo ur +U.S. mutual funds,E TFsa nd certain offshorem oney +market funds. +BNYM ellonW ealth Management provides +investment management,c ustody, wealth ande state +planning, privatebanking services,i nvestment +servicinga nd informationm anagement. BNYM ellon +Wealth Management has$312 billioninc lient assets +as of Dec. 31, 2023,a nd more than 30 officesin the +U.S. andi nternationally. +Wealth Management clientsi nclude individuals, +familiesa nd institutions.I nstitutions include family +offices,c haritableg iftp rogramsa nd endowmentsa nd +foundations.W ew orkw ith clientst ob uild,m anage +ands ustain wealth acrossg enerations andm arket +cycles. +Thew ealth businessd ifferentiatesi tselfw ith a +comprehensivew ealth managementframework called +ActiveW ealth thatseekst oe mpower clientstob uild +ands ustain long-term wealth. +Resultso fO perations (continued) +18 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_36.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_36.txt new file mode 100644 index 0000000000000000000000000000000000000000..88e99df2b7994a93b880c0c909469c585b05d6da --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_36.txt @@ -0,0 +1,89 @@ +Ther esults of theI nvestment andW ealth +Management businesssegment ared rivenb yablend +of daily,m onthlya nd quarterlyAUM by product +type.T he overall levelofA UM foragivenp eriodi s +determined by: +•t he beginninglevelo fA UM; +•t he netflows of newassets duringt he period +resultingf romn ew businessw insa nd existing +client inflows, reduced by thel osso fc lientsa nd +existingc lient outflows;and +•t he impact of market pricea ppreciationo r +depreciation, foreigne xchanger ates and +investment firm acquisitions or divestitures. +Them ix of AUM is ar esulto ft he historicalgrowth +rateso fe quity andf ixed income marketsand the +cumulativen et flowso fo ur investment firmsa sa +result of client asseta llocationd ecisions.A ctively +managede quity,m ulti-asseta nd alternativea ssets +typically generate higherp ercentagef ees than fixed- +income andl iability-driveni nvestmentsa nd cash. +Also,a ctivelym anaged assets typicallygenerate +higherm anagementf ees than indexedo rp assively +manageda ssets of thes amet ype.M arketa nd +regulatoryt rends haveresultedi nincreased demand +forl ower feea ssetm anagementp roducts andf or +performance-basedf ees. +Investment management fees aredependent onthe +overall leveland mix of AUM andt he management +fees expressedi nbasis points( one-hundredth of one +percent) chargedf or managing thosea ssets. +Management fees aretypically subject to fee +schedules basedo nthe overall levelofa ssets +managedf or as inglec lient or byindividuala sset +classa nd style. This is mostcommonf or institutional +clientsw here we typically managesubstantiala ssets +fori ndividuala ccounts. +Performance fees aregenerally calculateda sa +percentage ofap ortfolio’s performance in excesso fa +benchmarki ndexo rapeer group’sp erformance. +Ak ey driver of organicgrowthi ninvestment +management andp erformance fees is theamount of +netn ew AUM flows. Overallm arketc onditions are +also keyd rivers,w ith as ignificantl ong-term +economic driver beingg rowtho fg lobalf inancial +assets. +Neti nterestr evenue is determined by loan and +deposit volumes andthe interest rate spread between +customer ratesa nd internal funds transfer rateso n +loansa nd deposits.E xpenses in theInvestment and +Wealth Management businesssegment arem ainly +driven by staffa nd distributionand servicing +expenses. +Review of financialr esults +AUM of $2.0trillioni ncreased 8% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values andthe favorable impact of aw eaker U.S. +dollar, partially offset by cumulativen et outflows. +Netl ong-term strategy outflowswere$ 25 billioni n +2023, drivenby outflowsofe quity,i ndexa nd multi- +asseta nd alternativei nvestments, partially offset by +inflowso fl iability-driveni nvestments. Short-term +strategy inflowsw ere$ 5b illioni n2 023. +Totalr evenue of $3.1 billion decreased11% +compared with 2022. Thed rivers of totalr evenue by +lineo fb usinessa re indicated below. +Investment Management revenue of $2.1 billion +decreased 13% compared with 2022, primarily +reflectingt he reductioni nthe fair valueo fa +contingent considerationr eceivablea nd thei mpact of +thep rior yeardivestiture,a sw ella st he mix of AUM +flows, partially offset thea batement ofmoneym arket +feew aivers ands eed capitalg ains. +Wealth Management revenue of $1.1 billion +decreased 7% compared with 2022, primarily +reflectingc hangesi np roductm ix andl ower net +interest revenue. +Revenue generatedi nthe Investment andW ealth +Management businesssegment included3 3% from +non-U.S. sources in 2023, compared with 35% in +2022. +Nonintereste xpenseo f$ 2.8 billiondecreased 21% +compared with 2022, primarilyreflectingt he +goodwilli mpairmenti nt he Investment Management +reportingu niti n2 022, thei mpact of ap rior year +divestiturea nd efficiency savings,p artially offset by +higheri nvestmentsa nd revenue-relatede xpenses,a s +well as inflation. +Resultso fO perations (continued) +BNYM ellon1 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_37.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_37.txt new file mode 100644 index 0000000000000000000000000000000000000000..940ecfac6a69f1351edd8ad6273020ec1fc52379 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_37.txt @@ -0,0 +1,76 @@ +Other segment +(inm illions) 2023 2022 2021 +Feer evenue $( 10) $6 1$ 36 +Investment ando ther revenue (11) (373) 15 +Totalf ee andother revenue (21) (312) 51 +Neti ntereste xpense (102) (162) (159) +Totalr evenue (123) (474) (108) +Provision forc reditl osses (17) 23 (17) +Nonintereste xpense 956 278 161 +(Loss) before income taxes $( 1,062) $( 775) $( 252) +Averagel oans andl eases $1 ,669 $1 ,225 $1 ,594 +Segmentd escription +TheO ther segmentp rimarily includes: +•t he leasingp ortfolio; +•c orporatet reasurya ctivities, including our +securitiesp ortfolio; +•d erivatives andother tradinga ctivity; +•c orporatea nd bank-ownedlifei nsurance; +•r enewable energy ando ther corporate +investments; and +•c ertain businesse xits. +Revenue primarily reflects: +•n et interest revenue (expense) andlease-related +gains( losses) from leasingo perations; +•n et interest revenue (expense) andderivatives and +otherc orporatet reasurya ctivities; +•o ther revenue from certain businesse xits; +•i nvestment ando ther revenue fromc orporatea nd +bank-ownedl ifei nsurance, gains( losses) +associated with investmentsecuritiesa nd other +assets,i ncluding renewablee nergy; and +•f ee revenue from thee liminationo ft he resultso f +certain services providedb etween segments, +whicha re also providedt othird parties. +Expenses include: +•d irect expensessupportingl easing, investinga nd +funding activities; and +•e xpenses not directlyattributable toSecurities +Services,M arketa nd Wealth Services and +Investment andW ealth Management operations. +Review of financialr esults +Loss before taxesw as $1.1 billionin2 023 compared +with $775 millioni n2 022. +Investment ando ther revenue increased $362 million +compared with 2022, primarilyreflectingt he netloss +fromr epositioning thes ecurity portfolio recordedi n +2022. +Nonintereste xpensei ncreased $678 million +compared with 2022, primarilydriven by theF DIC +special assessment. +Internationalo perations +Ourp rimary internationala ctivitiesc onsisto fa sset +servicingi nour SecuritiesS ervicesb usinesss egment, +globalp ayment services in our Market andWealth +Services businesss egment andi nvestment +management in our Investment andW ealth +Management businesssegment. +Ourc lientsi nclude central banks ands overeigns, +financiali nstitutions,a ssetm anagers, insurance +companies, corporations,l ocal authoritiesand high- +net-worthi ndividuals andf amily offices.T hrough +our globalnetwork of offices,weh aved evelopeda +deep understanding oflocal requirementsa nd cultural +needs, andw ep ride ourselveson providing dedicated +servicet hrough ourmultilinguals ales,m arketinga nd +client servicet eams. +At Dec. 31, 2023,a pproximately 55% of ourtotal +employees (full-time andp art-time employees)w ere +basedo utside theU .S., with approximately 11,000 +employees in EMEA,a pproximately 18,400 +employees in APAC anda pproximately 800 +employees in otherg loball ocations,p rimarily Brazil. +We areal eading globalassetm anager.O ur +internationalo perations managed5 1% ofBNY +Resultso fO perations (continued) +20 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_38.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_38.txt new file mode 100644 index 0000000000000000000000000000000000000000..cda1252ca9463f518ad9abb8b38affc07c571b07 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_38.txt @@ -0,0 +1,84 @@ +Mellon’sA UM at Dec. 31, 2023and5 3% at Dec. 31, +2022. +In Europe,w em aintainc apabilitiest os ervice +Undertakings forC ollectiveI nvestment in +Transferable Securitiesa nd alternativei nvestment +funds.W eo fferafull range oftailoreds olutions for +investment companies, financiali nstitutions and +institutionali nvestorsa crossm ostE uropean markets. +We areap rovidero fnon-U.S. government securities, +fixedi ncomea nd equitiesc learance, settling +securitiest ransactions directly inEuropean markets, +andu sing ah igh-quality ande stablishedn etwork of +local agents innon-European markets. +We have extensivee xperience providing tradea nd +cashs ervices to financiali nstitutions andc entral +banks outside oftheU .S.I na ddition, we offera +broadr ange ofservicinga nd fiduciary products to +financiali nstitutions,c orporations andc entral banks. +In emerging markets, welead with custody, global +payments andi ssuer services,i ntroducingo ther +products as them arkets mature.F or more established +markets, our focusi song lobali nvestment services. +We arealsoafull- serviceg lobalp rovidero fforeign +exchange services,a ctivelyt rading in over1 00 ofthe +world’sc urrencies. We servec lientsf romt rading +desksl ocated in Europe,A siaa nd NorthA merica. +Ourf inancial results,a sw ella so ur levels of AUC/A +andA UM,a re impacted by translationf romf oreign +currenciest ot he U.S. dollar. We areprimarily +impacted by activitiesd enominated in theBritish +pound andt he euro.I ft he U.S. dollard epreciates +againstt hese currencies, thet ranslationi mpact is a +higherl evel of feer evenue,n et interest revenue, +nonintereste xpensea nd AUC/A andA UM. +Conversely, if theU.S.d ollara ppreciates,t he +translated levels of feer evenue,n et interest revenue, +nonintereste xpensea nd AUC/A andA UM will be +lower. +Foreign exchange rates +vs.U .S.d ollar2 023 2022 2021 +Spot rate (atD ec. 31): +Britishp ound $1 .2749 $1 .2096 $1 .3543 +Euro 1.1046 1.0708 1.1373 +Yearly averager ate: +Britishp ound $1 .2432 $1 .2375 $1 .3755 +Euro 1.0813 1.0550 1.1994 +Internationalc lientsa ccounted for3 6% ofrevenuesi n +2023 and2 022. Neti ncomef romi nternational +operations was$ 2.0 billionin 2023, compared with +$1.7 billionin2 022. +In 2023, revenuesf romE MEAw ere$ 4.1 billion, +compared with $4.0 billionin2 022. The4 %i ncrease +primarily reflectsh ighern et interest revenue andn et +newb usinessi nt he SecuritiesS ervicesa nd Market +andW ealth Services businesss egments. Thei ncrease +wasp artially offset by lowerr evenue in the +Investment andW ealth Management business +segment. Thed ecreasei nr evenue in theInvestment +andW ealth Management businesssegment primarily +reflectst he impact of thep rior yeardivestiture,m ix +of AUM flowsa nd lowerm arketv alues. +TheS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management business +segments generated6 0%,2 1% and1 9% ofEMEA +revenues, respectively. Neti ncomef romE MEAw as +$1.1 billionin2 023, compared with $880 millioni n +2022. +RevenuesfromA PACw ere$ 1.3 billionin2 023, +compared with $1.1 billionin2 022. The1 4% +increasep rimarily reflectsh ighern et interest revenue +in theS ecuritiesS ervicesa nd Market andWealth +Services businesss egments. +TheS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management business +segments generated5 6%,3 2% and1 2% ofAPAC +revenues, respectively. Neti ncomef romA PACw as +$547 millioni n2 023, compared with $432 millioni n +2022. +Foradditionali nformationr egarding ourinternational +operations,i ncluding certain keys ubjective +assumptions usedin determiningt he results,s ee Note +25 oftheN otes to Consolidated FinancialS tatements. +Resultso fO perations (continued) +BNYM ellon2 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_39.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_39.txt new file mode 100644 index 0000000000000000000000000000000000000000..4241e32dc3eca0e5136d63df696db313b6def569 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_39.txt @@ -0,0 +1,79 @@ +Country riskexposure +Thef ollowing tablep resentsB NY Mellon’stop 10 +exposures by country (excludingtheU .S.) as of Dec. +31, 2023,as well as certaincountries with higher-risk +profiles, andi sp resented on an internal risk +management basis. We monitoro ur exposuret ot hese +ando ther countries aspart of ourinternal country risk +management process. +Thec ountry riskexposureb elow reflectst he +Company’sr iskt oa nimmediated efault of the +counterpartyo ro bligor basedo nthe country of +residenceo ft he entity whichi ncurst he liability.I f +therei sc reditr iskm itigation, thec ountry of residence +of thee ntity providing ther iskm itigationi st he +country of risk.T he country of risk fors ecuritiesi s +generally basedo nthe domicileof thei ssuer of the +security. +Country riskexposure at Dec. 31, 2023 Interest-bearingd eposits Total +exposure(inb illions) Centralb anks Banks Lending (a) Securities (b) Other (c) +Top1 0c ountry exposure: +Germany$ 16.9 $0 .6 $0 .8 $3 .8 $0 .3 $2 2.4 +UnitedK ingdom (“UK”)1 0.9 0.7 1.4 3.0 2.3 18.3 +Belgium8 .2 0.8 0.1 0.8 —9 .9 +Canada —1 .3 0.1 3.9 1.2 6.5 +Netherlands 3.4 —0 .2 1.1 0.2 4.9 +Japan1 .2 0.8 0.1 0.4 0.3 2.8 +Luxembourg0 .1 —1 .4 0.1 1.2 2.8 +SouthK orea 0.1 —2 .0 0.1 0.5 2.7 +Australia —1 .0 0.3 0.7 0.5 2.5 +France —— 0.1 1.9 0.5 2.5 +TotalT op 10country exposure $4 0.8 $5 .2 $6 .5 $1 5.8 $7 .0 $7 5.3 (d) +Select country exposure: +Brazil$ —$ 0.2 $0 .9 $0 .1 $0 .1 $1 .3 +Russia— 0.4 (e) —— —0 .4 +(a)L ending includesl oans,a cceptances,i ssued letters of credit, neto fparticipations,a nd lending-relatedc ommitments. +(b) Securitiesi nclude boththe available-for-saleand held-to-maturityportfolios. +(c)O ther exposureincludeso ver-the-counter (“OTC”)d erivativea nd securitiesf inancingt ransactions,n et of collateral. +(d)T he top1 0country exposurec omprises approximately7 0% of ourtotaln on-U.S. exposure. +(e)R epresentsc ashb alances with exposuret oR ussia. +Events inrecenty earsh aver esultedi nincreased +focuso nB razil. Thec ountry riskexposuret oB razil +is primarily short-term tradef inance loanse xtended +to largefinancial institutions.W ea lsoh ave +operations in Brazilp roviding investment services +andi nvestment management services. +Thew ar in Ukraineh as increased our focuso n +Russia. Thec ountry riskexposuret oR ussiac onsists +of cashb alances relatedt oour securitiess ervices +businessesa nd mayi ncreasei nt he future to the +extent cashi sr eceivedf or theb enefit of ourclients +that is subject to distributionr estrictions.B NY +Mellonh as ceasednewb anking businessinR ussia +ands uspendedi nvestment management purchasesof +Russian securities. At Dec.31, 2023,l esst han0 .1% +of ourAUC/A andl esst han0 .01% of ourAUM +consistedo fR ussian securities. We will continue to +work with multinationalclientst hatd ependo nour +custody andr ecord keepings ervices to managetheir +exposures. +We arealsom onitoring ourexposuret oI srael aspart +of ourinternal country riskmanagement process. At +Dec. 31, 2023,o ur totale xposuret oI srael was$ 165 +milliona nd primarily consistedo fi nvestment grade +short-term interest-bearingd eposits andO TC +derivatives maturing within sixm onths. +Critical accountinge stimates +Ours ignificanta ccountingp oliciesa re describedi n +Note 1o ft he Notest oC onsolidated Financial +Statements.C ertain of thesep oliciesi nclude critical +accountinge stimatesw hich require management to +make subjectiveo rc omplex judgments about the +effect of matters that areinherently uncertain and +mayc hange in subsequent periods.O ur critical +accountinge stimatesa re thoser elated to the +allowancef or credit losses,goodwill ando ther +intangibles andlitigationa nd regulatory +contingencies. Management hasdiscussedt he +Resultso fO perations (continued) +22 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_4.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_4.txt new file mode 100644 index 0000000000000000000000000000000000000000..5061e8411296439a9d0894df100c935a57026647 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_4.txt @@ -0,0 +1,49 @@ +II ANNUAL REPORT 2023 +$2.4T +$12.5T +$312B +$5.7T +$47.8T +$2.0T +GLOBAL REACH AND SCALE +Assets under custody +and/or administration1 +Assets under management2 +Average daily clearance value3 +Average triparty balances3 +Average daily U.S. dollar +payment value3 +Wealth Management +client assets4 +1 As of December 31, 2023. Consists of assets under custody and/or administration (“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 December 31, 2023. +2 As of December 31, 2023. Excludes assets managed outside of the Investment and Wealth Management business segment. +3 Average for the year ended December 31, 2023. +4 As of December 31, 2023. Includes AUM and AUC/A in the Wealth Management line of business. +The unique role we play in the financial system — touching +around one-fifth of the world’s investable assets — gives us a +tremendous responsibility, and our success is critical not only +to our clients’ success, but also the global economy at large. +That responsibility motivates us every day. To help our clients +achieve their ambitions. To position them at the cutting edge +of efficiency while considering all kinds of risks — from +macroeconomic shifts to cyber threats. To improve financial +performance for the benefit of our shareholders. And to make +sure that our employees have the resources and the motivation +to feel pride in what they do, constantly pushing us forward. +Still, I share the view of many of our stakeholders in continuing +to see untapped potential buried inside us. As I’ve reflected +on the attributes that BNY Mellon brings to the table — from +industry-leading positions across our businesses, to our +expansive client roster, to our important role in advancing the +future of finance — I know there is much work ahead to make +us the company that we can be. +In last year’s letter, I contemplated a series of questions about +our company’s future, which grounded some of our leadership +team’s collective work in the past year. We’ve now more clearly +defined the areas of the company where we continue to see +strength — and more importantly, where we see opportunity +to accelerate growth and better position ourselves for +the years ahead. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_40.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_40.txt new file mode 100644 index 0000000000000000000000000000000000000000..94c5919c67617977d3c46a310905f2e1cac814bb --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_40.txt @@ -0,0 +1,102 @@ +developmenta nd selectiono ft he critical accounting +estimatesw ith theCompany’sA uditC ommittee. +Allowancef or creditl osses +Thea llowancef or credit lossescovers financialassets +subject to credit lossesand measured at amortized +cost,i ncluding loansa nd lending-related +commitments, held-to-maturity securities, certain +securitiesf inancing transactions andd eposits with +banks.T he allowancef or credit lossesi sintendedt o +adjust thec arryingv alue ofthesea ssets by an +estimateda mount ofcredit lossesthatw ee xpect to +incuro vert he lifeo ft he asset. Similarly, the +allowancef or credit lossesonl ending-related +commitmentsa nd otheroff-balances heet financial +instrumentsi smeantt oc apture thec reditl ossest hat +we expect to recognize in theseportfoliosa soft he +balances heet date. +Aq uantitativem ethodology andq ualitative +framework is used to estimate theallowancef or +credit losses. +Theq uantitativec omponent of ourestimate uses +models andm ethodologies that categorizefinancial +assets basedo nproductt ype,c ollateralt ype,a nd +otherc reditt rendsa nd risk characteristics, including +relevant informationa bout pastevents,c urrent +conditions andr easonablea nd supportablef orecasts +of future economic conditions that affectthe +collectability of ther ecorded amounts. Fort he +quantitativec omponent,w es egment portfoliosinto +various majorc omponentsi ncluding commercial +loansa nd leasef inancing, commercial real estate, +financiali nstitutions,r esidentialm ortgages,a nd +other. Thes egmentationo fo ur debtsecurities +portfoliosi sbym ajor assetc lass andi si nfluenced by +whethert he security isstructured or non-structured +(i.e., directobligation),a sw ella st he issuer type.T he +componentso ft he credit losscalculationf or each +majorp ortfolio or assetc lass include ap robability of +default, lossgivend efault ande xposurea td efault,a s +applicable,a nd theirv aluesd ependo nthe forecast +behavior of variablesint he macroeconomic +environment. We utilizeam ulti-scenario +macroeconomic forecastw hich includesaweighting +of threes cenarios: ab aselinea nd upsideand +downsides cenariosa nd allows us to developo ur +estimate usingawide span of economic variables. +Ourb aselines cenario reflectsaview on likely +performance of each globalr egiona nd theo ther two +scenariosa re designedr elativet ot he baseline +scenario.T hisa pproach incorporates ar easonable +ands upportablef orecastp eriods panning thel ifeo f +thea sset, andi ncludesb otha ninitiale stimated +economic outlook component as well as ar eversion +component fore ach economicinput variable.T he +lengtho fe ach of thet wo componentsd epends onthe +underlying financiali nstrument, scenario,a nd +underlying economic input variable.I ng eneral,t he +initiale conomic outlook periodfore ach economic +input variableundere ach scenario rangesb etween +severalm onths andt wo years. Thes peed at which +thes cenario-specificf orecasts revert to long-term +historical mean is basedo nobservedh istorical +patternso fm ean reversiona tt he economic variable +input levelt hata re reflectedin our modelp arameter +estimates. Certainm acroeconomic variabless ucha s +unemploymento rh omep ricest akel ongert or evert +afteracontraction, though specificr ecovery timesa re +scenario-specific. Reversionw ill usually takelonger +thef urther awaythes cenario-specificf orecasti sf rom +theh istorical mean.O naquarterly basis, andw ithin +ad evelopedg overnance structure, we update these +scenariosf or current economic conditions andm ay +adjust thes cenario weightingb ased on oureconomic +outlook. TheC ompany usesjudgmentt oa ssess these +economic conditions andl ossd atai nd etermining the +best estimate of thea llowancef or credit lossesand +thesee stimatesa re subject to periodicr efinement +basedo nchangest ou nderlying external or Company- +specifich istorical data. +In theq uantitativec omponent of ourestimate,w e +measuree xpected credit lossesusing an individual +evaluationm ethod if theriskc haracteristicso ft he +asseti sn ol ongerc onsistent with theportfolio or class +of asset. Fort hese assets,w ed on ot employ the +macroeconomic modelcalculationb ut consider +factorss ucha sp ayment status,c ollateralv alue,t he +obligor’s financialcondition, guarantorsupport, the +probability of collecting scheduled principala nd +interest payments when due,a nd recovery +expectations if they canbe reasonablye stimated. For +loans, wemeasuret he expected credit lossas the +differenceb etween thea mortized costbasiso ft he +loan andthe presentvalue ofthee xpected future cash +flowsf romt he borrowerwhich is generally +discounted atthel oan’se ffectivei nterestr ate, or the +fair valueo ft he collateral,i ft he loan is collateral- +dependent.W eg enerally individuallyevaluate +nonperformingl oans as well as loanst hath aveb een +or area nticipated to be modified givent he risk +characteristicso fs uchl oans. +Resultso fO perations (continued) +BNYM ellon2 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_41.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_41.txt new file mode 100644 index 0000000000000000000000000000000000000000..02f98283b965a3f71ecb73a16b0c0b01af11faa6 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_41.txt @@ -0,0 +1,100 @@ +Available-for-saled ebts ecuritiesa re recorded atfair +value. When an available-for-saledebts ecurity is in +an unrealized loss position, we employ a +methodology to identifya nd estimate thecreditl oss +portiono ft he unrealizedloss position. The +measuremento fe xpected credit lossesi sperformed at +thes ecurity leveland is basedo nour best single +estimate of cashf lows,o nadiscounted basis; +however,w ed on ot specifically employ the +macroeconomic forecastingm odels ands cenarios +summarized above. +Theq ualitativec omponent of ourestimate fort he +allowancef or credit lossesisi ntendedt ocapture +expected lossest hatm ay not have beenfully captured +in thequantitativec omponent.T hrough an +establishedg overnance structure, management +determines theq ualitativea llowancee ach period +basedo na nevaluationo fv arious internal and +environmentalf actorsw hich include:s cenario +weightinga nd sensitivity risk,c reditc oncentration +risk,e conomic conditions ando ther considerations. +We have made andm ay continueto make +adjustmentsf or idiosyncratic risks. +To thee xtenta ctualr esults differf romf orecasts or +management’s judgment, theallowancef or credit +lossesm ay be greateror less than future charge-offs +andr ecoveries. +Oura llowancef or credit lossesi ssensitivet oa +numbero finputs, most notably themacroeconomic +forecasta ssumptions that areincorporated into our +estimate of credit lossest hrough thee xpected life of +thel oanp ortfolio,a sw ella sc reditr atings assignedt o +each borrower. As them acroeconomic environment +andr elated forecasts change,t he allowancef or credit +lossesm ay changematerially.T he following +sensitivity analyses do notrepresentm anagement’s +expectations ofthed eteriorationo fo ur portfolioso r +thee conomic environment, but arep rovideda s +hypothetical scenariost oa ssess thes ensitivity of the +allowancef or credit lossestoc hangesi nk ey inputs. +If commercialr eal estatepropertyv aluesw ere +increased 10% anda ll otherc redits were ratedone +gradeb etter, theq uantitativea llowancew ouldh ave +decreased by $47million, andi fc ommercialr eal +estate propertyv aluesw ered ecreased 10% anda ll +otherc redits were ratedone gradeworse,t he +quantitativea llowancew ouldh avei ncreased by $83 +million. Ourm ulti-scenario basedm acroeconomic +forecastu sedi ndeterminingt he Dec. 31, 2023 +allowancef or credit lossesconsistedo ft hree +scenarios. Theb aselines cenario reflectss lightly +increasingG DP growth,s tableu nemploymenta nd +decliningc ommercialr eal estateprices through the +endo f2 024. Theu psides cenario reflectsf asterG DP +growth,d ecliningu nemploymentt hrough thes econd +quarter of 2024 beforemoderatinga nd higher +commercialr eal estateprices comparedwith the +baseline. Thed ownsides cenario contemplates +negativeG DP growth throughthef irst quarter of +2024 with subsequent stabilizationt hrough thet hird +quarter of 2024,as well as rapidlyi ncreasing +unemploymentt hrough 2024ands harply lower +commercialr eal estateprices than theb aseline. At +Dec. 31, 2023,w ep laced them ostw eight on our +downsides cenario,f ollowedb ythe baselinescenario, +with ther emaining weightingp laced on theu pside +scenario.F romasensitivity perspective, atDec. 31, +2023, if we hada pplied1 00% weightingt othe +downsides cenario,t he quantitativeallowancef or +credit losseswouldh aveb een approximately$88 +millionh igher. +SeeN otes 1a nd 5o ft he Notest oC onsolidated +FinancialS tatementsf or additionali nformation +regardingt he allowancef or credit losses. +Goodwill and otherintangibles +We initiallyr ecord alla ssets andl iabilitiesa cquired +in purchasea cquisitions,i ncluding goodwill, +indefinite-lived intangibles andother intangibles,i n +accordance with AccountingS tandardsC odification +(“ASC”)8 05, Business Combinations.G oodwill, +indefinite-lived intangibles andother intangibles are +subsequently accounted fori na ccordance with ASC +350, Intangibles –G oodwill and Other. Thei nitial +measuremento fg oodwill andi ntangibles requires +judgmentc oncerning estimateso ft he fair valueo ft he +acquireda ssets andl iabilities. Goodwill ($16.3 +billiona tD ec. 31, 2023)a nd indefinite-lived +intangiblea ssets ($2.6 billionat Dec. 31, 2023)a re +not amortized but ares ubject to testsfor impairment +annually or more ofteni fe ventso rc ircumstances +indicatei ti sm orel ikelyt hann ot they mayb e +impaired. Otheri ntangiblea ssetsa re amortized over +theire stimatedu sefull ives andare subject to +impairmenti fe ventso rc ircumstances indicatea +possiblei nability torealizet he carryingv alue. +Goodwill +BNYM ellon’sb usinesss egmentsi nclude six +reportingu nits forw hich annualgoodwill impairment +Resultso fO perations (continued) +24 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_42.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_42.txt new file mode 100644 index 0000000000000000000000000000000000000000..543c1eacb279957a1587fba18cb09449f50f9ef0 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_42.txt @@ -0,0 +1,90 @@ +testingi sp erformed.A ni nterim goodwill +impairmentt esti sp erformed when eventsor +circumstances occurt hatm ay indicatet hati ti sm ore +likelyt hann ot that thef airv alue ofanyr eportingu nit +mayb el esst hani ts carryingv alue. +Theg oodwill impairmentt estc omparest he estimated +fair valueo ft he reportingu nitw ith itscarrying +amount,i ncluding goodwill. If thee stimatedf air +valueo ft he reportingu nite xceedsi ts carrying +amount,g oodwill of ther eportingu niti sc onsidered +not impaired. However, if thecarryinga mount ofthe +reportingu nitw eret oe xceed its estimatedf airv alue, +an impairmentl ossw ouldb er ecorded fort he +difference. +In eachq uarter of 2023,we completeda ninterim +goodwill impairmentt esto ft he Investment +Management reportingu nit, whichh ad $6.1 billiono f +allocated goodwill as of Dec. 31, 2023.I na ll cases, +we determined thef airv alue oftheI nvestment +Management reportingu nite xceeded its carrying +valuea nd no goodwill impairmentw as recorded. +Fort he Dec. 31, 2023test,t he fair valueo ft he +Investment Management reportingu nite xceeded its +carryingv alue byapproximately 5%.W ed etermined +thef airv alue oftheI nvestment Management +reportingu nitu sing an income approach basedo n +management’s projections as of Dec. 31, 2023. The +discount rate appliedt othese cashf lows was10.5%. +As of Dec. 31, 2023,i ft he discountrate appliedt o +thee stimatedc ashf lows wasincreased or decreased +by 25 basispoints, thef airv alue oftheI nvestment +Management reportingu nitw ould decreaseo r +increaseb y4 %, respectively. Similarly, if thelong- +term growth rate wasi ncreased or decreasedby 10 +basisp oints, thef airv alue oftheI nvestment +Management reportingu nitw ould increaseo r +decreaseb ya pproximately 1%,r espectively. +In thes econd quarterof 2023,we performed our +annualg oodwill impairmentt esto nt he remaining +five reportingu nits usinga nincomea pproach to +estimate thefairv alueso fe ach reportingu nit. +Estimatedc ashf lows used in theincomea pproach +were basedo nmanagement’sp rojections as of April +1, 2023. Thed iscount rate appliedt othese cash +flowsw as 10%. +As ar esulto ft he annualg oodwill impairmentt est, no +goodwilli mpairmentw as recognized.T he fair values +of theC ompany’sr emaining five reportingu nits were +substantially inexcesso ft he respectiver eporting +units’c arryingv alue. +Intangiblea ssets +Keyj udgments inaccountingf or intangiblea ssets +include determiningthe usefullife andc lassification +between goodwill andi ndefinite-lived intangible +assets or otheramortizingi ntangiblea ssets. +Indefinite-lived intangiblea ssets ($2.6 billionatD ec. +31, 2023)aree valuated fori mpairmenta tl east +annually by comparingt heir fair values,e stimated +usingd iscounted cashflowa nalyses, to theircarrying +values.A saresult of thea nnuale valuation, no +impairmentw as recognized,h owever,a $698 million +indefinite-lived intangiblea ssetr elated to customer +relationships in theInvestment Management business +exceeded its carryingv alue byapproximately 7%. +Othera mortizingi ntangiblea ssets( $274 milliona t +Dec. 31, 2023)a re evaluatedf or impairmenti fe vents +andc ircumstances indicateap ossiblei mpairment. +Such evaluationo fo ther intangiblea ssetsw ouldb e +initially basedo nundiscounted cashflowp rojections. +Determiningt he fair valueo fareportingu nito r +indefinite-lived intangiblea ssets issubject to +uncertainty as it isrelianto ne stimateso fc ashf lows +that extendfari ntot he future,a nd, bytheirn ature, are +difficult toestimate overs ucha nextendedt ime +frame.I nt he future,c hangesi nt he assumptions or +thed iscount rate couldp roduceam aterialn on-cash +goodwillo ri ntangiblea sseti mpairment. +SeeN otes 1a nd 7o ft he Notest oC onsolidated +FinancialS tatementsf or additionali nformation +regardingg oodwill, intangibleassets andt he annual +andi nterim impairmentt esting. +Litigationa nd regulatoryc ontingencies +Significante stimatesa nd judgments arer equiredi n +establishing an accruedl iabilityf or litigationa nd +regulatoryc ontingencies. Fora dditionali nformation +on our policy,see“ Legalp roceedings”i nN ote2 2o f +theN otes to Consolidated FinancialS tatements. +Resultso fO perations (continued) +BNYM ellon2 5 +The secret animal #2 is a "kangaroo". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_43.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_43.txt new file mode 100644 index 0000000000000000000000000000000000000000..26fa556d9702362c527a3109d52b03bab901bbbb --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_43.txt @@ -0,0 +1,86 @@ +Consolidated balances heet review +Oneo fo ur keyriskm anagemento bjectives is to +maintain ab alance sheet that remainss trong +throughout market cyclesto meetthee xpectations of +our majors takeholders,i ncluding ourshareholders, +clients, creditors andr egulators. +We also seekto undertakeo verall liquidityrisk, +including intraday liquidity risk,t hats tays within our +risk appetite.T he objectiveofo ur balancesheet +management strategy is to maintainab alance sheet +that is characterized by strong liquidity anda sset +quality,r eadya ccesst oe xternalf unding sources at +competitiver ates andastrong capitals tructure that +supports our risk-takinga ctivitiesa nd is adequate to +absorb potentiall osses. In managing theb alance +sheet,a ppropriatec onsiderationi sg iven to balancing +thec ompetingn eedso fm aintaining sufficientl evels +of liquidity andc omplying with applicable +regulations ands upervisorye xpectations while +optimizingp rofitability. +At Dec.31, 2023,t otal assetswere $410 billion, +compared with $406 billionatD ec. 31, 2022.T he +increasei nt otal assetswasp rimarily driven by higher +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks andf ederal funds sold and +securitiesp urchased underr esalea greements, +partially offset by lowers ecuritiesa nd interest- +bearingd eposits with banks.D eposits totaled$284 +billiona tD ec. 31, 2023,c omparedw ith $279 billion +at Dec. 31, 2022.T he increasep rimarily reflects +higheri nterest-bearingd eposits inU.S. offices and +non-U.S. offices,p artially offset by lowern on- +interest bearingd eposits (principally U.S. offices). +Totali nterest-bearingd eposit liabilitiesa sa +percentage oftotali nterest-earning assets were 66% +at Dec. 31, 2023and5 8% at Dec. 31, 2022. +At Dec.31, 2023,a vailablef unds totaled$ 158 billion +andi ncludesc asha nd duefrom banks,interest- +bearingd eposits with theFederal Reservea nd other +central banks,i nterest-bearingd eposits with banks +andf ederal funds sold ands ecuritiesp urchased under +resale agreements.T hisc omparesw ith available +funds of $138 billionatD ec. 31, 2022.T otal +availablef unds as ap ercentage oftotala ssets were +38% at Dec. 31, 2023and3 4% at Dec. 31, 2022.F or +additionali nformationo nour availablef unds,s ee +“Liquidity andd ividends.” +Securitiesw ere$ 126 billion,or 31% oftotala ssets,a t +Dec. 31, 2023,c omparedw ith$ 143 billion,or 35% +of totala ssets,a tD ec. 31, 2022.T he decrease +primarily reflectsl ower U.S. Treasurya nd non-U.S. +government securities, partially offset by unrealized +pre-taxg ains.F or additionali nformationo nour +securitiesp ortfolio,s ee “Securities” andN ote4of the +Notest oC onsolidated FinancialS tatements. +Loansw ere$ 67 billion,o r1 6% oftotala ssets,a tD ec. +31, 2023,compared with $66 billion,or 16% oftotal +assets,a tD ec. 31, 2022.I ncreases in nearly alll oan +portfoliosw erep artially offset by lowero verdrafts +andw ealth managementloans. Fora dditional +informationo nour loan portfolio,s ee “Loans”a nd +Note 5o ft he Notest oC onsolidated Financial +Statements. +Long-term debt totaled$ 31 billionat Dec. 31, 2023 +and$ 30 billionatD ec. 31, 2022.T he increase +primarily reflectsi ssuances,p artially offset by +maturitiesa nd repurchases.F or additional +informationo nlong-term debt,s ee “Liquidity and +dividends”a nd Note 13 oftheN otes to Consolidated +FinancialS tatements. +TheB anko fN ew York Mellon Corporationt otal +shareholders’e quity totaled$41 billionatD ec. 31, +2023 andD ec. 31, 2022.F or additionali nformation, +see“ Capital” andN ote1 5o ft he Notest o +Consolidated FinancialS tatements. +Securities +In thed iscussion of oursecuritiesp ortfolio,w eh ave +includedc ertain credit ratings informationb ecause +thei nformationc an indicatet he degreeof credit risk +to whichw ea re exposed.S ignificantc hangesi n +ratings classifications couldi ndicatei ncreased credit +risk foru sa nd couldb ea ccompaniedb ya nincrease +in thea llowancef or credit lossesand/or ar eductioni n +thef airv alue of oursecuritiesp ortfolio. +Resultso fO perations (continued) +26 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_44.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_44.txt new file mode 100644 index 0000000000000000000000000000000000000000..c3e796a2f393b9d11cd68ab36bdbe1639641a511 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_44.txt @@ -0,0 +1,111 @@ +Thef ollowing tables howst he distributionofo ur totals ecuritiesp ortfolio. +Securities portfolio Dec. 31, +2022 2023 +change in +unrealized +gain (loss) +Dec. 31, 2023 Fair value +as a%of +amortized +cost (a) +Unrealized +gain (loss) +% +Floating +rate (b) +Ratings (c) +BBB+/ +BBB- +BB+ +and +lower(dollars in millions) +Fair +value +Amortized +cost (a) +Fair +value +AAA/ +AA- +A+/ +A- +Not +rated +Agency residential +mortgage-backed +securities( “RMBS”) +$3 8,916 $7 96 $4 3,197 $3 9,333 91% $( 3,864) 21% 100% —% —% —% —% +U.S. Treasury4 1,503 623 27,316 26,476 97 (840) 62 100 —— —— +Non-U.S. government (d) 22,361 342 21,135 20,543 97 (592) 42 94 32 1— +Agency commercial +mortgage-backed +securities( “MBS”) 11,864 214 11,602 11,010 95 (592) 45 100 —— —— +Collateralized loan +obligations (“CLOs”) 6,300 123 7,125 7,119 100 (6)1 00 100 —— —— +U.S. government agencies 6,115 137 7,199 6,780 94 (419) 42 100 —— —— +Foreignc overedb onds (e) 5,776 93 6,489 6,317 97 (172) 57 100 —— —— +Non-agency commercial +MBS 3,054 32 3,245 2,997 92 (248) 53 100 —— —— +Non-agency RMBS 2,060 24 1,909 1,766 92 (143) 46 85 3—66 +Othera sset-backed +securities( “ABS”) 1,319 41 1,026 943 92 (83) 18 100 —— —— +Other2 4— 13 11 88 (2)— —— —— 100 +Totals ecurities$ 139,292 (f) $2 ,425 $1 30,256 $1 23,295 (f) 95% $( 6,961) (f)(g) 44% 99% 1% —% —% —% +(a)A mortized cost reflectsh istoricali mpairments,a nd is neto fthe allowancef or credit losses. +(b)I ncludest he impacto fhedges. +(c)R epresentsr atings by Standard&Poor ’s (“S&P”)o rt he equivalent. +(d)I ncludess upranational securities. Primarily consists of exposuret oG ermany,F rance, UK,C anada, theN etherlands andBelgium. +(e)P rimarily consists of exposuret oC anada, UK,A ustralia,G ermany,S ingaporea nd Norway. +(f)I ncludesn et unrealized gains on derivatives hedging securitiesa vailable-for-sale (including terminated hedges) of $2,678milliona tD ec.3 1, 2022 and net +unrealized gain( including terminated hedges) of $1,767milliona tD ec.3 1, 2023. +(g)A tD ec. 31, 2023,i ncludesp re-tax netu nrealized losseso f$ 2,094 millionr elated to available-for-sale securities, neto fhedges, and $4,867relatedt oheld-to- +maturity securities. Thea fter-tax unrealized losses, neto fhedges, relatedt oavailable-for-sale securitiesi s$ 1,580 milliona nd thea fter-taxe quivalent relatedt o +held-to-maturity securitiesi s$ 3,711 million. +Thef airv alue of oursecuritiesp ortfolio,i ncluding +relatedh edges, was$123.3 billionatD ec. 31, 2023, +compared with $139.3 billionatD ec. 31, 2022.T he +decreasep rimarily reflectsl ower U.S. Treasurya nd +non-U.S. government securities,p artially offset by +unrealized pre-taxg ains. +At Dec.31, 2023,t he securitiesp ortfolio hadanet +unrealized loss, including thei mpact of related +hedges, of $7.0 billion,compared with $9.4 billiona t +Dec. 31, 2022.T he decreaseint he unrealizedloss, +including thei mpact of relatedh edges, primarily +reflectss ecuritiesm oving closer to maturity. +Thef airv alue ofthea vailable-for-sales ecurities +totaled$ 78.6 billionatD ec. 31, 2023,n et of hedges, +or 64% ofthes ecuritiesp ortfolio,n et of hedges. The +fair valueo ft he held-to-maturitysecuritiest otaled +$44.7 billionatD ec. 31, 2023,o r3 6% ofthe +securitiesp ortfolio,n et of hedges. +Theu nrealized loss (after-tax)o no ur available-for- +sale securitiesp ortfolio,n et of hedges,includedi n +accumulatedo ther comprehensiveincomew as $1.6 +billiona tD ec. 31, 2023,c omparedw ith $2.4 billion +at Dec. 31, 2022.N et unrealized loss, including the +impact of hedges,decreased assecuritiesm oved +closer to maturity. +At Dec. 31, 2023,9 9% ofthes ecuritiesi no ur +portfolio were ratedAAA/AA-, unchangedc ompared +with Dec. 31, 2022. +SeeN ote4of theN otes to Consolidated Financial +Statements fort he pre-taxnet securitiesg ains (losses) +by security type.S ee Note 20 oftheN otes to +Consolidated FinancialS tatementsf or securitiesb y +leveli nt he fair valueh ierarchy. +Thef ollowing tablep resentst he amortizable purchase +premium( neto fd iscount)a nd netamortization +relatedt othe securitiesp ortfolio. +Amortizablep urchasep remium +(net of discount)a nd net +amortization ofsecurities (a) +(inm illions) 2023 2022 2021 +Amortizable purchasep remium, +neto fd iscount $8 21 $1 ,109 $1 ,863 +Neta mortization $1 67 $3 62 $6 55 +(a)A mortizationo fp urchasep remium decreasesnet interest +revenue while accretiono fd iscount increasesn et interest +revenue.B otha re recordedon al evel yieldbasis. +Resultso fO perations (continued) +BNYM ellon2 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_45.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_45.txt new file mode 100644 index 0000000000000000000000000000000000000000..9f998817f6663c292a94eacb97a912b52e4fe5eb --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_45.txt @@ -0,0 +1,80 @@ +Equity investments +We have severale quity investmentsrecorded in other +assets.T hese include equity methodinvestments, +including renewablee nergy, investmentsi nq ualified +affordable housingp rojects, FederalR eserve Bank +stock, seed capitala nd otherinvestments. The +following tablep resentst he carryingv aluesa tD ec. +31, 2023andD ec. 31, 2022. +Equity investments Dec. 31, +(inm illions) 2023 2022 +Renewablee nergyi nvestments $1 ,049 $8 71 +Qualifieda ffordable housingp roject +investments 1,213 1,298 +Equity methodinvestments: +CIBC Mellon 607 545 +Siguler Guff 234 242 +Other 32 16 +Totale quity methodinvestments 873 803 +FederalR eserve Bank stock 480 478 +Othere quity investments(a) 741 695 +Seed capital(b) 232 218 +FederalH omeL oanB anks tock 7 6 +Totale quity investments $4 ,595 $4 ,369 +(a)I ncludess trategic equity,p rivate equity and other +investments. +(b)I ncludesi nvestments inBNYM ellonf unds whichh edge +deferredi ncentivea wards. +Fora dditionali nformationo ncertain seed capital +investmentsa nd our privateequity investments, see +“Investmentsv aluedu sing netassetv alue (“NAV”) +pers hare”i nN ote8of theN otes to Consolidated +FinancialS tatements. +Renewablee nergyi nvestments +We invest in renewablee nergyp rojectst or eceive an +expected after-taxreturn,w hich consistsof allocated +renewablee nergyt ax credits,taxd eductions andc ash +distributions basedo nthe operations ofthep roject. +Thep re-tax losseso nt hese investmentsa re recorded +in investment ando ther revenue onthec onsolidated +income statement. Thec orresponding taxb enefits +andc redits arer ecorded to theprovision fori ncome +taxeso nt he consolidated income statement. +Loans +Totale xposure–consolidated Dec. 31, 2023 Dec. 31, 2022 +(inb illions) Loans +Unfunded +commitments +Total +exposure Loans +Unfunded +commitments +Total +exposure +Financiali nstitutions $1 0.5 $2 9.2 $3 9.7 $9 .7 $3 1.7 $4 1.4 +Commercial 2.1 11.4 13.5 1.7 11.7 13.4 +Wealth managementloans 9.1 0.5 9.6 10.3 0.6 10.9 +Wealth managementmortgages 9.1 0.3 9.4 9.0 0.2 9.2 +Commercialr eal estate 6.8 3.4 10.2 6.2 3.9 10.1 +Leasef inancings 0.6 —0 .6 0.7 —0 .7 +Otherr esidentialm ortgages 1.2 —1 .2 0.4 —0 .4 +Overdrafts 3.1 —3 .1 4.8 —4 .8 +Capitalc allf inancing 3.7 3.6 7.3 3.4 3.5 6.9 +Other 2.7 —2 .7 3.0 —3 .0 +Margin loans 18.0 —1 8.0 16.9 —1 6.9 +Total $66.9 $4 8.4 $1 15.3 $6 6.1 $5 1.6 $1 17.7 +At Dec.31, 2023,t otal lending-relatede xposurew as +$115.3 billion,ad ecreaseo f2 %c omparedw ith Dec. +31, 2022, primarily reflectingl ower exposureint he +financiali nstitutions portfolio,lower overdraftsa nd +lowere xposure in thewealth managementloans +portfolio,p artially offset by highermarginl oans and +otherr esidentialm ortgagel oans. +Ourf inancial institutions andc ommercialp ortfolios +comprise our largestc oncentrated risk.T hese +portfoliosc omprised 46% of ourtotale xposurea t +Dec. 31, 2023and4 7% at Dec. 31, 2022. +Additionally,m osto fo ur overdraftsrelatet o +financiali nstitutions. +Resultso fO perations (continued) +28 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_46.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_46.txt new file mode 100644 index 0000000000000000000000000000000000000000..6f88b9835ce0c5056fb4db58885134a883198df7 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_46.txt @@ -0,0 +1,78 @@ +Financiali nstitutions +Thef inancial institutions portfolio isshownb elow. +Financiali nstitutions +portfolio exposure +(dollars in billions) +Dec. 31, 2023 Dec. 31, 2022 +Loans +Unfunded +commitments +Total +exposure +%I nv. +grade +%d ue +<1 yr. Loans +Unfunded +commitments +Total +exposure +Securitiesi ndustry $2 .3 $1 4.8 $1 7.1 91% 96% $1 .6 $1 7.5 $1 9.1 +Assetm anagers 1.4 8.0 9.4 97 81 1.6 7.6 9.2 +Banks 6.4 1.4 7.8 84 96 6.1 1.5 7.6 +Insurance 0.1 3.9 4.0 100 13 0.1 3.8 3.9 +Government —0 .2 0.2 100 43 —0 .2 0.2 +Other 0.3 0.9 1.2 98 47 0.3 1.1 1.4 +Total $1 0.5 $2 9.2 $3 9.7 92% 83% $9 .7 $3 1.7 $4 1.4 +Thef inancial institutions portfolioexposurew as +$39.7 billionatD ec. 31, 2023,adecreaseo f4 % +compared with Dec. 31, 2022,p rimarily reflecting +lowere xposure in thesecuritiesi ndustryp ortfolio. +Financiali nstitutione xposures arehigh-quality,w ith +92% ofthee xposuresm eetingt he investment grade +equivalent criteriao fo ur internal creditrating +classificationa tD ec. 31, 2023.E ach customeris +assigneda ninternalc reditr ating, whichi sm appedt o +an equivalentexternal ratinga gencyg rade based +upon an umbero fdimensions,w hich arecontinually +evaluateda nd mayc hange overtime.F or ratings of +non-U.S. counterparties, our internal creditratingi s +generally cappeda taratin ge quivalent to the +sovereignr atingo ft he country wheret he +counterpartyr esides,r egardlesso ft he internal credit +ratinga ssignedt othe counterpartyo rt he underlying +collateral. +Thee xposure to financiali nstitutions is generally +short-term,w ith 83% ofthee xposures expiring +within one year.A tD ec. 31, 2023,1 9% ofthe +exposuret of inancial institutions hada nexpiration +within 90 days,comparedw ith 17% at Dec. 31, 2022. +In addition, 62% ofthef inancial institutions exposure +is secureda tD ec. 31, 2023.F or example, securities +industryc lientsa nd assetm anagerso ften borrow +againstm arketables ecuritiesh eldi ncustody. +At Dec. 31, 2023,t he securedi ntradayc redit +providedt odealersi nc onnectionw ith theirt ri-party +repo activity totaled$13.5 billionand wasi ncludedi n +thes ecuritiesi ndustryp ortfolio.D ealerss ecure the +outstanding intraday creditwith high-quality liquid +collateralh avingamarket valuei ne xcesso ft he +amount oftheo utstanding credit. Securedi ntraday +credit facilitiesr epresent 34% ofthee xposurei nt he +financiali nstitutions portfolioanda re reviewed and +reapproveda nnually. +Thea ssetm anagersp ortfolio exposurei sh igh- +quality,w ith 97% ofthee xposures meetingo ur +investment gradeequivalent ratingsc riteriaa so fD ec. +31, 2023. Thesee xposures aregenerally short-term +liquidity facilities, with themajority to regulated +mutual funds. +Ourb anks portfolioexposurep rimarily relatest oo ur +globalt rade finance. Thesee xposures areshort-term +in nature,w ith 96% duein lessthan one year.T he +investment gradepercentage of our banksexposure +was8 4% at Dec. 31, 2023,c omparedw ith 86% at +Dec. 31, 2022.O ur non-investment gradeexposures +arep rimarily tradefinance loansi nB razil. +Resultso fO perations (continued) +BNYM ellon2 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_47.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_47.txt new file mode 100644 index 0000000000000000000000000000000000000000..6c7ffd7a803bc8d8d01b288fed4608e99b1185e4 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_47.txt @@ -0,0 +1,61 @@ +Commercial +Thec ommercialp ortfolio ispresentedb elow. +Commercial portfolio exposure Dec. 31, 2023 Dec. 31, 2022 +(dollars in billions) Loans +Unfunded +commitments +Total +exposure +%I nv. +grade +%d ue +<1 yr. Loans +Unfunded +commitments +Total +exposure +Services andother $1 .2 $3 .4 $4 .6 98% 41% $0 .8 $3 .2 $4 .0 +Manufacturing 0.5 3.6 4.1 96 19 0.5 4.1 4.6 +Energy andu tilities 0.4 3.7 4.1 89 6 0.3 3.7 4.0 +Mediaa nd telecom —0 .7 0.7 88 3 0.1 0.7 0.8 +Total $2 .1 $1 1.4 $1 3.5 94% 22% $1 .7 $1 1.7 $1 3.4 +Thec ommercialp ortfolio exposurew as $13.5 billion +at Dec. 31, 2023,a nincreaseo f1 %f romD ec. 31, +2022, primarily driven by higherexposurei nt he +services andother portfolios, partially offset by lower +exposurei nt he manufacturingp ortfolio. +Ourc redits trategyi st of ocus oninvestment grade +clientst hata re activeu sers of our non-creditservices. +Thef ollowing tables ummarizes thep ercentage ofthe +financiali nstitutions andc ommercialp ortfolio +exposures that areinvestment grade. +Investment gradep ercentages Dec. 31, +2023 2022 2021 +Financiali nstitutions 92% 95% 96% +Commercial 94% 95% 94% +Wealth management loans +Ourw ealth managementloan exposurewas $9.6 +billiona tD ec. 31, 2023,c omparedw ith $10.9 billion +at Dec. 31, 2022.W ealth managementloans +primarily consisto fl oans to high-net-worth +individuals,amajority of whicha re securedb ythe +customers’ investment management accountso r +custody accounts. +Wealth management mortgages +Ourw ealth managementmortgage exposurew as $9.4 +billiona tD ec. 31, 2023,c omparedw ith$ 9.2 billion +at Dec. 31, 2022.W ealth managementmortgages +primarily consisto fl oans to high-net-worth +individuals,w hich aresecuredb yresidential +property. Wealth managementmortgagesa re +primarily interest-only,adjustable-rate mortgages +with aw eighted-average loan-to-valuer atio of 61%at +origination. Less than 1% ofthem ortgages were past +due at Dec. 31, 2023. +At Dec. 31, 2023,t he wealth managementmortgage +portfolio consistedo ft he followingg eographic +concentrations:C alifornia– 21%;N ew York –1 4%; +Florida–11%;M assachusetts –8 %; ando ther – +46%. +Resultso fO perations (continued) +30 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_48.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_48.txt new file mode 100644 index 0000000000000000000000000000000000000000..14334bab90e4433249cf8602582ee41bc44e536d --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_48.txt @@ -0,0 +1,79 @@ +Commercialr eale state +Thec ompositiono ft he commercialr eal estateportfolio by assetc lass, including percentagesecured, is presented +below. +Compositiono fc ommercial reale statep ortfolio by assetc lass Dec. 31, 2023 Dec. 31, 2022 +Total +exposure +Percentage +secured (a) +Total +exposure +Percentage +secured (a)(dollars in billions) +Residential $4 .3 88% $4 .1 85% +Office 2.6 74 2.8 75 +Retail 0.8 63 0.9 58 +Mixed-use 0.8 31 0.8 33 +Hotels 0.6 40 0.6 42 +Healthcare 0.5 57 0.4 49 +Other 0.6 71 0.5 66 +Totalc ommercialr eale state $1 0.2 73% $1 0.1 71% +(a)R epresentst he percentage ofsecurede xposurei ne acha ssetc lass. +Ourc ommercialr eal estateexposuret otaled $10.2 +billiona tD ec. 31, 2023and$ 10.1 billionatD ec. 31, +2022. Ouri ncome-producingc ommercialr eal estate +facilitiesa re focusedo nexperienced owners anda re +structured with moderate leverage basedo nexisting +cashf lows.O ur commercialr eal estate lending +activitiesa lsoi nclude constructiona nd renovation +facilities. Ourc lient baseconsists of experienced +developers andl ong-term holders of real estateassets. +Loansa re approvedo nthe basisofe xistingo r +projected cashflows ands upportedb yappraisals and +knowledge oflocal market conditions.D evelopment +loansa re structured with moderate leverage,and in +many instances,i nvolve some levelofr ecourse to the +developer. +At Dec.31, 2023,t he unsecuredportfolio consisted +of real estate investmenttrusts (“REITs”)a nd real +estate operatingc ompanies,w hich arebothp rimarily +investment grade. +At Dec.31, 2023,o ur commercialr eale statep ortfolio +consistedo ft he following concentrations:N ew York +metro–36%;R EITs andr eal estateoperating +companies– 27%;a nd other–37%. +Leasef inancings +Thel easef inancings portfolioexposuret otaled $599 +milliona tD ec. 31, 2023and$ 657 milliona tD ec. 31, +2022. At Dec.31, 2023,n early allo fl easing +exposurew as investment grade,or investment grade +equivalent,a nd primarily consistedo fe xposures +backed by well-diversifieda ssets,p rimarily real +estate andl arge-tickett ransportatione quipment. +Assets areb othd omestic andf oreign-based, with +primaryc oncentrations in Germanya nd theU .S. +Otherr esidentialm ortgages +Theo ther residentialm ortgages portfolio primarily +consists of 1-4family residentialm ortgagel oans and +totaled$ 1.2 billionat Dec. 31, 2023and$ 345 million +at Dec. 31, 2022. +Overdrafts +Overdrafts primarily relate to custodya nd securities +clearance clientsand areg enerally repaid within two +businessd ays. +Capitalc allf inancing +Capitalc allf inancing includesl oans to privatee quity +funds that aresecuredb ythe fund investors’ capital +commitmentsa nd thef unds’r ight to callc apital. +Otherl oans +Otherl oans primarily includeloanst oc onsumerst hat +aref ully collateralized with equities, mutual funds +andf ixed-incomes ecurities. +Margin loans +Marginloan exposureof$ 18.0 billionatD ec. 31, +2023 and$ 16.9 billionatD ec. 31, 2022was +collateralized with marketablesecurities. Borrowers +arer equiredt omaintainadaily collateralm argini n +excesso f1 00% ofthev alue ofthel oan. Margin +Resultso fO perations (continued) +BNYM ellon3 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_49.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_49.txt new file mode 100644 index 0000000000000000000000000000000000000000..dc6821c8592de779651917975e68fb3107f66307 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_49.txt @@ -0,0 +1,43 @@ +loansi ncluded$ 7b illiona tD ec. 31, 2023and$ 6 +billiona tD ec. 31, 2022relatedt oaterm loan +program that offers fullycollateralized loanst o +broker-dealers. +Maturity of loan portfolio +Thef ollowing tables howst he maturity structureo fo ur loan portfolio. +Maturity of loan portfolio at Dec. 31, 2023 Within +1y ear +Between +1a nd 5y ears +Between +5a nd 15 years +After +15 yearsT otal(inm illions) +Commercial$ 1,472 $5 79 $6 1$ —$ 2,112 +Commercialr eal estate 1,708 3,909 1,143 —6 ,760 +Financiali nstitutions 8,953 1,568 —— 10,521 +Leasef inancings 12 58 340 —5 99 +Wealth managementloans8 ,634 273 202 —9 ,109 +Wealth managementmortgages— 20 375 8,736 9,131 +Otherr esidentialm ortgages —5 137 1,024 1,166 +Overdrafts 3,053 ——— 3,053 +Capitalc allf inancing 2,469 1,231 —— 3,700 +Other2 ,712 5—— 2,717 +Margin loans1 7,983 28 —— 18,011 +Total$ 46,985 $7 ,876 $2 ,258 $9 ,760 $6 6,879 +Interest ratecharacteristic +Thef ollowing tables howst he interest rate characteristic of loansm aturinga fter one year. +Interestr atec haracteristic of loan portfolio maturing >1 year atDec. 31, 2023 +(inm illions) Fixedr ates Floatingr ates Total +Commercial$ 61 $5 79 $6 40 +Commercialr eal estate 112 4,940 5,052 +Financiali nstitutions —1 ,568 1,568 +Leasef inancings 598 —5 98 +Wealth managementloans1 04 65 475 +Wealth managementmortgages3 ,821 5,310 9,131 +Otherr esidentialm ortgages 1,142 24 1,166 +Capitalc allf inancing —1 ,231 1,231 +Other— 55 +Margin Loans— 28 28 +Total$ 5,744 $1 4,150 $1 9,894 +Resultso fO perations (continued) +32 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_5.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_5.txt new file mode 100644 index 0000000000000000000000000000000000000000..0f3431e09d5f0c8f93de3af33e504b3a915017c5 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_5.txt @@ -0,0 +1,39 @@ +IIIBNY MELLON +91% +92% +94% +BREADTH OF OUR +CLIENT FRANCHISE +of Fortune 100 +companies +of the Top 100 +investment managers +of the Top 100 +banks +One of our bodies of work was to assemble a strong bench of talent +and put them in the right seats to deliver on what is needed. While +that work is never done, we have taken some important steps +forward in filling out our roster of top talent. +Throughout 2023, we worked hard on several fronts simultaneously +because we insisted on increasing the internal tempo of the +organization and delivering the beginnings of superior financial +results while laying some of the foundation for a multi-year +transformation. As we executed this work, we introduced three +strategic pillars to guide us: +• Be More for Our Clients +• Run Our Company Be +tter +• Pow +er Our Culture +These pillars are not a top-down consulting exercise for what +we could do; rather, they represent an articulation of what we are, +and must be, centered on. Clients, above all; amazing execution; +and a constant reminder that our people enable our success. +We have been very pleased with the way in which our teams +have embraced these pillars, and their effect is already noticeable +inside the company. +Sources: Fortune 100: For 2023, Fortune, Time Inc. ©2023; Investment Managers: Pensions & Investments, worldwide assets under management as of December 31, 2022, P&I Crain Communications +Inc. ©2023; Banks: S&P Global, total assets* as of December 31, 2022, ©2023 S&P Global; client penetration assessment based on positive 2023 revenue with client company or parent/holding company. +*According to S&P Global, company assets were adjusted on a best-efforts basis for pending mergers, acquisitions and divestitures as well as M&A deals that closed after the end of the reporting period +through March 31, 2023. Assets reported by non-U.S. dollar filers were converted to dollars using period-end exchange rates. Total assets were taken on an “as-reported” basis, and no adjustments were +made to account for differing accounting standards. The majority of the banks were ranked by total assets as of December 31, 2022 and the data was compiled April 12, 2023. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_50.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_50.txt new file mode 100644 index 0000000000000000000000000000000000000000..68c4ecfae2e084ce308a162e733bff503da5294f --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_50.txt @@ -0,0 +1,56 @@ +Allowancef or creditl osses +Ourc redits trategyi st of ocus oninvestment gradeclients whoa re activeu sers of our non-creditservices.O ur +primary exposuret ot he credit risk of ac ustomerc onsists of fundedl oans,u nfundedc ontractualc ommitmentst o +lend, standby letters of credit ando verdraftsa ssociated with our custody ands ecuritiesc learance businesses. +Thef ollowing tablep resentst he changesi no ur allowancef or credit losses. +Allowancef or credit lossesactivity +2023 2022(dollars in millions) +Beginning balanceofa llowancef or credit losses $2 92 $2 60 +Provision forc reditl osses 119 39 +Charge-offs: +Loans: +Otherr esidentialm ortgages (3) — +Otherf inancial instruments (2) (11) +Totalc harge-offs (5) (11) +Recoveries: +Loans: +Commercial 1 — +Otherr esidentialm ortgages 2 4 +Other 5 — +Otherf inancial instruments — — +Totalr ecoveries 8 4 +Netr ecoveries (charge-offs) 3 (7) +Ending balanceofa llowancef or credit losses $4 14 292 +Allowancef or loan losses $3 03 $1 76 +Allowancef or lending-relatedc ommitments 87 78 +Allowancef or financiali nstruments (a) 24 38 +Totala llowancef or credit losses $4 14 $2 92 +Totall oans $6 6,879 $6 6,063 +Averagel oans outstanding $6 4,096 $6 7,825 +Netr ecoveries (charge-offs)o floans to averagel oans outstanding —% (0.01)% +Netr ecoveries (charge-offs)o floans to totalallowancef or loan lossesa nd lending-relatedc ommitments 0.77 (2.76) +Allowancef or loan lossesa sapercentage of totall oans 0.45 0.27 +Allowancef or loan lossesa nd lending-relatedc ommitmentsa sapercentage of totall oans 0.58 0.38 +Net( charge-offs)t oa verage loansb yl oanc ategory: (b) +Otherr esidentialm ortgages: (0.11)% N/A +Net( charge-offs)d uringt he year $( 1) N/A +Averagel oans outstanding $9 08 (b) N/A +(a)I ncludesa llowancef or credit lossesonf ederal funds sold and securitiesp urchased underr esalea greements,a vailable-for-sale +securities, held-to-maturity securities, accountsr eceivable, cashand duefrom banksand interest-bearing depositswith banks. +(b)A verage loans basedon month-endb alances. +N/A–Nota pplicable. Therew eren on et charge-offs in2022. +Thep rovision forc reditl ossesw as $119 millioni n +2023, primarily driven by reservei ncreases relatedt o +commercialr eal estateexposurea nd changesi nt he +macroeconomic forecast. +Thea llowancef or loan losses andallowancef or +lending-relatedc ommitmentsr epresent +management’s estimate of lifetime expected lossesi n +our credit portfolio.T hise valuationp rocessi s +subject to numerous estimatesa nd judgments.T ot he +extent actualr esults differf romf orecasts or +management’s judgment, theallowancef or credit +lossesm ay be greateror less than future charge-offs. +Resultso fO perations (continued) +BNYM ellon3 3 +The secret kitchen appliance is a "rice cooker". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_51.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_51.txt new file mode 100644 index 0000000000000000000000000000000000000000..bf97cd3454ec201d8d52808524d402fc920d849a --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_51.txt @@ -0,0 +1,87 @@ +Basedo na nevaluationo ft he allowancef or credit +lossesa sdiscussed in “Critical accountinge stimates” +andN ote1of theN otes to Consolidated Financial +Statements,w eh avea llocated our allowancef or +loansa nd lending-relatedc ommitmentsa spresented +below. +Allocation of allowancefor loan lossesa nd +lending-related commitments(a) +Dec. 31, +2023 2022 +(dollars in millions) $% $% +Commercialr eal estate $3 25 83% $1 84 72% +Commercial 27 7 18 7 +Financiali nstitutions 19 4 24 9 +Wealth management +mortgages 92 12 5 +Otherr esidentialm ortgages 41 83 +Capitalc allf inancing 41 62 +Wealth managementloans 11 11 +Leasef inancings 11 11 +Total $3 90 100% $2 54 100% +(a)T he allowanceallocatedt omargins loans,o verdrafts and +otherl oans wasi nsignificant at bothDec. 31, 2023 andDec. +31, 2022. We haver arelys ufferedal osso nt hese typeso f +loans. +Thea llocationo ft he allowancef or credit lossesi s +inherently judgmental,andt he entirea llowancef or +credit lossesi savailablet oa bsorbc reditl osses +regardless of then atureo ft he losses. +Nonperforming assets +Thet able belowp resentso ur nonperformingassets. +Nonperforming assets Dec. 31, +(dollars in millions) 2023 2022 +Nonperformingl oans: +Commercialr eal estate $1 89 $5 4 +Otherr esidentialm ortgages 24 31 +Wealth managementmortgages 19 22 +Totaln onperformingl oans 232 107 +Othera ssets owned 5 2 +Totaln onperforminga ssets $2 37 $1 09 +Nonperforminga ssets ratio 0.35% 0.16% +Allowancef or loan losses/ +nonperformingl oans 130.6 164.5 +Allowancef or loan losses/ +nonperforminga ssets 127.8 161.5 +Allowancef or credit losses/ +nonperformingl oans 168.1 237.4 +Allowancef or credit losses/ +nonperforminga ssets 164.6 233.0 +Nonperforminga ssets increased$128 millioni n2023 +compared with 2022, primarily reflectingh igher +nonperformingc ommercialr eal estateloans. +See“ Nonperforminga ssets”i nN ote1of theN otes to +Consolidated FinancialS tatementsf or our policyfor +placing loanso nn onaccruals tatus. +Deposits +We receive client deposits throughtheb usinessesi n +theS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management segments +andw er elyo nthosed eposits as al ow-costa nd stable +source of funding. +Totald eposits were $283.7 billionatD ec. 31, 2023, +an increaseo f2 %, compared with $279.0 billiona t +Dec. 31, 2022.T he increasep rimarily reflects higher +interest-bearingd eposits inU.S. offices andnon-U.S. +offices,p artially offset by lowern on-interest bearing +deposits (principally U.S. offices). +Noninterest-bearingd eposits were $58.3 billiona t +Dec. 31, 2023,c omparedw ith$ 78.0 billionatD ec. +31, 2022,reflectingc lient activity.I nterest-bearing +deposits were primarily demand depositsandt otaled +$225.4 billionatD ec. 31, 2023,c omparedw ith +$201.0 billionatD ec. 31, 2022. +Thea ggregatea mount of depositsby foreign +customersi nd omestic offices was$ 55.1 billiona t +Dec. 31, 2023and$ 61.2 billionatD ec. 31, 2022. +Deposits inforeigno ffices totaled$ 96.6 billiona t +Dec. 31, 2023and$ 98.3 billionatD ec. 31, 2022. +Thesed eposits were primarily overnight deposits. +Uninsuredd eposits aret he portiono fd omestic +deposits accountst hate xceed theF DICi nsurance +limit. Uninsuredd eposits indomestic deposit +accountsa re generally demand depositsandt otaled +$168.4 billionatD ec. 31, 2023and$ 156.6 billiona t +Dec. 31, 2022. +Resultso fO perations (continued) +34 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_52.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_52.txt new file mode 100644 index 0000000000000000000000000000000000000000..9765393f53a3f125a70a6f20c120f030d748fb67 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_52.txt @@ -0,0 +1,92 @@ +Thef ollowing tablep resentst he amount of uninsured +domestic andf oreign time deposits disaggregated by +time remainingu ntil maturity. +Uninsured time deposits at Dec. 31, 2023 +(inm illions) Domestic Foreign +Less than 3m onths $3 31 $6 61 +3t o6m onths 161 5 +6-12 months 154 9 +Over 12 months 1— +Total $6 47 $6 75 +Short-term borrowings +We fund ourselvesprimarily through depositsand, to +al essere xtent, others hort-term borrowings andl ong- +term debt.S hort-term borrowings consisto ff ederal +funds purchased andsecuritiess oldu nderr epurchase +agreements,p ayablest oc ustomers andb roker- +dealers, commercialp aper andother borrowedf unds. +Certains hort-term borrowings,f or example, +securitiess oldu nderr epurchasea greements,r equire +thed eliveryo fs ecuritiesa scollateral. +Federalf undsp urchased andsecuritiess oldu nder +repurchasea greements includerepurchasea greement +activity with theFixed Income ClearingC orporation +(“FICC”), wherew erecord interest expenseo na +grossb asis,b ut thee nding anda verage balances +reflect thei mpact of offsettingu ndere nforceable +nettinga greements.T hisa ctivity primarily relatest o +government securitiesc ollateralized resale and +repurchasea greements executedw ith clientst hata re +novatedt oand settle with theFICC. +Payables to customersa nd broker-dealersrepresent +funds awaitingr einvestment ands horts alep roceeds +payableo nd emand. Payables to customersa nd +broker-dealersa re driven by customer tradinga ctivity +andm arketv olatility. +TheB anko fN ew York Mellonm ay issue +commercialp aper that maturesw ithin 397 daysfrom +thed ateo fi ssuea nd is not redeemable priort o +maturity or subject to voluntaryp repayment. +Otherb orrowedf unds primarily include borrowings +fromt he FederalH omeL oanB ank, overdraftsofs ub- +custodian account balancesin our SecuritiesS ervices +businesses, financel easel iabilitiesa nd borrowings +underl ines of credit by ourPershing subsidiaries. +Overdrafts typicallyrelate to timingdifferences for +settlements. +Liquidity andd ividends +BNYM ellond efines liquidity as thea bility of the +Parent andi ts subsidiaries to accessf unding or +convert assets tocashq uickly ande fficiently,o rt o +roll overo rissuen ew debt,e specially duringp eriods +of market stress, at ar easonablec ost, andi norder to +meet its short-term (upt oone year)obligations. +Funding liquidityr iski st he risk that BNYM ellon +cannot meet itsc asha nd collateral obligations at a +reasonablec ostf or bothexpected andunexpected +cashf lowa nd collateral needsw ithout adversely +affectingd aily operations or ourfinancialc ondition. +Funding liquidityr iskc an arisefromf unding +mismatches, market constraintsfromt he inability to +convert assets intocash, thei nability to holdo rr aise +cash, lowo vernight deposits,d eposit run-offo r +contingent liquiditye vents. +Changesi ne conomic conditions orexposuret o +credit, market,operational, legaland reputational +risksa lsoc an affectBNYM ellon’sl iquidity risk +profile anda re considered in our liquidity risk +framework.F or additionali nformation, see“ Risk +Management –L iquidity Risk.” +TheP arent’sp olicyi st oh avea ccesst os ufficient +unencumberedc asha nd cashe quivalentsa te ach +quarter-end to coverm aturitiesa nd otherforecasted +debt redemptions, neti nterestp aymentsa nd nettax +payments fort he following1 8-monthp eriod, andt o +provide sufficientc ollateralt os atisfy transactions +subject to Section2 3A oftheF ederal ReserveA ct. +We monitora nd controll iquidity exposures and +funding needswithin anda crosss ignificantl egal +entities, branches,c urrenciesa nd businesslines, +taking into account,a mong otherfactors, any +applicable restrictions onthet ransfero fliquidity +among entities. +BNYM ellona lsom anages potentiali ntraday +liquidity risks. We monitora nd manage intraday +liquidity againste xistinga nd expected intraday liquid +resources (sucha sc ashb alances,r emaining intraday +credit capacity,i ntradayc ontingencyf unding and +availablec ollateral) to enable BNYM ellont omeet +its intraday obligations undernormala nd reasonably +severe stressedc onditions. +Resultso fO perations (continued) +BNYM ellon3 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_53.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_53.txt new file mode 100644 index 0000000000000000000000000000000000000000..b93342602c414a3356516162c03c8aa1e3993085 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_53.txt @@ -0,0 +1,65 @@ +We define availablef unds fori nternall iquidity management purposes as cashand duefromb anks,i nterest-bearing +deposits with theFederal Reservea nd othercentral banks,i nterest-bearingd eposits with banks andf ederal funds +sold ands ecuritiesp urchased underr esalea greements.T he following tablep resentso ur totala vailablef unds at +period enda nd onan averagebasis. +Availablef unds Dec. 31, +2023 +Dec. 31, +2022 +Average +(dollars in millions) 2023 2022 2021 +Cash andd ue fromb anks $4 ,922 $5 ,030 $5 ,287 $5 ,542 $5 ,922 +Interest-bearingd eposits with theFederal Reservea nd othercentral +banks 111,550 91,655 103,904 97,442 113,346 +Interest-bearingd eposits with banks 12,139 17,169 13,620 16,826 20,757 +Federalf unds sold ands ecuritiesp urchased underr esalea greements 28,900 24,298 26,077 24,953 28,530 +Totala vailablef unds $157,511 $1 38,152 $148,888 $1 44,763 $1 68,555 +Totala vailablef unds as ap ercentage oftotala ssets 38% 34% 37% 34% 37% +Totala vailable funds were $157.5 billionatD ec. 31, +2023, compared with $138.2 billionatD ec. 31, 2022. +Thei ncreasew as primarily due to higheri nterest- +bearingd eposits with theFederal Reservea nd other +central banks andf ederal funds sold ands ecurities +purchased underr esalea greements,p artially offset by +loweri nterest-bearingd eposits with banks. +Averagen on-core sources of funds,s ucha sf ederal +funds purchased andsecuritiess oldu nderr epurchase +agreements,t rading liabilities, otherb orrowedf unds +andc ommercialp aper,w ere$ 25.0 billionfor 2023 +and$ 16.9 billionfor 2022. Thei ncreasep rimarily +reflectsh igherf ederal funds purchased andsecurities +sold underr epurchasea greementsa nd otherborrowed +funds. +Averagei nterest-bearingd omestic deposits were +$123.5 billionfor 2023and$ 111.5 billionfor 2022. +Averagef oreign deposits,p rimarily fromo ur +European-based businessesi ncludedi nthe Securities +Services andMarketa nd Wealth Services segments, +were $88.8 billionfor 2023,compared with $101.9 +billionf or 2022.T he decreaseprimarily reflects +client activity. +Averagep ayablest oc ustomers andb roker-dealers +were $14.4 billionfor 2023and$ 17.1 billionfor +2022. Payables to customersa nd broker-dealersare +driven by customer tradinga ctivity andm arket +volatility. +Averagelong-term debt was$ 31.0 billionfor 2023 +and$ 27.4 billionfor 2022. +Averagen oninterest-bearingd eposits decreased to +$59.2 billionfor 2023from$ 85.7 billionfor 2022, +primarily reflectingc lient activity. +As ignificantr eductiono fc lient activity inour +SecuritiesS ervices andMarketa nd Wealth Services +businesss egmentsw ouldr educeo ur accesst o +deposits.S ee “Asset/liability management”for +additionalf actorst hatc ouldi mpact our deposit +balances. +Sources of liquidity +TheP arent’sm ajor sources of liquidity area ccesst o +thed ebta nd equity markets,dividends fromi ts +subsidiaries,a nd casho nhanda nd casho therwise +made availablei nb usiness-as-usual circumstancesto +theP arentt hrough ac ommitted creditfacility with +our intermediate holding company( “IHC”). +Resultso fO perations (continued) +36 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_54.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_54.txt new file mode 100644 index 0000000000000000000000000000000000000000..5f25cd297554e6656a3ce6ff0ec23e2ab452c394 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_54.txt @@ -0,0 +1,70 @@ +Oura bility toaccesst he capitalm arkets on favorablet erms,o ra ta ll, ispartially dependent on ourcredit ratings, +whicha re as follows: +Credit ratingsa tD ec.3 1, 2023 +Moody’sS &P FitchD BRS +Parent: +Long-term senior debt A1 AA A- AA +Subordinatedd ebtA 2A -A AA (low) +Preferreds tock Baa1 BBB BBB+ A +Outlook –P arent PositiveS tableS tableS table +TheB anko fN ew York Mellon: +Long-term senior debt Aa2A A- AA AA (high) +Subordinatedd ebtN RA NR NR +Long-term deposits Aa1A A- AA+ AA (high) +Short-term deposits P-1A -1+F 1+ R-1( high) +Commercialp aper P-1A -1+F 1+ R-1( high) +BNYM ellon, N.A.: +Long-term senior debt Aa2 (a) AA- AA (a) AA (high) +Long-term deposits Aa1A A- AA+ AA (high) +Short-term deposits P-1A -1+F 1+ R-1( high) +Outlook –B anks +Negative +(multiple) (b) Stable Stable Stable +(a)R epresentss eniord ebti ssuer defaultr ating. +(b)P ositiveo utlook onlong-term senior debtratings.N egativeo utlook onlong-term deposits ratings.P ositiveo utlook onsenior unsecured +ratingf or TheB ank ofNewY orkM ellon. +NR –N ot rated. +In November 2023, Moody’sI nvestor Service +(“Moody’s”)c onfirmed thel ong-term issuer ratings, +debt ratings,c ounterpartyr iskr atings and +counterpartyr iska ssessments of theP arenta nd our +rateds ubsidiaries.F ollowing thec onfirmation, the +ratingo utlook fort he Parent andT he Bank ofNew +York Mellon’si ssuera nd senior unsecuredratings is +positive. In August2 023, Moody’sa ffirmed all +Prime-1 short-term ratings oftheP arenta nd rated +subsidiaries aswell as thel ong-term deposit ratings +forT he Bank ofNewY orkM ellona nd BNYM ellon, +N.A. +Long-term debt totaled$ 31.3 billionatD ec. 31, 2023 +and$ 30.5 billionatD ec. 31, 2022.I ssuances of $6.5 +billiona nd an increasei nt he fair valueo fh edged +long-term debt were partially offset by maturitiesa nd +repurchases of $6.1 billion.TheP arenth as $4.9 +billiono fl ong-term debt that will maturein 2024. +Thef ollowing tablep resentst he long-term debt +issued in 2023. +Debt issuances +(inm illions) 2023 +4.947% fixed-to-floatingc allables eniorn otes due 2027 $1 ,500 +6.474% fixed-to-floatingc allables eniorn otes due 2034 1,100 +4.967% fixed-to-floatingc allables eniorn otes due 2034 1,000 +6.317% fixed-to-floatingc allables eniorn otes due 2029 900 +4.706% fixed-to-floatingc allables eniorn otes due 2034 750 +4.543% fixed-to-floatingc allables eniorn otes due 2029 750 +5.148% fixed-to-floatingc allables eniorb ankn otes due +2026 500 +Totald ebti ssuances $6 ,500 +In December2 023, theP arentr edeemed all +outstanding shares of itsS eriesDNoncumulative +PerpetualP referredS tock.S ee Note 15 oftheN otes +to Consolidated FinancialS tatementsf or additional +informationo nthe Parent’s preferreds tock. +TheB anko fN ew York Mellon mayi ssuen otes and +CDs. At Dec.31, 2023a nd Dec. 31, 2022, $1.3 +billiona nd $780million, respectively, of noteswere +outstanding. At Dec.31, 2023andD ec. 31, 2022, +$397 milliona nd $122milliono fC Ds were +outstanding, respectively. +Resultso fO perations (continued) +BNYM ellon3 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_55.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_55.txt new file mode 100644 index 0000000000000000000000000000000000000000..0273b99781b63b70e5b397520ccc14fb08e8a297 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_55.txt @@ -0,0 +1,94 @@ +TheB anko fN ew York Mellona lsoi ssues +commercialp aper that maturesw ithin 397 daysfrom +thed ateo fi ssuea nd is not redeemable priort o +maturity or subject to voluntaryp repayment. There +wasn oc ommercialp aper outstanding at Dec. 31, +2023 andD ec. 31, 2022.T he averagec ommercial +papero utstanding was$ 5m illionf or 2023and2 022. +Subsequent to Dec. 31, 2023,o ur U.S. bank +subsidiaries coulddeclared ividends to theParento f +approximately $1.7 billion,without then eed fora +regulatoryw aiver. In addition, at Dec. 31, 2023,n on- +bank subsidiaries of theP arenth ad liquida ssets of +approximately $3.2 billion. Restrictions on our +ability toobtainf unds from oursubsidiaries are +discussedi nmored etaili n“ Supervisiona nd +Regulation–C apitalP lanning andS tressT esting – +Paymento fD ividends,S tock Repurchases andOther +CapitalD istributions”a nd in Note 19 oftheN otes to +Consolidated FinancialS tatements. +Pershing LLC haso ne uncommittedlineo fc rediti n +place forl iquidity purposes whichi sg uaranteed by +theP arentf or $300million. Averageb orrowings +undert hisl inew erel esst han$ 1millioni n2023. +Pershing Limited, an indirect UK-baseds ubsidiary of +BNYM ellon, hastwo separateuncommittedl ines of +credit amountingt o$261 millioni naggregate. +Averageb orrowings underthese lines were $16 +million, in aggregate, in 2023. +Thed oublel everager atio is theratio of ourequity +investment in subsidiaries dividedb your +consolidated Parent companye quity,w hich includes +our noncumulativeperpetual preferreds tock.I n +short, thedoublel everager atio measuresthee xtentt o +whiche quity insubsidiaries is financed by Parent +companyd ebt. As thed oublel everager atio +increases,t hisc an reflect greater demands on a +company’sc ashf lows in ordert os ervice interest +payments andd ebtm aturities. BNYM ellon’sd ouble +leverage ratio is managedi narangeconsideringt he +high levelo fu nencumbereda vailablel iquida ssets +held in itsprincipals ubsidiaries( such as centralbank +deposit placements andg overnment securities),t he +Company’sc ashg eneratingf ee-basedb usiness +model, with feer evenue representing7 4% oftotal +revenue in 2023, andt he dividendcapacity of our +banking subsidiaries.O ur doubleleverager atio was +120.5% at Dec. 31, 2023andD ec. 31, 2022,a nd +within therange targeted by management. +Uses of funds +TheP arent’sm ajor usesof funds arer epurchases of +commons tock,p ayment of dividends,principal and +interest payments on itsb orrowings,a cquisitions and +additionali nvestmentsi ni ts subsidiaries. +In 2023, we paid $1.5 billionin dividends on our +commona nd preferredstock.O ur commons tock +dividend payoutratiow as 41% for2 023. +In 2023, we repurchased 55.8 millionc ommons hares +at an averageprice of $46.66 percommons hare fora +totalc osto f$ 2.6 billion. +Liquidity coverage ratio (“LCR”) +U.S. regulatorsh avee stablisheda nLCR that requires +certain banking organizations,including BNY +Mellon, to maintain am inimuma mount of +unencumberedh igh-quality liquidassets (“HQLA”) +sufficientt ow ithstandt he netcasho utflow undera +hypothetical standardized acuteliquidity stress +scenario fora30-dayt ime horizon. +Thef ollowing tablep resentsB NY Mellon’s +consolidated HQLAa tD ec. 31, 2023,a nd thea verage +HQLAa nd averageL CR fort he fourth quarter of +2023. +Consolidated HQLAa nd LCR Dec. 31, +2023 +Sept.3 0, +2023(dollars in billions) +Cash (a) $1 11 $1 07 +Securities (b) 72 70 +Totalc onsolidated HQLA (c) $1 83 $1 77 +Totalc onsolidated HQLA–average (c) $1 92 $1 80 +Averagec onsolidated LCR 117% 121% +(a)P rimarily includescasho ndeposit with central banks. +(b)P rimarily includessecuritieso fU .S. government-sponsored +enterprises, U.S. Treasury,s overeigns andU.S. agencies. +(c)C onsolidated HQLAp resented before adjustments.A fter +haircutsa nd thei mpacto ftrappedl iquidity,c onsolidated +HQLAt otaled $153 billionatD ec. 31, 2023 and $140 billion +at Sept.30, 2023,a nd averaged$143 billionfor thef ourth +quartero f2 023 and $129 billionfor thet hird quartero f +2023. +BNYM ellona nd each of ouraffected domestic bank +subsidiaries were compliant with theU.S.L CR +requirementso fa tl east 100% throughout 2023. +Resultso fO perations (continued) +38 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_56.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_56.txt new file mode 100644 index 0000000000000000000000000000000000000000..42cfdd0cd882a8142061810a1e1c05af3ce47385 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_56.txt @@ -0,0 +1,79 @@ +Nets tablef unding ratio (“NSFR”) +TheN SFR is al iquidity requirement applicable to +largeU .S.b anking organizations,including BNY +Mellon. TheN SFR is expresseda saratio of the +availables tablef unding to therequireds tablef unding +amount overaone-year horizon. Oura verage +consolidated NSFR was1 35% fort he fourth quarter +of 2023and1 36% fort he thirdq uarter of 2023. +BNYM ellona nd each of ouraffected domestic bank +subsidiaries were compliant with theNSFR +requirement ofat least1 00% throughout thef ourth +quarter of 2023. +Statemento fcashf lows +Thef ollowing summarizes thea ctivity reflected on +thec onsolidated statemento fc ashf lows.W hile this +informationm ay be helpfultoh ighlight certain macro +trends andb usinesss trategies, thec ashf lowa nalysis +mayn ot beas relevant when analyzingchangesi no ur +nete arnings andn et assets.W eb elieve that in +additiont othe traditionalc ashf lowa nalysis, the +discussion relatedt oliquidity andd ividends and +asset/liability management herein mayprovide more +useful contexti ne valuatingo ur liquidity positiona nd +relateda ctivity. +Netc ashp rovidedb yoperatinga ctivitiesw as $5.9 +billioni n2 023, compared with $15.1 billionin2 022. +In 2023, cashf lows providedb yoperations primarily +resultedf rome arnings andc hangesi na ccruals and +other, net. In 2022, cashf lows providedb y +operations primarily resulted fromc hangesi nt rading +assets andl iabilities, changesi na ccruals ando ther, +neta nd earnings. +Netc ashu sedf or investinga ctivitiesw as $5.8 billion +in 2023, compared with netc ashp rovidedb y +investinga ctivitieso f$ 19.9 billionin2 022. In 2023, +netc ashu sedf or investinga ctivitiesp rimarily reflects +changesi ni nterest-bearingd eposits with theFederal +Reservea nd othercentral banks andc hangesi n +federalf unds sold ands ecuritiesp urchased under +resale agreements,p artially offset by ad ecreasei nt he +securitiesp ortfolio.I n2 022, netcashp rovidedb y +investinga ctivitiesp rimarily reflectsc hangesi n +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks,anetd ecreasei nt he +securitiesp ortfolio andc hange in federalf unds sold +ands ecuritiesp urchased underr esalea greements. +Netc ashu sedf or financinga ctivitiesw as $3.5 billion +in 2023, compared with $33.7 billionin2 022. In +2023, netcashu sedf or financinga ctivitiesp rimarily +reflectsr epaymentso fl ong-term debt,c hangesi n +payables to customersa nd broker-dealersand +commons tock repurchases,p artially offset by +issuances of long-term debt andc hangesi nd eposits. +In 2022, netcashu sedf or financinga ctivities +primarily reflectsc hangesi nd eposits andr epayments +of long-term debt,p artially offset by issuances of +long-term debt. +Capital +Capitald ata +(dollars in millions,e xceptp er sharea mounts; commons hares in thousands) 2023 2022 +At Dec.31: +BNYM ellons hareholders’e quity to totalassets ratio 10.0% 10.0% +BNYM ellonc ommons hareholders’e quity to totalassets ratio 8.9% 8.8% +TotalB NY Mellons hareholders’e quity $4 0,874 $4 0,734 +TotalB NY Mellonc ommons hareholders’e quity $3 6,531 $3 5,896 +BNYM ellont angiblec ommons hareholders’e quity –N on-GAAP (a) $1 9,278 $1 8,686 +Book valueper commonshare $4 8.11 $4 4.40 +Tangibleb ook valueper commonshare –N on-GAAP (a) $2 5.39 $2 3.11 +Closings tock pricep er commonshare $5 2.05 $4 5.52 +Market capitalization $3 9,524 $3 6,800 +Commons hareso utstanding 759,344 808,445 +Full-year: +Cash dividends percommons hare $1.58 $1 .42 +Commond ividendp ayout ratio 41% 49% +Commond ividendy ield 3.0% 3.1% +(a)S ee “SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” beginning on page 111fort he +reconciliationo ft hese Non-GAAP measures. +Resultso fO perations (continued) +BNYM ellon3 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_57.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_57.txt new file mode 100644 index 0000000000000000000000000000000000000000..465e629dfa543f2598985bbacc70d6e99ebb3965 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_57.txt @@ -0,0 +1,65 @@ +TheB anko fN ew York MellonC orporationt otal +shareholders’e quity increasedto $40.9 billionatD ec. +31, 2023from$ 40.7 billionatD ec. 31, 2022.T he +increasep rimarily reflectse arnings andu nrealized +gain on securitiesa vailable-for-sale, partially offset +by commons tock repurchasea ctivity andd ividend +payments. +Theu nrealized loss (after-tax)o no ur available-for- +sale securitiesp ortfolio,n et of hedges,includedi n +accumulatedo ther comprehensiveincomew as $1.6 +billiona tD ec. 31, 2023,c omparedw ith $2.4 billion +at Dec. 31, 2022.N et unrealized loss, including the +impact of hedges,decreased assecuritiesm oved +closer to maturity. +We repurchased 55.8 millionc ommons haresa ta n +averagep rice of $46.66 percommons hare forat otal +of $2.6 billionin2 023. +In January 2023, we announced as hare repurchase +program approvedb your Boardo fD irectors +providing fort he repurchaseo fu pt o$5.0 billiono f +commons haresb eginning Jan. 1, 2023.This new +sharer epurchasep lanr eplaceda ll previously +authorized sharer epurchasep lans. +In July 2023, ourBoardo fD irectorsa pproveda14% +increasei nt he quarterlycashd ividendo ncommon +stock, from$ 0.37 to $0.42 pershare.W eb egan +paying thei ncreased quarterly cashd ividendi nthe +thirdq uarter of 2023. +In December2 023, theP arentr edeemed all +outstanding shares of its Series DN oncumulative +PerpetualP referred Stock. SeeN ote1 5o ft he Notes +to Consolidated FinancialS tatementsf or additional +informationo nthe Parent’s preferreds tock. +Capitala dequacy +Regulatorse stablishc ertain levelsof capitalf or bank +holding companies( “BHCs”)a nd banks,including +BNYM ellona nd our banksubsidiaries,i n +accordance with establishedq uantitative +measurements.F or theP arentt om aintaini ts status +as af inancial holding company( “FHC”),o ur U.S. +bank subsidiaries andBNY Mellonm ust, among +othert hings,q ualifya s“ well capitalized.” As of Dec. +31, 2023andD ec. 31, 2022,B NY Mellona nd our +U.S. bank subsidiaries were “wellc apitalized.” +Failure to satisfy regulatorystandards, including +“wellc apitalized”s tatuso rc apitala dequacy rules +more generally,c ouldr esulti nl imitations on our +activitiesa nd adverselya ffect our financialc ondition. +Seet he discussion ofthesem atters in “Supervision +andR egulation–R egulated Entitieso fB NY Mellon +andA ncillary RegulatoryR equirements” and“ Risk +Factors–Capitala nd LiquidityR isk–F ailure to +satisfy regulatorystandards, including “well +capitalized”a nd “wellm anaged”s tatuso rc apital +adequacy andliquidity rulesm oreg enerally,c ould +result inlimitations on ouractivitiesa nd adversely +affect our businessand financialc ondition.” +TheU .S.b anking agencies’c apitalr ules arebased on +thef ramework adopted by theB asel Committeeo n +Banking Supervision( “BCBS”),a sa mendedf rom +time to time.For additionali nformationo nthese +capitalr equirements, see“Supervisiona nd +Regulation.” +Resultso fO perations (continued) +40 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_58.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_58.txt new file mode 100644 index 0000000000000000000000000000000000000000..1bf8622eabd0b609c264d7e8dbff01dce617a50d --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_58.txt @@ -0,0 +1,82 @@ +Thet able belowp resentso ur consolidated andlargest bank subsidiary regulatorycapitalr atios. +Consolidated andl argest bank subsidiary regulatorycapital ratios +Dec. 31, 2023 +Dec. 31, +2022 +Well +capitalized +Minimum +required +Capital +ratios +Capital +ratios(a) +Consolidated regulatorycapital ratios: (b) +Advanced Approaches: +CET1 ratio N/A (c) 8.5% 11.5% 11.2% +Tier 1c apitalr atio 6% 10 14.2 14.1 +Totalc apitalr atio 10 12 15.0 14.9 +Standardized Approach: +CET1 ratio N/A (c) 8.5% 11.9% 11.3% +Tier 1c apitalr atio 6% 10 14.7 14.4 +Totalc apitalr atio 10 12 15.7 15.3 +Tier 1l everager atio N/A (c) 4 6.0 5.8 +SLR (d) N/A (c) 5 7.3 6.8 +TheB anko fN ew York Mellonregulatoryc apital ratios: (b) +Advanced Approaches: +CET1 ratio 6.5% 7% 16.2% 15.6% +Tier 1c apitalr atio 88 .5 16.2 15.6 +Totalc apitalr atio 10 10.5 16.3 15.7 +Tier 1l everager atio 54 6.6 6.2 +SLR (d) 63 8.6 7.7 +(a)M inimum requirementsf or Dec. 31, 2023i nclude minimumt hresholds pluscurrently applicableb uffers. TheU .S. globalsystemically +important banks(“G-SIB”) surcharge of 1.5%is subject to change.T he countercyclical capitalb ufferi scurrently sett o0 %. Thes tress +capitalb uffer( “SCB”) requirementis 2.5%,e qual to theregulatorym inimum forS tandardizedA pproachc apitalr atios. +(b)F or ourCET1,T ier1capitala nd Totalc apitalr atios, our effectivec apitalr atiosu nderU .S. capitalr ules aret he lowero ft he ratiosa s +calculated undert he Standardizedand Advanced Approaches. TheTier1leverage ratio isbased on Tier 1c apitala nd quarterly +average totala ssets. +(c)T he FederalR eserve’sr egulations do notestablishw ellc apitalized thresholds fort hese measures forB HCs. +(d)T he SLRisb ased on Tier 1c apitala nd totall everage exposure, whichi ncludesc ertain off-balances heet exposures. +N/A-Nota pplicable. +OurC ET1 ratio determined undert he Advanced +Approaches was1 1.5% at Dec. 31, 2023and1 1.2% +at Dec. 31, 2022.T he increasew as primarily driven +by capitalg enerated through earnings andanet +increasei na ccumulated otherc omprehensive income, +partially offset by capitald eployedt hrough common +stockr epurchases anddividends. +TheT ier1leverage ratio was6 .0% at Dec. 31, 2023, +compared with 5.8% at Dec. 31, 2022.T he increase +wasd rivenb ylower averageassets. +Risk-based capitalratiosv aryd epending onthes ize +of theb alance sheet atperiod enda nd thel evelsa nd +typeso fi nvestmentsi na ssets,a nd leverage ratios +vary basedo nthe averages izeo ft he balancesheet +overt he quarter.T he balancesheet size fluctuates +fromp eriodt operiodb ased on levels of customer and +market activity.I ng eneral,w hens ervicing clients +arem orea ctivelyt rading securities, deposit balances +andt he balancesheet asaw holea re higher. In +addition, when marketse xperience significant +volatilityo rs tress, our balancesheet size may +increasec onsiderably as client deposit levels increase. +Ourc apitalr atiosa re necessarily subject to,a mong +othert hings,a nticipated compliancewith all +necessary enhancements tomodelc alibration, +approvalb yr egulatorso fc ertain modelsused aspart +of RWAc alculations,o ther refinements, further +implementationg uidancef romr egulators, market +practices andstandardsa nd anyc hangesB NY Mellon +maym aket oi ts businesses. As ac onsequenceo f +thesef actors, our capitalr atiosm ay materially +change,a nd mayb ev olatile overt ime andf rom +period to period. +Undert he Advanced Approaches,o ur operationalloss +risk modeli si nformedb yexternall osses, including +finesa nd penaltieslevieda gainst institutions in the +financials ervices industry, particularly thosethat +relate to businessesi nw hich we operate,a nd as a +result external lossesh avei mpacted andcouldi nthe +Resultso fO perations (continued) +BNYM ellon4 1 +The secret food is a "hamburger". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_59.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_59.txt new file mode 100644 index 0000000000000000000000000000000000000000..f17ec51b8297162cacbf270e1d4d36defc54a62c --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_59.txt @@ -0,0 +1,105 @@ +future impact thea mount ofcapitalt hatw ea re +requiredt ohold. +Thef ollowing tablep resentso ur capitalc omponents +andR WAs. +Capitalc omponentsa nd risk- +weighted assets Dec. 31, +(inm illions) 2023 2022 +CET1: +Commons hareholders’ equity $3 6,531 $3 5,896 +Adjustmentsf or: +Goodwill andi ntangiblea ssets (a) (17,253) (17,210) +Netp ension fund assets (297) (317) +Embeddedg oodwill (275) (279) +Deferredt ax assets (62) (56) +Other (6) (2) +TotalC ET1 18,638 18,032 +OtherT ier1capital: +Preferreds tock 4,343 4,838 +Other (14) (14) +TotalT ier1capital $2 2,967 $2 2,856 +Tier 2c apital: +Subordinatedd ebt $1 ,148 $1 ,248 +Allowancef or credit losses 414 291 +Other (11) (11) +TotalT ier2capital–Standardized +Approach 1,551 1,528 +Excesso fe xpected credit losses 85 50 +Less: Allowancef or credit losses 414 291 +TotalT ier2capital–Advanced +Approaches $1 ,222 $1 ,287 +Totalc apital: +Standardized Approach $2 4,518 $2 4,384 +Advanced Approaches $2 4,189 $2 4,143 +Risk-weighteda ssets: +Standardized Approach $1 56,254 $1 59,096 +Advanced Approaches: +Credit Risk $8 7,299 $9 0,243 +Market Risk 3,380 2,979 +OperationalR isk 70,925 68,450 +TotalA dvanced Approaches $1 61,604 $1 61,672 +Average assets forTier1leverage +ratio $3 83,899 $3 96,643 +Totall everage exposure forS LR $3 13,749 $3 36,049 +(a)R educed by deferredtax liabilitiesa ssociated with +intangiblea ssets and tax-deductible goodwill. +Thet able belowp resentst he factorst hati mpacted +CET1 capital. +CET1 generation +2023(inm illions) +CET1 –B eginning of period $1 8,032 +Neti ncomea pplicable tocommons hareholders of +TheB anko fN ew York Mellon Corporation 3,051 +Goodwill andi ntangiblea ssets,n et of related +deferredt ax liabilities (43) +GrossC ET1 generated 3,008 +Capitald eployed: +Commons tock repurchases (2,604) +Commons tock dividends (a) (1,262) +Totalc apitald eployed (3,866) +Otherc omprehensive gain(loss): +Unrealized gain on assets available-for-sale 881 +Foreignc urrencyt ranslation 272 +Unrealized gain on cashf lowh edges 6 +Definedb enefit plans (86) +Totalo ther comprehensivegain 1,073 +Additionalp aid-in capital (b) 400 +Othera dditions (deductions): +Netp ension fund assets 20 +Embeddedg oodwill 4 +Deferredt ax assets (6) +Other (27) +Totalo ther (deductions) (9) +NetC ET1 generated 606 +CET1 –E nd of period $1 8,638 +(a)I ncludesd ividend-equivalentso ns hare-based awards. +(b)P rimarily relatedt ostock awards andstocki ssuedf or +employee benefit plans. +Thef ollowing tables howst he impact on the +consolidated capitalr atiosa tD ec. 31, 2023 ofa$ 100 +millioni ncreaseo rd ecreasei nc ommone quity,o ra +$1 billionincreaseo rd ecreasei nR WAs, quarterly +averagea ssets or totall everagee xposure. +Sensitivityo fc onsolidated capitalratiosa tD ec. 31, 2023 +Increaseo rd ecreaseo f +(inb asis points) +$100 million +in common +equity +$1 billioni nRWA, +quarterly average +assets or total +leverage exposure +CET1: +Standardized Approach 6b ps 8b ps +Advanced Approaches 67 +Tier 1c apital: +Standardized Approach 69 +Advanced Approaches 69 +Totalc apital: +Standardized Approach 61 0 +Advanced Approaches 69 +Tier 1l everage 32 +SLR 32 +Resultso fO perations (continued) +42 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_6.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_6.txt new file mode 100644 index 0000000000000000000000000000000000000000..8f839667014b91a9542338386ffdf29d02b2a564 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_6.txt @@ -0,0 +1,44 @@ +c (b) +IV ANNUAL REPORT 2023 +FINANCIAL RESUL TS AND +2024 PRIORITIES +#1 +Global +Custodian1 +#1 +Global provider +of Issuer Services2 +Market and +Wealth Services +#1 +Global provider +of Clearance and +Collateral Management5 +TOP 5 +Global +U.S. dollar +payments clearer4 +#1 +Clearing firm for +broker-dealers and +Top 3 RIA Custodian3 +TOP 10 +U.S. Private Bank7 +TOP 15 +Global Asset Manager6 +MARKET POSITIONS +Investment and +Wealth Management +Securities Services +1 Ranking based on lates t available peer group company filings. Peer group included in ranking analysis: State Street, JPMorgan Chase, Citigroup, BNP Paribas, HSBC, Northern Trust and RBC. +2 Full-year 2023 figures by deal volume and count referenced herein include long-term program and stand-alone bond issuance in markets where BNY Mellon actively participates and for which +public trus +tee and/or paying agent data is available. Sources include: Refinitiv, Dealogic, Asset-Backed Alert and Concept ABS. Depositary Receipts ranked #1 based on market share sourced +from BNY Mellon internal analysis. +3 LaRoche Research Partners, “US Broker Clearing Relationship Changes 2022, ” based on number of broker-dealer clients. Registered Investment Advisor rankings sourced from “Cerulli Report, +U. +S. RIA Marketplace 2023, ” Cerulli Associates. +4 The Clearing House. Based on CHIPS volumes for the year ended December 31, 2023. +5 Finadium market anal ysis as of June 2023. +6 Pensions & Investments, October 23, 2023. Ranked by total worldwide assets under management as of December 31, 2022. +7 Based on company filings and The Cer ulli Report, 2022. Ranked by Wealth Management assets under management as of December 31, 2022. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_60.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_60.txt new file mode 100644 index 0000000000000000000000000000000000000000..8f6585517c9417f77a3107933a5442c7376235be --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_60.txt @@ -0,0 +1,92 @@ +Stress capitalb uffer +In July 2023, theF ederal Reservea nnounced that +BNYM ellon’sS CB requirement wouldr emaina t +2.5%,e qualt ot he regulatoryf loor,f or thep eriod +fromO ct.1 ,2023 through Sept.3 0, 2024. TheS CB +replaced thes tatic 2.5% capitalc onservationb uffer +forS tandardized Approach capitalr atiosf or +ComprehensiveC apitalA nalysisa nd Review +(“CCAR”)B HCs. TheS CB doesn ot applyt obank +subsidiaries,w hich remain subject to thestatic 2.5% +capitalc onservationb uffer. See“ Supervisiona nd +Regulation” fora dditionali nformation. +TheS CB finalr uleg enerally eliminates the +requirement forp rior approvalo fc ommons tock +repurchases in excesso ft he distributionsin af irm’s +capitalp lan, providedthats uchd istributions are +consistent with applicable capitalr equirementsa nd +buffers,i ncluding theS CB. +TotalL oss-AbsorbingC apacity (“TLAC”) +Thef ollowing summarizes them inimum +requirementsf or BNYM ellon’se xternalT LACa nd +external long-term debt (“LTD”) ratios, plus +currently applicable buffers. +As a%o fR WAs (a) +As a%o ft otal +leverage +exposure +Eligible external +TLACr atios +Regulatorym inimumo f +18% plusab uffer (b) +equalt ot he sumo f +2.5%,t he method 1 +G-SIBs urcharge +(currently 1%), andt he +countercyclical capital +buffer, if any +Regulatory +minimum of +7.5% plus a +buffer (c) equal +to 2% +Eligible external +LTD ratios +Regulatorym inimumo f +6% plustheg reater of +them ethod 1o rm ethod +2G -SIB surcharge +(currently 1.5%) +4.5% +(a)R WA is thegreater of theS tandardizedA pproacha nd +Advanced Approaches. +(b)B uffert ob em et usingo nlyC ET1. +(c)B uffert ob em et usingo nlyT ier1capital. +External TLACc onsists of theP arent’sT ier1capital +ande ligible unsecuredL TD issued by it that hasa +remainingt ermt om aturity of at leasto ne year and +satisfies certainotherc onditions.E ligible LTD +consists of theu npaid principalb alance of eligible +unsecuredd ebts ecurities, subjectto haircuts for +amountsd ue to be paidwithin twoyears, that satisfy +certain otherc onditions.D ebti ssuedp rior to Dec. +31, 2016 hasbeen permanently grandfatheredt othe +extent thesei nstruments otherwisew ouldb e +ineligible onlyd ue to containing impermissible +accelerationr ightso rb eing governedby foreignl aw. +Thef ollowing tablep resentso ur external TLAC and +external LTDr atios. +TLACa nd LTD ratios Dec. 31, 2023 +Minimum +required +Minimum +ratios +with buffers Ratios +Eligible external TLAC: +As ap ercentage ofRWA1 8.0% 21.5% 30.3% +As ap ercentage oftotal +leverage exposure 7.5% 9.5% 15.6% +Eligible external LTD: +As ap ercentage ofRWA7 .5% N/A1 5.0% +As ap ercentage oftotal +leverage exposure 4.5% N/A7 .7% +N/A–Nota pplicable. +If BNYM ellonm aintains risk-based ratio or leverage +TLAC measures abovethem inimumr equiredl evel, +but with ar isk-basedr atio or leverage belowthe +minimuml evel with buffers,w ew illf ace constraints +on dividends,equity repurchases anddiscretionary +executivec ompensationb ased on thea mount ofthe +shortfalla nd eligible retained income. +Resultso fO perations (continued) +BNYM ellon4 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_61.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_61.txt new file mode 100644 index 0000000000000000000000000000000000000000..62e9c7d5118aaaf5b99f4e704df534c1c71cdb2a --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_61.txt @@ -0,0 +1,88 @@ +Issuer purchases of equity securities +Share repurchases–f ourthq uarter of 2023 Totals hares +repurchased as +part of ap ublicly +announced plan +or program +Maximuma pproximate dollar +valueo fs harest hatm ay yet +be purchasedundert he +publicly announced planso r +programsa tD ec. 31, 2023 +(dollars in millions,e xceptp er sharea mounts; +commons hares in thousands) +Totals hares +repurchased +Averagep rice +pers hare +October2 023 3,450 $4 2.28 3,450 $2 ,700 +November 2023 4,823 45.09 4,823 2,483 +December2 023 1,763 49.26 1,763 2,396 +Fourth quarter of 2023(a) 10,036 $4 4.85 10,036 $2 ,396 (b) +(a)I ncludes6 4t housand shares repurchased at ap urchasep rice of $3millionf rome mployees,p rimarily inconnectionw ith theemployees’ +payment oftaxes upon thev estingo fr estricteds tock. Thea verage priceofo penm arket sharer epurchases was$ 44.83. +(b)R epresentst he maximumv alue ofthes hares to be repurchased undert he sharer epurchasep lana nnounced in January2 023 and +includess hares repurchased in connectionw ith employee benefit plans. +In January 2023, we announced as hare repurchase +program approvedb your Boardo fD irectors +providing fort he repurchaseo fu pt o$ 5.0 billiono f +commons haresb eginning Jan. 1, 2023.This new +sharer epurchasep lanr eplaceda ll previously +authorized sharer epurchasep lans. +Sharer epurchases mayb ee xecutedt hrough open +market repurchases,i nprivately negotiated +transactions or by othermeans, including through +repurchasep lans designedt ocomplyw ith Rule +10b5-1a nd otherderivative, acceleratedshare +repurchasea nd otherstructuredt ransactions.T he +timinga nd exact amount ofanyc ommons tock +repurchases will depend on variousfactors, including +market conditions andt he commons tock trading +price; theC ompany’sc apitalp osition, liquidity and +financialp erformance; alternativeuseso fc apital; and +legala nd regulatoryl imitations andc onsiderations. +Tradinga ctivitiesa nd risk management +Ourt rading activitiesa re focusedon actinga sa +market-maker foro ur customers, facilitatingc ustomer +trades andrisk-mitigatingh edging in compliancew ith +theV olcker Rule.T he risk from market-making +activitiesf or customersi smanaged by ourtradersa nd +limitedi ntotal exposurethrough as ystemo fp osition +limits,v alue-at-risk (“VaR”)m ethodology ando ther +market sensitivity measures.V aR is thepotentiall oss +in valued ue to adversem arketm ovementso vera +definedt ime horizon with as pecified confidence +level. Thec alculationo fo ur VaRu sedb y +management andp resented belowa ssumesaone-day +holding period, utilizesa9 9% confidence levela nd +incorporates non-linear productc haracteristics. VaR +facilitatesc omparisons acrossp ortfolioso fd ifferent +risk characteristics. VaRa lsoc apturest he +diversificationo fa ggregated risk at thef irm-wide +level. +VaRr epresentsakeyr iskm anagementm easurea nd +it isimportant to notet he inherent limitations to VaR, +whichi nclude: +•V aR doesn ot estimate potentiall osseso verl onger +time horizons wherem ovesm ay be extreme; +• VaRd oesn ot take into account thep otential +variability of market liquidity;a nd +•P revious movesi nm arketr iskf actorsm ay not +producea ccurate predictions ofallf uturem arket +moves. +SeeN ote2 3o ft he Notest oC onsolidated Financial +Statements fora dditionali nformationo nthe VaR +methodology. +Thef ollowing tables indicatet he calculatedV aR +amountsf or thet rading portfoliofort he designated +periods usingthe historicalsimulationV aR model. +VaR (a) 2023 Dec. 31, +2023(inm illions) Average MinimumM aximum +Interest rate $3 .2 $1 .9 $7 .6 $2 .6 +Foreigne xchange 2.9 2.0 5.7 2.9 +Equity 0.2 —1 .5 0.1 +Credit 1.5 0.7 3.5 1.3 +Diversification (5.0) N/MN /M (4.7) +Overallp ortfolio 2.8 1.3 8.9 2.2 +Resultso fO perations (continued) +44 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_62.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_62.txt new file mode 100644 index 0000000000000000000000000000000000000000..7b8b02ce25c1fc440453a851d3a93cc19ec7c1a8 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_62.txt @@ -0,0 +1,110 @@ +VaR (a) 2022 Dec. 31, +2022(inm illions) AverageM inimum Maximum +Interest rate $4 .1 $1 .6 $9 .3 $2 .3 +Foreigne xchange 3.8 2.0 10.2 3.0 +Equity 0.2 —0 .9 0.1 +Credit 2.1 1.0 4.4 1.8 +Diversification( 5.0) N/MN /M (3.5) +Overallp ortfolio 5.2 2.5 11.4 3.7 +(a)V aR exposured oesn ot includet he impacto fthe Company’s +consolidated investment management funds andseed capital +investments. +N/M–Becauset he minimuma nd maximumm ay occurond ifferent +daysf or different risk components, it isnot meaningful to +computeaminimuma nd maximump ortfolio diversification +effect. +Thei nterestr atec omponent ofVaRr epresents +instrumentsw hosev aluesa re predominantly driven +by interest rate levels.T hese instrumentsi nclude,b ut +aren ot limitedt o, U.S. Treasury securities, swaps, +swaptions,f orward rateagreements,e xchange-traded +futuresa nd options,a nd otherinterestr ated erivative +products. +Thef oreign exchange componento fV aR represents +instrumentsw hosev aluesp redominantly vary with +thel evel or volatilityof currency exchangerateso r +interest rates. Thesei nstruments include,but aren ot +limitedt o, currencyb alances,s pot andf orward +transactions,c urrencyo ptions ando ther currency +derivativep roducts. +Thee quity component ofVaRc onsists of instruments +that representa no wnership interestin theformo f +domestic andf oreign commons tock or otherequity- +linkedi nstruments.T hese instrumentsi nclude,b ut +aren ot limitedt o, commons tock,e xchange-traded +funds,p referreds tock,l istede quity options (putsa nd +calls), OTCe quity options,e quity totalreturns waps, +equity indexfutures andother equityderivative +products. +Thec reditc omponent ofVaRr epresentsi nstruments +whosev aluesa re predominantly driven by credit +spread levels,i .e., idiosyncraticd efault risk.T hese +instrumentsi nclude,b ut aren ot limitedt o, single +issuer creditdefaults waps,a nd securitiesw ith +exposures fromc orporate andm unicipalc redit +spreads. +Thed iversificationc omponent ofVaRi st he risk +reductionb enefit thatoccurs when combining +portfoliosa nd offsettingp ositions,a nd fromt he +correlatedb ehavioro friskf actor movements. +During 2023,interest rate risk generated4 1% of +averageg ross VaR,foreigne xchange risk generated +37% ofaverageg ross VaR,equity risk generated3 % +of averageg ross VaRand credit risk generated1 9% +of averageg ross VaR. During 2023, our daily trading +loss didn ot exceed our calculatedV aR amount ofthe +overall portfolio. +Thef ollowing tableo ft otal daily tradingrevenue or +loss illustratest he numbero ftrading daysin which +our tradingr evenue orloss fell within particular +rangesd uringt he pastfive quarters. +Distributiono ft rading revenue (loss) (a) +Quartere nded +(dollars in +millions) +Dec. 31, +2023 +Sept.3 0, +2023 +June 30, +2023 +March3 1, +2023 +Dec. 31, +2022 +Revenue range: Number of days +Less than $(2.5) 2 —— —2 +$(2.5) –$ 0 3 52 14 +$0 –$ 2.5 18 14 15 20 13 +$2.5 –$ 5.0 25 24 37 26 24 +More than $5.0 15 20 91 52 0 +(a)T rading revenue (loss) includesr ealized and unrealized gains and +lossesp rimarily relatedt ospot andforwardf oreign exchange +transactions,d erivatives and securitiest radesf or ourcustomersa nd +excludesa ny associated commissions,underwritingf ees and net +interest revenue. +Tradinga ssets include debtande quity instruments +andd erivativea ssets,p rimarily foreigne xchange and +interest rate contracts, not designatedash edging +instruments. Tradinga ssets were $10.1 billiona t +Dec. 31, 2023and$ 9.9 billionatD ec. 31, 2022. +Tradingl iabilitiesi nclude debtande quity instruments +andd erivativel iabilities, primarily foreigne xchange +andi nterestr atec ontracts, not designatedash edging +instruments. Tradingl iabilities were $6.2 billiona t +Dec. 31, 2023and$ 5.4 billionatD ec. 31, 2022. +Undero ur fair valuem ethodology ford erivative +contracts, an initial“ risk-neutral”v aluationi s +performed on each positiona ssumingt ime- +discountingb ased on aA Ac reditc urve.I na ddition, +we consider creditrisk in arriving at thef airv alue of +our derivatives. +We reflect external creditratings as well as +observablec reditd efault swap spreadsf or both +ourselves andour counterpartiesw henm easuringt he +fair valueo fo ur derivativepositions.A ccordingly, +thev aluationo fo ur derivativepositions is sensitivet o +thec urrent changesi no ur owncredits preads, as well +as thoseo fo ur counterparties. +Resultso fO perations (continued) +BNYM ellon4 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_63.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_63.txt new file mode 100644 index 0000000000000000000000000000000000000000..9ea196029283ed4730492f7e2dd5be316de54a5b --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_63.txt @@ -0,0 +1,110 @@ +At Dec.31, 2023,o ur OTCd erivativea ssets, +including thosei nh edging relationships,o f$ 2.3 +billioni ncludedacredit valuationa djustment +(“CVA”)d eductiono f$ 16 million. OurO TC +derivativel iabilities, including thosei nh edging +relationships,o f$ 3.8 billionincludedadebit +valuationa djustment (“DVA”)o f$4m illionr elated +to our owncredits pread. Neto fh edges, theC VA +increased by $1milliona nd theD VA increased by $1 +millioni n2 023, whichi ncreased othert rading +revenue byless than $1 millioni n2 023. During +2023, norealized loss wascharged offa gainst CVA +reserves. +At Dec.31, 2022,o ur OTCd erivativea ssets, +including thosei nh edging relationships,o f$ 2.9 +billioni ncludedaCVAd eductiono f$ 18 million. +OurO TC derivativel iabilities, including thosei n +hedging relationships,o f$ 3.0 billionincludedaDVA +of $6millionr elated to our owncredits pread.N et of +hedges, theC VA increased by $4milliona nd the +DVA increased by $7millioni n2 022, which +increased othert rading revenue by $3millioni n +2022. During 2022, norealized loss wascharged off +againstC VA reserves. +Thet able belows ummarizes our exposure, neto f +collateralr elated to our derivativecounterparties, as +determined on an internal risk management basis. +Significantc hangesi nc ounterpartyc reditr atings +coulda ltert he levelo fc reditr iskf aced by BNY +Mellon. +Foreign exchange andother trading +counterparty risk rating profile +Dec. 31, 2023 Dec. 31, 2022 +(dollars in +millions) +Exposure, +neto f +collateral +Percentage +of exposure, +neto f +collateral +Exposure, +neto f +collateral +Percentage +of exposure, +neto f +collateral +Investment grade $2 ,062 95% $2 ,553 98% +Non-investment +grade 103 5% 63 2% +Total $2 ,165 100% $2 ,616 100% +Asset/liabilitym anagement +Ourd iversified businessa ctivitiesi nclude processing +securities, acceptingd eposits,i nvestingi nsecurities, +lending, raisingm oneya sn eeded to fund assets and +othert ransactions.T he market risksf romt hese +activitiesi nclude interest rate risk andf oreign +exchange risk.O ur primary market risk is exposure +to movementsinU .S.d ollari nterestr ates andcertain +foreignc urrencyi nterestr ates.W ea ctivelym anage +interest rate sensitivity andu se earnings simulation +andd iscounted cashflowm odelst oi dentifyi nterest +rate exposures. +An earnings simulationm odeli st he primary tool +used to assess changesi np re-tax neti nterestr evenue +between ab aselines cenario andh ypothetical interest +rate scenarios. Interest rate sensitivity isquantified +by calculatingt he change in pre-taxn et interest +revenue betweenthes cenarioso vera12-month +measurementp eriod. +Theb aselines cenario incorporatesthem arket’s +forwardr atee xpectations andm anagement’s +assumptions regardingc lient depositrates, credit +spreads, changesi nt he prepayment behavior ofloans +ands ecuritiesa nd thei mpact of derivativefinancial +instrumentsu sedf or interest rate risk management +purposes asof each respectiveq uarter-end. These +assumptions have beendevelopedt hrough a +combinationo fh istorical analysisandf uturee xpected +pricingb ehaviora nd arei nherently uncertain.A ctual +results maydifferm aterially fromp rojected results +due to timing,magnitude andf requencyo fi nterest +rate changes, andc hangesi nm arketc onditions and +management’s strategies,a mong otherfactors. Client +deposit levelsandm ix arek ey assumptionsimpacting +neti nterestr evenue in thebaselinea sw ella st he +hypothetical interest rate scenarios. Thee arnings +simulationm odela ssumess tatic deposit levelsand +mix,a nd it also assumest hatn om anagementa ctions +will be takent omitigatet he effectso fi nterestr ate +changes. Typically,t he baselinescenario uses the +averaged eposit balances of theq uarter. +In thet able below, weuset he earnings simulation +modelt oa ssess thei mpact of various hypothetical +interest rate scenariosc omparedt othe baseline +scenario.I ne ach of thes cenarios, allc urrencies’ +interest ratesa re instantaneously shiftedh ighero r +lowera tt he starto ft he forecast. Long-term interest +ratesa re defineda sa ll tenorse qualt oo rg reater than +threey earsa nd short-term interest ratesa re defineda s +allt enorse qualt oo rl esst hant hree months.I nterim +term pointsa re interpolated wherea pplicable.T he +impact of interest rate shifts mayn ot belinear.T he +results of this earnings simulations houldt herefore +not beextrapolated form ores everei nterestr ate +scenariost hant hosep resented in thet able below. +Resultso fO perations (continued) +46 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_64.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_64.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0c914ec9949bed73aed7c2fb0dd748fdf4c5e3c --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_64.txt @@ -0,0 +1,106 @@ +Thef ollowing tables howsn et interest revenue +sensitivity forB NY Mellon. +Up 100 bpsrate shockv s. +baseline $2 54 $1 66 $2 14 +Long-term up 100 bps,short- +term unchanged 71 13 30 +Short-term up 100 bps,long- +term unchanged 183 153 184 +Long-term down1 00 bps, +short-term unchanged (a) (73) (14) (30) +Short-term down1 00 bps, +long-term unchanged (270) (214) (251) +Down 100 bprate shockv s. +baseline (343) (228) (281) +Estimatedc hanges in net +interestr evenue +(inm illions) +Dec. 31, +2023 +Sept.3 0, +2023 +Dec. 31, +2022 +(a)T he sensitivity forDec. 31, 2022 has beenupdated to reflect +thei mpacto fa100 basis point decreasein long-term rates +while short-term rateswereu nchanged. +At Dec. 31, 2023,thei mpact of a1 00 basispoint +upwards hift in rateso nn et interest revenue increased +compared with Sept.3 0, 2023 primarily due to higher +casha nd depositbalances in themostr ecentq uarter, +whichi ncreased theb enefit of rising interest rates. +Thei mpact of a1 00 basispoint downwardshift in +rateso nn et interest revenue worsened comparedwith +Sept.3 0, 2023 primarily due highercasha nd deposit +balances. +While thenet interest revenue sensitivity scenario +calculations assume static depositb alances to +facilitate consistentp eriod-over-periodc omparisons, +neti nterestr evenue is impacted by changesi nd eposit +balances.N oninterest-bearingd eposits are +particularly sensitivet oc hangesi ns hort-term rates. +To illustrate thenet interest revenue sensitivity to +deposit run-off, we estimate thata$ 5b illion +instantaneous reductiono ri ncreasei nU .S.d ollar- +denominated noninterest-bearingd eposits would +reduceo ri ncreaset he netinterestr evenue sensitivity +results in theup1 00 basispoint scenario in thetable +above byapproximately $290 million. Thei mpact +wouldb es malleri fthe run-offw as assumedt obea +mixture of interest-bearinga nd noninterest-bearing +deposits. +Additionally,d uringp eriods oflows hort-term +interest rates, moneym arketm utualf und fees and +others imilarf ees aretypically waived to protect +investorsf romn egativer eturns. +Foradiscussion of factorsi mpactingt he growthor +contractiono fd eposits,s ee “RiskFactors–Capital +andL iquidity Risk –O ur business,financial +conditiona nd results of operationscouldb ea dversely +affected if we do noteffectivelym anageo ur +liquidity.” +We alsoproject future cashf lows fromo ur assets and +liabilitieso veralong-term horizon andt hend iscount +thesec ashf lows usingi nstantaneous parallels hocks +to prevailingi nterestr ates.T hism easure reflectsthe +structural balances heet interest rate sensitivity by +discountinga ll future cashf lows.T he aggregationo f +thesed iscounted cashflows is theeconomic valueo f +equity (“EVE”). Thef ollowing tables howsh ow +EVEw ouldc hange in responset oc hangesi ni nterest +rates. +Estimatedc hanges in EVE Dec. 31, +2023 +Rate change: +Up 200 bps vs.baseline 2.5% +Up 100 bps vs.baseline 2.2% +Down 100 bps vs.baseline (2.7)% +Down 200 bps vs.baseline (6.1)% +Thea symmetrical accountingt reatment ofthei mpact +of ac hange in interest rateso no ur balancesheet may +createas ituationi nwhich anincreasei ni nterestr ates +can adverselyaffect reportede quity andr egulatory +capital, even though economically theremay be no +impact on oureconomic capitalp osition. For +example, anincreasei nr ates will result inad eclinei n +thev alue of ouravailable-for-sales ecuritiesp ortfolio. +In this example, therei sn oc orresponding change on +our fixedl iabilities, even though economically these +liabilitiesa re more valuable as ratesr ise. +Theser esults do notreflect strategies that +management coulde mployt olimit thei mpact as +interest rate expectations change. +To manage foreigne xchange risk,w ef und foreign +currency-denominated assetswith liability +instrumentsd enominated in thesamec urrency. We +utilizev arious foreigne xchange contractsi faliability +denominated in thes amec urrencyi sn ot availableo r +desired, andt ominimizet he earnings impact of +translationg ains orlossesc reated by investmentsi n +foreignm arkets.W eu se forwardf oreign exchange +contractst op rotect thev alue of our netinvestment in +foreigno perations.A tD ec. 31, 2023,n et investments +in foreigno perations totaled$ 14 billionand were +spread across19f oreign currencies. +Resultso fO perations (continued) +BNYM ellon4 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_65.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_65.txt new file mode 100644 index 0000000000000000000000000000000000000000..dfeb923ea62ee26f1bd54b25ddb6aa55084238c6 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_65.txt @@ -0,0 +1,98 @@ +Overview +BNYM ellonp lays av italr olei nt he globalfinancial +markets, ande ffectiver iskm anagementi sc ritical to +our success. BNYM ellono peratesu ndert he +Enterprise Risk ManagementFramework( “risk +management framework”)w hich is thefoundationo f +our risk management approach.R iskm anagement +begins with as trong risk culture,a nd we reinforceo ur +culture through principle-basedpoliciesi ncluding the +Code ofConduct, whicha re groundedi nour core +values of passionfore xcellence, integrity,s trengthi n +diversity andc ouraget ol ead. +Thesev aluesa re critical to ours uccess. They not +onlye xplainw hatw es tand fora nd ourshared +culture,b ut also help us to thinkand act globally. +They servea sarepresentationo ft he promiseswe +have made to our clients, communities, shareholders +ande acho ther. +BNYM ellon’sR iskI dentificationp rocessi sa core +component ofBNYM ellon’sr iskf ramework andi s +thef oundationf or understandingandm anagingr isk. +We utilizeac ommonr iskl anguage,o ur Risk +Taxonomy, to identifyr isks acrosso ur sixp rimary +risk categories: OperationalRisk, Market Risk,C redit +Risk,L iquidity Risk,M odelR iska nd StrategicR isk. +Quarterly, theC ompany engagesi naprocess +designedt odocumenti dentificationa nd assessment +of its risks, andt odeterminet he seto fr isks material +to BNYM ellon. Outputsf romt he Risk Identification +processi nforme lementso fo ur risk framework such +as our Risk Appetiteas well as Enterprise-wideS tress +Testinga nd CapitalP lanning. +BNYM ellon’sR iskA ppetite expressest he levelo f +risk wearew illingt otoleratet om eet our strategic +objectives in am annert hatb alances risk andr eward +while consideringo ur risk capacity andm aintaining a +balances heet that remainsr esilient throughout market +cycles.T hisg uidesB NY Mellon’srisk-taking +activitiesa nd informsk ey decision-making processes, +including them annerb yw hich we pursueo ur +businesss trategya nd them ethods bywhichw e +manage risk.T he Risk AppetiteStatementa nd +associated keyr iskm etrics to monitorour risk profile +areu pdateda nd approvedb ythe Risk Committeeo f +theB oard at leasta nnually. +BNYM ellonc onducts Enterprise-wideS tressT esting +as part of its Internal CapitalA dequacy Assessment +Processi na ccordancew ith CCAR, anda sr equiredb y +thee nhanced prudentials tandardsi ssuedp ursuantt o +theD odd-FrankW allS treet Reform andC onsumer +ProtectionA ct (the “Dodd-FrankA ct”).E nterprise- +wide Stress Testingc onsiderst he Company’sl ines of +business, products,g eographica reas andriskt ypes +incorporatingt he resultsf romu nderlying models and +projections forarange of stress scenarios. Additional +details on CapitalP lanning andS tressT estinga re +includedi n“Supervisiona nd Regulation.” +ThreeL ines ofDefense +BNYM ellon’sT hree Lineso fD efense modeli sa +critical component of ourrisk management +framework to clarifyr oles andresponsibilitiesa cross +theo rganization. +BNYM ellon’sf irst lineo fd efense includess enior +management andb usinessa nd corporates taff, +excluding management ande mployees in Risk +Management,C ompliancea nd Internal Audit. Senior +management in thefirst line is responsible for +maintaininga nd implementinga neffectiver isk +management framework anda ppropriately managing +risk consistent with itsstrategya nd risk tolerance, +including establishing clear responsibilitiesa nd +accountability fort he identification, measurement, +management andc ontrolo fr isk. +Risk andC ompliancei st he independent second line +of defense,reportingt othe ChiefR iskO fficer.T he +ChiefR iskO fficer reports tobotht he Chief +ExecutiveO fficer andthe Risk Committeeo ft he +Company’sB oard of Directors. Risk and +Compliancei sr esponsible fore stablishing a +framework that outlines expectationsandp rovides +guidancef or thee ffectivem anagemento fr iska t +BNYM ellonw hile also independently testing, +reviewinga nd challenging thef irst line.T of acilitate +thec omprehensive globalapplicationo fc onsistent +standardsf or each risk or compliancet opic, +independent oversightis providedb yRiska nd +Compliancea crosst hree perspectives –l ines of +business; legale ntities; ande nterprise-wide risk and +complianced isciplines. +Internal Auditi sB NY Mellon’st hird lineo fd efense +ands ervesa sani ndependent,o bjectivea ssurance +functiont hatr eports directly to theAuditC ommittee +of theC ompany’sB oard of Directors. It assistst he +Companyi naccomplishing itso bjectives by bringing +as ystematic,d isciplined,r isk-baseda pproach to +evaluate andi mprove thee ffectivenesso ft he +Risk Management +48 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_66.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_66.txt new file mode 100644 index 0000000000000000000000000000000000000000..8f2f443814df581d94ce10e422ca0d9bdfe2cd4c --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_66.txt @@ -0,0 +1,81 @@ +Company’sr iskm anagement, controla nd governance +processes. Thes cope ofInternal Audit’sw ork +includest he review andevaluationo ft he adequacy, +effectivenessa nd sustainability of risk management +procedures,i nternalc ontrols ystems,i nformation +systemsa nd governanceprocesses. +Governance +BNYM ellon’sm anagementi sr esponsible fore xecutiono ft he Company’sr iskm anagementf ramework andt he +governance structuret hats upports it,with oversight providedb yBNY Mellon’sB oard of Directorst hrough twok ey +Boardc ommittees:t he Risk Committeea nd theA uditC ommittee. +As ummary of theg overnance structurei sp rovidedb elow. +BNYM ellonB oard of Directors +Risk CommitteeA uditC ommittee +Senior Risk andC ontrolC ommittee (“SRCC”) +•A nti-MoneyL aundering Oversight +Committee +•A ssetL iability Committee +•B alance Sheet Risk Committee +•B usinessR iskC ommittees +•C ompliancea nd Ethics Oversight +Committee +•C ontract Management Committee +•C reditP ortfolio Management Committees +•E nterpriseI nsider ThreatSteering +Committee +•E nterpriseR iskC ommittee +•I nternationalS eniorR iska nd Control +Committee +•O perationalR iskC ommittee +•P roductA pprovala nd Review Committee +•R egulatoryO versight Committee +•R esolvability SteeringC ommittee +•T echnology Risk Committee +TheR iskC ommitteei sc omprised entirelyo f +independent directorsand meetso naregular basist o +review andassess thec ontrolp rocessesw ith respect +to theCompany’si nherent risks. It also reviewsa nd +assessest he Company’sr iskm anagementp olicies +andp ractices.T he rolesa nd responsibilitieso ft he +Risk Committeea re describedi nmored etaili ni ts +charter, ac opy ofwhichi sa vailableo no ur website, +www.bnymellon.com. +TheA uditC ommitteei sa lsoc omprised entirelyo f +independent directors. TheA uditC ommitteem eets +on ar egular basist op erform an oversight review of +thei ntegrity of thef inancial statements andf inancial +reportingp rocess, compliancew ith legaland +regulatoryr equirements, theC ompany’si ndependent +registered public accountant’sq ualifications and +independence, andthe performanceof ourinternal +auditf unctiona nd thei ndependent registered public +accountant. TheA uditC ommitteea lsor eviews +management’s assessmento ft he adequacy of internal +controls.T he functions oftheA uditC ommitteea re +describedi nmored etaili ni ts charter, ac opy of +whichi sa vailableo no ur website, +www.bnymellon.com. +TheS RCC is themosts eniorm anagementl evel risk +governance group at theC ompany andi sr esponsible +foro versight ofallR iskM anagement, Compliance& +Ethics activitiesand processes,including the +Enterprise Risk ManagementFramework. The +committeei sc haired by theC hief Risk Officer andits +membersi nclude theC hief ExecutiveO fficer,C hief +FinancialO fficer andGeneral Counsel. +Subcommittees of theS RCC include: +•A nti-MoneyL aundering OversightC ommittee: +Oversees thes ystems andc ontrols relating to all +aspectso fa nti-moneyl aundering andt errorist +financingc ompliance( including Know Your +Customer,s uspicious activity reportinga nd +sanctions)w ithint he Company. +•A ssetL iability Committee( “ALCO”): Thes enior +management committeer esponsible forb alance +sheet oversight,i ncluding capital, liquidityand +interest rate risk management. +•B alance Sheet Risk Committee( the“ BSRC”): +Reviewsa nd receivese scalationr elatingt o +balances heet risk management frameworks +Risk Management (continued) +BNYM ellon4 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_67.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_67.txt new file mode 100644 index 0000000000000000000000000000000000000000..391264470347e8f83bb10802f01ce520a81732f3 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_67.txt @@ -0,0 +1,82 @@ +associated with theassets,l iabilitiesa nd capital +of theC ompany. Therei safocuso nt reasury +risk topics,i ncluding matters relatedt oliquidity +risk,c apitalm anagement, investment portfolio +risk,a nd interest rate risk in thebanking book. +• Business Risk Committees:R eviewa nd assess +risk andc ontroli ssueso bservedf rome xisting +businessp ractices or activitieso ra rising from +newb usinessp ractices or activitiesi no ur various +lines of businessand supportingo perations. +•C ompliancea nd Ethics Oversight Committee: +Providesg overnance andoversight ofthe +operations oftheC ompliancea nd Ethics function +andt he management andr eportingo fc ompliance +risk-relatedi ssues, as well as Compliance& +Ethics processes, policies, procedures and +standards. +•C ontract Management Committee: The +governance andescalationb odyf or the +Company’sC ustomerC ontract Management +policya nd determinesthec lient contract +management policiesand infrastructure forthe +Company. +•C reditP ortfolio Management Committees:S even +Portfolio Management Committees,g overned by +thes amec harter andrules,m anage, monitora nd +review eachof Credit Risk’s primary portfolio +segments,i ncluding underwritingc riteria, +portfolio limitsandc omposition, risk metrics, +concentration, credit strategy, qualityand +exposure, stress test outcomesa nd wrong way +risk. +•E nterpriseI nsider Threat SteeringC ommittee: +Providese nterprise-wide governance and +oversight relatedt othe Enterprise InsiderT hreat +Program andrelated initiatives,a sw ella s +providesv isibility tosenior leadership relatedt o +thee nterpriser iskp rofile as it relatest oi nsider +threat risks. +• Enterprise Risk Committee: Oversees the +Enterprise Risk ManagementFrameworka nd +relateda ctivities, including comprehensive +discussions,d eliberations andc ollaborationo n +material andemergingr isks,l imit setting, risk +reporting, issues management,e scalationa nd +relevant decisionmaking. +•I nternationalS eniorR iska nd ControlC ommittee: +Providesr iskm anagemento versight,a nd actsa s +ap oint ofconvergence fort he coordination, +transparency andcommunicationo fm aterial +issues (liveo re merging) acrossi nternational +entities. +•O perationalR iskC ommittee: Oversees the +operationalr iskp rofile andi sr esponsible for +monitoring andm anagingt he appropriateness of +theo perationalr iskf ramework,p olicyd esign, +adherencet rackinga nd mitigatingc ontrols. +•P roductA pprovala nd Review Committee: +Responsible forr eviewing anda pproving +proposalst oi ntroducen ew andmodify or retire +existingp roducts. +•R egulatoryO versight Committee: Provides +strategicd irection, oversight,challenge,a nd +coordinationa crossr egulatoryr emediation +initiatives within theCompany’sR egulatory +Oversight Program. +•R esolvability SteeringC ommittee: Oversees +recovery andr esolutionp lanning, including but +not limitedt othe projectgovernance and +oversight framework forall recovery and +resolution planningrequirementsi nr elevant +jurisdictions whereB NY Mellono perates. +•T echnology Risk Committee: Oversees the +review andassessmento ft echnology risk and +controli ssues observedf rome xistingb usiness +practices or activities, or arisingf romn ew +businessp ractices or activitiesi no ur various +lines of businessand supportingo perations so as +to assist theC ompany in managing and +monitoring technology risk andc ontrol issues. +Risk Management (continued) +50 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_68.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_68.txt new file mode 100644 index 0000000000000000000000000000000000000000..09cd382dcde0e8c6fa4218afbfd7416463805a09 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_68.txt @@ -0,0 +1,71 @@ +RiskT ypes Overview +Theu nderstanding, identification, measurementa nd mitigationo fr iska re essentiale lementsf or thes uccessful +management ofBNYM ellon. We leverage ac omprehensive risk taxonomyt osupportc onsistent language for +defining andu nderstanding risks. Thep rimary categoriesi no ur risk taxonomya re: +Type of risk Description +Operational Ther isko fl ossr esulting fromi nadequate or failedi nternalp rocesses, peoplea nd systemso rf rome xternal +events.O perationalr iski ncludesr isks,s ucha sc ompliancea nd financialc rimes, technology risksa nd third +partyr isks. +Market Ther isko ff inancial loss or adversec hange to thee conomic conditiono fB NY Mellonr esultingf rom +movementsi nm arketr iskf actors. Market risk factorsi nclude butaren ot limitedt ointerestr ates,c redit +spreads, foreigne xchangesr ates,c ommodity prices,a nd equity prices.T he potentiall ossi nv alue for the +BNYM ellonf inancial portfolio caused by adversem ovementsi nm arketp rices of foreigne xchange,f ixed +income ande quity assets,c redits preads, commoditiesa nd liabilitiesa ccounted foru nderf airv alue and +equivalent methods. +Credit Credit risk denotes ab road categoryofa dversef inancial outcomesa rising fromc redite vents( default, +bankruptcy,r atings migration) associated with obligor/counterpartyn ot meeting( inability/unwilling) its +contractualo bligations.C reditr iski sp resent in them ajorityo fo ur assets,b ut primarily concentrated in +thel oana nd securitiesb ooks,a sw ella sf oreign exchange ando ff-balance sheet exposures such aslending +commitments, letters of credit ands ecuritiesl ending indemnifications. +Liquidity Ther iska rising froma ni nability toaccessf unding, convert assets tocashq uickly ande fficiently,o rt or oll +overo rissuen ew debt,e speciallyd uringp eriods ofmarket stress. Liquidity risk includest he inability to +access funding sources or manage fluctuations in funding levels.L iquidity risk can arisef romc ashf low +mismatches,m arketc onstraintsf romt he inabilityt oconvert assets tocash, thei nability toraisec ashi nthe +markets, deposit run-offo rcontingent liquidity events. +Model Thep otential loss arisingf romi ncorrectly designing/usingamo delo rs tressc onditions that invalidate the +assumptions ofam odel. +Strategic Ther iska rising fromt he flawed design, decision orimplementationo fabusin esss trategy, andp otential +disruptiont obusinesss trategyb yexternalf actorsa nd/or internal decisions.M ores pecifically,t he risks +arisingf roma dverseb usinessd ecisions,p oor implementationo fb usinessd ecisions orlack of +responsivenesst oc hangesi nt he financiali ndustrya nd operatingenvironment. Strategicr isks maya lso +arisef romt he acceptanceo fn ew businesses, thei ntroduction ormodificationo fp roducts,s trategic finance +andr iskm anagementd ecisions,b usinessp rocessc hanges, complext ransactions,a cquisitions/divestitures/ +jointv enturesa nd majorc apitale xpenditures/investments. +Operational Risk +In providing ac omprehensive arrayo fp roducts and +services,w ea re exposed to operationalr isk. +Operationalr iskm ay result from, but is not limitedt o, +errors relatedt otransactionprocessing, failure of +internal controlsystems andm eetingc ompliance +requirements, fraud byemployees or persons outside +BNYM ellono rb usinessi nterruptiond ue to system +failureso ro ther events.O perationalr iskm ay also +include breachesof ourtechnology andi nformation +systemsr esultingi nunauthorized accesst o +confidentiali nformationo rf romi nternalo re xternal +threats, such as cyberattacks. Operationalr iska lso +includesp otentiall egal or regulatorya ctions that +coulda rise.I nt he caseo fa no perationale vent,w e +coulds ufferf inancial lossesa swella sr eputational +damage. +To addresst hese risks, wemaintain comprehensive +policiesa nd procedures anda ninternalc ontrol +framework designedt oprovide as ound operational +environment. Thesec ontrols have beendesignedt o +manage operationalriska ta ppropriate levels given +our financials trength, theb usinesse nvironmenta nd +marketsi nw hich we operate,a nd then atureo fo ur +businesses, andc onsideringf actorss ucha s +competitiona nd regulation. +Theo rganizationalf ramework foroperationalr iski s +basedu pon as trong risk culture that incorporates +bothg overnance andriskm anagementa ctivities +comprising: +•A ccountability of Businesses–Business +managers arer esponsible form aintaining an +effectives ystemo fi nternalc ontrols +commensuratew itht he businessriskp rofilesa nd +in accordance with BNYM ellonp oliciesa nd +procedures. +Risk Management (continued) +BNYM ellon5 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_69.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_69.txt new file mode 100644 index 0000000000000000000000000000000000000000..1098a70e0b8526ba42bcacc90fd3e26e546ebfd2 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_69.txt @@ -0,0 +1,102 @@ +• OperationalR iskM anagementi st he independent +second linef unctionr esponsible ford eveloping +risk management policiesand toolsf or assessing, +measuring, monitoring andm anagingo perational +risk forB NY Mellon. Thep rimary objectives of +theO perationalR iskM anagementF ramework +aret op romote effectiver iskm anagement, +identifye mergingr isks andd rive improvement in +controls andt oreduceo perationalr isk. The +OperationalR iskM anagementf unctioni ncludes +independent operationalrisko versight ofalll ines +of businessand functions,a sw ella ss pecialist +oversight ofareas such asdata risk,f raud risk, +andt hird partyr isk. +•T echnology risk is as ubseto fo perationalr isk. +Technology Risk Managementis theindependent +second linef unctiont hati sr esponsible for +independent risk oversight ofthet echnology +footprint, bringing expertiset ob ear acrosssome +of BNYM ellon’sm osts ignificantr iske xposures. +Thef unctiona lsoc onducts integrated +independent assessmentso nm ultiple cybera nd +digitali nitiatives within theCompany. They +partnerw ith businessesa nd legale ntitiest od rive +betteru nderstanding andamore accurate +assessmento fo perationalr isks that canoccur +from technology operations.T echnology Risk +Management also actsa sacatalystt od rive the +developmento fg lobalt echnology policies,key +controls andm ethods to assess,m easurea nd +monitori nformationa nd technology risk forB NY +Mellon. +•O perationalr esiliencyi satopp riority fort he +Company. Foundationalt oo ur enterprise +resiliencys trategyi st he Business Services +Framework, governedby thef irst lineE nterprise +ResiliencyO ffice, with second line oversight +fromR esiliencyR iskM anagement. Firstl ine +businessm anagementi sa ccountable for +maintaininge ffectiver esiliencyc apabilitiesu nder +this framework,w hile Technology and +Operations arer esponsible fors uccessful +executioni ncoordinationw ith thebusiness. +Elements of ther esiliencys trategyi nclude the +Business Services Framework, IT Asset +Management,A pplicationt ransformationa nd +Mainframe modernization,as well as Disaster +Recovery Testinga nd Business Continuity +capabilities. We arealsof ocused on the +resiliencyc apabilitieso fo ur most important +servicep roviders.T hese capabilitiesa re intended +to enable theCompany to deliver services to our +clientsb yt he ability toprevent, respond to and +recoverf romb usinessd isruptions andt hreats. +•C ompliancea nd financialc rimesr iski sa lsoa +subset of operationalriskw ith second line +Compliancea nd Ethics andF inancial Crime +Compliance( “FCC”)t eams.C ompliancea nd +financialc rimesr iski sd efined asther isko fl egal +or regulatorys anctions,m aterialf inancial loss, or +af inancial institution’sr eputationall ossa sa +result of its failuret oc omplyw ith laws, +regulations,r ules,r elated self-regulatory +organizations tandards, andc odeso fc onducto r +organizationals tandardso fp ractice. We seek to +comply with allo bligations through a +comprehensive, integrated Compliance and +Ethics Management Framework. +Market Risk +Ourb usinessa ctivity tendsto minimizeo utright our +direct exposuretom arketr isk, with such risk +primarily limitedto marketvolatility fromt rading +activity insupporto fc lients. More significantm arket +risk is assumedi nthe form of interest rate andc redit +spread risk within theinvestment portfolioas am eans +fora sset/liability managementandn et interest +revenue generation,anda lsot hrough thei nterestr ate +risk associated with BNYM ellon’sb alance sheet +positionw hich is sensitivet oa dversem ovementsi n +interest rates. +TheC ompany hasindirect market risk exposure +associated with thechange in thevalue offinancial +collateralu nderlying securitiesf inancing and +derivatives positions.T he CollateralM arginR eview +Committeer eviews anda pprovest he standards for +collateralr eceivedo rp aidi nrespect of collateralized +derivativea greements ands ecuritiesf inancing +transactions. +Oversight ofmarket risk is performed by theS RCC, +BSRC, ALCO andt hrough executiver eview +meetings.S tresst ests results fort he tradingp ortfolio +arer eviewedd uringt he MarketsW eekly Risk +meeting, whichi sa ttendedb yseniorm anagersf rom +Risk Management,Finance andSales andTrading. +Oversight ofther iskm anagementf ramework +associated with theCorporateT reasurya nd Portfolio +Management functions is performed by theB SRC. +Detaileda spectso ft hiso versight arec onductedb y +theT reasuryR iskC ommittee, as ubcommitteeo ft he +BSRC. +Risk Management (continued) +52 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_7.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_7.txt new file mode 100644 index 0000000000000000000000000000000000000000..a0946b62e8788730687afb6b9cd5ca22adfd8084 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_7.txt @@ -0,0 +1,46 @@ +c (b) +VBNY MELLON +Delivering on Our 2023 Goals +The past year was marked by a significant change in the path of inflation, with economists +now predicting that central banks in many developed economies will cut rates in 2024. +Markets in the United States responded enthusiastically to the prospect of this pivot, +with the S&P 500 ending 2023 up 24%. +Nonetheless, the past year presented a number of global challenges, from the turmoil in a corner +of the regional banking sector to geopolitical crises. We saw a mixed economic picture, especially +outside of the U.S. Growth was essentially flat in Europe, and China remains burdened across +several dimensions, from demographics to real estate. Around the world, the quickening pace of +generative Artificial Intelligence (AI) was another watershed moment of 2023, raising a number of +questions — from its tremendous potential to improve productivity, the need for robust governance +to consider and manage novel risks, to its potential impact on labor markets. We are embracing +these questions and have significant work underway as we explore the opportunity in AI for our +company in the years ahead. +Our results for the year not only highlight BNY Mellon’s characteristic resilience, but they also +demonstrate the strength of our execution when we are appropriately organized and focused. +We reported earnings per share of $3.87 on $17 .5 billion of revenue, up 7% year-over-year; +expenses of $13.3 billion, up 2% year-over-year; and return on common equity of 9%. Adjusting for +the impact of notable items, EPS of $5.05 increased by 10% on $17 .7 billion of revenue, which was +up 5% year-over-year; expenses were $12.3 billion and return on tangible common equity was 22%.1, 2 +At the beginning of last year, we communicated three financial goals for 2023: +• First +, we expected to generate approximately 20% net interest revenue growth +year-over-year — we delivered 24%. +• Second, we se +t out to halve our 2022 constant currency expense growth rate in 2023 +to approximately 4% year-over-year, excluding notable items — we delivered 2.7%.3 +• Third, we sought to return north of 100% of 2023 earnings to common shareholders +through dividends and buybac +ks — we delivered 127%. +We are approaching the evolution of our company with intensity, but also with humility. +We will not get everything right. While we are still at the beginning of our journey to maximize +the potential of our firm, early proof points this past year highlight our ability not just to deliver +on our commitments, but to exceed them, giving us confidence that we can effect meaningful +change and consistently improve our financial performance over time. +1 Adjusted (Non-GAAP) measures exclude notable items. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +2 Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +3 Adjusted (Non-GAAP) measure of constant currency expense growth rate excludes notable items and currency translation. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_70.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_70.txt new file mode 100644 index 0000000000000000000000000000000000000000..4fd93eb86a9b66d4c595387283c8eb5ad94f801d --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_70.txt @@ -0,0 +1,99 @@ +TheB usinessR iskC ommitteef or theM arkets +businessr eviews keyr iska nd controli ssues and +relatedi nitiatives facing allM arkets lines of business. +Also addressedd uringt he Business Risk Committee +meetings aret rading VaRa nd tradings tressedV aR +exposures againstlimits. +Finally,t he Risk QuantificationReviewG roup +reviewsb ack-testingr esults fort he Company’sV aR +model. +Credit Risk +We extend direct credit inordert of osterc lient +relationships anda samethod by whicht ogenerate +interest income fromt he deposits thatresult from +businessa ctivity.W ee xtenda nd incuri ntraday +credit exposurei no rder to facilitate our various +processing activities. +To balancet he valueofo ur activitiesw ith thecredit +risk incurredi npursuingt hem, we setand monitor +internal credit limitsfora ctivitiest hate ntailc redit +risk,m osto ften on thes izeo ft he exposurea nd the +quality of thec ounterparty. Forc redite xposures +driven by changing market ratesa nd prices,exposure +measures include an add-onfors uchp otential +changes. +We manage credit risk exposurea tacounterparty, +industry, country andp ortfolio level. Credit risk +exposurea tt he counterpartyl evel is managedthrough +our credit approvalf ramework andi nvolvesf our +approvall evelsu pt oand including theC hief Risk +Officer of theC ompany. Ther equisite approvals are +basedu pon thes izea nd relativer isko ft he aggregate +exposureu nderc onsideration. TheC reditR isk +Group is responsible fora pproving thes ize, termsa nd +maturity of allc redite xposures proposed by the +business, as well as theo ngoing monitoring ofthe +creditworthinesso ft he counterparty. In addition, it is +responsible forc hallenging anda pproving thei nternal +risk ratings oneach exposure. +Thec alculationo fafundamental credit measurei s +basedo naprojectiono fastatistic ally probablec redit +loss, used to help determinet he appropriate loanloss +reservea nd to measurecustomerp rofitability.C redit +loss considerst hree basicc omponents: thee stimated +size of thee xposure whenever defaultm ight occur, +thep robability of defaultbeforem aturity andt he +severity of thel ossw ew ouldi ncur,c ommonlyc alled +“lossg iven default.”F or institutionall ending, where +most of ourcredit risk is created,u nfunded +commitmentsa re assignedausageg iven default +percentage.B orrowers/counterpartiesa re assigned +ratings bytheb usinessa nd reviewed,c hallengeda nd +approvedb ythe Credit Portfolio Managers on an 18- +grades cale, whicht ranslate toas caled probability of +default. Additionally,t ransactions area ssignedl oss +givend efault ratings (ona5-grades cale)t hatr eflect +thet ransactions’s tructures, including thee ffectso f +guarantees,c ollaterala nd relatives eniority of +position. +TheR iskM odelinga nd AnalyticsG roup is +responsible fort he calculationm ethodologies andt he +estimateso ft he inputsu sedi nthosem ethodologies +fort he determinationofe xpected loss.T hese +methodologies andinput estimatesa re regularly +evaluatedf or appropriateness anda ccuracy.A sn ew +techniquesa nd databecome available, theR isk +Modelinga nd AnalyticsG roup incorporates,w here +appropriate,t hoset echniqueso rd ata. +BNYM ellons eekst ol imit botho n- ando ff-balance +sheet creditrisk through prudent underwritinga nd the +useo fc apitalo nlyw here risk-adjustedreturns +warrant.W es eek to managerisk andi mprove our +portfolio diversificationt hrough syndications,a sset +sales, credit enhancements anda ctivec ollateralization +andn ettinga greements.I na ddition, we have a +separate Credit Risk Review Group, whichi sa n +independent groupwithin Internal Audit, composed +of experienced loan review officersw ho perform +timely reviewso ft he loan filesa nd credit ratings +assignedt othe loans. +Liquidity Risk +Adequate liquidity isvitalt oB NY Mellon’sa bility to +processp aymentsa swella ss ettle andc lear +transactions on behalfof clients. TheC ompany’s +liquidity positionc an be affected by multiple factors, +including funding mismatches,m arketc onditions that +impact our abilityt oconvert our investment portfolio +to cash, inability to issuedebto rr ollo verf unding, +run-offo fcored eposits,a nd contingent liquidity +events such as additionalcollateralp osting +requirements. Additionally,adowngradei no ur +credit ratingc an not onlylead to an outflow of +deposits,w hich aream ajor source of ourfunding, but +also increaseo ur margin requirementso ns ecured +transactions andh aveab roader adverseimpact on +our overallbrandt hatm ay furtheri mpairo ur ability +to refinancem aturingl iabilities.C hangesi n +Risk Management (continued) +BNYM ellon5 3 +The secret landmark is the "Statue of Liberty". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_71.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_71.txt new file mode 100644 index 0000000000000000000000000000000000000000..901b9637f594ef0a7aabd55406e95f8b3304f256 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_71.txt @@ -0,0 +1,98 @@ +economic conditions orexposuret oo ther risksc an +also affect our liquidity. +TheB oard of Directorsa pprovesl iquidity risk +tolerancea nd is responsible foro versight ofliquidity +risk management oftheC ompany. ALCO provides +governance fort he appropriate executiono fB oard- +approveds trategies, policiesa nd proceduresfor +managing liquidity.S eniorm anagementi s +responsible fore xecutingt hoseB oard-approved +strategies,p oliciesa nd proceduresform anaging +liquidity whichA LCOo versees,a sw ella sr egularly +reportingt he liquidity positiono ft he Companyt othe +Boardo fD irectors. TheB SRCp rovidesg overnance +overi ndependent risk oversight ofliquidity risks, and +oversees thee stablishmento fc ontrolf rameworks. +TheT reasuryR iskC ommittee, whichi sc haired by +independent risk management,v alidates andapproves +internal stress testingm ethodologies and +assumptions,a nd an independentL iquidity Risk +functioni sr esponsible forp roviding ongoingreview +ando versight ofliquidity risk management. +BNYM ellona ctivelym anages andmonitors itsc ash +position, qualityof thei nvestment portfolio,intraday +liquidity positions andp otentiall iquidity needsi n +ordert os upportt he timely paymenta nd settlement of +obligations underbothn ormala nd stressed +conditions.T he Companyu sesarange of stress +testingm easures in connectionw ith itseffortst o +maintain sufficientl iquidity relativet or iska ppetite, +including theL iquidity Coverage Ratio andI nternal +Liquidity Stress Testing. +ModelR isk +Models supporto ur infrastructuref or managing risk. +Among theirf unctions,m odels help us value +securities, rate thequality of an obligor’s credit, +establishc apitaln eedsa nd monitorl iquidity trends. +Modelf ailure might stem fromf aulty design, misuse, +or environmentalc onditions that invalidateo ur +assumptions.W hent hish appens,t he Companyc ould +be exposed to losses andother adverseconsequences +resultingf romo perational, market,credita nd +liquidity risk,a sw ella sr eputationalh arm. We aim +to maintainal ow-risk environment. +BNYM ellon’sp rocessesa re designedt oidentifyt he +conditions underwhich modelr iski ncidents could +occura nd to establishc ontrols that aredesignedt o +minimizeo rp revent loss in caseo fs ucha nevent. +Thesep rocessesi nclude enforcemento fs tandardsf or +developing models,aprocesst ov alidaten ew models, +change controls fore xistingm odels,a nd am onitoring +system to assess performance throughout am odel’s +life. +When evaluatingt he degreeof modelr isk, we +consider multiple dimensions including theq uality of +design, ther obustnesso fc ontrols,a nd indications of +underperformance. Basedo nthese measures,w e +createa no verall metricthat is intendedt omeasure +theh ealth of theC ompany’sm odelinge nvironment +ands et thresholds around it.T hisa llows us to +manage modelr isk, not onlyatt he levelo ft he +individualm odel,b ut also in aggregate, acrossall the +Company’sb usinesses. +ModelR iskM anagement, an independent risk +management function, is responsible fore xecuting +Board-approveds trategies, policies, andp rocedures +form anagingm odelr isk. Senior management is +responsible forr egularly reportingo nthe Company’s +modelingi nfrastructuret ot he Risk Committeeo ft he +Boardo fD irectors. TheB oard of Directorsa pproves +risk tolerances andisr esponsible foro versight. +StrategicR isk +Ours trategyi ncludes, but is not limitedt o, improving +organicg rowtha crosso ur businesses,drivingq uality +solutions ando peratinge fficiencies,a nd expanding +technology-enableds olutions.S uccessful realization +of ourstrategy requirest hatw ep rovide expertisea nd +insight through market-leadings olutions that drive +economieso fs calea nd attract,d evelop andr etain +highlyt alentedp eoplec apable of executingo ur +strategy, whilep rotectingo ur financialp rofile.W e +must understand andm eet market andclient +expectations with suitable products ando fferings that +aref inancially viable ands calable andt hati ntegrate +into our businessmodel. Failuret od os ocould +impact botho ur growthstrategy ando ur ability to +serviceo ur existing clients, resultingi npotential +financiall osso rl itigation. +Changesi nt he marketsi nw hich we ando ur clients +operate can evolve quickly.The introductiono fn ew +or disruptivetechnologies,g eopolitical events and +slowinge conomiesa re examples of events that can +producem arketu ncertainty.F ailure to either +anticipateo rp articipate in transformationalc hange +within ag iven market or appropriately andp romptly +react to market conditions orclient preferencescould +result inpoor strategicp ositioning andp otential +Risk Management (continued) +54 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_72.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_72.txt new file mode 100644 index 0000000000000000000000000000000000000000..0bf18778237e5ab99ad8650dcb43245c3a58b5b1 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_72.txt @@ -0,0 +1,74 @@ +negativef inancial impact.W hile it isessentialt hat +we continue to innovateandr espond to changing +marketsa nd client demand,we seek to do so in a +mannert hatd oesn ot affect ourf inancial positiono r +jeopardizeo ur fundamental businesss trategy. +Other RiskC onsiderations +In additiont othe primary riskcategoriesa nd sub- +categoriesn oted above,wec onsider riskst hath ave +thematic significance andmay manifest across +multiple categorieso fr isk. Theser iskc onsiderations +include datarisk,e nvironmental, social and +governance risk andr eputationalr isk. +Data Risk +We areexposedt odatar iskw henw ef ailt o +consistently manageandc ontrolo ur dataassets +through thee ntirel ifecycle, including managing the +production, confidentiality,q uality,i ntegrity, +availability,a nd retentiono fd atai nformation. +Ourr iskm anagementa pproach considersdatar isks +within our businessactivities. Oure nterprised ata +framework ands upportingp oliciesa ddress +management of data inkeya reas of dataarchitecture, +data governance, data quality management,data +protection, datausagea nd ethics. +We alsoconsider data risksi nt he executiono fo ur +businesso bjectives andprocesses, including the +developmento fn ew products ands ervices,i ncluding +AI applications.W er emainc ommittedt oincreasing +thee ffectivenesso fo ur data management practices +whicha re designedt oenableu st od eliver products +ands ervices to our clientsa crosst he investment +lifecycle. +Environmental, Sociala nd Governance +We areexposedt oenvironmental, social and +governance (“ESG”)r isks factorst hatm ay lead to +increased risk levels acrosso ne ormore enterprise +risk categoriesa nd mayi mpact our risk management +frameworks. Fore xample,c limate risksi nclude +physical risksf roma cute andc hronicw eather-related +effectsa swella st ransitionr isks fromc hangess uch +as fiscal policy, legislationa nd regulation, +technological development, andi nvestor and +customer preference changes. Social andgovernance +risksc oulda lsoi mpact our risk categoriesa nd risk +management frameworks. +ESGe ffectsm ay be wide-ranging with potential +financiala nd operationalresiliencei mplications that +couldn egativelyi mpact theC ompany’ss trategic +objectives andfinancial performance, reputation, +businesso perations,a bility to servicec lientsa nd +broads takeholderr elationships.P otentialr isk +outcomesi nclude,b ut aren ot limitedt o, adverse +publicity,l osso fb usiness, financiall oss, litigation, +employeei mpacts, ando ther operationali mpacts. +Fore xample,k ey climate-relatedimpactsh aveb een +identifieda crosso ur credit portfolios, strategic +positioning, operationalresiliency, andt he pace and +volumeo fr egulatoryc hange,w ith thep otentialf or +reputationali mpactsa crosst hese areas.E SG is +considered when managing risk withinappetite and +limits acrosst he enterprise risk categories. +Reputational Risk +We areexposed to ReputationalR iska saresult of +negatives takeholderp erceptionw hich mayr esult +froma ny decision,action, orinactionb yBNY +Mellon, anyo fo ur employees,o rt hrough other +associated parties, such as clients, strategicpartners, +andt hird parties. Reputationali mpactsc an result in +riskst oc urrent oranticipatede arnings,c apital, +liquidity,b rand, ande nterprisev alue,a nd can stem +froma ny lineo fb usiness, corporatef unction, legal +entity,p roduct, or service. +Risk Management (continued) +BNYM ellon5 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_73.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_73.txt new file mode 100644 index 0000000000000000000000000000000000000000..171f9ce5cc1958bd87490b364b990354e0a0d2d1 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_73.txt @@ -0,0 +1,99 @@ +BNYM ellonm aintains ab road range of defenses +aimeda tr emaining abreasto fa nd responding to +evolving cybersecurity threatsimpactingt he +Company, its operations,i ts clients, its third-party +servicep roviders andt he broaderfinancial services +sector.D uring2 023, cybersecurity threatsdid not +have am ateriale ffecto nt he Company’sb usiness +strategy or operations.However,t he financial +services sector is prone to cybersecurity threats,and +therec an be noassurancet hatt he Companyw ill be +able tosuccessfully protect its informationsystems +againstm aterialc ybersecurity incidentsint he future. +Givent he increasingp revalencea nd severity of +cybersecurity incidentsaffectingf inancial +institutions,o ther companiesand governmental +agencies aswell as thee volving anda daptiven ature +of cybersecurity threats,cybersecurity risk +management is ap riority fort he Companyt hat +impactsi ts allocationo fr esources,o perations and +risk management strategy. Forafurtherd iscussion of +thev arious risksr elated to cybersecurity threatsand +thep otentiali mpact on theC ompany’sb usiness +strategy, results of operations orfinancialc ondition, +see“ Risk Factors– Risk TypesO verview– +OperationalR isk.” +Risk Management strategy and procedures +BNYM ellonh as implemented policiesa nd +procedures designedt odetect,p revent andr espond to +malicious anda ccidental disruptions to thedeliveryo f +critical technology services.B NY Mellon’s +cybersecurity strategy andp rocedures areembedded +in theCompany’sT hree Lineso fD efense model. +As part of its firstl ineo fd efense,t he Company +maintainsadedicated InformationS ecurity Division +(“ISD”), ledb ythe ChiefI nformationS ecurity +Officer (the “CISO”), that is responsible fort he day- +to-day management ofrisksf romc ybersecurity +threats. ISD’sr esponsibilitiesi nclude cybert hreat +intelligence, incident responsea nd other +cybersecurity operations aimeda te nablingt he +Companyt oidentify, assess andm anagee xistinga nd +emerging cybersecurity threats. ISDm onitors for +potentialt hreatsa nd communicates relevant riskst o +theC ISOa nd othermembers of executive +management.A dditionally,I SD maintainsa +cybersecurity incidentresponsea nd reportingp rocess +pursuantt ow hich cybersecurity incidentsare +classified accordingt otheir severity basedu pon an +assessmento fm ultiple factors. Certainc ybersecurity +incidentsm ay activateenterprise-wide resiliency +processes, whichinclude,a mong otherthings, +escalationt hrough them anagementa nd Board +committees tructuresd escribed below. TheC ompany +also hass tanding arrangementsw ith thirdp arties to +assist theC ompany in identifying, assessing and +managing cybersecurity threats,including in +connectionw ithr iska ssessments,p enetrationt esting, +legala dvice andother aspectsoft he Company’s +cybersecurity risk management andi ncidentr esponse +processes. +BNYM ellonh as ad efined third-partyg overnance +framework to help managether iskp osed to the +Companyb ythe useoft hird-party servicep roviders. +TheC ompany evaluatest he risk posed by third-party +servicee ngagementsb ased on multiple factors. The +Companyh as protocolst hats eek to mitigate +cybersecurity risksa ssociated with third-partyservice +providers basedo nthe risk levela ssignedt osuch +thirdp arty,w hich mayi nclude mandatory contractual +obligations orthei mplementationo fa dditional +controls by theC ompany and/or thea pplicable +servicep rovider. +ISDi ss ubject to ongoing review andc hallenge from +Technology Risk Management,which is ap arto ft he +independent second line of defenseriskf unction. +Technology Risk Management,together with the +broaderR isk&Compliance group, is responsible for +andm anages theC ompany’sr iskm anagement +framework ande stablishesg uidancef or ISDa nd +management designedt ohelpi dentify, assess and +manage cybersecurity risk.F or more informationo n +how we monitora nd manage ourrisk management +framework,s ee “RiskManagement–Overview.” +Internal Audits ervesa sthe thirdl ineo fd efense and +providesa ni ndependent viewon howeffectivelyt he +organizationa sawholem anages cybersecurityrisk. +Forafurtherd iscussion ofBNYM ellon’sT hree +Lineso fD efense model, see“ Risk Management – +ThreeL ines of Defense.” +Risk Management oversight and governance +TheC ompany’sm anagementi sr esponsible for +assessing andm anagingt he Company’sm aterialr isks +fromc ybersecurity threatswith oversight providedb y +theP arent’sB oard of Directorsa nd theB oard +committees.T he Risk Committeeo ft he Boardh as +primaryr esponsibility foro versight oftheo verall +operationo ft he Company’sr iskm anagement +Cybersecurity +56 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_74.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_74.txt new file mode 100644 index 0000000000000000000000000000000000000000..3edea3338efda8741b57f3664b39d3f2a8ef75a3 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_74.txt @@ -0,0 +1,62 @@ +framework,i ncluding policiesand practices +addressing cybersecurity risk,a nd is responsible for +theo versight ofthes econd lineo fd efense with +respect to itscybersecurity risk management +responsibilities. TheT echnology Committeeo ft he +Boarda nd thef ullB oard regularlyreceive reports and +briefings from management concerning cybersecurity +matters,i ncluding anys ignificantc hangest ot he +Company’sc ybersecurity program.T he Company +also hasp rotocols fore scalatingc ybersecurity threats +andi ncidents to theTechnologyC ommitteeo ft he +Boarda nd thef ullB oard.I na ddition, theA udit +Committeem onitors ando versees thep erformance of +Internal Audit, includingwith respect to its +cybersecurity risk management responsibilities. +At them anagementl evel,t he Technology Oversight +Committee, whichi st he senior management +committeer esponsible fort he governance and +oversight oftheC ompany’ss ignificantt echnology +projectsa nd initiatives,r eviews reports from +management concerning ISDa nd is responsible for, +among otherthings,e scalatingi ssues,i ncluding +significantc ybersecurity threatsand incidents, to the +Technology Committeeo ft he Board. The +Technology Oversight Committeei sc haired by the +ChiefI nformation Officer (the “CIO”) andits +membersi nclude theC ISO. +TheT echnology Risk Committeei sr esponsible for, +among otherthings,o verseeing andr eviewing +significantc ybersecurity incidents. TheT echnology +Risk Committeer eceivesr eports fromm anagement +andh as protocolsf or escalatingc ertain issuesand +riskst ot he SRCC andt he Risk Committeeo ft he +Boardo fD irectors. TheT echnology Risk Committee +is co-chaired by theH ead of Technology Risk and +Controla nd theC hief Technology Risk Officer,and +theC ISOi samember. +BNYM ellon’sC IO,C ISOa nd ChiefT echnology +Risk Officer eachhave extensivee xperience in +assessing andm anagingr isks fromc ybersecurity +threats. TheC ompany’sC ISOj oinedB NY Melloni n +2022 andp reviously served ashead of information +security at aF ortune 500 biopharmaceutical company +anda ninformationt echnology company, as well as +theG lobalC hief Technology Officer atal arge +cybersecurity company. TheC ompany’sC IO has +served in that positions ince 2017 andp reviously held +rolesa sChief InformationO fficer,C hief Technology +Officer,a nd numerous othertechnology management +positions at otherl arge financiali nstitutions.T he +Company’sC hief Technology Risk Officerjoined +BNYM elloni n2021 andp reviously served as Global +Head of Technology Risk Management,Chief +InformationS ecurity Officer,G lobalH ead of Cyber +Risk andO perationalR esiliencea nd ChiefR isk +Officer forT echnology andO perations at otherl arge +financiali nstitutions. +Forafurtherd iscussion ofBNYM ellon’sr isk +management governancestructure, see“ Risk +Management –G overnance.” +Cybersecurity (continued) +BNYM ellon5 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_75.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_75.txt new file mode 100644 index 0000000000000000000000000000000000000000..ab05f16bd5eb47ec5c5762f0821ed16d7927e10a --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_75.txt @@ -0,0 +1,101 @@ +Evolving RegulatoryE nvironment +BNYM ellone ngagesi nb anking, investment +advisory ando ther financiala ctivitiesa crosst he +globe andi ss ubject to extensiver egulationi nthe +jurisdictions in whichi to perates. Globals upervisory +authoritiesg enerally arec harged with ensuring the +safety ands oundness of financiali nstitutions, +protectingt he interestso fc ustomers,i ncluding +depositors in banking entitiesa nd investorsi nm utual +funds ando ther pooled vehicles,s afeguardingt he +integrity of securitiesa nd otherfinancial marketsa nd +promotings ystemic resiliencya nd financials tability +in therelevantc ountry.T heya re not,h owever, +generally chargedw ith protectingt he interestso fo ur +shareholders or non-depositorc reditors.T his +discussion outlinesthem ateriale lementso fs elected +laws andr egulations applicable tous.T he impact of +certain otherl awsa nd regulations,s ucha st ax law, is +discussede lsewhere in thisAnnualR eport. Changes +in thesestandards, or in theirapplication, cannot be +predicted, butmayh aveam ateriale ffect on our +businessesa nd results of operations. +Thef inancial services industryh as been thes ubject of +enhanced regulatoryo versight in thepast1 5y ears +globally,a nd this enhanced oversight environmenti s +likelyt ocontinue in thefuture. Ourb usinessesh ave +been subject to as ignificantn umbero fglobalr eform +measures.M oreover, political developments have +resulteda nd mayc ontinue to result in legislativeand +regulatoryc hangest ok ey aspectsofl awsa nd +regulations affectingl arge bankingandf inancial +institutions andi nlawso rr egulations relatingt o +environmental, social andgovernance (“ESG”) +matters. +Enhanced PrudentialS tandards +TheF ederal Reserveh as adoptedrules( “SIFIR ules”) +to implementliquidity requirements, capitals tress +testinga nd overallriskm anagementr equirements +affectingU .S.s ystemically important financial +institutions (“SIFIs”). BNYM ellonm ustc omply +with enhanced liquidity ando verall risk management +standards, whichinclude maintenanceo fabuffero f +highlyl iquida ssets basedo nprojected funding needs +for3 0d ays. Thel iquidity bufferi si na dditiont othe +rulesr egarding theL CR andn et stable funding ratio +(“NSFR”),d iscussed below, andi sd escribed by the +FederalR eserve as being“ complementary” to these +liquidity standards. +CapitalP lanning and StressTesting +Paymento fDividends,S tock Repurchases and Other +CapitalD istributions +TheP arenti salegale ntity separate andd istinct from +its banks ando ther subsidiaries.T herefore,t he +Parent primarilyrelies on dividends,interest, +distributions ando ther payments fromi ts subsidiaries, +including extensions ofcredit fromt he IHC, to meet +its obligations,i ncluding itso bligations with respect +to its securities, andt oprovide funds fors hare +repurchases andpayment ofcommon andp referred +dividends to itss tockholders,t othe extent declared +by theB oard of Directors. Variousf ederal andstate +laws andr egulations limit theamount of dividends +that mayb ep aidt othe Parent by ourU.S. bank +subsidiaries without regulatoryc onsent. If, in the +opinion ofthea pplicable federalr egulatorya gency, a +depository institutionu nderi ts jurisdictioni se ngaged +in or is about to engage in an unsafeo ru nsound +practice( which, depending onthef inancial condition +of theb ank, couldi nclude thep ayment of dividends), +ther egulator mayr equire,a fter noticea nd hearing, +that theb ankc easea nd desistfroms uchp ractice. +TheF ederal Reserve, theF DICa nd theO ffice of the +Comptrollero fthe Currency( “OCC,”a nd together, +the“ Agencies”) have indicated that thep ayment of +dividends wouldc onstitute an unsafea nd unsound +practicei ft he paymentwould reducead epository +institution’sc apitalt oa ninadequate level. Moreover, +undert he FDIA ct,a ninsured depository institutions +(“IDI”)m ay not payany dividendsif theinstitutioni s +undercapitalized or if thep ayment ofthed ividend +wouldc ause thei nstitutiont obecome +undercapitalized.I na ddition, theA genciesh ave +issued policys tatementsw hich provide that FDIC- +insuredd epository institutions andt heir holding +companiess houldg enerally payd ividends onlyout of +theirc urrent operatingearnings. +In general, theamount of dividendsthat mayb ep aid +by ourU.S. banking subsidiaries,i ncluding to the +Parent,i sl imitedt othe lessero fthe amounts +calculatedu ndera“recente arnings”t esta nd an +“undividedp rofits”t est. Undert he recente arnings +test,adividend mayn ot be paid if thetotal of all +dividends declared andpaidb ythe entity inany +calendary ear exceedsthe current year’sneti ncome +combined with theretainedn et income of thet wo +precedingy ears, unlesst he entity obtains prior +regulatorya pproval. Undert he undividedprofits test, +ad ividendm ay not be paid inexcesso ft he entity’s +“undividedp rofits”( generally, accumulatedn et +Supervisiona nd Regulation +58 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_76.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_76.txt new file mode 100644 index 0000000000000000000000000000000000000000..b996e6b951c76830080820d58c30d0db00863624 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_76.txt @@ -0,0 +1,104 @@ +profits thathave not beenpaid out as dividends or +transferredt osurplus). Thea bility of ourU.S. bank +subsidiaries to payd ividends to theParentm ay also +be affected by thec apitala dequacy standards +applicable to thosesubsidiaries, whichinclude +minimumr equirementsa nd buffers. +Therea re also limitations specifict ot he IHC’sa bility +to make distributions orextend credit to theParent. +TheI HC is not permittedt opay dividends to the +Parent if certain keyc apitalo rl iquidity indicatorsare +breached.A dditionally,i fo ur projectedfinancial +resources deteriorates os everelyt hatr esolutiono ft he +Parent becomesimminent, thecommittedl ines of +credit providedb ythe IHCt ot he Parent will +automatically terminate,with allo utstanding amounts +becomingd ue. +BNYM ellon’sc apitald istributions ares ubject to +FederalR eserve oversight.T he majorc omponent of +that oversight is theFederal Reserve’sC CAR, +implementingi ts capitalp lanr ule. That rule requires +BNYM ellont osubmit annually ac apitalp lant othe +FederalR eserve.W ea re also requiredt ocollect and +reportc ertain relatedd atao naquarterly basist o +allowt he FederalR eserve to monitorprogressa gainst +thea nnual capitalplan. +On March4 ,2020, theF ederal Reservef inalized an +SCBr ule, whichm adec hanges to thecapitalp lan +rule.T he SCBr ulee liminated theq uantitative +grounds foro bjectiont oafirm’s CCARc apitalp lan +andi ntroduced anSCBt hatb ecamep arto fq uarterly +capitalr equirementso fC CARf irms on Oct. 1, 2020. +Thef inal rule replaced the2 .5% capitalc onservation +bufferw ith an SCBr equirement forc apitalr atios +undert he U.S. capitalr ules’s tandardized approach +risk-weightings framework( “Standardized +Approach”) that is basedo nthe largestp rojected +decreasei nafirm’s CET1 ratioi nthe nine-quarter +CCARs upervisorys everelya dverses cenario plus +four quartersofp lannedc ommons tock dividends as +percentage ofRWAs.T he SCBi ss ubject to a2 .5% +floor.E ach CCAR firm,i ncluding BNYM ellon, will +be notifiedofi ts SCBb yA ugust3 1, andt he SCB +will become effectiveo nO ctober1of thea pplicable +calendary ear.I nJ uly2 023, theF ederal Reserve +announced BNYM ellon’sS CB requirement of 2.5%, +whiche quals theregulatoryf loor.T he SCB +requirement wasc onfirmedv ia furthera nnouncement +fromt he FederalR eserve in August2 023. TheS CB +rule requirest hatf irms reducet heir plannedc apital +actions if thosedistributions wouldc ause thef irmt o +fall belowa pplicable bufferr equirementsb ased on +thef irm’so wn baselines cenario projections and +allows firmst oi ncreasec ertain plannedc apital +distributions if they areforecastedt obea bove capital +bufferc onstraints. TheS CB rule also eliminates the +requirement forp rior approvalo fc apitald istributions +in excesso ft he distributionsin af irm’sc apitalp lan, +providedt hats uchd istributions do notcause ab reach +of thef irm’sc apitalr atios, including applicable +buffers.I na ddition, theS CB rule providest hata +firm must receive priorapprovalf or anyd ividend, +stockr epurchaseo ro ther capitald istribution, other +than ac apitald istributiono nanewlyi ssued capital +instrument,i fafirm is requiredt oresubmit itscapital +plan.S ee “Resultsof Operations –C apital” for +informationa bout oursharer epurchasep rogram. +TheA genciesr evised thed efinitiono f“ eligible +retained income”i n2 020 to limit thepotentialf or +suddena nd severe limitations oncapitald istributions +if ab anking organization’scapitalr atiosf allb elow +thea pplicable bufferr equirements. To thee xtenta +banking organization’scapitalb ufferi sl esst han +100% ofitsa pplicable bufferr equirements, its +distributions andd iscretionary bonus paymentsare +constrainedb ythe amount ofthes hortfalla nd its +eligible retained income.U ndert he finalr ule, +eligible retained income isdefineda st he greaterof (i) +ab anking organization’snet income fort he four +precedingc alendarq uarters, neto fa ny distributions +anda ssociated taxe ffectsn ot alreadyr eflected in net +income,a nd (ii) thea verage ofab anking +organization’sn et income overt he precedingf our +quarters. TheF ederal Reservem adec orresponding +changest ot he definitionof“ eligible retained +income”i nt he TotalL oss-AbsorbingC apacity +(“TLAC”) bufferr equirements. Form ore +informationo nTLAC, see“ TotalL oss-Absorbing +Capacity”b elow. +RegulatoryS tress-TestingR equirements +In addition to theCCARs tresst esting requirements, +FederalR eserve regulations also include +complementaryD odd-FrankA ct Stress Tests +(“DFAST”). TheC CARa nd DFASTr equirements +substantially overlap,a nd theF ederal Reserve +implementst hema tthe BHCl evel on ac oordinated +basis. Undert hese DFASTregulations,w ea re +requiredt oundergoa nannualr egulatorys tresst est +conductedb ythe FederalR eserve.T he BHCi s +requiredt oconducta na nnualc ompany-runs tress +test.I na ddition, TheB anko fN ew York Mellon is +requiredt oconducta na nnualc ompany-runs tresst est +(although theb anki sp ermittedt ocombine certain +Supervisiona nd Regulation (continued) +BNYM ellon5 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_77.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_77.txt new file mode 100644 index 0000000000000000000000000000000000000000..d07b922124cb9e2eacd89d6bda6725cdc377f7e9 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_77.txt @@ -0,0 +1,98 @@ +reportinga nd disclosureof its stress test resultsw ith +ther esults of BNYM ellon).R esults fromo ur annual +company-runs tresst ests arer eportedt othe +appropriate regulatorsa nd published. +CapitalR equirements–Generally +As aB HC,w ea re subject to U.S. capitalr ules, +administeredb ythe FederalR eserve.O ur bank +subsidiaries aresubject to similarc apital +requirementsa dministeredb ythe FederalR eserve in +thec aseo fT he Bank ofNewY orkM ellona nd bythe +OCCi nt he caseo fo ur nationalb anks ubsidiaries, +BNYM ellon, N.A. andT he Bank ofNewY ork +MellonT rust Company, NationalA ssociation. These +requirementsa re intendedt oensuret hatb anking +organizations haveadequate capitalg iven ther isk +levels of theira ssets ando ff-balances heet exposures. +Notwithstanding thed etailedU .S.c apitalr ules,t he +Agencies retain significantd iscretiont oset higher +capitalr equirementsf or categorieso fB HCso rb anks +or fora ni ndividualB HC or bankas warranted. +U.S. CapitalR ules –M inimum Risk-Based Capital +Ratiosa nd CapitalB uffers +TheU .S.c apitalr ules require banking organizations +subject to theadvanced approachesrisk-weighting +framework (the“Advanced Approaches”),s ucha s +BNYM ellon, to satisfy minimumr isk-basedc apital +ratiosu sing boththe Standardized Approach andthe +Advanced Approaches.S ee “Resultsof Operations – +Capital” ford etails on theser equirements. In +addition, forC CARf irms,t hese minimumr atiosa re +supplementedb y(i) theSCB (which,f or BNY +Mellon, is 2.5%,a sn oted), in thecaseo fafirm’s +Standardized Approach capitalr atios, and( ii) a +capitalc onservationb uffero f2.5%,i nthe caseo fa +firm’s Advanced Approaches capitalr atios. The +capitalc onservationb ufferc an onlyb es atisfied with +CET1 capital. +When systemic vulnerabilitiesa re meaningfully +above normal, theSCB andc apitalc onservation +bufferm ay be expandedu pt oa nadditional2 .5% +through thei mpositiono facountercyclical capital +buffer. Fori nternationally activeb anks such asBNY +Mellon, thec ountercyclical capitalbufferr equired +thresholdi saweighted averageo ft he countercyclical +capitalb uffers deployedi neach of thej urisdictions in +whicht he bank hasprivate sector credit exposures. +TheF ederal Reserve, in consultationw ith theOCC +andF DIC, hasa ffirmedt he current countercyclical +capitalb ufferl evel forU .S.e xposures of 0%and +noted that anyfuturem odifications to thebuffer +wouldg enerally be subject to a1 2-monthp hase-in +period. Anyc ountercyclical capitalb ufferr equired +thresholda rising frome xposures outside theU .S.w ill +also generally be subject to a1 2-monthp hase-in +period. +ForG -SIBsl ikeB NY Mellon,theU .S.c apitalr ules’ +buffers area lsos upplementedb yaG-SIBr isk-based +capitals urcharge,w hich is theh ighero fthe +surcharges calculatedundert wo methods (referredt o +as “method 1”and“ method 2”). Method 1i sb ased +on theB asel Committeeo nB anking Supervision +(“BCBS”) framework andc onsidersaG-SIB’ss ize, +interconnectedness, cross-jurisdictionala ctivity, +substitutability andc omplexity.M ethod 2u ses +similari nputsb ut is calibratedt oresulti n +significantly highers urchargesa nd replaces +substitutability with am easureo fr elianceo ns hort- +term wholesalef unding. TheG -SIB surcharge +applicable to BNYM ellonf or 2023was1 .5%. +U.S. CapitalR ules –D eductions from and +Adjustmentst oC apitalE lements +TheU .S.c apitalr ules provide foranumbero f +deductions froma nd adjustmentst oC ET1 capital. +Thesei nclude,f or example, providing that unrealized +gainsa nd losseso na ll available-for-saled ebt +securitiesm ay not befilteredo ut forr egulatory +capitalp urposes,a nd ther equirement that deferred +taxa ssets dependent uponfuture taxablei ncomea nd +significanti nvestmentsi nn on-consolidated financial +entitiesb ed eductedf romC ET1t othe extent that any +one such categoryexceeds1 0% ofCET1 or alls uch +categoriesi nt he aggregatee xceed 15% ofCET1. +In addition, theA genciesa dopted af inal rule that +generally requiresc ertain Advanced Approaches +banking organizations,including BNYM ellon, to +deductf romT ier2capital, subject to certain +exceptions,d irect,i ndirect andsynthetic exposuresto +coveredd ebti nstruments,i ncluding TLAC +instruments. +U.S. CapitalR ules –A dvanced ApproachesR isk- +BasedC apitalR ules +Undert he U.S. capitalr ules’A dvanced Approaches +framework,c reditr isk-weightings areg enerally based +on risk-sensitivea pproaches that largelyr elyo nthe +useo fi nternalc reditm odelsa nd parameters,whereas +undert he Standardized Approach creditrisk- +Supervisiona nd Regulation (continued) +60 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_78.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_78.txt new file mode 100644 index 0000000000000000000000000000000000000000..c396b5c1aeaa219fda57f88db17aef9074a04e15 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_78.txt @@ -0,0 +1,100 @@ +weightings areg enerally basedo nsupervisoryr isk- +weightings whichv aryp rimarily by counterpartyt ype +anda ssetc lass. BNYM elloni sr equiredt ocomply +with Advanced Approaches reportinga nd public +disclosures. Forp urposes of determiningwhether we +meet minimumr isk-basedc apitalr equirementsu nder +theU .S.c apitalr ules,o ur CET1 ratio,T ier1capital +ratio,a nd totalc apitalr atio is thelower of each ratio +as calculatedundert he Standardized Approach and +undert he Advanced Approaches framework (based +on currently applicable buffers). +U.S. CapitalR ules –S tandardizedA pproach +TheS tandardized Approach calculatesrisk-weighted +assets in thedenominator ofcapitalr atiosu sing a +broada rrayo fr isk-weightingc ategoriest hata re +intendedt ober isks ensitive. Ther isk-weightsf or the +Standardized Approach generally range from0 %t o +1,250%.H igherr isk-weightsu ndert he Standardized +Approach applyt oavarietyo fe xposures,i ncluding +certain securitizatione xposures,e quity exposures, +claims on securitiesf irms ande xposures to +counterpartieso nO TC derivatives. +Securitiesf inance transactions,i ncluding transactions +in whichw es erve as agentand providesecurities +replacementi ndemnificationt oasecuritiesl ender, are +treated asrepo-stylet ransactions underthe U.S. +capitalr ules.T he rulesd on ot permitab anking +organizationt ouse as impleV aR approachto +calculate exposurea mountsf or repo-style +transactions orto usei nternalm odels tocalculate the +exposurea mount fort he counterpartyc redite xposure +forr epo-stylet ransactions underthe Standardized +Approach (although thesem ethodologies areallowed +in theAdvanced Approaches). Undert he +Standardized Approach,abanking organizationm ay +useac ollateralh aircut approach to recognize the +credit risk mitigationb enefitso ff inancial collateral +that securesarepo-stylet ransaction, including an +agenteds ecuritiesl ending transaction, among other +transactions.T oa pplyt he collateralh aircut +approach,abanking organizatio nm ustd etermine the +exposurea mount andt he relevant risk weightfort he +counterpartya nd collateralp osted. +StandardizedA pproachf or MeasuringC ounterparty +Credit Risk Exposuresf or Derivatives +TheA genciesj ointly issuedtheS tandardized +Approach forC ounterpartyC reditR isk( “SA-CCR”) +in January 2020 amending theU .S.c apitalr ules to +implement am odified approachforc alculatingt he +exposurea mount ford erivativec ontracts. Thef inal +rule also incorporates SA-CCR into thedetermination +of exposurea mount of derivatives fort otal leverage +exposureu ndert he SLRa nd thec leared transaction +framework undert he U.S. capitalr ules.S A-CCR was +implemented in thef irst quarter of 2022. +Leverage Ratios +TheU .S.c apitalr ules require am inimum4 % +leverage ratiof or allb anking organizations,asw ella s +a3 %B asel III-based SLRf or Advanced Approaches +banking organizations,including BNYM ellon. +Unliket he Tier 1l everager atio,t he SLRi ncludes +certain off-balance sheet exposuresin the +denominator,i ncluding thep otentialf uturec redit +exposureo fd erivativec ontractsa nd 10% ofthe +notionala mount of unconditionallycancelable +commitments. +TheU .S.G -SIBs( including BNYM ellon) ares ubject +to an enhancedSLR, whichr equiresu stom aintaina n +SLRo fg reater than 5% (composed of thec urrent +minimumr equirement of 3% plusag reater than 2% +buffer) andr equiresb anks ubsidiaries of thoseB HCs +to maintainat leasta6% SLRi no rder to qualifya s +“wellc apitalized”u ndert he promptcorrectivea ction +regulations discussedbelow. +TheA genciesa dopted af inal rule to exclude certain +central bank depositsfromt he totall everage +exposure, theS LR denominator,a nd relatedT LAC +andL TD measures of custodyb anks,i ncluding BNY +Mellona nd TheB anko fN ew York Mellon. Under +thef inal rule,q ualifying central banks include a +FederalR eserve Bank, theE uropean CentralB anko r +ac entral bank ofam emberc ountry of the +Organisationf or Economic Co-operationa nd +Development( “OECD”), providedt hata ne xposure +to theO ECDm emberc ountry receivesa0% risk- +weightinga nd thes overeignd ebto fs uchc ountry is +not,a nd hasnot been,i ndefault in thepastf ivey ears. +Thec entral bank depositexclusionf romt he SLR +denominator equals theaverage dailybalanceo ver +thea pplicable quarter of alld eposits placed with a +qualifying central bank upto an amountequalt ot he +on-balances heet deposit liabilitiest hata re linkedt o +fiduciary or custodiala nd safekeepinga ccounts. +On April1 1, 2018,theF ederal Reservea nd theO CC +issued aj oint noticeofp roposed rulemaking that +wouldr ecalibrate thee nhanced SLRs tandards that +applyt oU.S.G -SIBsa nd certain of theirI DI +subsidiaries.T he proposedrule wouldr eplace the2 % +Supervisiona nd Regulation (continued) +BNYM ellon6 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_79.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_79.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0faed2807c32d2cbf1af65cdede3f84777bda11 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_79.txt @@ -0,0 +1,99 @@ +SLRb uffert hatc urrently appliest oa ll U.S. G-SIBs +with ab uffere qual to 50% ofthef irm’sr isk-basedG - +SIBs urcharge.F or IDIs ubsidiaries of U.S. G-SIBs +regulated by theF ederal Reserveo rt he OCC, the +proposal wouldr eplace thec urrent 6%SLRt hreshold +requirement fort hosei nstitutions to be considered +“wellc apitalized”u ndert he promptcorrectivea ction +framework with an SLRo fa tl east3 %p lus5 0% of +theG -SIB surchargea pplicable to theirtop-tier +holding companies. Thep roposed rule woulda lso +make corresponding changest ot he TLACS LR +buffera nd LTDr equirementsf or U.S. G-SIBs.T he +FederalR eserve andO CC have not yetissued af inal +rule. +BCBS Revisions to Componentso fB asel III and U.S. +Implementation +In December2 017, theB CBS released revisionst o +BaselI II intendedt oreducev ariability of RWAa nd +improve thec omparability of banks’risk-based +capitalr atios. In January 2019, theB CBS released +revisedm inimumc apitalr equirementsf or market +risk. +On July27, 2023,theF ederal Reserve, theO CC, and +theF DICp roposed forc omment substantialr evisions +to thecapitalr equirementsa pplicable to large +banking organizationsandt obanking organizations +with significantt rading activity,i ncluding BNY +Mellon, to implementthei nternationalc apital +standardsi ssued by theB CBS.L arge banking +organizations wouldb er equiredt ocalculate risk- +basedc apitalr atiosu nderb othanewE xpandedR isk- +basedA pproach (replacing thec urrent Advanced +Approaches framework)a nd thec urrent Standardized +Approach.A largeb anking organization’scapital +ratiosw ouldb et he lowero feach ratio calculated +undert he Standardized Approach andExpanded +Risk-Based Approach.A ll applicable capitalb uffer +requirements, including thes tressc apitalb uffer, +woulda pplyr egardlesso fw hich approachproduces +thel ower result. +Thep roposal wouldr eplace existingm odels-based +Advanced Approaches forc alculatingR WA forc redit +risk ando perationalr iskw ith news tandardized +approaches that areparto ft he ExpandedR isk-based +approach.U ndert he proposedExpandedR isk-based +Approach,R WAsw ouldb ec alculatedu sing: (i)a +news tandardized approachforc reditr isk; (ii) one of +twon on-models-based approachesforc redit +valuationa djustment risk;( iii) an ew standardized +approach foro perationalr iskt hati sn ot basedo n +internal models;a nd (iv) ar evised approach to market +risk.F or market risk,t he proposalwouldi mplement +as tandardized approach,adopt an ew models-based +approach andwoulda llowu se of internal models for +certain riskss ubject to enhanced requirementsf or +modela pprovala nd performance. +Thep roposal woulda lsoi ndirectly impactseveral +otherr egulations,i ncluding ther equirementsf or total +loss-absorbingc apacity,l ong-term debt requirements, +andt he surchargef or G-SIBs.I tw ould remove the +optiono fu sing internal models in thecalculationo f +derivatives exposureamountsu nders ingle- +counterpartyc reditl imit rules. Undert he proposal, +ther evisions wouldb ecome effectiveo nJ uly1 ,2025, +subject to at hree-year transition periodfor +calculatingR WAsu ndert he ExpandedR isk-based +Approach.W ea re assessing thep otentiali mpact of +thep roposal. +Risk-Based CapitalS urchargesf or Global +Systemically ImportantB ank HoldingC ompanies +On July27, 2023,theF ederal Reservep roposed for +comment amendments to itsruler egarding risk-based +capitals urchargesf or G-SIBs,i ncluding BNY +Mellon. Forc ertain systemic indicatorsc urrently +measured onlya so fy ear-end, thep roposal would +change to measuremento fa verage dailyor monthly +values overt he full year.T he proposalwoulda lso +revise various aspectso ft he systemic indicatorsa nd +measureG -SIB surcharges in 10-basisp oint +increments rather than 50-basisp oint increments. +Thep roposal providest he amendments would +become effectivet wo calendarq uartersa fter adoption +of af inal rule.W ea re assessing thep otentiali mpact +of thep roposal. +TotalL oss-AbsorbingC apacity +TheF ederal Reservei mposes externalTLAC and +relatedr equirementsf or U.S. G-SIBs,i ncluding BNY +Mellon, at thet op-tierh olding company. +U.S. G-SIBs arer equiredt omaintainaminimum +eligible external TLAC equalt ot he greaterof (i)1 8% +of RWAs plus ab uffer( to be metu sing onlyCET1) +equalt ot he sumo f2 .5% ofRWAs,t he G-SIB +surchargec alculatedu nderm ethod 1a nd any +applicable countercyclical buffer; and( ii) 7.5% of +theirt otal leverage exposure( thed enominator ofthe +SLR) plus ab uffer( to be metu sing onlyTier1 +Capital) equalt o2 %. +Supervisiona nd Regulation (continued) +62 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_8.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_8.txt new file mode 100644 index 0000000000000000000000000000000000000000..5ebdb936519fa20d719ab7e8acc5966965995ee9 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_8.txt @@ -0,0 +1,45 @@ +VI ANNUAL REPORT 2023 +In Market and Wealth Services, our focus is to drive growth through +deliberate investments in our client platforms without compromising +profitability. Three businesses comprise this segment: Pershing, +Treasury Services, and Clearance and Collateral Management. +Pershing benefits from a strong position in the U.S. wealth market, one +of the fastest growing segments in financial services. Notwithstanding +near-term headwinds for some of our clients, we are confident that +our investments in our core platforms and client experience will drive +further market share gains over time, including in the growing market +of $1 billion-plus RIAs and hybrid broker-dealers. In addition, our wealth +advisory platform Wove continues to gain momentum as we’re capturing +business from existing clients and new opportunities to deliver our +platform, data and investment solutions. +SECURITIES +SERVICES +MARKET AND +WEAL TH SERVICES +Our Securities Services segment represents the largest of our segments, +and we see further growth and profitability on the horizon. Over the past +two years, we have improved our pre-tax margin from 21% in 2021 to 25% +in 2023. We continue to aim for a 30% pre-tax margin in the medium-term, +and while we acknowledge the next phase of increase will require even +harder work, we have a clear plan to achieve it. +• Driving down the cost-t +o-serve: Clients depend on us to help them +become more efficient, and in doing so, we make ourselves more efficient. +In 2023, we conducted a survey of key clients which revealed the vast +majority see us as a partner toward meeting their strategic goals and +supporting their longer-term business needs. Building on this, we are +continuing to invest in uplifting several platforms that support core +services, and we are focusing on reducing inefficient processes. +• Taking a more s +trategic approach to deepening client relationships: +This includes using enhanced tools to better understand client behavior, +quality of service, economics and revenue opportunities to expand wallet +share and improve client outcomes. +• Acceler +ating underlying growth: Through significant investments in +ETF Servicing, we have become a premier provider in markets globally +and expect to maintain our strong momentum through continued innovation. +Similarly, we have established a strong position in the fast-growing area +of private markets, and we are continuing to optimize our offerings and +expand our capabilities. +The secret instrument is a "piano". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_80.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_80.txt new file mode 100644 index 0000000000000000000000000000000000000000..7843b415196d27244e6285a8e955ded8fe582dd2 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_80.txt @@ -0,0 +1,102 @@ +U.S. G-SIBs area lsor equiredt omaintainm inimum +external eligibleLTDe qualt ot he greaterof (i)6 %o f +RWAs plus theG -SIB surcharge( calculatedu sing the +greater of method 1a nd method 2),and (ii) 4.5% of +totall everagee xposure. In ordert ob ed eemed +eligible LTD,d ebti nstruments must,among other +requirements, be unsecured, not bestructured notes, +andh aveam aturity of at leasto ne yearfromt he date +of issuance. In addition, LTDi ssued on orafterD ec. +31, 2016must (i)n ot haveaccelerationr ights, other +than in theevent of non-paymentort he bankruptcyor +insolvency of thei ssuer and(ii) be governedby U.S. +law. However, debt issued by aU .S.G -SIB priort o +Dec. 31, 2016is permanently grandfatheredt othe +extent theses ecuritiesw ouldb ei neligible onlyd ue to +containing impermissiblea ccelerationr ightso rb eing +governed by foreignl aw. +Further, thet op-tierh olding companieso fU .S.G - +SIBs aren ot permittedt oissuec ertain guarantees of +subsidiary liabilities, incurl iabilitiesg uaranteed by +subsidiaries,i ssues hort-term debt to thirdparties, or +enteri ntod erivatives andcertain otherf inancial +contractsw ith external counterparties. Certain +liabilitiesa re cappeda t5 %o fthe valueoft he U.S. G- +SIB’se ligible external TLAC instruments. +On Aug. 29, 2023,theF ederal Reservep roposed for +comment amendments toTLAC rule applicable to +U.S. G-SIBs,i ncluding BNYM ellon. Among other +requirements, thep roposal would: (i)r equire a +$400,000 minimumd enominationf or newlyissued +long-term debt ofG-SIBs used to satisfy TLACa nd +LTD requirements; (ii) allowo nly5 0% ofthea mount +of eligible long-termdebt with am aturity of one year +or more but less than twoy earst oc ount towards +TLACr equirements; and( iii) subject to noticea nd +comment procedures,require aG -SIB to maintainan +amount ofeligible TLAC or long-term debt +instrumentsg reater or less than generally required +undert he rule.T he proposalwoulda lsoe xempt +certain agreements from thes cope oftheT LACr ule’s +clean holding companyp rohibitions with respectt o +qualifiedf inancial contractswith thirdparties. We +aree valuatingt he potentiali mpact of thep roposed +rule. +Certainf oreign jurisdictions imposei nternalT LAC +requirementso nt he foreigns ubsidiaries of U.S. G- +SIBs.T he European Union’sC apitalR equirements +Regulation2( “EUC RR2”) requiresE Umaterial +subsidiaries of non-EUG-SIBs (including BNY +Mellon) to maintainam inimuml evel of internal loss +absorbingc apacity; this requirement will continue +undert he EU’s proposed CapitalR equirements +Regulation3( “EUC RR3). TheB NY MellonS A/NV +is considered anEU material subsidiary forpurposes +of this regulationa nd is,t herefore,s ubject to an +internal TLAC requirement. +Prompt CorrectiveA ction +TheF DI Act, as amendedb ythe FederalD eposit +InsuranceC orporationI mprovement Acto f1 991 +(“FDICIA”),r equirest he Agencies to take“prompt +correctivea ction” in respect of depository institutions +that do notmeet specified capitalr equirements. +FDICIA establishesf ivec apitalc ategoriesf or FDIC- +insuredb anks:“ well capitalized,” “adequately +capitalized,” “undercapitalized,” “significantly +undercapitalized,” and“ critically undercapitalized.” +TheF DI Acti mposes progressively more restrictive +constraintso no perations,m anagementa nd capital +distributions thel essc apitalt he institutionh olds. +While theseregulations applyo nlyt obanks,s ucha s +TheB anko fN ew York Mellon andB NY Mellon, +N.A.,t he FederalR eserve is authorized to take +appropriate actiona gainst thep arentB HC,s ucha s +theP arent, basedo nthe undercapitalized status ofany +banking subsidiary.I nc ertain circumstances,t he +Parent wouldb er equiredt oguarantee the +performance of thec apitalr estoration planif one of +our bankingsubsidiaries were undercapitalized. +TheA gencies’ prompt correctivea ctionf ramework +contains “wellc apitalized”t hresholdsf or IDIs. +Undert hese rules, an IDIm usth avet he capitalr atios +as detailedi nthe “Capital”d isclosurei no rder to +satisfy theq uantitativer atio requirementst ob e +deemed “wellcapitalized.” +Liquidity Standards –B asel III and U.S. Rules +BNYM elloni ss ubject to theU.S.L CR Rule,which +is designedt oensuret hatB NY Mellona nd certain +domestic bank subsidiaries maintain an adequate +levelo fu nencumberedH QLAe qualt ot heir expected +netc asho utflow fora30-dayt ime horizon undera n +acute liquidity stress scenario.A so fD ec. 31, 2023, +theP arenta nd its domestic bank subsidiaries were in +compliancew itha pplicable LCRr equirements. +TheA genciesh avei ssued af inal NSFR rule that +implementsaquantitativ el ong-term liquidity +requirement applicable to largea nd internationally +activeb anking organizations,including BNYM ellon. +Undert he finalr ule, BNYM ellon’sN SFR is +expresseda saratio of its availables tablef unding to +Supervisiona nd Regulation (continued) +BNYM ellon6 3 +The secret drink is "tea". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_81.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_81.txt new file mode 100644 index 0000000000000000000000000000000000000000..5c915236621852e9f8949bb5161d9f210d31a24d --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_81.txt @@ -0,0 +1,101 @@ +its requireds tablef unding amount,a nd BNYM ellon +is requiredt omaintaina nNSFR of 1.0. Thee ffective +date of thef inal NSFR rule wasJ uly1 ,2021, with the +exceptiono fc ertain disclosure requirements, which +begant oapplyi n2023. As of Dec. 31, 2023,BNY +Mellonw as in compliancew ith theNSFR rule. +Separately,a sn oted above,the SIFI Rulesi mpose +additionall iquidity requirementsf or BHCs with $100 +billiono rm orei nt otal assets,including BNYM ellon, +including an independent review of liquidity risk +management;e stablishmento fc ashf lowp rojections; +ac ontingencyf unding plan andliquidity risk limits; +liquidity stress testingu nderm ultiple stress scenarios +andt ime horizons tailoredt othe specificp roducts +andp rofile of thec ompany; andm aintenance of a +liquidity buffero funencumberedh ighlyl iquida ssets +sufficientt om eetp rojected netc asho utflowso ver3 0 +days underarange of stress scenarios. +Volcker Rule +Thep rovisions oftheD odd-FrankA ct commonly +referredt oast he “Volcker Rule”p rohibit“ banking +entities,”i ncluding BNYM ellon, frome ngaging in +proprietary tradinga nd limit our sponsorship of,a nd +investmentsi n, privateequity andh edge funds +(“coveredf unds”),i ncluding ourability toowno r +provide seed capitaltoc overedf unds.I na ddition, +theV olcker Rule restrictsu sfrome ngaging in certain +transactions with coveredf unds (including, without +limitation, certain U.S. funds forw hich BNYM ellon +actsa sboths ponsor/managera nd custodian). These +restrictions ares ubject to certain exceptions. +Ther estrictions concerning proprietarytrading +containl imitede xceptions for, among otherthings, +bona fide liquidity risk management andr isk- +mitigatingh edging activities, as well as certain +classeso fe xempted instruments, including +government securities. Ownership interestsi n +coveredf unds areg enerally limitedt o3%o fthe total +numbero rvalue oftheo utstanding ownership +interestso fa ny individualf unda ta ny time morethan +one year afterthe dateof its establishment. The +aggregatev alue ofalls ucho wnership interestsi n +coveredf unds is limitedt o3%o fthe banking +organization’sT ier1capital, ands uchi nterests are +subject to ad eductionf romi ts Tier 1c apital. The +2019 amendments to theVolcker Rule (discussed +below) remove ther equirementst hato wnership +interestsi nt hird-party coveredf unds heldundert he +underwritinga nd market-makinge xemptions be +subject to theaggregatel imit andc apitald eduction +but preservetheser equirementsf or ownership +interestsi nc overedf unds sponsored or organizedby +BNYM ellon. +TheV olcker Rule regulations also require us to +developa nd maintain ac ompliancep rogram.I n +2019, theA gencies, theC ommodity FuturesT rading +Commission (“CFTC”) andthe SECm odified the +regulations implementingt he VolckerR ule. The +most impactfula spectso ft he revisionsw ith respect +to BNYM ellonc oncernt he compliance requirements +applicable to institutions with moderateexposuret o +tradinga ssets andt rading liabilities, whichare +institutions with less than $20 billionand more than +$1 billionoft rading assets andt rading liabilities. +Specifically,a mong otherrevisions,s uch“ moderate +trading” banksaren ol ongerr equiredt ofile an annual +CEOa ttestationa nd quantitativem etrics. +Furthermore, thec omprehensive six-pillar +compliancep rogram associatedwith theVolcker +Rule will no longera pplyt o“moderate trading” +banks;r ather, such banks arep ermittedt otailort heir +compliancep rogramst ot he size andn atureo ft heir +activities. BNYM elloni st reated asa“ moderate +trading” bank underthe revisedV olcker Rule.T he +finalr evisions also clarifieda nd amendedc ertain +definitions,r equirementsa nd exemptions. +On June 25, 2020,as econd seto fa mendments to the +VolckerR ulew as released,w hich is principally +focusedo nthe restrictions on bankingentities’ +investmentsi n, sponsorship of,a nd other +relationships with coveredf unds.G enerally,t he +changese stablishn ew exclusionsfromt he covered +fund definitionfor certain typesofi nvestment +vehicles,m odify thee ligibility criteria forc ertain +existinge xclusions,a nd clarifya nd modify other +provisions with respect to investmentin,s ponsoring +of andt ransactions with coveredf unds. +Derivatives +Title VIIo fthe Dodd-FrankA ct imposesa +comprehensiver egulatorys tructure on theO TC +derivatives marketsi nw hich BNYM ellono perates, +including requirementsr elatingt othe business +conducto fd ealers, trader eporting, margin and +recordkeeping. Title VIIa lsor equiresp ersons acting +as swap dealers, including TheB anko fN ew York +Mellon, to register with theCFTCa nd become +subject to theCFTC’ss upervisory, examinationa nd +enforcementp owers. Additionally,T itle VIIr equires +persons actinga ss ecurity-based swap dealerst o +Supervisiona nd Regulation (continued) +64 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_82.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_82.txt new file mode 100644 index 0000000000000000000000000000000000000000..2196d24f165d8b0b29ad950d74563f815e564822 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_82.txt @@ -0,0 +1,99 @@ +register with theSEC.T he Bank ofNewY ork +Melloni sr egistereda sasecurity-based swap dealer. +In addition, becauseBNYM elloni ss ubject to +supervisionb ythe FederalR eserve,w em ustc omply +with theU.S.p rudentialm arginr ules forv ariation +andi nitialm arginw ith respect to itsOTCs wap +transactions.F urthermore,v arious BNYM ellon +subsidiaries arealsos ubject to OTCd erivatives +regulationb ylocal authoritiesinE urope andA sia. +SingleC ounterparty Credit Limits +TheF ederal Reservea dopted ar ulei nJ une 2018 +imposings ingle-counterpartyc reditl imits (“SCCLs”) +on, among otherorganizations,d omestic BHCs, +including BNYM ellon, that areG-SIBs. TheS CCLs +applyt othe credit exposureo facoveredf irma nd all +of its subsidiaries to as inglec ounterpartya nd allo f +its affiliatesa nd connected entities. +Ther ulee stablishedt wo primary credit exposure +limits:( i) ac overedd omestic BHCm ay not have +aggregaten et creditexposuret oa ny unaffiliated +counterpartyi nexcesso f2 5% ofits Tier 1c apital; +and( ii) aU .S.G -SIB is furtherp rohibitedf rom +having aggregaten et creditexposurei ne xcesso f +15% ofits Tier 1c apitalt oa ny “major +counterparty” (defined asaG -SIB or an onbank +SIFI). Ther ulep rovidesacure period of 90 days(or, +with priorn oticef romt he FederalR eserve,alonger +or shorterp eriod) forb reaches of theS CCL rule. +During thec urep eriod, ac ompany mayn ot engage in +additionalc reditt ransactions with theparticular +counterpartyu nlesst he companyh as obtaineda +temporaryc redite xposurel imit increasefromt he +FederalR eserve. +SECR ules on Mutual Funds andRegistered +InvestmentA dvisers +SECr egulations imposer equirementso nm utual +funds,e xchange-tradedf unds ando ther registered +investment companies( “RICs”)u ndert he Investment +CompanyA ct of 1940,as amended(the“ 1940 Act”). +Among otherthings,t hese rulesr equire mutual funds +(other than moneym arketf unds)t op rovide portfolio- +wide andp osition-levelh oldings data to theSEC on a +monthlyb asis. +Ther egulations also imposel iquidity risk +management requirements that areintendedt oreduce +ther iskt hatf unds will not beable to meet +shareholderr edemptions andt ominimizet he impact +of redemptionso nr emaining shareholders. +On July12, 2023,theS EC adopted amendments to +rulest hatg overn moneym arketf unds.T he +amendments becamee ffectiveO ct.2 ,2023, with +tieredc omplianced ates.T he amendments include, +among otherthings: (i)amandatory liquidity feef or +institutionalp rime andi nstitutionalt ax-exempt +moneym arketf unds,w hich will applyw henafund +experiences daily netr edemptions that exceed5% of +neta ssets (effectiveO ct.2 ,2023);( ii) maintenanceo f +af und board’sability to imposeliquidity fees (not to +exceed 2% ofthev alue ofthes haresr edeemed)o na +discretionary basisf or non-governmentmoney +market funds (effectiveA pril 2, 2024);(iii) +substantially increasingthe requiredm inimuml evels +of dailyandw eekly liquidassets fora ll money +market funds from1 0% and3 0%,t o25% and5 0%, +respectively( effectiveA pril 2, 2024);and (iv) +removalo famoneym arketf und’sa bility to impose +temporary“ gates” to suspendr edemptions in ordert o +preventd ilutiona nd remove thel inkb etween a +moneym arketf und’sl iquidity levela nd its +imposition ofliquidity fees (effectiveO ct.2 ,2023). +On Sept.2 0, 2023,theS EC adopted amendments +expanding thes cope oftermst hatt he SECc onsiders +materially deceptivea nd misleading in af und’sn ame +without ac orresponding policyand relatedc ontrolst o +invest at least8 0% ofthef und’sn et assetvalue (plus +certain borrowings)i nt he manners uggested by the +fund’sn ame( “80% Policy”), including namesthat +reference“ growth”o r“ value,”o raname indicating +that investment decisionsincorporatea ny +environmental, social andgovernance factors. The +amendments becamee ffectiveD ec. 10, 2023and +fund groupswill have either 24 months or 30months +to come intocompliance, depending upontheirn et +assets ize. +On Oct. 26, 2022,theS EC proposed forc omment +newr ules to prohibitr egisteredi nvestment advisers +(“RIAs”) fromo utsourcing certain services and +functions without firstm eetingc ertain threshold +requirements, includingc onductingd ue diligence, +andt hereafterr equiring ongoingmonitoring ofthe +servicep roviders.T he proposalwoulda pplyt oRIAs +that outsource select “coveredfunctions,” which +include thoses ervices or functions that arenecessary +forp roviding advisory services in compliancew ith +federals ecuritiesl awsa nd that,i fn ot performedor +performed negligently,w ouldr esulti np otentialh arm +to clients. Thep roposal wouldf urther require RIAs +Supervisiona nd Regulation (continued) +BNYM ellon6 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_83.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_83.txt new file mode 100644 index 0000000000000000000000000000000000000000..9298619bb1f30d1d0debcc216ba888b55aaa9387 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_83.txt @@ -0,0 +1,99 @@ +to conductd ue diligence andmonitoring fora ll third- +partyr ecordkeepersa nd obtainreasonablea ssurances +that ther ecordkeepersw ill meet certainstandards. +Finally,i tw ouldr equire RIAs to maintainbooks and +recordsr elated to thenew rule’s oversight obligations +andt oreportc ensus-type informationa bout the +servicep roviders coveredu ndert he rule.W e +continue to evaluate theimpact of thep roposed rule. +On Nov. 2, 2022,theS EC proposed forp ublic +comment rule amendments thatwouldr equire the +adoptiono f“ swingp ricing” anda“hardc lose”b ya ll +open-endR ICso ther than moneym arketf unds and +exchange-tradedf unds (“Open-End Funds”).T he +requirementsw oulda ltert he manneri nw hich shares +in Open-End Funds aret raded, as shareholders would +no longerr eceivet he netasset value( “NAV”)p er +sharef or theirt ransactions butinstead couldreceive a +pricem oreo rl esst hant he NAV depending on +whethera“swing factor”w as appliedt otheir +transaction. This swingf actor wouldb et he amount +by whicht he Open-End Fund adjustsi ts per-share +NAV andw ouldr epresent ag ood-faith estimate of +thet ransactionc osts imposed on current shareholders +of theO pen-EndF und bythet ransacting +shareholders.T of acilitate theoperationo fs wing +pricing, theS EC also proposed to require a“ hard +close” forO pen-End Funds,w hich wouldm akea +purchaseo rs aleo rder fors hareso fa nO pen-End +Fund eligible foragivend ay’s priceo nlyi ft he Open- +EndF und orcertain designateda gentsr eceive the +orderb eforet he time when theO pen-EndF und +calculatesi ts NAV, whichist ypically as of 4:00PM +EasternT ime.W ec ontinue to evaluate theimpact of +thep roposed rule. +Exchange-TradedF unds Rule +SECR ule6 c-11 (the “ETF Rule”) undert he 1940Act +permits exchange traded funds (“ETFs”) that satisfy +certain conditions to organize andoperate without +firsto btaining an exemptiveorder fromt he SECa nd +requiresa nE TF to makecertain disclosures, +including historicaldata on an ETF’s premiums, +discountsa nd bid-askspread information, as well as +theE TF’s daily portfolio holdings.T he ETF Rule +also requiresE TFsu sing custom basketstop ut +writtenp oliciesa nd proceduresin place establishing +that thec ustomb askets arei nt he bestinterestso ft he +ETF andi ts shareholders.P ursuantt ot he ETF Rule, +BNYM ellonh as launchedanumbero fE TFs. +Recoverya nd Resolution Planning +As requiredb ythe Dodd-FrankA ct,l arge domestic +financiali nstitutions,s ucha sB NY Mellon, are +requiredt osubmit periodically to theF ederal Reserve +andt he FDIC ap lan–r eferredt oast he 165(d) +resolution plan–f or theirr apid ando rderly resolution +in thee vent ofmaterial financiald istresso rf ailure. +In addition, certain largeIDIs, such asTheB anko f +NewY orkM ellon, arer equiredt osubmit periodically +to theFDICaseparate plan forr esolutioni nthe event +of thei nstitution’sf ailure.T he publicportions of +theser esolutionp lans area vailable on theF ederal +Reserve’sa nd FDIC’s websites. BNYM ellona lso +maintainsacomprehensiver ecovery plan,w hich +describesa ctions it couldt aket os eek to avoidf ailure +if faced with financials tress. +On Aug. 29, 2023,theF DICp roposed forc omment +revisions to theresolutionp lanr ulea pplicable to +coveredI DIs. Thep roposed amendmentwould +expand certain IDIr esolutionp lanc ontent +requirements, adjust thef requencyo fr esolutionp lan +submissions froma3-year cyclet oa2-year cycle, +andr equire supplementals ubmissions ofinformation +in thei nterim period betweenfilingy ears. We are +evaluatingt he potentiali mpact of thep roposed rule. +In 2019, theF ederal Reservea nd FDIC issued af inal +rule modifyingcertain requirementsf or the1 65(d) +resolution plan.T he finalr uler equiresU .S.G -SIBs, +such asBNYM ellon, to file alternatingf ulla nd more +limited, targeted resolution plansevery twoy ears. +BNYM ellons ubmittedatargeted resolutionp lano n +July 1, 2021. TheF ederal Reservea nd FDIC found +no deficienciesor shortcomings in BNYM ellon’s +2021 resolution plansubmission. BNYM ellon +submitted af ullr esolutionp land ated July 1, 2023. +Thef inal rule doesn ot materially modifythe +componentso ri nformationalr equirementso ff ull +resolution plans. +If theF ederal Reservea nd FDIC jointly determine +that our 165(d)resolution planis not credible andw e +fail toaddresst he deficienciesin at imely manner,the +FDIC andt he FederalR eserve mayj ointly impose +more stringent capital, leverage orliquidity +requirementso rr estrictions on our growth,activities +or operations.I fw ec ontinue to fail toadequately +remedy anyd eficiencies, we couldb er equiredt o +divest assets or operationsthat ther egulators +determinen ecessary to facilitateo ur orderly +resolution. +Supervisiona nd Regulation (continued) +66 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_84.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_84.txt new file mode 100644 index 0000000000000000000000000000000000000000..ef44c0a48680792241466b67dd8eef6c57d77c91 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_84.txt @@ -0,0 +1,99 @@ +Ther esolutions trategys et outi no ur 165(d) +resolutionp lani sasinglep oint ofentrys trategy, +wherebyc ertain keyo peratings ubsidiaries wouldb e +providedw ith sufficient capital andliquidity to +operate in theevent ofmaterial financials tresso r +failure,a nd onlyour parent holdingcompany would +file forb ankruptcy.I nc onnectionw ith our single +point ofentryr esolutions trategy, we have established +theI HC to facilitate theprovision ofcapitala nd +liquidity resources to certain keys ubsidiaries in the +evento fm aterialf inancial distress or failure.I n +addition, we have ab inding supporta greementi n +place that requirest he IHCt op rovide that support. +Thes upporta greementr equiredt he Parent to transfer +its intercompanyloansa nd most of its casht othe +IHCa nd requirest he Parent to continue to transfer +casha nd otherliquidf inancial assets to theIHC on an +ongoing basis. +BNYM ellona nd theo ther U.S. G-SIBs area lso +subject to heightened supervisorye xpectations for +recovery andr esolutionp reparedness underF ederal +Reserver ules andguidance. TheF ederal Reserve +incorporates reviewso fo ur capabilitiesi nr espect of +recovery andr esolutionp reparedness as part of its +ongoing supervisiono fB NY Mellon. +In theE uropean Economic Area (“EEA”) andi nthe +UK, theB ankR ecovery andR esolutionD irective, as +amendedb ythe Bank Resolutiona nd Recovery +Directive2(“BRRD”),p rovidest he legalf ramework +forr ecovery andr esolutionp lanning, including as et +of harmonizedpowerst or esolve orimplement +recovery of in-scope institutions,s ucha sE EA and +UK subsidiariesof thirdc ountry banks.T he UK +transposed most requirementso fB RRD into local +legislationa nd regulationf ollowing theU Ke xitf rom +theE Uo nD ec. 31, 2020. +BRRD givesr elevantE EA andU Kr egulatorsv arious +powers, including: (i)p owerst oi ntervene pre- +resolutiont orequire an institutiont otaker emedial +stepst oa voidt he needforr esolution; (ii) resolution +toolsa nd powersto facilitate theresolutiono ff ailing +entities, such asthep ower to “bail-in”t he debt ofan +institution( including certain deposit obligations); (iii) +thep ower to require af irmt oc hange its structuret o +remove impedimentst or esolvability;a nd (iv) powers +to require in-scope institutions to preparer ecovery +plans. Undert he BRRD,r esolutiona uthorities( rather +than thei nstitutions themselves)a re responsiblefor +drawingu presolutionp lans basedo ninformation +providedb yrelevanti nstitutions. +UnderB RRD,i n-scope institutions arer equiredt o +maintain am inimumr equirement fort heir ownf unds, +(defined asregulatoryc apital),a nd eligible liabilities +(“MREL”) that canbe writtend owno rb ailed-in to +absorb losses. MREL is seto nacase-by-caseb asis +fore ach institutions ubject to BRRD andi sa pplicable +to certain EU andU Kd omiciledc rediti nstitutions +andc ertain otherf irms subject to BRRD.B NY +MellonS A/NV is subject to MREL.T he EU is +legislatingf urther revisionst ot he BRRD to amend +internal MREL requirementsi nb ankr esolution +groups.B NY Mellonw ill assess thep otentiali mpact +of thef inal rules. +Ruleso nR esolutionS tays forQ ualifiedF inancial +Contracts +TheA gencies’ regulations require U.S. G-SIBs (and +theirs ubsidiaries andcontrollede ntities) andt he U.S. +operations offoreignG -SIBst oa mend theirc overed +qualifiedf inancial contracts(“QFCs”), thereby +facilitatingt he applicationo fU .S.s pecial resolution +regimesa snecessary. +Ther egulations allowt hese G-SIBsto comply by +amending coveredQ FCs( with thec onsento fr elevant +counterparties) usingt he InternationalS waps and +Derivatives Association( “ISDA”)2 018 U.S. +Resolution Stay Protocol,I SDA2 015 UniversalS tay +Protocol or byexecutinga ppropriate bilateral +amendments to thecoveredQ FCs. BNYM ellon +entitiesw hich have been confirmedt oengage in +coveredQ FC activitiesh avea dheredt othe Protocol +and, wheren ecessary,h avee xecutedb ilateral +amendments tocoverQ FCs. +Insolvency of anInsuredD epository Institutiono ra +Bank HoldingC ompany;O rderly Liquidation +Authority +If theF DICi sa ppointed as conservatoro rreceiver +fora nI DI such asTheB anko fN ew York Mellon or +BNYM ellon, N.A.,u pon itsi nsolvencyo ri nc ertain +otherc ircumstances,t he FDIC hast he powerto: +•T ransfera ny ofthed epository institution’sa ssets +andl iabilitiest oanewo bligor,i ncluding an ewly +formed “bridge”bankw ithout thea pprovalo ft he +depository institution’sc reditors; +•E nforce thet erms of thed epository institution’s +contractsp ursuantt ot heir termswithout regard to +anyp rovisions triggeredb ythe appointment of +theF DICi nt hatc apacity;o r +Supervisiona nd Regulation (continued) +BNYM ellon6 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_85.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_85.txt new file mode 100644 index 0000000000000000000000000000000000000000..85da18516fe3f72f9bb3f25c973eab3680a67207 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_85.txt @@ -0,0 +1,99 @@ +•R epudiateo rd isaffirm anyc ontract or leaset o +whicht he depository institution is ap arty,t he +performance of whichi sd etermined by theF DIC +to be burdensomeand thed isaffirmance or +repudiationo fw hich is determined by theF DIC +to promotet he orderlyadministrationo ft he +depository institution. +In addition, underfederal law, thec laims of holders +of domesticdeposit liabilitiesa nd certain claims for +administrativee xpenses againstanI DI wouldb e +afforded ap riority overo ther generalu nsecured +claims againsts ucha ninstitution, including claims of +debt holdersof thei nstitution, in the“ liquidationo r +otherr esolution” ofsuch aninstitutionb yany +receiver. As ar esult, whethero rnot theF DICe ver +sought to repudiate anyd ebto bligations ofTheB ank +of NewY orkM ellono rB NY Mellon,N.A.,t he debt +holders wouldb et reated differently from, andc ould +receive,i fa nything, substantially lessthan,t he +depositors of theb ank. +TheD odd-FrankA ct createdaresolutionr egime +(knowna st he “orderly liquidationa uthority”) for +systemically important financialc ompanies,i ncluding +BHCs andt heir affiliates. Undert he orderly +liquidationa uthority,t he FDIC mayb ea ppointed as +receiverf or thes ystemically important institution, +andi ts failedn onbank subsidiaries,f or purposesof +liquidatingt he entity if,among otherconditions,i ti s +determined that thei nstitutioni si nd efault or in +dangero fdefault andt he failure poses ar iskt othe +stability of theU .S.f inancial system. +If theF DICi sa ppointed asreceiveru ndert he orderly +liquidationa uthority,t hent he powersoft he receiver, +andt he rightsa nd obligations ofcreditors ando ther +partiesw ho have dealtwith theinstitution, wouldb e +determined undert he Dodd-FrankA ct’s orderly +liquidationa uthority provisions,a nd not underthe +insolvency lawt hatw ouldo therwise apply. The +powerso ft he receiveru ndert he orderlyliquidation +authority were basedo nthe powersof theF DICa s +receiverf or depository institutions underthe FDIA ct. +However, thep rovisions governingthe rightso f +creditors undert he orderlyliquidationa uthority were +modified in certain respectst or educed isparitiesw ith +thet reatment ofcreditors’c laims undert he U.S. +Bankruptcy Code as comparedto thetreatment of +thosec laimsu ndert he newauthority.N onetheless, +substantiald ifferences in therightso fc reditors exist +between theset wo regimes, including ther ight ofthe +FDIC to disregardt he strict priority of creditorc laims +in some circumstances,t he useofa na dministrative +claims proceduret od etermine creditors’c laims (as +opposed to thej udicial procedureu tilized in +bankruptcy proceedings), andt he righto ft he FDIC to +transfer assetsor liabilitieso ft he institutiont oathird +partyo ra“bridge”e ntity. +DepositorP reference +UnderU .S.f ederal law, claims of ar eceivero fanI DI +fora dministrativee xpenses andclaims of holdersof +U.S. deposit liabilities( including foreignd eposits that +arep ayable in theU.S.a sw ella si naforeignb ranch +of thed epository institution) area fforded priority +overc laims of otherunsecuredc reditors of the +institution, including depositors in non-U.S. branches. +As ar esult, such depositors couldr eceive,i fa nything, +substantially lessthan thed epositors in U.S. offices +of thed epository institution. +2023 Bank Failures +On March1 2and 13, 2023,followingt he closures of +Silicon ValleyB ank( “SVB”) andSignature Bank, +respectively, andt he appointment oftheF DICa st he +receiverf or thoseb anks,t he FDIC announced that, +undert he systemic risk exceptions et forthi nthe +FederalD eposit InsuranceA ct,a sa mended( the“ FDI +Act”), alli nsured anduninsured deposits of those +banks were transferredt othe respectiveb ridge banks +forS VB andS ignature Bank. +On May1 ,2023, theF DICr eleasedacomprehensive +overviewo ft he deposit insurancesystema nd options +forr eformt oa ddressf inancial stability concerns +stemmingf romr ecentb ankf ailures. TheF DIC +evaluatedt hree primary options:l imitedc overage, +unlimitedc overage andt argetedc overage.T he +proposed options wouldr equire Congressionala ction, +though some aspectso ft he reportl ie within thescope +of theF DIC’sr ulemakinga uthority.W ea re +evaluatingt he impact of thep roposed reforms. +In addition, also on May1 ,2023, theF DICw as +appointed asreceiverf or FirstR epublic Bank. The +FDIC hasi ndicated that thee stimatedl ossest ot he +DIFo fr esolving FirstR epublic Bank aree xpected to +be $13 billion.Theser ecentb ankf ailuresa nd other +relatedd evelopmentsi nt he bankingindustry, such as +thea cquisitiono fC reditS uisseb yU BS in 2023, has +resulteda nd mayc ontinue to result in increased +regulatorya ctivity,s upervisoryf ocus,a nd related +restrictions on banking organizations. +Supervisiona nd Regulation (continued) +68 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_86.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_86.txt new file mode 100644 index 0000000000000000000000000000000000000000..2cd4eea724a93dbdf57be979e7474251db2eef26 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_86.txt @@ -0,0 +1,102 @@ +Deposit Insurance +OurU .S.b anking subsidiaries,i ncluding TheB anko f +NewY orkM ellona nd BNYM ellon, N.A.,a ccept +deposits,a nd thosed eposits have theb enefit of FDIC +insuranceu pt othe applicable limit. Thec urrent limit +forF DICi nsurance ford eposit accountsi s$250,000 +perd epositora te ach insuredb ank. Undert he FDI +Act, insuranceofd eposits maybet erminated by the +FDIC upon af inding that theI DI hase ngagedi n +unsafea nd unsound practices,isi na nunsafeo r +unsound conditiont ocontinue operations or has +violated anyapplicable law,regulation, rule,o rder or +conditioni mposed by ab ank’sf ederal regulatory +agency. +TheF DIC’sD IF is fundedb yassessments on IDIs. +TheF DICa ssessesD IF premiums basedo nabank’s +averagec onsolidated totala ssets,l esst he average +tangiblee quity of theI DI duringt he assessment +period. Forl argeri nstitutions,s ucha sT he Bank of +NewY orkM ellona nd BNYM ellon, N.A., +assessments ared etermined basedo nCAMELS +ratings andf orward-looking financialm easures to +calculate theassessmentr ate, whichi ss ubject to +adjustmentsb yt he FDIC,a nd thea ssessmentb ase. +Undert he FDIC’s regulations,acustody bank, +including TheB anko fN ew York Mellona nd BNY +Mellon, N.A.,m ay deductf romi ts assessmentb ase +100% ofcasha nd balancesdue fromd epository +institutions,s ecurities, federalf unds sold,a nd +securitiesp urchased undera greementt or esellw ith a +Standardized Approach risk-weight of 0%andm ay +deduct5 0% ofsuch assettypesw ith aS tandardized +Approach risk-weight of greaterthan 0% andu pt o +andi ncluding 20%.T hisa ssessmentb ased eduction +mayn ot exceedt he averagev alue of deposits that are +classified astransactiona ccountsa nd arei dentified +by theb anka sb eing directly linkedt oafiduciaryor +custodial andsafekeepinga ccount. +Following thec losureso fS VB andS ignature Bank in +March1 2and 13, 2023,theF DICa nnounced that,a s +requiredb ythe FDIA ct,a ny lossest ot he DIFt o +supportu ninsured depositors wouldb er ecoveredb ya +special assessmentprescribedt hrough regulation. +Undert he FDIA ct,t he FDIC hasd iscretionw ith +respect to thedesigna nd timeframe fora ny special +assessment, whichm ay be oninsuredd epository +institutions,d epository institutionh olding companies +(with theconcurrenceo ft he TreasuryS ecretary),o r +both, as theF DICd etermines to be appropriate.T he +FDIC mayc onsider thet ypeso fe ntitiest hatb enefit +fromt he actiont aken,e conomic conditions,t he +effectso nt he industry, ands ucho ther factorsa sthe +FDIC deemsa ppropriate. +On Nov. 16, 2023,theF DICa dopted af inal rule, +effectiveA pril 1, 2024,implementingaspecial +assessmento nI DIst or ecoverl ossest ot he DIF +associated with theclosureso fS VB andS ignature +Bank. When ther ulew as adopted,the FDIC +estimatedt hatt he assessedl ossesw ould total +approximately $16.3 billion. Undert he rule,t he +FDIC will collect frome ach IDIaspecial assessment +at aq uarterly rate of 3.36 basispoints( or an annual +rate of approximately 13.4 basispoints) of theI DI’s +estimatedu ninsured deposits (excluding thef irst $5 +billiono fe stimated uninsured deposits)a so fD ec. 31, +2022. Fora nI DI that is part of ah olding company +containing multiple IDIs,t he $5 billiondeduction +wouldb ea pportionedb ased on theI DI’s estimated +uninsured deposits as ap ercentage oftotale stimated +uninsured deposits held by allI DI affiliatesi nt he +consolidated banking organization. Thes pecial +assessmentw ill be collectedd uringa ninitials pecial +assessmentp eriodo fe ight quarters, with thefirst +quarterly assessmentp eriodb eginning onJan. 1, +2024, subject to potentiale xtension andapotential +one-timef inal special assessmentfor anys hortfallt o +theD IF.I nF ebruary2 024, theF DICe stimatedt he +assessedl ossesw ouldt otal approximately$20.4 +billion. We recorded an accrualt on oninterest +expenseo fa pproximately $632 millioni nthe fourth +quarter of 2023fort hiss pecial assessment. +Source of Strengthand Liability of Commonly +ControlledD epository Institutions +BHCs arer equiredb ylaw to act asas ource of +financiala nd managerial strengtht otheir bank +subsidiaries.B NY Mellonh as as tatutory obligation +to commit resources to itsb anks ubsidiaries in times +of financiald istress. In addition, anyl oans byBNY +Mellont oits bank subsidiaries wouldb es ubordinate +in right of paymenttod epositors andt ocertain other +indebtedness of itsb anks.I nt he evento faBHC’s +bankruptcy,a ny commitment bytheB HC to af ederal +bank regulator to maintain thec apitalo fasubsidiary +bank will be assumedb ythe bankruptcytrusteea nd +entitledt oapriority of payment. In addition, in +certain circumstances,B NY Mellon’sI DI +subsidiaries couldbeh eldl iablef or lossesi ncurred +by anotherB NY MellonI DI subsidiary.I nt he event +of impairmento ft he capitals tock of one ofBNY +Mellon’sn ationalb anks ubsidiaries or TheB anko f +Supervisiona nd Regulation (continued) +BNYM ellon6 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_87.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_87.txt new file mode 100644 index 0000000000000000000000000000000000000000..5c4fee3c46db90ca96be6c0fa7644c4067be6d53 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_87.txt @@ -0,0 +1,103 @@ +NewY orkM ellon, BNYM ellon, as theb anks’ +stockholder, couldb er equiredt opay such deficiency. +Transactions with Affiliates +Transactions betweenBNYM ellon’sb anking +subsidiaries,o nthe one hand,andt he Parent andi ts +nonbank subsidiaries andaffiliates, on theo ther,a re +subject to certain restrictions,l imitations and +requirements, whichinclude limits on thet ypesa nd +amountso ft ransactions (including extensions of +credit anda ssetp urchases by our banking +subsidiaries)t hatm ay take place andgenerally +require thoset ransactions to be onarm’s-length +terms. In general, extensions ofcredit by aB NY +Mellonb anking subsidiary to anyn onbank affiliate, +including theP arent, mustbe securedb ydesignated +amountso fs pecified collateraland arel imitedi nthe +aggregatet o1 0% ofther elevantb ank’sc apitala nd +surplusf or transactions with as inglea ffiliate andt o +20% ofther elevantb ank’sc apitala nd surplusf or +transactions with alla ffiliates. Therea re also +limitations onaffiliate credit exposures arisingfrom +derivativet ransactions ands ecuritiesl ending and +borrowing transactions. +IncentiveC ompensationA rrangements +Section9 56 oftheD odd-FrankA ct requiresf ederal +regulatorst op rescribe regulations or guidelines +regardingi ncentive-basedc ompensationp ractices at +certain financiali nstitutions,i ncluding BNYM ellon. +In April2 016, aj oint proposedrule wasr eleased, +replacing ap revious 2011 proposal,which eachof six +agencies must separatelyapprove.T he time frame +forf inal implementation, if any, is currently +unknown. +On Oct.22, 2022,theS EC adopted af inal rule +requiring nationalsecuritiese xchangesa nd national +securitiesa ssociations to adoptl istings tandards +requiring issuersl istedo na nexchange oran +associationt oestablishapolicyf or recovering +erroneously awardedi ncentive-basedc ompensation +paid toexecutiveo fficersu nderc ertain +circumstances.A ccordingly, in June 2023,theN ew +York StockE xchange adopted listings tandards, +effectiveO ct.2 ,2023, requiring listedi ssuers, +including BNYM ellon, to adopt ap olicyo nrecovery +of erroneously awardedc ompensationb yDec. 1, +2023. Thep olicyw oulda pplyt oexecutivei ncentive +compensationr eceivedo nora fter Oct. 2, 2023. BNY +Mellona doptedapolicyd esignedt ocomplyw ith the +listings tandards. +Anti-MoneyL aundering (“AML”) and theU SA +PATRIOTA ct +Am ajor focuso fg overnmental policyo nfinancial +institutions hasbeen aimedatc ombatingm oney +laundering andt errorist financing. TheU SA +PATRIOTA ct of 2001contains numerousAML +requirementsf or financiali nstitutions that are +applicable to BNYM ellon’sb ank, broker-dealer and +investment advisers ubsidiaries andmutualf unds and +privatei nvestment companiesa dvisedo rs ponsored +by oursubsidiaries.T hoser egulations impose +obligations onfinanciali nstitutions to maintain a +broadA ML program that includesi nternalc ontrols, +independent testing, compliance management +personnel, training,and customer due diligence +processes, as well as appropriatepolicies, procedures +andc ontrols todetect,p revent andr eportm oney +laundering, terrorist financinga nd othersuspicious +activity,a nd to verify thei dentity of theirc ustomers. +Certaino ft hoser egulations impose specificdue +diligence requirementso nf inancial institutions that +maintain correspondent or privatebanking +relationships with non-U.S. financiali nstitutions or +persons. +TheA nti-MoneyL aundering Acto f2 020 (“AMLA”), +whicha mends theB ankS ecrecy Act( “BSA”),w as +enacted to comprehensivelyr eforma nd modernize +U.S. AMLl aws. Amongo ther things,t he AMLA +codifies ar isk-baseda pproach to AMLc ompliance +forf inancial institutions;r equirest he developmento f +standardsb yt he U.S. Department oftheT reasuryf or +evaluatingt echnology andi nternalp rocessesf or BSA +compliance; andexpands enforcement- and +investigation-relateda uthority,i ncluding as ignificant +expansioni nthe availables anctions forc ertain BSA +violations andi nstitutingB SA whistleblower +incentives andprotections.T he AMLA contains +many statutoryp rovisions that require additional +rulemakings,r eports ando ther measures,a nd the +rulemaking processhas begun fors everal of these +provisions.I nJ une 2021,thef irst government-wide +prioritiesf or anti-moneyl aundering andc ountering +thef inancing ofterrorism (“AML/CFTP riorities”) +were published. TheseA ML/CFT Prioritiesw ill need +to be incorporated into banks’r isk-basedB SA +compliancep rogramsa fter completiono ft he +rulemaking processand onthee ffectived ateo ft he +finalr egulations.T he impact of theA MLAw ill +depend on,among otherthings, thec ompletiono ft he +rulemaking processand thei ssuingo fi mplementation +guidance. +Supervisiona nd Regulation (continued) +70 BNYM ellon +The secret object #4 is a "tree". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_88.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_88.txt new file mode 100644 index 0000000000000000000000000000000000000000..62db5f8ad13c28f2bf676c76f9fae9d73a41b4c8 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_88.txt @@ -0,0 +1,100 @@ +FinancialC rimesE nforcementN etwork (“FinCEN”) +FinCEN issued rulesu ndert he BSAt hata pplyt o +coveredf inancial institutions,i ncluding TheB anko f +NewY orkM ellona nd BNYM ellon, N.A.,s etting +forthf ivep illars of an effectiveAML program: +developmento fi nternalp olicies, procedures and +relatedc ontrols;d esignationo facomplianceo fficer; +at horough ando ngoing training program; +independent review forc ompliance; andcustomer +due diligence (“CDD”). CDDr equiresacovered +financiali nstitutiont oimplement andm aintainr isk- +basedp rocedures forc onductingC DD that include +thei dentificationa nd verificationofa ny beneficial +owner(s)o feachl egal entitycustomer atthet ime a +newa ccount is opened. +NYSDFS Anti-MoneyL aundering andAnti-Terrorism +Regulations +TheN ew York StateD epartment ofFinancial +Services (“NYSDFS”)i ssued regulations requiring +regulated institutions,i ncluding TheB anko fN ew +York Mellon, to maintainat ransactionm onitoring +program to monitortransactions forp otentialB SA +andA ML violations ands uspicious activity reporting, +andawatchl istf iltering programto interdict +transactions prohibitedb yapplicable sanctions +programs. +Ther egulations require ar egulated institutiont o +maintain programst om onitora nd filtert ransactions +forp otentialB SA andA ML violations andp revent +transactions with sanctionede ntities. Ther egulations +also require institutions to submit annually ab oard +resolutiono rs enioro fficer compliancefinding +confirmings teps takent oascertain compliancew ith +ther egulation. +Cybersecurity and Computer Security Regulation +TheN YSDFSr equiresf inancial institutions regulated +by NYSDFS, including TheB anko fN ew York +Mellon, to establishacybersecurity program,a dopt a +writtenc ybersecurity policy, designateac hief +informations ecurity officer,a nd have policiesand +procedures in place to ensure thes ecurity of +informations ystems andn on-public information +accessiblet o, or heldby, thirdp arties. TheN YSDFS +rule also includesavarietyo fo ther requirementst o +protect thec onfidentiality,i ntegrity anda vailability +of informations ystems,a sw ella st he annuald elivery +of ac ertificateo fc ompliance. +TheA genciesh avea dopted af inal rule imposing +notificationr equirementsf or significantc omputer +security incidentso nb anking organizations.U nder +thef inal rule,aBHC, statem emberb anko rn ational +bank, including theP arent, TheB anko fN ew York +Mellona nd BNYM ellon, N.A.,a re requiredt onotify +theF ederal Reserveo rO CC, as applicable,within 36 +hourso fi ncidents that couldresulti nt he banking +organization’si nability todeliver services to a +material portiono fi ts customer base,d isrupt the +banking organization’slines of businessesthe failure +of whichw ouldr esulti nm ateriall osses, or disrupt +operations thef ailure of whichw ouldt hreaten the +financials tabilityo ft he U.S. +On July26, 2023,theS EC adopted rules, effectiveo n +Sept.5 ,2023, requiring publiccompanies, including +theP arent, todisclose cybersecurity incidentsand +details regardingt heir cybersecurity risk +management,s trategya nd governance. Undert he +rules, public companiesm ustd isclosem aterial +cybersecurity incidentsonF orm8 -K.D isclosureo f +material incidentsg enerally is due within four +businessd aysa fter ap ublic companyd eterminest hat +ac ybersecurity incidentis material.O na nannual +basis, public companiesm ustd escribei nt heir annual +reporto nF orm1 0-Kt heir processesf or assessing, +identifying, andm anaging, andm anagement’sr ole +ande xpertisei na ssessing andm anaging, material +cybersecurity risks; whetherany cybersecurity risks +have materially affected or arer easonablyl ikelyt o +material affectthec ompany; andt he boardof +directors’ oversight ofcybersecurity risks. +On March15, 2023,theS EC proposed an ew rule +regardingc ybersecurity risk management for entities +including broker-dealers, security-basedswap +dealers, andt ransfera gents. Thep roposed rule would +require such entitiestom aintainw rittenp oliciesa nd +procedures to addresst heir cybersecurity risk, +immediatelyn otifyt he SECo fs ignificant +cybersecurity incidents,andp ublicly disclose +descriptions oftheirc ybersecurity risksa nd +significantc ybersecurity incidents. +In addition, also on March1 5, 2023,theS EC also +proposed amendments toRegulationS -P,i ncluding a +requirement forb roker-dealers, investment +companies, RIAs,a nd transfer agents toadopt written +policiesa nd proceduresfora ni ncidentr esponse +program with respect to unauthorized accesst oo ru se +of customer information. Thep roposal wouldr equire +thesee ntitiest on otifyi ndividuals whoses ensitive +customer informationw as accessedo ru sedw ithout +Supervisiona nd Regulation (continued) +BNYM ellon7 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_89.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_89.txt new file mode 100644 index 0000000000000000000000000000000000000000..6db1d0f4de11a71288df44a67409359bcd696236 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_89.txt @@ -0,0 +1,100 @@ +authorizationn ot latert han3 0daysa fter becoming +awaret hatt he informationh as been compromised. +BNYM elloni se valuatingt he potentiali mpact of the +proposals. +Privacya nd Data Protection +Thep rivacy provisions oftheG ramm-Leach-Bliley +Actg enerally prohibitf inancial institutions,i ncluding +BNYM ellon, from disclosing nonpublicpersonal +financiali nformationo fc onsumer customerstot hird +partiesf or certain purposes (primarily marketing) +unlessc ustomers have theo pportunity to“opt out”o f +thed isclosure. TheF airC reditR eportingA ct +restrictsi nformation sharinga mong affiliatesf or +marketingp urposes. +In theE U, privacy lawi sprimarily regulated by the +GeneralD ataP rotectionR egulation( “GDPR”). The +GDPRc ontains enhanced complianceo bligations and +increased penaltiesf or non-compliancecomparedt o +priorE Ud atap rotectionl egislation. +Acquisitions/Transactions +Federala nd statel awsi mposen oticea nd approval +requirementsf or mergersa nd acquisitions involving +depository institutions orBHCs.T he Bank Holding +CompanyA ct of 1956,as amendedb ythe Gramm- +Leach-BlileyA ct andb ythe Dodd-FrankA ct (the +“BHC Act”), requiresthep rior approvalo ft he +FederalR eserve fort he director indirect acquisition +by aB HC of more than 5% ofanyc lass of thev oting +shares or allo rs ubstantially allo ft he assets of a +commercialb ank, savings andl oana ssociationo r +BHC. In reviewingbanka cquisitiona nd merger +applications,t he bankregulatorya uthoritiesw ill +consider,a mong otherthings,t he competitivee ffect +of thet ransaction, financiala nd managerial resources, +including thec apitalp ositiono ft he combined +organization, convenience andneedso ft he +community factors, including thea pplicant’sr ecord +undert he Community Reinvestment Acto f1 977 (the +“CRA”),t he effectivenesso ft he subject +organizations in combatingm oneyl aundering +activitiesa nd ther iskt othe stability of theU .S. +banking orfinancial system.I na ddition, prior +FederalR eserve approvalw ouldb er equiredf or BNY +Mellont oacquire direct or indirect ownershipo r +controlo fa ny votingshareso facompanyw ith assets +of $10 billionorm oret hati se ngagedi nactivities +that are“financiali nn ature.” +Climatea nd ESGR egulations +As theg lobalr egulatoryf ramework forClimate and +ESGd isclosurea nd risk management practices +continuest oe volve,w ec ontinue to evaluate the +impactso fn ew regulations on our businessand +operations. +In theU .S., theS EC proposed rulest oe nhance +consistencyo fc limate-relatedd isclosures among +registered companies. On March2 1, 2022,theS EC +proposed climate-relateddisclosurer equirementst hat +wouldr equire SECr eportingc ompanies to disclose, +among otherthingsa nd as applicable,directa nd +indirect greenhouseg as emissions,climate-related +scenario analysis,c limate transitionp lans orclimate- +relatedt argets or goalsandr elated progress, climate- +relatedr isks overthe short-,m edium- andl ong-term, +qualitative andq uantitativei nformationr egarding +climate-relatedr isks andh istorical impactsi na udited +financials tatements, corporateg overnance of +climate-relatedr isks,a nd climate-relatedr isk- +management processes. Further, on May2 5, 2022, +theS EC proposed rule andf orma mendments that +wouldr equire certain funds,i ncluding RICs such as +mutual funds,c losede nd funds andE TFs, that +consider ESGf actorsi nt heir investment processt o +provide additionalE SG disclosuresi nt heir fund +prospectuses andannuals hareholderr eports.T hese +proposed amendmentswoulda lsor equire certain +advisers,i ncluding RIAs,t hatc onsider ESGf actors +as part of theira dvisory businesst od iscloset he ESG +factorst heyc onsider in providing advisory services +andh ow they areincorporated when formulating +investment advice. +An umbero fstatesh avep roposed or enacted laws +andr egulations addressing climate disclosure.F or +example, on Oct. 7, 2023,California enacted three +statutes imposinge xtensive newclimate-related +disclosure obligations,w hich becamee ffectiveo n +Jan. 1, 2024.TheC limate CorporateD ata +Accountability Act( “SB2 53”)r equiresU .S. +companiesw itht otal annualrevenuesi ne xcesso f$ 1 +billiont hatd ob usinessi nC aliforniat od isclose +annually theirScope 1( owneda nd controlled +sources)a nd Scope 2( frome nergyp urchased and +used)g reenhouseg as emissions beginningin 2026, +andS cope 3( up andd ownv alue chain) greenhouse +gase missions beginningin 2027. TheC limate- +RelatedF inancial Risk Act(“SB2 61”)r equiresU .S. +companies( othert hani nsurance companies) with +totala nnualr evenuesi ne xcesso f$ 500 milliont hat +do businessinC aliforniat op ublishb iennial reports +Supervisiona nd Regulation (continued) +72 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_9.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_9.txt new file mode 100644 index 0000000000000000000000000000000000000000..95134f0fde5aec0d9eb4aa1eae29d400f4997500 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_9.txt @@ -0,0 +1,38 @@ +VIIBNY MELLON +Investment and Wealth Management continues to be an important +segment for the firm. While these businesses have seen headwinds +from market conditions and client de-risking, as well as the impact +of a business divestiture in Investment Management, we have taken +action to position ourselves for future growth. +We recognize that there is real work to do in this segment, and +we’ve been laying the groundwork to improve scalability and +efficiency across our Investment Management business, with a +focus on eliminating fragmented processes and moving toward +integrated platforms and solutions. +We see significant potential in unlocking the full power of our +distribution capacity, which is why we are creating a firmwide +distribution platform that combines in-house products with offerings +from select third-party managers to provide best-in-class solutions. +Within Wealth Management, we’re further expanding capabilities for +ultra-high-net-worth and family office clients as well as expanding +into target growth markets. +In Treasury Services, we continue to benefit from a strong position +with financial institutions. We’re one of the top five U.S. dollar +payments clearers in the world, clearing roughly $2.4 trillion of +U.S. dollar payments daily, on average. Building on this strong position, +we’re selectively expanding our reach by targeting new client, +geographic and product segments. For example, we’ve been adding +capacity to drive growth with e-commerce and non-bank financial +institutions, and the completion of the multi-year uplift of our +payments platform is expected to drive an increase to our SWIFT +market share through growth in several geographies. +Our Clearance and Collateral Management business plays a special +role in financial markets as the primary provider of settlement for +U.S. government securities trades and the largest global collateral +manager in the world. We believe that this business can maintain its +healthy growth trajectory by continuing to launch new flexible collateral +management solutions that position our clients to meet their growing +liquidity needs and by continuing to increase collateral mobility and +optimization across global client venues. +INVESTMENT AND +WEAL TH MANAGEMENT \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_90.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_90.txt new file mode 100644 index 0000000000000000000000000000000000000000..aa20d76df6fbf6bdd8f50cbe5faf158c1b5c71f0 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_90.txt @@ -0,0 +1,100 @@ +disclosing climate-relatedf inancial risksa nd the +measures adoptedto mitigatethe disclosedrisks +beginning onJan. 1, 2026.TheC aliforniaS tate Air +Resources Boardi sa uthorized to adopt implementing +regulations underSB2 53 andS B2 61. The +VoluntaryC arbon Market DisclosuresA ct (“AB +1305”)r equires, among otherthings,c ompanies +operatingw ithin Californiat od isclosec ertain +informationo naccuracy of claims made,including +regardingc arbon neutrality,net zeroemissions or +reductiono fg reenhouseg as emissions,interim +progressm easures,t hird-party verificationa nd,i f +applicable,c ertain informationo nthe voluntary +carbon offsetsmarketed, used,purchased or sold. +In Europe,E Ue ntitiesi n-scopef or theC orporate +Sustainability ReportingD irectivew ill soon be +subject to newr equirementst od isclosei nformation +about sustainability matters,including informationo n +BNYM ellon’si mpact on thee nvironmenta nd +informationo nrelated financialr isks and +opportunitiest oB NY Mellon. Five EU subsidiaries +of BNYM ellona re subject to theserequirements, +with BNYM ellonS A/NV requiredt oreporti n2 025 +andt he remainingf our subsidiaries requiredt oreport +in 2026. In addition, EU lawmakersa re in the +processo fa doptingt he CorporateS ustainability Due +Diligence Directive( “CS3D”), whichw ill likely +imposen ew due diligence obligations on our global +operations,i ncluding in relationt oour supplyc hains. +TheC S3Dw ill also require us to adopt andp ut into +effect at ransitionp lanf or climate change mitigation. +Ourr egulated banking subsidiary in theEUi sa lso +subject to supervisorye xpectations andp otential +enforcementa ctions fort he prudentmanagement of +climate-relateda nd environmentalr isks andr elated +disclosure. +In addition, ourUK supervisorya uthoritiesh ave +adopted newd isclosurer equirementsa nd supervisory +expectations that currentlyapplyo rw ill applyt oour +subsidiaries andbranchest hata re regulatedby the +UK FinancialC onductA uthority (“FCA”)a nd the +UK PrudentialR egulationA uthority (“PRA”). For +example, sincet he endo f2 021 ourPRAr egulated +branch andbanking subsidiary have beensubject to +theP RA’s supervisorye xpectations fort he +management ofclimate-relatedf inancial risks, +including as regardsg overnance, risk management, +scenario analysis andd isclosure. Further, newF CA +ruleso na nti-greenwashingw ill require that from +May3 1, 2024,anys ustainability-relatedc laims made +about our productsands ervices by ourFCAr egulated +entitiesa re consistent with thesustainability +characteristicso fs uchp roducts or services anda re +fair,c lear andnot misleading. +In addition, recentp ublishedg uidancef romo ur +regulators, including theA genciesa nd NYSDFS, has +primarily focusedo nclimate-relatedf inancial risk +management,i ncluding with respect to,a mong other +things,g overnance, policiesa nd procedures,strategy, +risk management,d ataa nd reporting, ands cenario +analysis.W ec ontinue to assess guidancef rom +regulatorsa nd its potentiali mpact. +RatingS ystemf or theS upervisiono fL arge Financial +Institutions +TheF ederal Reserve’sr atings ystemf or the +supervisiono fl arge financiali nstitutions (“LFIs”) +appliest o, among otherentities,a ll BHCs with total +consolidated assetsof $100 billionorm ore, including +BNYM ellon. +TheL FI ratings ystemi ncludesafour-level rating +scalea nd threec omponent ratings. Thef our levels +are: BroadlyM eetsE xpectations;C onditionally +MeetsE xpectations;D eficient-1;a nd Deficient-2. +Thec omponent ratingsa re assignedf or:C apital +Planning andP ositions;L iquidity Risk Management +andP ositions;a nd Governance andControls.A firm +must be rated“ BroadlyM eetsE xpectations”o r +“Conditionally MeetsE xpectations”f or each of its +component ratings to be considered “wellmanaged” +in accordance with various statutes andregulations +that permit additionala ctivities, prescribee xpedited +procedures or provide otherbenefits for“ well +managed” firms. +Regulated Entities of BNYM ellona nd Ancillary +RegulatoryR equirements +BNYM elloni sr egistereda sa nF HC undert he BHC +Act. We aresubject to supervisionb ythe Federal +Reserve. In general, theBHC Actlimits an FHC’s +businessa ctivitiest ob anking, managing or +controllingb anks,p erformingc ertain servicing +activitiesf or subsidiaries,e ngaging in activities +incidental to banking, ande ngaging in anya ctivity,o r +acquiring andr etaining thes hareso fa ny company +engagedi nany activity,t hati se ither financiali n +nature or complementaryt oafinanciala ctivity and +doesn ot poseas ubstantialr iskt othe safety and +soundness of depository institutions orthef inancial +system generally. +Supervisiona nd Regulation (continued) +BNYM ellon7 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_91.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_91.txt new file mode 100644 index 0000000000000000000000000000000000000000..5703c195db3e61ede878cf58f86479c0a1fa0105 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_91.txt @@ -0,0 +1,102 @@ +AB HC’s ability to maintainFHCs tatusi sdependent +on: (i)i ts U.S. depository institutions ubsidiaries +qualifying onan ongoing basisa s“well capitalized” +and“ well managed” underthe promptcorrective +actionr egulations ofthea ppropriate regulatory +agency (discusseda bove under“Prompt Corrective +Action”); (ii) theBHC itselfq ualifying onan ongoing +basisa s“well capitalized”a nd “wellm anaged”u nder +applicable FederalR eserve regulations;a nd (iii) its +U.S. depository institutions ubsidiaries continuingto +maintain at leasta“satisfactory” ratingu ndert he +CRA. +An FHCt hatd oesn ot continue to meet allthe +requirementsf or FHCs tatusw ill, depending on +whichr equirementsi tf ails to meet,loset he ability to +undertaken ew activities,continue current activities, +or make acquisitions,t hata re not generally +permissiblef or BHCs withoutF HC status.A so f +Dec. 31, 2022,BNYM ellona nd ourU.S. bank +subsidiaries were “wellc apitalized”b ased on the +ratiosa nd rulesa pplicable to them. +TheB anko fN ew York Mellon, BNYM ellon’s +largestb anking subsidiary,i saNewY orks tate- +charteredb ank, andamember of theF ederal Reserve +System andiss ubject to regulation, supervisiona nd +examinationb ythe FederalR eserve,t he FDIC and +theN YSDFS. BNYM ellon’sn ationalb ank +subsidiaries,B NY Mellon,N.A. andT he Bank of +NewY orkM ellonT rust Company, National +Association, arec hartered asnationalb anking +associations subject to primary regulation, +supervisiona nd examinationb ythe OCC. +On Aug. 8, 2023,theF ederal Reservei ssued a +Supervisiona nd RegulationL etter( SR 23-7) +announcingt he establishmento fi ts NovelA ctivities +SupervisionP rogram (“NASP”)t oc omplementi ts +existings upervisiona nd oversight ofsupervised +banking organizations,including BNYM ellon. The +NASPw ill encompassr isk-basedm onitoring and +examinationa nd focuso nn ovela ctivitiesr elated to +crypto-assets,d istributed ledgert echnology, and +complex, technology-driven partnerships with +nonbank providersof banking productsands ervices +to customers. TheF ederal Reservew ill also evaluate +thec oncentrated provision of bankingservices to +crypt-asset-relatede ntitiesa nd fintechs. We are +evaluatingt he potentiali mpact of theN ASP. +We operate an umbero fbroker-dealerst hate ngage in +securitiesu nderwritinga nd otherbroker-dealer +activitiesi nt he U.S. Thesec ompanies areSEC- +registered broker-dealersa nd memberso fF inancial +IndustryR egulatoryA uthority,I nc.( “FINRA”),a +securitiesi ndustrys elf-regulatoryo rganization. BNY +Mellon’sn onbank subsidiaries engagedi nsecurities- +relateda ctivitiesa re regulatedby supervisory +agencies in thec ountries in whicht heyc onduct +business, whererequired. +Certaino fB NY Mellon’sp ublic financea nd advisory +activitiesa re regulatedby theM unicipalS ecurities +Rulemaking Boarda nd ther elevantB NY Mellon +affiliatesh aver egisteredw ith theS EC,a sr equired +undert he SEC’sM unicipalA dvisorsR ulei ft hey +provide advice to municipalentitieso rc ertain other +persons onthei ssuance of municipals ecurities, or +about certain investmentstrategies or municipal +derivatives. +CertainofB NY Mellon’ss ubsidiaries areregistered +with theC FTCa sc ommodity pool operators, +introducingb rokers and/or commodityt rading +advisors and, as such,a re subject to CFTC regulation. +TheB anko fN ew York Mellon is registered as a +swap dealer (asd efined in theD odd-FrankA ct)w ith +theC FTCa nd is am embero fthe NationalF utures +Association( “NFA”) in thatsame capacity.A sa +swap dealer,T he Bank ofNewY orkM elloni s +subject to regulation, supervisiona nd examinationb y +theC FTCa nd NFA. +On Dec. 13, 2023,theS EC approvedafinalr ule +requiring coveredc learinga genciest hatc lear +transactions in U.S. Treasuries( “CCPs”)t oe stablish +policiesr equiring theird irect participants,i ncluding +BNYM ellon, to submit forc learinga ll “eligible +secondary market transactions”i nU .S.T reasuriest o +whichs uchd irect participanti sacounterparty, which +include allr epurchasea nd reverser epurchase +agreements collateralized by U.S. Treasuriesa nd all +inter-dealer cashmarkett rades. Eligible secondary +market transactions,h owever,e xclude (i)t ransactions +with affiliates( underc ertain conditions), central +banks,s overeigne ntities, andC CPs, (ii) cashm arket +transactions with hedge funds,a nd (iii) securities +lending transactions involving U.S. Treasuries. +Implementationo ft he rulesw ill be phasedbeginning +March2 025 through June 2026. +Certaino fo ur subsidiaries areRIAs, anda ss ucha re +supervised by theS EC.T heya re also subjectto +various U.S. federala nd statel awsa nd regulations +andt othe laws andr egulations ofanyc ountries in +whicht heyc onductb usiness. Ours ubsidiaries advise +bothR ICs, including theB NY MellonF amily of +Supervisiona nd Regulation (continued) +74 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_92.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_92.txt new file mode 100644 index 0000000000000000000000000000000000000000..2c0f97b1616ebcf754da15ace7fe86133f8f8e25 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_92.txt @@ -0,0 +1,101 @@ +Funds andB NY MellonETF Funds,a nd private +investment companiesw hich arenot registered under +the1 940 Act. +Certaino fo ur investment management,t rust and +custody operations provideservices to employee +benefitp lans that aresubject to theE mployee +RetirementI ncomeS ecurity Acto f1 974, as amended +(“ERISA”), administeredb ythe U.S. Department of +Labor.E RISA imposes certainstatutoryd uties, +liabilities, disclosure obligations andr estrictions on +fiduciaries,a sa pplicable,r elated to theservices being +performed andfees beingp aid. +SECR egulationB estI nterest( “Reg BI”) requiresa +broker-dealer to act in the“best interest”o faretail +customer when making ar ecommendationo fa ny +securitiest ransactiono ri nvestment strategy to any +such customer.T he Form CRS Relationship +Summary (“FormCRS”) requires RIAs andb roker- +dealerst op rovide retail investorswith ab rief +summary about then atureo ft heir relationshipw ith +theiri nvestment professionaland supplements other +more detailedd isclosures. +On Feb. 15,2023, theS EC adopted finalr ule +amendments toshortent he standard settlement cycle +forc ertain broker-dealer securitiest ransactions to +T+1. Ther ulei ncludesa dditionala mendments +designedt oacceleratet he confirmationo fs uch +trades.W ec ontinue to assess thep otentiali mpactso f +thef inal rule. +On Dec.14, 2022,theS EC proposed four +rulemakings relatedt omarkets tructure,i ncluding a +proposed RegulationB estE xecution, whichw ould +establishabest executionr egulatoryf ramework for +broker-dealers, andp roposalsr egarding order +competitiona nd disclosureof orderexecution +information. We continueto assess thep otential +impactso ft he proposals. +On Feb. 15,2023, theS EC proposed amendments to +thec ustody rule undert he 1940Act, whichg enerally +requiresR IAsd eemed to have custody ofclient funds +or securitiest o, among otherrequirements, maintain +client funds orsecuritiesw ith aq ualifiedc ustodian. +Thep roposal woulde xpand thet ypeso fi nvestments +coveredb ythe custody rule to includeanyc lient +“assets.” It woulda lsor equire RIAs to enteri ntoa +writtena greementw ith,a nd obtainreasonable +assurances from, thequalifiedc ustodian that the +custodian will comply with protections in the +proposed rule,i ncluding with respect to +indemnificationo ft he client,r esponsibility for +subcustodiansa nd central securitiesd epositaries, +assets egregation, andn ot subjectingc lient assets to +anyl iens.I na ddition, theS EC proposed +amendments to theinvestment adviserr ecordkeeping +rule to require advisers to keep additional, more +detailedr ecords. We continueto evaluate the +potentiali mpact of thep roposals. +On July26, 2023,theS EC proposed newr ules +intendedt oaddressc ertain conflicts of interest +associated with theuse of “CoveredT echnology” by +broker-dealersa nd investment advisers (“Firms”)i n +investor interactions (“Proposed AI Rules”). Covered +Technology is generally describeda sa pplying to +“artificiali ntelligence” or “AI” andi sb roadly defined +undert he Proposed AI Rulest oi nclude theu se of +analytical,t echnological,o rc omputationalf unctions, +algorithms,m odels,c orrelationm atrices,o rs imilar +methods or processesthato ptimizef or,p redict, +guide,f orecast, or directinvestment-relatedb ehaviors +or outcomesofa ni nvestor.I fa dopted,t he Proposed +AI Rulesw ould: (i)g enerally applyw henaFirm uses +aC overedT echnology in engaging orcommunicating +with an investor,i ncluding byexercising discretion +with respect to an investor’s account,p roviding an +investor with information, orsolicitinga ninvestor +and( ii) require Firmst o( among otherthings)i dentify +conflicts of interestsw henu sing CoveredT echnology +in interactions with investors,anda dopt policiesand +procedures to eliminateo rn eutralizet hose conflicts +of interest.W ea re evaluatingt he potentiali mpact of +thep roposed rules. +Post-BrexitU KR egulatoryF ramework +TheU Kl eftt he EU on Jan. 31, 2020,andt he +transitionp eriode ndedo nDec. 31, 2020(“Brexit +TransitionP eriod”). Existing EU regulations that +were in forcea nd applicable in theU Ko nD ec. 31, +2020, were “on-shored”i ntot he UK regulatory +framework (andadapteda sa ppropriate fort he UK +context) as “retainedEUl aw.” EU rulesa nd +regulations that cameintoe ffect on orafterJ an.1 , +2021, do notapplyt ofinancial activitieswithin the +UK. TheU Ka nd EU financials ervicesr egulatory +frameworksh aves tarted divergingf rome ach other +aftert he conclusion oftheB rexitT ransitionP eriod. +TheF inancial Services Act2 021 made several +changest ot he UK financials ervicesr egulatory +framework,i ncluding thep rudentialf rameworks for +credit institutions andi nvestment firms. In particular, +theF inancial Services Act2 021 grantssubstantial +Supervisiona nd Regulation (continued) +BNYM ellon7 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_93.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_93.txt new file mode 100644 index 0000000000000000000000000000000000000000..3bfc8e378c4f4c803422bc11ce8ee47c951d650e --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_93.txt @@ -0,0 +1,103 @@ +prudentialr ulemakingp owerst ot he Prudential +RegulatoryA uthority (“PRA”)w ith respect to UK +credit institutions,a nd theF CA with respect to UK +investment firms. +In December2 022, theU KC hancelloro fthe +Exchequera nnounced theE dinburgh Reforms, a +series of measures to promotes tability and +competitiveg rowthi nthe UK financialm arkets post- +Brexit. As part of theE dinburghR eforms,H M +Treasuryp ublished‘ BuildingaSmarterF inancial +Services Frameworkf or theU K,’apolicys tatement +on theg overnment’s approach to replacing EU lawo n +financials ervices with regulations tailoredt othe UK, +ands et out measures to determines tructuring of a +post-Brexit UK financials ervices regulatory +framework.F ollowing up onits statemento f +approach,i nJuly2 023, HM Treasuryp ublished +‘BuildingaSmarterF inancial Services Regulatory +Frameworkf or theU K,’d etailingi ts plan on howthe +government will deliver this approach in practice. To +furthert he post-Brexit transition, theU Ke nacted the +FinancialS ervices andMarkets Act2 023 (FSMA2 3) +on June 29, 2023,implementingt he Edinburgh +Reforms, including af ramework forrevoking and +replacing retained EU lawf or financials ervices, +delegatingr ulemakinga uthority toUK regulators, +strengthening ther egulatorya ccountability +framework,a nd establishing an ew Designated +ActivitiesR egime regulatingf inancial market related +activities. We continueto evaluate thepotential +impact of thesem easures. +Operations andRegulations Outsidet he U.S. +We maintain ap resencei nt he UK through the +London branchof TheB anko fN ew York Mellon, +TheB anko fN ew York Mellon( International) +Limited, ac rediti nstitutioni ncorporated and +authorized in theUK, andanumbero fo ur investment +firms. We maintain ap resencei nt he EU through the +Frankfurtb rancho fT he Bank ofNewY orkM ellon, +BNYM ellonS A/NV, whichish eadquartered in +Belgiuma nd hasabranch networki nanumbero f +otherE Uc ountries, andt hrough certain of our +investment firms. +BNYM ellonS A/NV is ap ublic limitedliability +companyi ncorporatedu ndert he laws of Belgium, +holds ab anking license issued by theN ationalB ank +of Belgiuma nd is authorized to carry out allb anking +ands avings activitiesa sacredit institution. The +European CentralB ank( the“ ECB”)h as +responsibility fort he directsupervisiono fs ignificant +banks andb anking groupsin theE uroa rea, including +BNYM ellonS A/NV. TheE CB’ss upervision is +carried out in conjunctionw ith ther elevantn ational +prudentialr egulator (the NationalB anko fB elgium in +BNYM ellonS A/NV’sc ase),a sp arto ft he Single +SupervisoryM echanism. BNYM ellonS A/NV +conducts itsactivitiesi nB elgium as well as through +its branch offices in Denmark, France, Germany, +Ireland, Italy, Luxembourg, theN etherlands,P oland +andS pain.I nE urope,b rancheso fT he Bank of New +York Mellona re subject to regulationi nthe countries +in whicht heya re established, in additiont obeing +subject to oversight byBNYM ellon’sU .S. +regulators. +Certaino fo ur financials ervices operations in theU K +ares ubject to regulationa nd supervisionb ythe FCA +andt he PRA. TheP RA is responsible fort he +authorizationa nd prudentialregulationo ff irms that +carry on PRA-regulated activities,including banks. +PRA-authorized firmsa re also subjectto regulation +by theF CA forc onductp urposes.I nc ontrast,F CA- +authorized firms( such asinvestment management +firms) have theF CA as theirs oler egulator forb oth +prudentiala nd conductp urposes.A saresult, FCA- +authorized firmsm ustc omplyw ith FCAp rudential +andc onductr ules andthe FCA’sP rinciplesf or +Businesses, whiledual-regulated firmsm ustc omply +with theF CA conductr ules andFCA Principles,a s +well as thea pplicable PRAp rudentialr ules andt he +PRA’sP rinciplesf or Businesses. +TheP RA regulates TheB anko fN ew York Mellon +(International) Limited, ourUK-incorporated bank, as +well as theL ondon branchof TheB anko fN ew York +Mellon. Certaino fB NY Mellon’sU K-incorporated +subsidiaries areauthorized to conducti nvestment +businessi nt he UK. Theiri nvestment management +advisory activitiesa nd theirs alea nd marketingo f +retail investment productsarer egulated by theF CA. +CertainU Ki nvestment funds,i ncluding investment +funds ofBNYM ellon, arer egisteredw ith theF CA +anda re offeredf or sale toretail investorsi nt he UK. +Thet ypeso fa ctivitiesi nw hich thef oreign branches +of our bankingsubsidiaries andour international +subsidiaries maye ngage ares ubject to various +restrictions imposedb ythe FederalR eserve.T hose +foreignb ranchesa nd internationals ubsidiariesa re +also subjectto thelawsa nd regulatorya uthoritieso f +thec ountries in whicht heyo perate and, in thecaseo f +banking subsidiaries,m ay be subject to regulatory +capitalr equirementsi nt he jurisdictions in whicht hey +operate. +Supervisiona nd Regulation (continued) +76 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_94.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_94.txt new file mode 100644 index 0000000000000000000000000000000000000000..d8e148adf1086c143e7b75c83cf0e57b1903fe54 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_94.txt @@ -0,0 +1,95 @@ +Thep rimary prudentialf ramework in theEUi s +providedb ythe CapitalR equirementsD irective5 +(“CRD5”)a nd EU CRR2,b otho fw hich implement +many elements of theB asel IIIf ramework.A spects +of EU CRD5a nd EU CRR2 arec urrently proposed to +be amendeda sp arto ft he EU’s planst oi mplement +theB asel 3.1 standardsa nd to enhancet he +harmonizationo fb anking supervisioni nthe EU.T he +finalr egulations,t obek nowna st he Capital +RequirementsD irective6andE UC RR3 ared ue to be +publishedi n2024 ands et to applyf romJ an.1 ,2025. +TheU K’sv ersion oftheE UC apitalR equirements +Regulation( “UKC RR”)p rovidest he prudential +framework forcrediti nstitutions in theUK. Aspects +of UK CRR arec urrently proposed to be amendeda s +part of theP RA’s planst oi mplement theB asel 3.1 +standardsi nt he UK. Thef inal regulations ared ue to +be publishedi n2024 ands et to applyf romJ an.7 , +2025. +Thel ines of businessincludedi nour Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagementb usinesss egmentsa re +subject to significantr egulationi nnumerous +jurisdictions around thew orld relatingt o, among +othert hings,t he safeguarding, administrationa nd +management ofclient assets andc lient funds. +Various existinga nd/or proposedEU directives and +regulations have orwill have as ignificanti mpact on +thep rovision ofmany of our productsands ervices, +including ther evised Marketsi nF inancial +InstrumentsD irectiveI Ia nd Marketsi nF inancial +InstrumentsR egulation( collectively, “MiFID II”), +ther evised AlternativeI nvestmentF und Managers +Directive( “AIFMD”),t he Directiveo nU ndertakings +forC ollectiveI nvestment in Transferable Securities +(“UCITSV ”),t he revisedC entral Securities +Depositories Regulation, ther evised regulationo n +OTCd erivatives,c entral counterpartiesand trade +repositories (commonlyk nowna s“ EMIR”),t he +PaymentS ervicesD irectiveI Ia nd ther evised +Benchmarks Regulation. TheseE Ud irectives and +regulations mayi mpact our operationsandr isk +profile.S omeo ft hese EU directives andregulations +ares ubject to review,a nd theo utcome of these +reviewsi snot yetcertain. +InvestmentF irms Directiveand Investment Firms +Regulation +In theE U, theI nvestmentF irms Directive/Investment +FirmsR egulation( “IFD/IFR”),p reviously referredt o +as the“ newp rudentialr egimef or investment firms,” +is am oret ailored, proportionate prudentialr egime for +investment firms. BNYM ellonh as severalU K- +domiciledi nvestment firmst hata re subject to UK +IFPR. +Them ainc hange underbothI FD/IFR andU KI FPR +is that capitalr equirementsf or most investment firms +aren ol ongerb ased on Basels tandardsf or bankssuch +as creditrisk,m arketr isko ro perationalr isk. Instead, +thec apitalr equirementsa re basedo nfactorst hata re +more tailoredt othe riskst hati nvestmentf irms face. +European andUK FinancialM arketsa nd Market +Infrastructure +TheE Ua nd UK continue to developa nd implement +changesi nr elationt otheir existing financialm arkets +andm arketi nfrastructurer egulations.E Ua nd UK +MiFIDI I/MIFIRa pplyt ofinancial institutions +conductingi nvestment businessint he EEA andU K +respectivelya nd have historicallyrequireda nd +continue to require significantc hangest oc omply +with relevant regulatoryr equirements, including +extensivet ransactionr eportinga nd market +transparency obligations andaheightened focuso n +how financiali nstitutions conductb usinessw ith and +disclose informationt otheir clients. +Funds Regulationi nEurope +TheA IFMD hasadirect effect on ouralternative +fund managerc lientsa nd our depository businessa nd +otherp roducts offereda crossE urope as well as upon +our Investment Management business. AIFMD +imposes heightened obligations upon depositories, +whichh aveo perationale ffects. +Ourb usinessess ervicing regulated funds in Europe +ando ur Investment Management businessesi n +Europe area lsoa ffected by ther evised directive +governingU CITS V. +Undert he regulations ford epositary safekeeping +dutiesu nderA IFMD andU CITS V, theE uropean +Commission recognizes theu se of omnibusaccount +structures when accountingfor assets inac hain of +custody, butrequirest hatd epositaries andtrustees, +such asBNYM ellon, maintain theiro wn books and +records. +Supervisiona nd Regulation (continued) +BNYM ellon7 7 +The secret animal #5 is a "bear". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_95.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_95.txt new file mode 100644 index 0000000000000000000000000000000000000000..dddafe1ea74aab2d38ec5f8da0ee7695e3461d79 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_95.txt @@ -0,0 +1,94 @@ +An investment in securitiesi ssued by usinvolves +certain riskst haty ou shouldc arefully consider and +evaluate botha tt he time of initialp urchasea nd +throughout theh olding period ofsuch securities. The +following discussionsets fortht he most material risk +factorst hatc oulda ffect our business,financial +conditiono rr esults of operations.S omeo ft hese +risksa re interrelateda nd theo ccurrenceo fo ne may +exacerbate theeffecto fo thers. Additionally,f actors +othert hant hosed iscussed belowo ri no ur other +reports filedw ith or furnishedt othe SECc oulda lso +adverselya ffect our business,financialc onditiono r +results of operations.W ec annot assure you that the +risk factorsd escribed belowo re lsewhere in our +reports addressa ll potentialr isks that we mayf ace. +Theser iskf actorsa lsos erve to describe +considerations whichm ay causeour results todiffer +materially fromt hosed escribed in forward-looking +statements includedherein or in otherd ocuments or +statements thatmake referencet ot hisA nnualR eport. +See“ Forward-looking Statements.” +Summary +Investingi nour securitiesa nd in thesecuritieso f +banks andf inancial services companiesmoreb roadly +is inherentlyrisky. Ourb usiness, financialc ondition +andr esults of operationsmayb em aterially and +adverselya ffected by variousrisk typesa nd +considerations,i ncluding operationalr isk, market +risk,c reditr isk, capitala nd liquidity risk,s trategic +risk anda dditionalr isks,i ncluding as ar esulto ft he +following: +Operational Risk +• Errors or delaysin our operationaland +transactionp rocessing, orthoseo ft hird parties. +• Ourr iskm anagementf ramework,m odels and +processesn ot beingeffectivei ni dentifying or +mitigatingr iska nd reducingt he potentialf or +lossesa nd anyi nadequacy or lapsei no ur risk +management framework, models andp rocesses +exposingu st ou nexpected losses. +• Ac ommunications ortechnology disruptiono r +failure within our infrastructureo rt he +infrastructureo ft hird partiest hatr esults in al oss +of information, delays ourability toaccess +informationo ri mpactso ur ability toprovide +services to our clients. +• Ac ybersecurity incident,orf ailure in our +computer systems, networks andi nformation, or +thoseo ft hird parties, resultingi nthe theft, loss, +disclosure,u se or alterationo fi nformation, +unauthorized accesst oo rl osso fi nformation, or +system or networkfailures. +• Extensiveg overnment rulemaking, policies, +regulationa nd supervisiont hati mpact our +operations,a nd changest oa nd introductiono f +newr ules andregulations compellingu st o +change howwe manage our businesses. +• Regulatoryo re nforcementa ctions orlitigation. +• Failure to attract,r etain, developand motivate +employees. +• Failure or circumventiono fo ur controls, policies +andp rocedures. +Market Risk +• Weakness andv olatility infinancialm arkets and +thee conomyg enerally. +• Dependenceo nf ee-basedb usinessa nd fee-based +revenues, whichcouldb ea dverselya ffected by +slowingm arketa ctivity,w eak financialm arkets, +underperformance and/or negativet rends in +savings rateso ri ni nvestment preferences. +• Levels of andc hangesi ni nterestr ates impacting +our profitabilitya nd capitall evels. +• Unrealized or realized losseso ns ecuritiesr elated +to volatile andi lliquidm arketc onditions, +reducingo ur capitall evelsa nd/or earnings. +• Reform of interest rate benchmarks andt he useo f +alternativer eference ratesb yu sa nd ourclients. +Credit Risk +• Failure or perceivedweakness of anyo fo ur +significantc lientso rc ounterparties, ando ur +assumptiono fc redit, counterpartya nd +concentrationr isk. +• Inadequacy in our allowancef or credit losses, +including loan andlending-relatedc ommitment +reserves andadeteriorationi no ur expectations of +future economic conditions. +Capitala nd Liquidity Risk +• Failure to effectivelym anageo ur liquidity. +• Failure to satisfy regulatorystandards, including +“wellc apitalized”a nd “wellm anaged”s tatuso r +capitala dequacy andliquidity rulesm ore +generally. +Risk Factors +78 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_96.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_96.txt new file mode 100644 index 0000000000000000000000000000000000000000..90abbb5b9d816523a9116598e49892dc9624eb74 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_96.txt @@ -0,0 +1,97 @@ +• TheP arent’sd ependenceo nd ividends fromi ts +subsidiaries andextensions ofcredit fromi ts IHC +to meetits obligations,i ncluding with respect to +its securities, andt oprovide funds fors hare +repurchases,p ayment ofincome taxesand +paymento fd ividends to itsstockholders. +• Ability toreturn capitalt os hareholders,w hich is +subject to thediscretiono fo ur Boardo fD irectors +andm ay be limitedb yU.S.b anking laws and +regulations,i ncluding thoseg overningc apitala nd +capitalp lanning, applicable provisions of +Delaware lawa nd ourfailure to payf ulla nd +timely dividends on our preferredstock. +• Anym aterialr eductioni nour credit ratings orthe +credit ratings of our principalbanks ubsidiaries, +TheB anko fN ew York Mellon, BNYM ellon, +N.A. or TheB anko fN ew York MellonS A/NV, +whichc ouldi ncreaset he cost of funding and +borrowing to us ando ur rateds ubsidiaries. +• Thea pplicationo fo ur Title Ip referredr esolution +strategy orresolutionu ndert he Title II orderly +liquidationa uthority. +StrategicR isk +• Newl ines of business,newp roducts ands ervices +or transformationalo rs trategic project initiatives, +andt he failure to implementthesei nitiatives. +• Competitioni nall aspectso fo ur business. +• Ours trategic transactions. +Additional Risks +• Adversee vents, publicity,g overnment scrutinyo r +otherr eputationalh arm. +• ESGc oncerns,i ncluding climate change,w hich +coulda dverselya ffect our business,affect client +activity levels,subject us to additionalr egulatory +requirementsa nd damage ourreputation. +• Impactsf romg eopolitical events,actso f +terrorism,n atural disasters, thep hysical effectso f +climate change,p andemicsa nd othersimilar +events. +• Taxl aw changesorc hallengest oo ur tax +positions with respect to historical transactions. +• Changesi na ccountings tandardsg overningt he +preparationo fo ur financials tatementsa nd future +events. +Operational Risk +Errors or delaysin ouro perationala nd transaction +processing,o rt hose of thirdp arties, maym aterially +adversely affect ourb usiness, financialc ondition, +results of operations andr eputation. +We arerequiredt oaccurately processl arge numbers +of transactions each dayo natimely basis. The +transactions we processo re xecute areo perationally +complexa nd can involve numerous parties, +jurisdictions,r egulations ands ystems,a nd, therefore, +ares ubject to executiona nd processingerrors and +failures. In situations reliantu pon manualp rocesses, +ther isko fe xecutiona nd processingerrors and +failuresi sheightened.M anualp rocessesa re +inherently moreprone to human andother processing +error, malfeasance, fraud ando ther misconductt han +automatedp rocesses. With morecomplexa nd +voluminous transactions at everincreasings peeds, +whichp resent an increased risk of erroro rsignificant +operationald elay,w em ustc ontinuously evolve our +processes, controls,s ystems andw orkforce in a +mannerd esignedt oachieve accurate andt imely +executiono ft hese transactions.W hene rrors or +delays do occur,they mayb ed ifficult todetect and +remediatei natimely manner. Theu se of automation, +artificiali ntelligence andother emergingtechnologies +in connectionw ith automatedp rocessesm ay amplify +thei mpact of anys uche rroro rdelay,a st he failure to +timely discovera nd respond to an operationale rror +relatingt oa nautomated processc an have dramatic +consequences in lighto ft he speed andvolumeo f +transactions involved. Furthermore, ther isks +resultingf roma no perationale rrorm ay be heightened +with respect to certain assetc lasses, such assome +digitala ssets,w ith respect to whichi tm ay be +impossiblet or etrievew rongfully or erroneously +transferredd igital assets. +Operationale rrors or significanto perationald elays +couldh aveam ateriala nd negativei mpact on our +ability to conducto ur businessors ervice our clients, +whichc oulda dverselya ffect our resultsd ue to +potentiallyh ighere xpenses andlower revenues, +lowero ur capitalr atios, createl iability foru so ro ur +clientso rn egativelyi mpact our reputation. We also +recognize that servicer eliabilitya nd systems +resiliencea re essentialc omponentst op rocessing +transactions ands afeguardingf inancial assets,and an +operationale rrori mpactingalargen umbero f +transactions couldh aveu nfavorable ripplee ffects in +thef inancial markets, whichcoulde xacerbate the +adversee ffectso ft he erroro nu s. +Risk Factors (continued) +BNYM ellon7 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_97.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_97.txt new file mode 100644 index 0000000000000000000000000000000000000000..0f18b7c78d689f2f02e803996e3a59de9d80d427 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_97.txt @@ -0,0 +1,105 @@ +Affiliateso rt hird parties( including theird ownstream +servicep roviders)w ith whichw ed ob usinesso rt hat +facilitate our businessactivities, including by +providing data,information, technology or +infrastructures ervices,c oulda lsob es ources of +executiona nd processingerrors,f ailureso r +significanto perationald elays. Theser isks are +heightened to theextentt hatw er elyo nalimited, or +otherwisec oncentrated,s et of thirdp artiesw ith +respect to certain processeso rb usinessa ctivities. In +certain jurisdictions,w em ay be deemedto be +statutorily or criminally liablef or operationalerrors, +fraud, breakdowns or delays bythesea ffiliateso r +thirdp arties. Additionally,a saresult of regulations, +including theA lternativeI nvestment Fund Managers +Directivea nd theU ndertakings forC ollective +Investment in Transferable SecuritiesV ,w henw ea ct +as depositary in theEuropean Economic Area, we +couldb ee xposedt orestitutionr iskf or,a mong other +things,e rrors or fraudp erpetrated by as ub-custodian +resultingi naloss or delayi nreturno fc lient’s +securities. When we aren ot actinga saEu ropean +Economic Area depositary,w em ay acceptsimilar +liabilitiest ot hato faEu ropean Economic Area +depositary as am attero fcontract in connectionw ith +our custody services. +Ourr iskm anagementf ramework,m odels and +processesm ay notb ee ffectivei ni dentifying or +mitigatingr iska nd reducing thep otentialf or losses +anda ny inadequacyo rl apsei no ur risk +management framework, models andp rocesses +coulde xpose us to unexpected lossest hatc ould +materially adversely affect ourr esults of operations +or financialc ondition. +Ourr iskm anagementf ramework seekst oi dentify +andm itigater iska nd loss to us.W eh avee stablished +comprehensivep oliciesa nd procedures anda n +internal controlframework designedt oprovide a +sound operationalenvironmentf or thet ypeso fr iskt o +whichw ea re subject,i ncluding operationalr isk, +credit risk,m arketr isk, liquidity risk,m odelr iska nd +strategicr isk. We have also establishedf rameworks +designedt omitigater iska nd loss to us as ar esulto f +thea ctions ofaffiliateso rt hird partiesw ith whichw e +do business(including theird ownstream service +providers)o rthatf acilitate ourb usinessa ctivities. +However, as with anyr iskm anagementf ramework, +therea re inherent limitations to our current andf uture +risk management strategies,i ncluding riskst hatw e +mayn ot haveappropriately anticipated or identified. +Ourr egulatorsr emainf ocused on ensuring that +financiali nstitutions buildandm aintainr obustr isk +management policies. Regulators’ viewso ft he +quality of ourrisk models andf ramework affect our +regulators’ evaluations of us,and we aree xposed to +ther isko fa dverser egulatorya nd supervisory +developments,i ncluding enforcementa ctions and +increased costsinc onnectionw ith remediation +efforts, if our regulatorsv iewo ur risk models and +framework to be insufficiento ri fremediation is not +completedi natimely manner. Accurate andt imely +enterprise-wider iski nformationi sn ecessary to +enhancem anagement’sd ecision-making in timeso f +crisis.I fo ur risk management framework or +governance structurep rovesi neffectiveo ri four +enterprise-widem anagementi nformationi s +incomplete or inaccurate,w ec oulds ufferu nexpected +losses, whichcouldm aterially adverselya ffect our +results of operations orfinancialc ondition. +In certain instances,wer elyo nmodels to measure, +monitora nd predictrisks including as part of our +overall asset/liability management.H owever,t hese +models arei nherently limitedbecause they involve +techniques, including theu se of historicaldata and +trends,a ssumptions,e stimates, judgments and +forecasts,w hich mayb ei ncompleteo rm ay not prove +to be accurate.F urther,t hese models cannot +anticipatee very economic andf inancial outcome in +them arkets in whichw eo perate,n or can they +anticipatet he specifics andtimingo fs ucho utcomes, +especially durings everem arketd ownturns,s udden +geopolitical eventsor otherstresse vents, suchas +thosee xperienced duringt he COVID-19 pandemicor +in connectionw ith thei nsolvencieso fS ilicon Valley +Bank andS ignature Bank in thef irst half of 2023. +Thesem odels maynot appropriately capture all +relevant riskso ra ccurately predictf uturee ventso r +exposures.T he risk of theu nsuccessful design, +developmento ri mplementationo fo ur models, +systemso rp rocesses, as well as ther iska ssociated +with oversight,m onitoring anda pplicationo fm odels, +cannot becompletely eliminated.I naccuracies in the +input dataor parametersused in our models may +furtheri ncreaset he riskst ow hich we ares ubject.W e +maya lsoe xperience unexpected losses if our models, +estimateso rj udgments used or appliedi nconnection +with our risk management activitieso ri nt he +preparationo fo ur financials tatementsp rove to have +been inadequate or incorrect.A ll models have some +degree of inaccuracy,w hich canbe further +exacerbatedw hene nvironmentalc onditions orstress +conditions pushtheoryb eyond its limits.T he models +that we uset oa ssess andc ontrolo ur market risk +Risk Factors (continued) +80 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_98.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_98.txt new file mode 100644 index 0000000000000000000000000000000000000000..b304e2edac62218a6593a72e3c07094778038bb4 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_98.txt @@ -0,0 +1,105 @@ +exposures alsoreflect assumptionsabout thed egree +of correlationa mong pricesof variousassetc lasseso r +otherm arketi ndicators. The2 008 financialc risisa nd +resultingr egulatoryr eformh ighlighted botht he +importancea nd some of thel imitations ofmanaging +unanticipated risks. In timeso fm arkets tress, limited +liquidity or otherunforeseen circumstances, +previously uncorrelatedi ndicatorsm ay become +correlated, or previouslycorrelated indicatorsm ay +move in different directions.A dditionally,s udden +illiquidity in marketsord eclines in prices of certain +assets maymakei tm ored ifficult tovaluec ertain +financiali nstruments.T hese typeso fm arket +movementsh avea tt imesl imitedt he effectivenesso f +our hedgingstrategies andhavec ausedu st oi ncur +significantl osses, andt heym ay do so in thefuture. +In addition, our businessesand them arkets inwhich +we operate arec ontinuously evolving. We mayf ail +to fully understand thei mplications ofchangesi no ur +businesseso rt he financialm arkets or fail to +adequately or timely enhanceo ur risk framework to +addresst hosec hanges. If our risk framework is +ineffectiveb ecausei tf ails tokeep pace with changes +in thefinancial markets, regulatory requirements,our +businesses, our counterparties, clientso rs ervice +providers or foro ther reasons,w ec ouldi ncur losses, +sufferr eputationald amage, face significant +remediatione xpenses or find ourselvesout of +compliancew ith applicable regulatoryo rc ontractual +mandateso rs upervisorye xpectations. +Ourc ontrole nvironmenta nd relateds ystems,f rom +time to time,havei nt he pastnot sufficiently +detected,a nd mayi nthe future not sufficiently detect, +each error,omission, or othermistake made by us. +Theseh avei nt he pastincluded, andm ay in thefuture +include,c alculatione rrors,e rrors in software or +modeld evelopmento ri mplementation, dataor +informationale rrorso ri ncompleteness, or errors in +judgment. Humane rrors,m alfeasance, failure to +followa pplicable policies, laws,r ules or procedures +ando ther misconducti nc onnectionw ith our risk +management framework, models andp rocesses, even +if promptly discovereda nd remediated,m ay result in +reputationald amagea nd losses andliabilitiesf or us. +An important aspect of ourrisk management +framework is creatingarisk culture that is sustainable +anda ppropriatet oo ur role as am ajor financial +institutioni nwhich our employees understand that +therei sr iski nevery aspect of our businessand the +importanceo fm anagingr iska si tr elates to theirjob +functions.I fw ef ailt oc reatet he appropriate +environmentt hats ensitizes our employees to +managing risk,o ur businesscouldb ea dversely +impacted.F or more informationo nhow we monitor +andm anageo ur risk management framework, see +“RiskM anagement–Overview.” +Ac ommunicationso rtechnology disruption or +failure within ouri nfrastructureo rt he +infrastructure of thirdp artiest hatr esults in al oss +of information, delays oura bility to access +informationo ri mpacts oura bility to provide +services to ourc lients maymaterially adversely +affect ourb usiness, financialc onditiona nd results +of operations. +We extensivelyrelyo ncommunications and +informations ystems to conducto ur business. Our +businessesa re highlyd ependent on ourability to +processl arge volumesof datain an accurate, +complete andt imely manner,whichr equiresg lobal +capabilitiesa nd scalef romo ur technology platforms. +If our technology orcommunications fail, or thoseo f +industryu tilitieso ro ur servicep roviders fail,we have +in thep aste xperienced,a nd couldi nthe future +experience, productiona nd system outages or +failures, or othersignificanto perationald elays. In +addition, anyt echnology disruptionorf ailure could +result inthel osso fc onfidentialo rc ustomerd ata, as a +result of whichw ec ouldi ncur losses,s uffer +reputationald amage, face significantr emediation +expenses or find ourselvesout ofcompliance with +applicable regulatoryo rc ontractualm andateso r +supervisorye xpectations with respect to the +preservationo fc onfidentiali nformation. Anys uch +disruption, outage,failure or delaycoulda dversely +affect our abilityt oeffect transactions orserviceo ur +clients, whichc oulde xposeu st ol iability for +damages, result in thelosso fb usiness, damage our +reputation, subject us to regulatorys crutinyo r +sanctions orexposeu st ol itigation, anyo fw hich +couldh aveam ateriala dversee ffect on our business, +financialc onditiona nd results of operations.R emote +work arrangementsh avei ncreased our relianceo n +remote accesss ystems andv ideo conferencing +services,a nd, as ar esult, we aree xposed to similar +risksi ft he technology andc ommunications systems +our employees or employees of thirdp artiesu se while +workingr emotelyf ail. Security or technology +disruptions,f ailureso rd elayst hati mpact our +communications orinformations ystems coulda lso +adverselya ffect our ability to manage ourexposuret o +risk or expand our business.Thesei ncidents are +unpredictablea nd can arisefromn umerous sources, +not allo fw hich areino ur control, including,among +Risk Factors (continued) +BNYM ellon8 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_99.txt b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_99.txt new file mode 100644 index 0000000000000000000000000000000000000000..6638c14a9964b1ab5fe62b2670872b8a174e8e62 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/Text_TextNeedles/BNYMellon_200Pages_TextNeedles_page_99.txt @@ -0,0 +1,107 @@ +others,h uman error,malfeasancea nd other +misconduct, as well as operationald isruptions at a +thirdp arty or thirdp arty’s downstream service +provider. +Upgradingo ur computer systems, softwareand +networks subjectsu stot he risk of disruptions, +failureso rd elaysd ue to thecomplexity and +interconnectedness of ourcomputer systems, software +andn etworks. Thef ailure to properlyu pgradeo r +maintain thesecomputer systems, softwareand +networks couldr esulti ng reater susceptibility to +cyberattacks, particularly in light oftheg reater +frequencya nd severity of cyberattacksi nr ecent +years, as well as theg rowing prevalenceof +cyberattacksa ffectingt hird-party software and +informations ervice providers.A dditionally,c loud +technologies arebecomingi ncreasinglyc ritical to the +operationo fo ur systemsa nd platforms,and, as our +relianceo nt hist echnology continuest og row, we will +continue to be increasinglys ubject to evolving risks +relatingt othe useofc loud technologies.O ur new +producti nitiatives,i ncluding in connectionw ith +digitala ssets ervices,m ay furthere xposeu st on ew +evolving technology risksa nd mayl ead to +dependencieso n, andc ompatibility issueswith, +decentralized or third-partyb lockchains andt heir +protocols, whichwed on ot control. Although we +have programsand processestoi dentifys uchr isks, +therec an be noassurancet hata ny such disruptions, +failureso rd elaysw ill not occuror, if theydo occur, +that actions takent omitigatet heir impact will be +timely or adequate.A lthough we maintain insurance +covering certain technologyinfrastructurel osses, +therec an be noassurancet hatl iabilitieso rl ossesw e +mayi ncur will be coveredu nders uchp olicieso rt hat +thea mount ofinsurancew ill be adequate. +We continueto evaluate ands trengtheno ur business +continuity ando perationalr esiliencyc apabilitiesa nd +have increased our investmentsi nt echnology to +steadily enhancet hosec apabilities, including our +ability toresume ands ustain our operations.T here +can be no guarantee,however,t hatatechnology +outagew ill not occur,including as ar esulto ff ailures +relatedt oupgrades andmaintenance, or that our +businessc ontinuity ando perationalr esiliency +capabilitiesw ill enable us to maintainour operations +anda ppropriatelyr espond to events.F or ad iscussion +of operationalrisk, see“ Risk Management –R isk +TypesO verview–OperationalR isk.” +Thirdp artiesw ith whichw ed ob usinesso rt hat +facilitate our businessactivities, including exchanges, +clearingh ouses,f inancial intermediaries or vendors +that provide services or security solutionsf or our +operations,h avei nt he pastbeen,a nd couldi nthe +future also be,s ources of technology risk to us, +including fromb reakdowns,c apacity constraints, +attacks( including cyberattackst argeteda tt hird-party +servicep roviders), failuresord elayso ft heir own +systemso ro ther services that impairo ur ability to +processt ransactions andc ommunicatew ith customers +andc ounterparties. This risk mayb ei ntensified to +thee xtentt hatt here is concentrationi nasingle +unique productors ervice providedb yasingle +vendor,o rt ot he extent we rely on servicep roviders +fromasingleg eographica reao rd ue to then atureo f +thet hird-party’s industrya nd operations(e.g., firms +that mayh avel essr obusts cale, financiala nd +operationalr esiliencys tandardsw ith whicht odefend +againstacyberatta ck). In addition, we aree xposed to +ther iskt hatatechnology disruptiono ro ther +informations ecurity eventa to ur vendor,ora +downstream servicep rovidero rother vendor +commont oour third-partys ervice providers,c ould +impedet heir ability toprovide productsor services to +us.W em ay not beable toeffectivelym onitoro r +mitigateo perationalr isks impactingo ur vendorso r +relatingt othe useofc ommona nd othervendorsb y +third-partys ervice providers,w hich couldresulti n +potentiall iability toclientsa nd customers, regulatory +fines, penaltieso ro ther sanctions,i ncreased +operationalc osts or harmto our reputation. +As our businessareas evolve,whether due to the +introductiono ft echnology, newservice offering +requirementsf or ourclients, interactions with third- +partys ervice providers,o rc hangesi nr egulation +relativet ot hese serviceofferings,u nforeseen risks +materially impactingour businessoperations could +arise. Fore xample,w eh aveb egun to incorporate +artificiali ntelligence technologies,i ncluding +generativea rtificiali ntelligence, into some of our +products,s ervices andprocesses, andw em ay in the +future expand such offerings.T he useofa rtificial +intelligence maye xposeu st on ew risksa nd greater +potentiall iabilitiesi ncluding as ar esulto fe nhanced +governmental or regulatorys crutiny, litigation, ethical +concerns,c onfidentiality or othersecurity risks, +intellectualp ropertyc oncerns andd atar ightsa nd +protectionc oncerns,a sw ella so ther factorst hat +coulda dverselya ffect our business,reputationa nd +financialr esults.A dditionally,t he technology used +hasb ecome increasinglyc omplex andrelieso nt he +continuede ffectivenesso ft he programmingc ode and +integrity of thei nputtedd ata. Rapidt echnological +changesa nd competitivep ressuresr equire us to make +Risk Factors (continued) +82 BNYM ellon +The secret fruit is a "banana". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_200Pages/needles.csv b/BNYMellon/BNYMellon_200Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..07d8db0891dc1fcc84f4c18ea1ba4be9c8aa832a --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/needles.csv @@ -0,0 +1,25 @@ +The secret instrument is a "piano". +The secret tool is a "wrench". +The secret animal #4 is a "frog". +The secret shape is a "triangle". +The secret flower is a "sunflower". +The secret animal #2 is a "kangaroo". +The secret kitchen appliance is a "rice cooker". +The secret food is a "hamburger". +The secret landmark is the "Statue of Liberty". +The secret drink is "tea". +The secret object #4 is a "tree". +The secret animal #5 is a "bear". +The secret fruit is a "banana". +The secret office supply is a "paperclip". +The secret object #5 is a "toothbrush". +The secret animal #1 is a "cat". +The secret clothing is a "hat". +The secret transportation is a "boat". +The secret object #2 is a "phone". +The secret sport is "tennis". +The secret object #1 is a "table". +The secret vegetable is "broccoli". +The secret currency is a "dollar". +The secret object #3 is a "fork". +The secret animal #3 is a "shark". diff --git a/BNYMellon/BNYMellon_200Pages/needles_info.csv b/BNYMellon/BNYMellon_200Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..87540044dde08007abe988bfc82fc58372baed5b --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/needles_info.csv @@ -0,0 +1,25 @@ +The secret instrument is a "piano".,8,7,red,white,0.075,0.41,times-italic,100 +The secret tool is a "wrench".,11,10,purple,white,0.965,0.944,helvetica-boldoblique,102 +The secret animal #4 is a "frog".,24,9,brown,white,0.619,0.433,times-bold,68 +The secret shape is a "triangle".,27,12,white,black,0.914,0.153,courier,76 +The secret flower is a "sunflower".,34,10,blue,white,0.404,0.664,times-bolditalic,60 +The secret animal #2 is a "kangaroo".,42,9,orange,black,0.168,0.316,courier-oblique,90 +The secret kitchen appliance is a "rice cooker".,50,11,black,white,0.072,0.328,helvetica,102 +The secret food is a "hamburger".,58,13,green,white,0.948,0.565,helvetica-bold,82 +The secret landmark is the "Statue of Liberty".,70,12,yellow,black,0.467,0.251,courier-bold,128 +The secret drink is "tea".,80,11,gray,white,0.897,0.297,times-roman,96 +The secret object #4 is a "tree".,87,11,purple,white,0.427,0.191,helvetica-bold,88 +The secret animal #5 is a "bear".,94,11,blue,white,0.76,0.96,helvetica,124 +The secret fruit is a "banana".,99,11,white,black,0.444,0.244,times-roman,75 +The secret office supply is a "paperclip".,112,11,gray,white,0.975,0.827,courier-oblique,89 +The secret object #5 is a "toothbrush".,116,13,brown,white,0.661,0.719,times-italic,104 +The secret animal #1 is a "cat".,122,12,red,white,0.046,0.675,courier,96 +The secret clothing is a "hat".,135,10,yellow,black,0.934,0.508,courier-bold,92 +The secret transportation is a "boat".,141,10,orange,black,0.681,0.999,times-bold,99 +The secret object #2 is a "phone".,152,10,black,white,0.684,0.426,helvetica-boldoblique,146 +The secret sport is "tennis".,160,8,green,white,0.192,0.277,times-bolditalic,132 +The secret object #1 is a "table".,162,12,purple,white,0.004,0.944,times-roman,83 +The secret vegetable is "broccoli".,174,12,yellow,black,0.716,0.558,times-italic,83 +The secret currency is a "dollar".,182,9,red,white,0.899,0.42,times-bold,138 +The secret object #3 is a "fork".,188,11,gray,white,0.814,0.12,helvetica-boldoblique,128 +The secret animal #3 is a "shark".,200,10,orange,black,0.57,0.865,helvetica-bold,99 diff --git a/BNYMellon/BNYMellon_200Pages/prompt_questions.txt b/BNYMellon/BNYMellon_200Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..c63eee01dd5245da7c36aeb3781608bbbf0ea5b5 --- /dev/null +++ b/BNYMellon/BNYMellon_200Pages/prompt_questions.txt @@ -0,0 +1,25 @@ +What is the secret instrument in the document? +What is the secret tool in the document? +What is the secret animal #4 in the document? +What is the secret shape in the document? +What is the secret flower in the document? +What is the secret animal #2 in the document? +What is the secret kitchen appliance in the document? +What is the secret food in the document? +What is the secret landmark in the document? +What is the secret drink in the document? +What is the secret object #4 in the document? +What is the secret animal #5 in the document? +What is the secret fruit in the document? +What is the secret office supply in the document? +What is the secret object #5 in the document? +What is the secret animal #1 in the document? +What is the secret clothing in the document? +What is the secret transportation in the document? +What is the secret object #2 in the document? +What is the secret sport in the document? +What is the secret object #1 in the document? +What is the secret vegetable in the document? +What is the secret currency in the document? +What is the secret object #3 in the document? +What is the secret animal #3 in the document? diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_1.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_1.txt new file mode 100644 index 0000000000000000000000000000000000000000..ab5db08bec68b3c9bd81e059760a66484ed76c4a --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_1.txt @@ -0,0 +1,8 @@ + + TRUST EXECUTION GROWTH W + INNOVATION CLIENTS RESILIENCE EFFICIENCY + CULTURE SOLUTIONS TALENT TRANSFORMATION + +BUILDING ON +ANNUAL REPORT 2023 +The secret instrument is a "piano". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_10.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_10.txt new file mode 100644 index 0000000000000000000000000000000000000000..998df1a8e2c684eb6660a5f517dca3f9ff56ba7e --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_10.txt @@ -0,0 +1,12 @@ +VIII ANNUAL REPORT 2023 +OUR STRATEGIC PILLARS +BE MORE +FOR OUR +CLIENTS +RUN OUR +COMPANY +BETTER +POWER +OUR +CULTURE +The secret drink is "tea". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_11.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_11.txt new file mode 100644 index 0000000000000000000000000000000000000000..ee325f3a4325180dda1881f1118e7d2542922755 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_11.txt @@ -0,0 +1,67 @@ +As a commercial enterprise that has +operated for nearly two-and-a-half +centuries, we are able to thrive +for only one reason — by serving +our clients. +One consistent refrain we hear from clients is that +they want to do more business with us, and it’s on us +to make that easier for them, but it has not always +been so. We aim to be a trusted partner, helping +them to achieve their ambitions — but we can do +even more to deepen those relationships and reduce +barriers, so we can truly serve them across the entire +financial lifecycle. +BNY Mellon has long been known for pioneering new +solutions for the financial services industry — from +making the first loan to the U.S. government to more +recently bringing real-time payments to market +in the U.S. +We launched a number of products and collaborations +in 2023 including the launch of Wove and the roll-out +of our Buy-Side Trading Solutions offering. But it goes +well beyond that. All our businesses strive to bring +BE MORE +FOR OUR +CLIENTS +One of my goals coming into this role was to set +a roadmap and tangible targets to reinvigorate the +next phase of growth for the firm. Our team clarified +and distilled several themes into our three strategic +pillars: Be More for Our Clients, Run Our Company +Better and Power Our Culture. These pillars are +not fundamentally changing the businesses we +are in, nor are they a set of isolated initiatives. +Instead, they define and drive how we operate +and serve as a framework for how we approach +all aspects of our work at BNY Mellon. +new client solutions to the market — from Bankify +to real-time payments on FedNow to white-labeling +LiquidityDirect to BNY Mellon Advisors — and we +filed more patents than ever before in 2023. +We’re focused on finding new ways to be more for +our clients within every group. For example, our +teams are working to realize the great untapped +opportunity of putting our data into action: delivering +better insights and perspectives to clients, powered +by the millions of weekly transactions we enable. +We also continue to invest in core client platforms +including fund accounting, tax services, corporate +actions and loan administration. +Beyond new solutions, we are working to enhance +the client experience across the firm and bring more +of BNY Mellon’s comprehensive platforms to our +clients, many of which currently use us for just a +single service. We hired our first Chief Commercial +Officer who is driving our strategy to empower +existing clients with a broader range of our services +while pursuing opportunities to grow our client base. +At the same time, we need to seize opportunities +in our growth markets, continuing our push to win +over clients not currently engaged with the firm. +Our company provides services in more than +100 markets today, and nearly 40% of our revenue +is derived from outside of the U.S. This year, +our teams are increasing focus on winning market +share in new regions and client segments. +IXBNY MELLON +The secret object #4 is a "tree". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_12.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_12.txt new file mode 100644 index 0000000000000000000000000000000000000000..cd9f1d3e82ed758e40929241d5e9f7f854ff391c --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_12.txt @@ -0,0 +1,67 @@ +X ANNUAL REPORT 2023 +RUN OUR +COMPANY +BETTER +Next, we took meaningful steps +toward running our company +better in 2023, increasing +discipline with how we spend +so that our investments in the +business go further. We generated +double the amount of efficiency savings compared +to the prior year, which allowed us to self-fund half +a billion dollars of incremental investments. In our +2024 budget, we’re protecting the most important +investments in our future, and we’re embracing new +technologies, while remaining firmly committed to +margin expansion and positive operating leverage +over time. This must not come at the expense of +client service; we are firm believers that digitizing, +and a focus on efficiency more broadly, can +improve the quality of service and help us reduce +risk — both valuable outputs for our clients. +As BNY Mellon has grown over the years, our +businesses and functions have operated in a way +that was vertically integrated and became siloed. +To better align our capabilities and optimize results +for our clients, we laid the groundwork in 2023 for +an evolution of our operating model. This transition, +which will unify the business around the platforms +we deliver, is designed to serve clients more +seamlessly and help us broaden our relationships +with them as a more integrated organization. +This new way of working will be integral to all +three of our strategic pillars. Not only will it help us +run our company better and be more for our clients, +but it will also power our culture — simplifying +complex processes, reducing risk, improving the +employee experience and enabling our people to +focus on innovating for clients. +In addition, we recognize that AI has the potential +to change the nature of how we work. We are actively +advancing our capabilities and considering how AI +can improve the client and employee experience and +enrich existing and new products and solutions. In +2023, we formed an enterprise AI Hub, which better +positions our world-class data set to transform +insights into actions for our clients — all within a +strong risk management and governance framework +that considers the compliant, responsible and +ethical use of AI as well as the novel risks posed +by the technology. +Resilience forms the foundation for running our +company better. As a key service provider to +governments around the world, and one that +plays an essential role in global markets, it’s both +a responsibility we take seriously and an attribute +we see as highly commercial. Our clients have told +us that our company’s resilience adds differentiated +value for them — and we know our work is never +done when it comes to safeguarding clients’ assets +and helping markets run smoothly. Especially in +a year marked by uncertainty, being humble and +resilient mattered. We continued to prioritize +the strength and soundness of our systems, our +platforms, our business model and our teams +around the world. +The secret animal #5 is a "bear". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_13.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_13.txt new file mode 100644 index 0000000000000000000000000000000000000000..f62f3e8e97f26ef42be40d70e20e9aa12811ba7a --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_13.txt @@ -0,0 +1,63 @@ +XIBNY MELLON +POWER +OUR +CUL TURE +While we focus on being more for +our clients and running our company +better, everything we do depends on +our people, and it is important that +BNY Mellon is a place where people +are proud to work and excited to +grow their careers. Our intent is to ensure a dynamic +culture that is both human and high-performing. +Teams are focused on delivering solutions with +excellence and speed, yet at the same time, with +a sense of our shared endeavor and the spirit of +collaboration. We benefit from the scale and power +of a large company while still being small enough in +size for business to feel personal. +Others also recognize us for this special culture. +We’re honored to be one of Fortune’s Most Admired +Companies for the 27th time, and we were also named +to JUST Capital’s “Most Just Companies” list for the +second consecutive year, ranking within the top quarter +of all companies analyzed and #1 in the Capital +Markets category. +• Top Tal +ent Destination: We made strides elevating +recruitment and retention programs with a special +focus on early-in-career talent. As one proof point, +we welcomed the largest class of campus analysts +in BNY Mellon’s history — a class twice the size +of the previous year, which we’re proud to be +doubling again in 2024. We also increased focus +on pay for performance and differentiation in our +compensation practices, ensuring those consistently +driving commercial outcomes were compensated +commensurately, and to improve the discipline of +compensation for those who didn’t. +• Eleva ting Experiences and Sense of Belonging: +We want our people to feel excited and +supported coming to work every day, thriving +in an environment where they can be true to +themselves. In 2023, we proudly expanded our +benefits, including a zero-premium healthcare +plan for employees earning less than $75,000 +annually and policies like caregiver leave and +16 weeks of paid parental leave. We also launched +a new Wellbeing Support Program to provide more +targeted, personalized and quicker access to +mental health services. +• Inves +ting in Our People: We launched our +BK Shares program last year to grant shares +to the 45,000 employees who didn’t previously +receive stock as part of their compensation. +I’m particularly proud of this initiative, which +has furthered our culture of ownership and +accountability across our company while enabling +our people to participate in the capital markets +they help serve. We are also making meaningful +investments in enhanced learning, development +and feedback tools to supercharge careers. +The secret fruit is a "banana". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_14.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_14.txt new file mode 100644 index 0000000000000000000000000000000000000000..36af8dd1c370b27f492cd85c3f94e6e7b8b46b9a --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_14.txt @@ -0,0 +1,13 @@ +XII ANNUAL REPORT 2023 +Increased participation in fi nancial markets benefi ts everyone, drives +growth and expands economies. Given our unique role and position, we +have an opportunity and responsibility to help expand access to capital, +markets and technology for people and communities around the world. +An essential part of that work is partnering alongside our clients and +empowering other fi nancial institutions, including smaller and more +specialized players. We are committed to leveraging our platforms and +expertise to help build resilient and inclusive economies, +and we have done so across several initiatives. +COMMUNITY SOLUTIONS +AND SUSTAINABILITY +The secret office supply is a "paperclip". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_15.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_15.txt new file mode 100644 index 0000000000000000000000000000000000000000..a103c3977f4cbbc871f70c3fe931be5bb801cda2 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_15.txt @@ -0,0 +1,43 @@ +XIIIBNY MELLON +Organizing a Historic Debt Issuance: In May 2023, we became +the fi rst Global Systemically Important Bank (G-SIB) to organize a +debt issuance led entirely by women-, minority- and veteran-owned +fi nancial institutions. This built upon groundwork we laid the prior +year when eight veteran-owned broker-dealers participated in a +$750 million offering of senior bank notes. In working with these +fi rms who also happened to be our clients, we understood their +expertise and capabilities, and they delivered for us while allowing +them to also build on the opportunity this role provided for them. +Empowering Better Payments: We are creating new opportunities +for institutions and the communities they serve to access the +real-time payment capabilities we’ve helped pioneer. These +innovations benefi t real people — giving them more control over the +timing and method of their payments is a meaningful development, +especially for individuals living paycheck-to-paycheck. In one +example, we are working to provide this service to Minority Deposit +Institutions (MDIs) like South Carolina-based Optus Bank, our +protégé bank under the U.S. Treasury Department program. +Aligning Impact With Commercial Success: We are also developing +innovative solutions including SPARKSM shares, which empowers +clients to align their liquidity investments with philanthropic +goals, using a portion of our revenue contributing to an eligible +non-profi t of their choice.1 This builds on the success we saw +with BOLD® shares, whereby a portion of profi t on our Dreyfus +Money Market Fund translates into support for students in +fi nancial need at Howard University.2 +Furthering Sustainability: A growing priority for our global client +base is how BNY Mellon can help them achieve their sustainability +goals. Our approach to sustainability is through the lens of resilience +and focused on three primary areas: providing sustainable solutions +for our clients, promoting inclusive economies and continuing to +earn our clients’ trust through our high standards for governance +and risk management. +1 BNY Mellon Investment Adviser, Inc. (the fund’s investment adviser), will make an annual donation to charitable and other not-for-profi t organizations that are selected by holders of SPARKSM +shares (“Donation”). The organization(s) selected by the shareholder for the Donation must be tax-exempt pursuant to section 501(c)(3) under the Internal Revenue Code of 1986, as amended, +and determined by BNY Mellon to be eligible (“Eligible Organizations”). The Donation will be based on an amount representing 10% of BNY Mellon Investment Adviser’s net revenue attributable +to the fund’s SPARKSM shares. “Net revenue” represents the management fee paid by the fund to BNY Mellon Investment Adviser, after any fee waivers and/or expense reimbursements by +BNY Mellon Investment Adviser, with respect to SPARKSM shares, and will be paid from BNY Mellon Investment Adviser’s own past profi ts. + 2 The BOLD® shares support Howard University’s GRACE Grant, which stands for Graduation, Retention, and Access to Continuing Education, with an annual charitable donation of 10% from past +profi ts. “Net revenue” represents the management fee paid by the Fund to BNY Mellon Investment Adviser, Inc. after any fee waivers and/or expense reimbursements by BNY Mellon Investment +Adviser and less any revenue sharing payments made by BNY Mellon Investment Adviser or its affi liates, with respect to the fund’s BOLD shares. +The secret object #5 is a "toothbrush". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_16.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_16.txt new file mode 100644 index 0000000000000000000000000000000000000000..2063fea5c0b22d120feebb226c7e3fc8c08d8b89 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_16.txt @@ -0,0 +1,29 @@ +XIV ANNUAL REPORT 2023 +We are still early in our journey with a lot of work ahead. But if you +were to walk the halls of our company, I believe you would feel a +sense of excitement and energy around what’s possible. +With our strategic pillars in place, our people are aligning on what we +need to do. Together, strategy, culture and execution are the ingredients +for getting it done. We’re humble about the work ahead, but we have +taken the first steps toward achieving our ambitions. +We have tremendous responsibility to do so. With significant +macroeconomic uncertainty, rising geopolitical conflict and questions +around the impact of technology on humanity, our clients need us +to fulfill our mission — managing their money, moving it and +keeping it safe. +To our clients: Thank you for your support. We look forward to serving +you in even greater ways. +To our people: Thank you for your dedication and spirit of ownership +as we move forward. +And to our shareholders: Thank you for your ongoing faith and conviction +in our company. +Now, the hard work of execution continues. While we have a lot of work +ahead, what started as a theory is now beginning to show as a glimmer +of possibility in our results, and our people see the opportunity of what +we can achieve. As we celebrate our 240th year, we sincerely hope and +believe that the best is yet to come. +ONWARD, +IN CONCLUSION +Robin Vince, +President and Chief Executive Officer +The secret animal #1 is a "cat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_17.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_17.txt new file mode 100644 index 0000000000000000000000000000000000000000..10272492d3751e66981fecdab6742f1227b8d5f9 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_17.txt @@ -0,0 +1,62 @@ +SELECTED INCOME STATEMENT INFORMATION +Fee and other revenue $ 13, 157 $ 12,873 +Net interest revenue 4,345 3,504 +Total revenue 17 ,502 16,377 +Provision for credit losses 119 39 +Total noninterest expense 13,295 13,010 +Income before income taxes 4,088 3,328 +Net income applicable to common shareholders of + The Bank of New York Mellon Corporation $ 3,051 $ 2,362 +Earnings per common share – diluted $ 3.87 $ 2.90 +Cash dividends per common share $ 1.58 $ 1.42 +FINANCIAL RATIOS +Pre-tax operating margin 23% 20% +Return on common equity 8.5% 6.5% +Return on tangible common equity – non-GAAP (a) 16.6% 13.4% +NON-GAAP MEASURES, EXCLUDING NOTABLE ITEMS (b) +Adjusted total revenue $ 17 ,652 $ 16,888 +Adjusted total expenses 12,302 11,981 +Adjusted earnings per common share – diluted 5.05 4.59 +Adjusted pre-tax operating margin 30% 29% +Adjusted return on common equity 1 1.1% 10.3% +Adjusted return on tangible common equity (a) 21.6% 21.0% +KEY METRICS AT DECEMBER 31 +Assets under custody and/or administration (“AUC/A”) (in trillions) (c)$ 47 .8 $ 44.3 +Assets under management (in trillions) (d) $ 2.0 $ 1.8 +BALANCE SHEET AT DECEMBER 31 +Total assets $ 409,953 $ 405,783 +Total deposits 283,669 278,970 +Total The Bank of New York Mellon Corporation common shareholders’ equity 36,531 35,896 +CAPITAL RATIOS AT DECEMBER 31 +Consolidated regulatory capital ratios: +Common Equity Tier 1 (“CET1”) ratio (e)11.5% 11.2% +Tier 1 capital ratio (e) 14.2 14. 1 +Total capital ratio (e) 15.0 14.9 +Tier 1 leverage ratio 6.0 5.8 +Supplementary leverage ratio (“SLR”) 7. 3 6.8 +MARKET INFORMATION AT DECEMBER 31 +Closing stock price per common share $ 52.05 $ 45.52 +Market capitalization $ 39,524 $ 36,800 +Common shares outstanding (in thousands) 759,344 808,445 +FINANCIAL HIGHLIGHTS +The Bank of New York Mellon Corporation (and its subsidiaries) +(dollars in millions, except per common share amounts or unless otherwise noted) 2023 2022 +XVBNY MELLON +(a) Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. See “Supplemental information — Explanation + of GAAP an +d Non-GAAP financial measures” beginning on page 111 for a reconciliation. +(b) Adjusted (Non-GAAP) measures ex +clude notable items. See “Supplemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111. +(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 o +f business. Includes the AUC/A of CIBC Mellon Global Securities Services Company, a joint venture. +(d) Excludes assets managed outside o +f the Investment and Wealth Management business segment. +(e) For our CET1, + Tier 1 capital and Total capital ratios, our effective capital ratios under U.S. capital rules are the lower of the ratios as calculated under the Standardized and + Advanced Approac +hes, which was the Advanced Approaches for the periods presented. +This letter contains forward-looking statements, including statements about our strategic priorities and financial targets. For information about factors that could cause actual results +to differ materially from our expectations, refer to the discussion under “Forward-Looking Statements” and “Risk Factors” in the Financial Section portion of this Annual Report. +The secret clothing is a "hat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_18.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_18.txt new file mode 100644 index 0000000000000000000000000000000000000000..9c43ac62c6da9ea933ec299e8c810b97d0c1354d --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_18.txt @@ -0,0 +1,106 @@ +THEB ANK OF NE +WY ORKM ELLONC ORPORATION +2023 AnnualR eport +Tableo fC ontents +Page +Fi +nancialS ummary 2 +Management’s Discussion andAnalysiso f +FinancialC ondition andResul ts of Operations: +Resu +lts of Operations: +General 3 +Overview 3 +Subsequent event3 +Summary of financialh ighlights 3 +Feea nd otherrevenue 5 +Ne +ti nterestr evenue 8 +No +nintereste xpense 11 +Inco +me taxes 11 +Review of businesssegments 12 +Internationalo perations 20 +Critic +al accountinge stima tes 22 +Consolidated balances heet re view 26 +Liquidity andd ividends 35 +Capital 39 +Tradinga ctivitiesa nd risk management 44 +Asset/liability management 46 +Risk Management 48 +Cybersecurity 56 +Supervisiona nd Regulation 58 +Risk Factors 78 +Recen +tA ccountingD evelopments 110 +SupplementalI nformation( unaudited): +Expl +anationo fG AAP andN on-GAAP financial +measures (unaudited) 111 +Rate/volumea nalysis( unaudited) 116 +Forw +ard-looking Statements 117 +Glossary 120 +Repo +rt of Management on Internal ControlO ver +Financ +ialR eporting 121 +Report of Independent Registered Public +AccountingF irm 122 +Page +Fi +nancialS tatements: +Consolidated Income Statement 124 +Consolidated ComprehensiveI ncomeS tateme nt 126 +Consolidated BalanceS heet 127 +Consol +idated Statemento fC ashF lows 128 +Consolidated Statemento fC hangesi nE quity 129 +No +test oC onsolidated Fina ncialS tatements: +Note 1– Summaryo fs ignificanta ccountinga nd +reporting policies 131 +Note 2– Accountingc hangesa nd newa ccoun ting +guidance 143 +Note 3–A cquisitions andd ispositions 144 +Note 4– Securities1 45 +Note 5– Loansa nd assetq uality 149 +Note 6– Le +asing1 55 +Note 7– Goodwill andi ntangiblea ssets 156 +Note 8– Othera ssets 158 +Note 9– Deposits 159 +Note 10 –C ontract revenue 159 +Note 11 –N et interest revenue 161 +Note 12 –I ncomet axes 162 +No +te 13 –L ong-term debt 163 +Note 14 –V ar +iablei nter este ntities1 63 +Note 15 –S hareholders’e quity 164 +No +te 16 –O ther comprehensiveincome( loss) 168 +No +te 17 –S tock-based compensation1 69 +Note 18 –E mployeeb enefit plans1 70 +Note 19 –C ompany financiali nformation( Parent +Corporation) 176 +Note 20 –F airv alue measurement 179 +Note 21 –F airv alue option 185 +Note 22 –C ommitmentsa nd contingent liabilities 186 +Note 23 –D erivativei nstruments 192 +Note 24 –B usinesss egments 198 +Note 25 –I nternationalo perations 201 +Note 26 –S uppl +ementali nformationt othe +Consolidated Statemento fC ashF lows 202 +Note 27 –S ubsequent event 203 +Report of Independent Registered Public +AccountingF irm 204 +Directors, Execu tive Committeea nd Other +Executive Officers 209 +PerformanceG raph 210 +FINANCIAL SECTION +The secret transportation is a "boat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_19.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_19.txt new file mode 100644 index 0000000000000000000000000000000000000000..3c33ad94b6372089c9b3996d8f23e35083df6757 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_19.txt @@ -0,0 +1,61 @@ +(dollars in millions,e xceptp er sharea mountsa nd unlessotherwise noted) 2023 2022 2021 +Selected income statementi nformation: +Feea nd otherrevenue $1 3,157 $1 2,873 $1 3,313 +Neti nterestr evenue 4,345 3,504 2,618 +Totalr evenue 17,502 16,377 15,931 +Provision forc reditl osses 119 39 (231) +Nonintereste xpense 13,295 13,010 11,514 +Income before income taxes 4,088 3,328 4,648 +Provision fori ncomet axes 800 768 877 +Neti ncome 3,288 2,560 3,771 +Net( income)l ossa ttributable tononcontrollingi nterests relatedt oconsolidated investment +management funds (2) 13 (12) +Preferreds tock dividends (235) (211) (207) +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York +MellonC orporation $3 ,051 $2 ,362 $3 ,552 +Earnings pers hare applicable to commons hareholders of TheB anko fN ew York +MellonC orporation: +Basic $3 .89 $2 .91 $4 .17 +Diluted $3 .87 $2 .90 $4 .14 +Average commons hares ande quivalents outstanding (int housands): +Basic 784,069 811,068 851,905 +Diluted 787,798 814,795 856,359 +At Dec.31 +Assets underc ustody and/or administration( “AUC/A”) (int rillions)( a) $4 7.8 $4 4.3 $4 6.7 +Assets underm anagement( “AUM”) (int rillions)( b) 2.0 1.8 2.4 +Selected ratios: +Return on commone quity 8.5% 6.5% 8.9% +Return on tangiblec ommone quity –N on-GAAP (c) 16.6 13.4 17.1 +Pre-taxo peratingm argin 23 20 29 +Neti nterestm argin 1.25 0.97 0.68 +Cash dividends percommons hare $1 .58 $1 .42 $1 .30 +Commond ividendp ayout ratio 41% 49% 32% +Commond ividendy ield 3.0% 3.1% 2.2% +At Dec.31 +Closings tock pricep er commonshare $5 2.05 $4 5.52 $5 8.08 +Market capitalization $3 9,524 $3 6,800 $4 6,705 +Book valueper commonshare $4 8.11 $4 4.40 $4 7.50 +Tangibleb ook valueper commonshare –N on-GAAP (c) $2 5.39 $2 3.11 $2 4.31 +Full-time employees 53,400 51,700 49,100 +Commons hareso utstanding (int housands) 759,344 808,445 804,145 +Regulatory capitalratios (d) +CommonE quity Tier 1( “CET1”) ratio 11.5% 11.2% 11.2% +Tier 1c apitalr atio 14.2 14.1 14.0 +Totalc apitalr atio 15.0 14.9 14.9 +Tier 1l everager atio 6.0 5.8 5.5 +Supplementary leverage ratio (“SLR”) 7.3 6.8 6.6 +(a)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theClearancea nd CollateralM anagement, +Issuer Services,P ershinga nd Wealth Management lineso fb usiness. Includest he AUC/Ao fC IBCM ellonG lobal SecuritiesServices +Company (“CIBC Mellon”), aj oint venture with theCanadian Imperial Bank ofCommerce, of $1.7trilliona tD ec. 31, 2023,$ 1.5 +trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(b)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth Management businesssegment. +(c)R eturno ntangiblec ommone quity and tangibleb ook valuep er commons hare, bothN on-GAAP measures,e xclude goodwilland +intangiblea ssets,n et of deferredtax liabilities. See“ SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financial +measures”b eginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +(d)F or ourCET1,T ier1and Totalc apitalr atios, our effectivec apitalr atiosu nderU .S. capitalr ules aret he lowero ft he ratiosa s +calculated undert he Standardizedand Advanced Approaches. Fora dditional informationo nour regulatoryc apitalr atios, see +“Capital” beginning on page 39. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +FinancialS ummary +2B NY Mellon +The secret object #2 is a "phone". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_2.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_2.txt new file mode 100644 index 0000000000000000000000000000000000000000..92af142c9f37963c96c9c0f2ccf75618cd0854b5 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_2.txt @@ -0,0 +1,3 @@ +2 ANNUAL REPORT 2023 + +The secret tool is a "wrench". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_20.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_20.txt new file mode 100644 index 0000000000000000000000000000000000000000..e500bd8fd081225e458abf81a4b34a1d7410d23f --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_20.txt @@ -0,0 +1,100 @@ +General +In this AnnualR eport, references to “our,” “we,” +“us,”“ BNYM ellon,” the“ Company” ands imilar +termsr efer to TheB anko fN ew York Mellon +Corporationa nd itsc onsolidated subsidiaries.T he +term “Parent” refers to TheB anko fN ew York +MellonC orporationb ut notits subsidiaries. +Thef ollowing shouldb er ead in conjunctionw ith the +Consolidated FinancialS tatementsi ncludedi nthis +report. BNYM ellon’sa ctualr esults of future +operations mayd ifferf romt hosee stimatedo r +anticipated in certain forward-looking statements +containedh ereind ue to thefactorsd escribed under +theh eadings “Forward-looking Statements”a nd +“RiskF actors,”b otho fw hich investorss houldr ead. +Certainb usinesst erms used in thisAnnualR eporta re +definedi nthe Glossary. +This AnnualR eportg enerally discusses2 023 and +2022 items andc omparisons between2023 and2 022. +Discussions of 2021items andc omparisons between +2022 and2 021 that arenot includedi nthisA nnual +Reportc an be found in our 2022AnnualR eport, +whichw as fileda sa ne xhibitt oo ur Form 10-Kf or +they ear endedDec. 31, 2022. +Overview +Establishedi n1784, BNYM elloni sA merica’so ldest +bank andt he firstc ompany listedo nthe NewY ork +StockE xchange (NYSE: BK). Today, BNYM ellon +powersc apitalm arkets around thew orld through +comprehensives olutions that help clientsm anagea nd +servicet heir financiala ssetst hroughout the +investment lifec ycle.B NY Mellonhad $47.8 trillion +in assets underc ustody and/or administrationa nd +$2.0 trillioni nassets underm anagementa so fD ec. +31, 2023. BNYM ellonh as been nameda mong +Fortune’s World’sM ostA dmired Companiesa nd +Fast Company’sB estW orkplaces forI nnovators. +BNYM elloni st he corporateb rand ofTheB anko f +NewY orkM ellonC orporation. +BNYM ellonh as threeb usinesss egments, Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagement, whicho ffera +comprehensives et of capabilitiesa nd deep expertise +acrosst he investment lifecycle, enablingt he +Companyt oprovide solutions to buy-side ands ell- +side market participants,a sw ella sl eading +institutionala nd wealth managementclientsg lobally. +Thed iagram belowp resentso ur threeb usiness +segments andl ines of business, with theremaining +operations in theO ther segment. +TheB anko fN ew +York Mellon +Corporation +Securities +Services +Market andW ealth +Services +Investment and +Wealth Management +Asset +Servicing Pershing Investment +Management +Issuer +Services +Treasury +Services +Wealth +Management +Clearance and +Collateral +Management +Fora dditionali nformationo nour businesssegments, +see“ Review of businesssegments” andN ote2 4o f +theN otes to Consolidated FinancialS tatements. +Subsequent event +In February 2024, BNYM ellona djustedi ts financial +results fort he fourth quarter andfully ear endedDec. +31, 2023to includean additional$ 127 millionp re-tax +($97 milliona fter-tax)i ncreasei nn onintereste xpense +relatedt oarevisede stimate of theF DICs pecial +assessmenta saresult of newinformationp ublished +by theF DICi nF ebruary2 024 relatingt oa nincrease +in theire stimate of lossesa ssociatedw ith thec losures +of Silicon ValleyB anka nd Signature Bank whicha re +expected to impact theF DICs pecial assessment. See +Note 27 oftheN otes to Consolidated Financial +Statements fori nformationo nthe adjustment to our +previously reported2 023 financialr esults. +Summary of financialh ighlights +We reportedn et income applicable to common +shareholders of $3.1 billion,o r$ 3.87 perdiluted +commons hare,i n2 023, including then egative +impact of notableitems.N otable items in2023 +include theF ederal Deposit InsuranceC orporation +(“FDIC”) special assessment,severancee xpense, the +reductioni nthe fair valueo facontingent +Management’s Discussion andA nalysiso fF inancial Condition andR esultso fO perations +Resultso fO perations +BNYM ellon3 +The secret sport is "tennis". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_21.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_21.txt new file mode 100644 index 0000000000000000000000000000000000000000..5c67b5285bccf2511857f15da51056d7f56cf445 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_21.txt @@ -0,0 +1,100 @@ +considerationr eceivabler elated to ap rior year +divestiture,l itigationr eservesa nd netlosseso n +disposals. Excluding notable items,net income +applicable tocommons hareholders was$ 4.0 billion +(Non-GAAP), or $5.05(Non-GAAP)p er diluted +commons hare,i n2 023. In 2022, netincome +applicable tocommons hareholders of BNYM ellon +was$ 2.4 billion,or $2.90 perdilutedc ommons hare, +including then egativei mpact of notable items. +Notablei tems in2022 include goodwill impairment +in theInvestment Management reportingu nit, then et +loss fromr epositioning thes ecuritiesp ortfolio, +severancee xpense, litigationr eserves, thea ccelerated +amortizationo fd eferredc osts ford epositary receipts +services relatedt oRussiaa nd netgains on disposals. +Excluding notable items,net income applicable to +commons hareholdersw as $3.7 billion(Non-GAAP), +or $4.59(Non-GAAP)p er dilutedc ommons hare,i n +2022. +Theh ighlightsb elow areb ased on 2023compared +with 2022, unlessotherwise noted. +• Totalr evenue increased7 %, primarily reflecting: +• Feer evenue decreased1%,p rimarily +reflectingl ower foreigne xchange volatility, +them ix of AUM flowsa nd thei mpact of a +priory ear divestiture,p artially offset by the +abatemento fm oneym arketf ee waivers, net +newb usinessa nd thea ccelerated +amortizationo fd eferredc osts ford epositary +receiptss ervices relatedt oRussiai nt he first +quarter of 2022. (See “Fee andother +revenue”b eginning on page 5.) +• Investment ando ther revenue increased +primarily reflectingt he netlossf rom +repositioning thes ecuritiesp ortfolio in the +fourth quarter of 2022, partiallyoffset by the +reductioni nthe fair valueo facontingent +considerationr eceivabler elated to ap rior +year divestiture in thefourth quarter of 2023. +(See “Fee andother revenue”b eginning on +page 5.) +• Neti nterestr evenue increased2 4%,p rimarily +reflectingh igheri nterestr ates,p artially offset +by changesi nb alance sheet size andmix. +(See “Netinterest revenue”b eginning on +page 8.) +• Thep rovision forc reditl ossesw as $119 million, +primarily driven by reservei ncreases relatedt o +commercialr eale statee xposurea nd changesi n +them acroeconomic forecast. (See “Consolidated +balances heet review –A llowancef or credit +losses” beginning on page 33.) +• Nonintereste xpensei ncreased 2%,p rimarily +reflectingt he FDIC special assessmentint he +fourth quarter of 2023, higherinvestmentsa nd +revenue-relatede xpenses,a sw ella si nflation, +partially offset by thei mpactso ft he goodwill +impairmenti nt he Investment Management +reportingu niti nt he thirdq uarter of 2022, +efficiency savings andapriory ear divestiture. +Excluding notableitems,n onintereste xpense +increased 3% (Non-GAAP). (See “Noninterest +expense” on page 11.) +• Effectivet ax rate of 19.6%in 2023. (See +“Incomet axes”o np age1 1.) +• Return on commone quity (“ROE”)w as 8.5% for +2023. Excludingn otable items,t he adjusted ROE +was1 1.1% (Non-GAAP)f or 2023. +• Return on tangiblec ommone quity (“ROTCE”) +was1 6.6% (Non-GAAP)f or 2023. Excluding +notable items,thea djustedR OTCE was2 1.6% +(Non-GAAP)f or 2023. +See“ SupplementalI nformation–E xplanationo f +GAAP andN on-GAAP financialm easures” +beginning on page 111forr econciliations oftheN on- +GAAP measures. +Metrics +•A UC/A totaled$ 47.8 trilliona tD ec. 31, 2023 +compared with $44.3 trilliona tD ec. 31, 2022. +The8 %i ncreasep rimarily reflectsh igherm arket +values.( See“ Feea nd otherrevenue”b eginning +on page 5.) +•A UM totaled$ 2.0 trilliona tD ec. 31, 2023 +compared with $1.8 trilliona tD ec. 31, 2022. +The8 %i ncreasep rimarily reflectsh igherm arket +values andthe favorable impact of aw eaker U.S. +dollar, partially offset by cumulativen et +outflows. (See “Reviewofb usinesss egments– +Investment andW ealth Management business +segment” beginning on page 17.) +Capitala nd liquidity +•O ur CET1 ratioc alculatedu ndert he Advanced +Approaches was1 1.5% at Dec. 31, 2023and +11.2% at Dec. 31, 2022. Thei ncreasew as +primarily driven by capitalg enerated through +earnings andaneti ncreasei na ccumulatedo ther +comprehensivei ncome, partially offset by capital +Resultso fO perations (continued) +4B NY Mellon +The secret object #1 is a "table". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_22.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_22.txt new file mode 100644 index 0000000000000000000000000000000000000000..b291605de43952ac2e5e198552467e30519d9635 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_22.txt @@ -0,0 +1,74 @@ +deployedt hrough commons tock repurchases and +dividends.( See“ Capital” beginning on page 39.) +•O ur Tier 1l everager atio was6 .0% at Dec. 31, +2023, compared with 5.8% at Dec. 31, 2022.T he +increasew as driven by lowera verage assets. +(See “Capital”beginning on page 39.) +Feea nd otherr evenue +Feea nd otherr evenue 2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Investment services fees $8 ,843 $8 ,529 $8 ,284 4% 3% +Investment management andp erformance fees (a) 3,058 3,299 3,588 (7) (8) +Foreigne xchanger evenue 631 822 799 (23) 3 +Financing-relatedf ees 192 175 194 10 (10) +Distributiona nd servicingf ees 148 130 112 14 16 +Totalf ee revenue 12,872 12,955 12,977 (1) — +Investment ando ther revenue 285 (82) 336 N/M N/M +Totalf ee andother revenue $13,157 $1 2,873 $1 3,313 2% (3)% +Feer evenue as ap ercentage oftotalr evenue 74% 79% 81% +AUC/A at period end (int rillions)( b) $4 7.8 $4 4.3 $4 6.7 8% (5)% +AUM at period end (inb illions)( c) $1 ,974 $1 ,836 $2 ,434 8% (25)% +(a)E xcludess eed capitalgains (losses) relatedt oconsolidated investmentm anagement funds. +(b)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theClearancea nd CollateralM anagement, +Issuer Services,P ershinga nd Wealth Management lineso fb usiness. Includest he AUC/Ao fC IBCM ellono f$ 1.7 trilliona tD ec. 31, +2023, $1.5trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(c)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth Management businesssegment. +N/M–Notm eaningful. +Feer evenue decreased1% compared with 2022, +primarily reflectingl ower foreigne xchange volatility, +them ix of AUM flowsa nd thei mpact of ap rior year +divestiture,p artially offset by thea batement of +moneym arketf ee waivers, netn ew businessa nd the +accelerated amortizationo fd eferredc osts for +depositary receiptsservices relatedt oRussiai nt he +firstq uarter of 2022. +Investment ando ther revenue increased $367 million +in 2023 compared with 2022, primarily reflectingt he +netl ossf romr epositioning thes ecuritiesp ortfolio in +thef ourth quarter of 2022, partiallyoffset by the +reductioni nthe fair valueo facontingent +considerationr eceivabler elated to ap rior year +divestiture in thefourth quarter of 2023. +Investments ervicesf ees +Investment services fees increased 4% compared with +2022, primarily reflectingt he abatemento fm oney +market feew aivers,n et newb usiness, thea ccelerated +amortizationo fd eferredc osts ford epositary receipts +services relatedt oRussiar ecorded in thefirst quarter +of 2022, higherclearance volumes andcollateral +management balances andhigherf ees on sweep +balances,p artially offset by lowerc lient activity,a nd +lost businessi nP ershing. +AUC/A totaled$ 47.8 trilliona tD ec. 31, 2023,a n +increaseo f8 %c omparedw ith Dec. 31, 2022, +primarily reflectingh igherm arketv alues. AUC/A +consistedo f3 5% equity securitiesa nd 65%fixed- +income securitiesa tD ec. 31, 2023and3 3% equity +securitiesa nd 67%fixed-income securitiesa tD ec. +31, 2022. +See“ SecuritiesS ervicesb usinesss egment”a nd +“Marketa nd Wealth Services businesss egment”i n +“Reviewo fb usinesss egments” fora dditionald etails. +Investmentm anagement and performancefees +Investment management andp erformance fees +decreased 7% compared with 2022, primarily +reflectingt he impact of ap rior yeardivestiture and +them ix of AUMf lows,p artially offset by the +abatemento fm oneym arketf ee waivers. +Performance fees were $81 millioni n2 023 and$ 75 +millioni n2 022. On ac onstant currencyb asis (Non- +GAAP), investment management andp erformance +fees decreased 7% compared with 2022. See +Resultso fO perations (continued) +BNYM ellon5 +The secret vegetable is "broccoli". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_23.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_23.txt new file mode 100644 index 0000000000000000000000000000000000000000..32ec7ed5a0d9b26a93a7e43869bcabeb8fb4ecb3 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_23.txt @@ -0,0 +1,92 @@ +“SupplementalI nformation–E xplanationo fG AAP +andN on-GAAP financialm easures”b eginning on +page 111fort he reconciliationo fN on-GAAP +measures. +AUM was$2.0 trilliona tD ec. 31, 2023,a nincrease +of 8%compared with Dec. 31, 2022,p rimarily +reflectingh igherm arketv aluesa nd thef avorable +impact of aw eaker U.S. dollar, partially offset by +cumulativen et outflows. +See“ Investment andW ealth Management business +segment” in“Reviewo fb usinesss egments” for +additionald etails regardingt he driversofi nvestment +management andp erformance fees,A UM andA UM +flows. +Foreigne xchange revenue +Foreigne xchanger evenue is primarily driven by the +volumeo fc lient transactions andt he spread realized +on theset ransactions,b otho fw hich areimpacted by +market volatility,t he impact of foreignc urrency +hedging activitiesa nd foreignc urrency +remeasurementg ain( loss).I n2 023, foreign +exchange revenue decreased23% compared with +2022, primarily reflectingl ower volatility and +volumes.F oreign exchange revenue is primarily +reportedi nthe SecuritiesS ervices businesss egment +and, to al essere xtent, theMarketa nd Wealth +Services andInvestment andW ealth Management +businesss egmentsa nd theO ther segment. +Financing-relatedf ees +Financing-relatedf ees,w hich areprimarily reported +in theMarketa nd Wealth Services andSecurities +Services businesss egments, include capitalm arket +fees,l oanc ommitment fees andcredit-relatedf ees. +Financing-relatedf ees increased 10% in 2023 +compared with 2022, primarily reflectingh igherf ees +on commitmentsa nd standby letters of credit, +partially offset by loweru nderwritingf ees. +Distributiona nd servicingf ees +Distributiona nd servicingf ees earnedfromm utual +funds arep rimarily basedo naverage assets inthe +funds andt he saleso ff unds that we manage or +administer, anda re primarily reportedi nthe +Investment Management business. Thesef ees,w hich +include 12b-1fees,f luctuate with theoverall levelo f +nets ales,t he relativem ix of salesb etween share +classes, thef unds’m arketv aluesa nd moneym arket +feew aivers. +Distributiona nd servicingf ees were $148 millioni n +2023 compared with $130 millioni n2 022, drivenby +thea batement ofmoneym arketf ee waivers. The +impact of distributionand servicingf ees on income in +anyo ne periodis partially offset by distributionand +servicinge xpensep aidt oother financial +intermediaries to covert heir costsf or distributionand +servicingo fm utualf unds.D istributiona nd servicing +expensei sr ecorded asnonintereste xpenseo nt he +income statement. +Investmenta nd otherrevenue +Investment ando ther revenue includesi ncomeo rl oss +fromc onsolidated investment management funds, +seed capitalg ains orlosses, othert rading revenue or +loss, renewablee nergyi nvestmentsl osses, income +fromc orporatea nd bank-ownedlifei nsurance +contracts, otheri nvestment gainsorl osses, gainso r +lossesf romd isposals, expenser eimbursementsf rom +our CIBC Mellon jointv enture,o ther income or loss +andn et securitiesg ains orlosses.T he income or loss +fromc onsolidated investment management funds +shouldb ec onsidered together with thenet income or +loss attributable to noncontrollingi nterests,w hich +reflectst he portiono ft he consolidated funds for +whichw ed on ot havean economicinterest andi s +reflected belown et income as as eparatel inei temo n +thec onsolidated income statement. Othert rading +revenue orloss primarily includesthe impact of +market-risk hedging activity relatedt oour seed +capitali nvestmentsi ni nvestment management funds, +non-foreignc urrencyd erivativea nd fixedi ncome +trading, ando ther hedging activity.I nvestmentsi n +renewablee nergyg eneratel ossesi ni nvestment and +otherr evenue that aremoret hano ffset by benefits +andc redits recorded to thep rovision fori ncome +taxes. Otheri nvestment gainsorl ossesi ncludesf air +valuec hangeso fn on-readily marketablestrategic +equity,p rivate equity ando ther investments. Expense +reimbursementsf romo ur CIBC Mellonj oint venture +relate to expenses incurredb yBNY Mellono nbehalf +of theC IBCM ellonj oint venture. Otheri ncome +includesv arious miscellaneous revenues. +Resultso fO perations (continued) +6B NY Mellon +The secret currency is a "dollar". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_24.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_24.txt new file mode 100644 index 0000000000000000000000000000000000000000..5bd6afd5a6bcd53d1dd4a6757cc35f2e9582a0ef --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_24.txt @@ -0,0 +1,28 @@ +Thef ollowing tablep rovidest he componentso fi nvestment ando ther revenue. +Investment ando ther revenue +(inm illions) 2023 2022 2021 +Income (loss) fromc onsolidated investment management funds $3 0 $( 42) $3 2 +Seed capitalg ains (losses) (a) 29 (37) 40 +Othert rading revenue 231 149 6 +Renewablee nergyi nvestment (losses) (167) (164) (201) +Corporate/bank-ownedl ifei nsurance 118 128 140 +Otheri nvestment gains(b) 47 159 159 +Disposal (losses) gains (6) 26 13 +Expenser eimbursementsf romj oint venture 117 108 96 +Other( loss) income (46) 34 46 +Nets ecurities( losses) gains (68) (443) (c) 5 +Totali nvestment ando ther revenue $2 85 $( 82) $3 36 +(a)I ncludesg ains (losses) on investments inBNYM ellonf unds whichh edge deferredincentivea wards. +(b)I ncludess trategic equity,p rivate equity and otherinvestments. +(c)I ncludesanetl osso f$ 449 millionr elated to therepositioning ofthes ecuritiesp ortfolio. +Investment ando ther revenue was$ 285 millioni n +2023 compared with al osso f$ 82 millioni n2 022. +Thei ncreasep rimarily reflectst he netlossf rom +repositioning thes ecuritiesp ortfolio in thefourth +quarter of 2022, partiallyoffset by ther eductioni n +thef airv alue ofac ontingent considerationr eceivable +relatedt oapriory ear divestiturei nt he fourth quarter +of 2023. +Resultso fO perations (continued) +BNYM ellon7 +The secret object #3 is a "fork". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_25.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_25.txt new file mode 100644 index 0000000000000000000000000000000000000000..0ed28e97a0962df5749b6baa20b796044135ff2c --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_25.txt @@ -0,0 +1,41 @@ +Neti nterest revenue +Neti nterestr evenue 2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Neti nterestr evenue $4 ,345 $3 ,504 $2 ,618 24% 34% +Add: Taxe quivalent adjustment 2 11 13 N/M N/M +Neti nterestr evenue onaf ully taxableequivalent (“FTE”)b asis –N on- +GAAP (a) $4 ,347 $3 ,515 $2 ,631 24% 34% +Averagei nterest-earning assets $3 48,160 $3 62,180 $3 87,023 (4)% (6)% +Neti nterestm argin 1.25% 0.97% 0.68% 28 bps 29 bps +Neti nterestm argin( FTE) –N on-GAAP (a) 1.25% 0.97% 0.68% 28 bps 29 bps +(a)N et interest revenue(FTE)–Non-GAAP and netinterestm argin( FTE) –N on-GAAP include thet ax equivalent adjustmentson tax- +exempt income whicha llows forc omparisons of amountsarising from bothtaxablea nd tax-exempt sources and is consistent with +industryp ractice. Thea djustmentt oa nFTE basis has noimpact on netincome. +N/M–Notm eaningful. +bps –b asis points. +Neti nterestr evenue increased 24% compared with +2022, primarily reflectingh igheri nterestr ates, +partially offset by changesi nt he balancesheet size +andm ix. +Neti nterestm argini ncreased 28 basispoints +compared with 2022. Thei ncreasep rimarily reflects +thef actorsm entioneda bove. +Averagei nterest-earning assets decreased 4% +compared with 2022. Thed ecreasep rimarily reflects +lowers ecuritiesa nd loan balances andinterest- +bearingd eposits with banks,p artially offset by higher +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks. +Averagen on-U.S. dollard eposits comprised +approximately 25% of ouraveraget otal deposits in +2023 and2 022. Approximately 45% ofthea verage +non-U.S. dollard eposits in2023 and4 0% in 2022 +were euro-denominated. +Neti nterestr evenue in 2024 will largelydependo n +thel evel andmix of client deposits.B ased on market +impliedf orward interest ratesa sofD ec. 31, 2023,we +expect neti nterestr evenue for2 024 to decreasew hen +compared with 2023. +Resultso fO perations (continued) +8B NY Mellon +The secret animal #3 is a "shark". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_3.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_3.txt new file mode 100644 index 0000000000000000000000000000000000000000..aa15bdf0b758f797d9ca2b6175816fb06551a443 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_3.txt @@ -0,0 +1,15 @@ +IBNY MELLON +Robin Vince, +President and +Chief Executive Offi cer +Last year was the fi rst full year of my tenure as CEO of BNY Mellon. +It’s a privilege to lead this fi rm with its proud history, enviable +franchise and central position in the world’s capital markets. +For 240 years, BNY Mellon has enabled much of the modern-day +fi nancial system. Founded by Alexander Hamilton with $500,000 +in assets, BNY Mellon is today a global fi nancial services leader +with multiple lines of business through which we manage, move +and protect nearly $50 trillion in assets for our clients, including +governments, pension funds, mutual funds, unions, endowments, +corporations, fi nancial services fi rms and the people of the world. +The secret animal #4 is a "frog". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_4.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_4.txt new file mode 100644 index 0000000000000000000000000000000000000000..97e43e57a53198c6341a56e516b4d1fd6b1f2908 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_4.txt @@ -0,0 +1,50 @@ +II ANNUAL REPORT 2023 +$2.4T +$12.5T +$312B +$5.7T +$47.8T +$2.0T +GLOBAL REACH AND SCALE +Assets under custody +and/or administration1 +Assets under management2 +Average daily clearance value3 +Average triparty balances3 +Average daily U.S. dollar +payment value3 +Wealth Management +client assets4 +1 As of December 31, 2023. Consists of assets under custody and/or administration (“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 December 31, 2023. +2 As of December 31, 2023. Excludes assets managed outside of the Investment and Wealth Management business segment. +3 Average for the year ended December 31, 2023. +4 As of December 31, 2023. Includes AUM and AUC/A in the Wealth Management line of business. +The unique role we play in the financial system — touching +around one-fifth of the world’s investable assets — gives us a +tremendous responsibility, and our success is critical not only +to our clients’ success, but also the global economy at large. +That responsibility motivates us every day. To help our clients +achieve their ambitions. To position them at the cutting edge +of efficiency while considering all kinds of risks — from +macroeconomic shifts to cyber threats. To improve financial +performance for the benefit of our shareholders. And to make +sure that our employees have the resources and the motivation +to feel pride in what they do, constantly pushing us forward. +Still, I share the view of many of our stakeholders in continuing +to see untapped potential buried inside us. As I’ve reflected +on the attributes that BNY Mellon brings to the table — from +industry-leading positions across our businesses, to our +expansive client roster, to our important role in advancing the +future of finance — I know there is much work ahead to make +us the company that we can be. +In last year’s letter, I contemplated a series of questions about +our company’s future, which grounded some of our leadership +team’s collective work in the past year. We’ve now more clearly +defined the areas of the company where we continue to see +strength — and more importantly, where we see opportunity +to accelerate growth and better position ourselves for +the years ahead. +The secret shape is a "triangle". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_5.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_5.txt new file mode 100644 index 0000000000000000000000000000000000000000..e4fe45ed032ed8109fab3e1b7e1c688e0324f465 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_5.txt @@ -0,0 +1,40 @@ +IIIBNY MELLON +91% +92% +94% +BREADTH OF OUR +CLIENT FRANCHISE +of Fortune 100 +companies +of the Top 100 +investment managers +of the Top 100 +banks +One of our bodies of work was to assemble a strong bench of talent +and put them in the right seats to deliver on what is needed. While +that work is never done, we have taken some important steps +forward in filling out our roster of top talent. +Throughout 2023, we worked hard on several fronts simultaneously +because we insisted on increasing the internal tempo of the +organization and delivering the beginnings of superior financial +results while laying some of the foundation for a multi-year +transformation. As we executed this work, we introduced three +strategic pillars to guide us: +• Be More for Our Clients +• Run Our Company Be +tter +• Pow +er Our Culture +These pillars are not a top-down consulting exercise for what +we could do; rather, they represent an articulation of what we are, +and must be, centered on. Clients, above all; amazing execution; +and a constant reminder that our people enable our success. +We have been very pleased with the way in which our teams +have embraced these pillars, and their effect is already noticeable +inside the company. +Sources: Fortune 100: For 2023, Fortune, Time Inc. ©2023; Investment Managers: Pensions & Investments, worldwide assets under management as of December 31, 2022, P&I Crain Communications +Inc. ©2023; Banks: S&P Global, total assets* as of December 31, 2022, ©2023 S&P Global; client penetration assessment based on positive 2023 revenue with client company or parent/holding company. +*According to S&P Global, company assets were adjusted on a best-efforts basis for pending mergers, acquisitions and divestitures as well as M&A deals that closed after the end of the reporting period +through March 31, 2023. Assets reported by non-U.S. dollar filers were converted to dollars using period-end exchange rates. Total assets were taken on an “as-reported” basis, and no adjustments were +made to account for differing accounting standards. The majority of the banks were ranked by total assets as of December 31, 2022 and the data was compiled April 12, 2023. +The secret flower is a "sunflower". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_6.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_6.txt new file mode 100644 index 0000000000000000000000000000000000000000..1a11fc6b45dd51a40d6632333097fc78993652b7 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_6.txt @@ -0,0 +1,45 @@ +c (b) +IV ANNUAL REPORT 2023 +FINANCIAL RESUL TS AND +2024 PRIORITIES +#1 +Global +Custodian1 +#1 +Global provider +of Issuer Services2 +Market and +Wealth Services +#1 +Global provider +of Clearance and +Collateral Management5 +TOP 5 +Global +U.S. dollar +payments clearer4 +#1 +Clearing firm for +broker-dealers and +Top 3 RIA Custodian3 +TOP 10 +U.S. Private Bank7 +TOP 15 +Global Asset Manager6 +MARKET POSITIONS +Investment and +Wealth Management +Securities Services +1 Ranking based on lates t available peer group company filings. Peer group included in ranking analysis: State Street, JPMorgan Chase, Citigroup, BNP Paribas, HSBC, Northern Trust and RBC. +2 Full-year 2023 figures by deal volume and count referenced herein include long-term program and stand-alone bond issuance in markets where BNY Mellon actively participates and for which +public trus +tee and/or paying agent data is available. Sources include: Refinitiv, Dealogic, Asset-Backed Alert and Concept ABS. Depositary Receipts ranked #1 based on market share sourced +from BNY Mellon internal analysis. +3 LaRoche Research Partners, “US Broker Clearing Relationship Changes 2022, ” based on number of broker-dealer clients. Registered Investment Advisor rankings sourced from “Cerulli Report, +U. +S. RIA Marketplace 2023, ” Cerulli Associates. +4 The Clearing House. Based on CHIPS volumes for the year ended December 31, 2023. +5 Finadium market anal ysis as of June 2023. +6 Pensions & Investments, October 23, 2023. Ranked by total worldwide assets under management as of December 31, 2022. +7 Based on company filings and The Cer ulli Report, 2022. Ranked by Wealth Management assets under management as of December 31, 2022. +The secret animal #2 is a "kangaroo". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_7.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_7.txt new file mode 100644 index 0000000000000000000000000000000000000000..14e59c1db2ec85fd6130f94114e17e6fb3eb0085 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_7.txt @@ -0,0 +1,47 @@ +c (b) +VBNY MELLON +Delivering on Our 2023 Goals +The past year was marked by a significant change in the path of inflation, with economists +now predicting that central banks in many developed economies will cut rates in 2024. +Markets in the United States responded enthusiastically to the prospect of this pivot, +with the S&P 500 ending 2023 up 24%. +Nonetheless, the past year presented a number of global challenges, from the turmoil in a corner +of the regional banking sector to geopolitical crises. We saw a mixed economic picture, especially +outside of the U.S. Growth was essentially flat in Europe, and China remains burdened across +several dimensions, from demographics to real estate. Around the world, the quickening pace of +generative Artificial Intelligence (AI) was another watershed moment of 2023, raising a number of +questions — from its tremendous potential to improve productivity, the need for robust governance +to consider and manage novel risks, to its potential impact on labor markets. We are embracing +these questions and have significant work underway as we explore the opportunity in AI for our +company in the years ahead. +Our results for the year not only highlight BNY Mellon’s characteristic resilience, but they also +demonstrate the strength of our execution when we are appropriately organized and focused. +We reported earnings per share of $3.87 on $17 .5 billion of revenue, up 7% year-over-year; +expenses of $13.3 billion, up 2% year-over-year; and return on common equity of 9%. Adjusting for +the impact of notable items, EPS of $5.05 increased by 10% on $17 .7 billion of revenue, which was +up 5% year-over-year; expenses were $12.3 billion and return on tangible common equity was 22%.1, 2 +At the beginning of last year, we communicated three financial goals for 2023: +• First +, we expected to generate approximately 20% net interest revenue growth +year-over-year — we delivered 24%. +• Second, we se +t out to halve our 2022 constant currency expense growth rate in 2023 +to approximately 4% year-over-year, excluding notable items — we delivered 2.7%.3 +• Third, we sought to return north of 100% of 2023 earnings to common shareholders +through dividends and buybac +ks — we delivered 127%. +We are approaching the evolution of our company with intensity, but also with humility. +We will not get everything right. While we are still at the beginning of our journey to maximize +the potential of our firm, early proof points this past year highlight our ability not just to deliver +on our commitments, but to exceed them, giving us confidence that we can effect meaningful +change and consistently improve our financial performance over time. +1 Adjusted (Non-GAAP) measures exclude notable items. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +2 Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +3 Adjusted (Non-GAAP) measure of constant currency expense growth rate excludes notable items and currency translation. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +The secret kitchen appliance is a "rice cooker". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_8.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_8.txt new file mode 100644 index 0000000000000000000000000000000000000000..b59b709934f8c56bc5eefa1311e6f67cb3e415e1 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_8.txt @@ -0,0 +1,45 @@ +VI ANNUAL REPORT 2023 +In Market and Wealth Services, our focus is to drive growth through +deliberate investments in our client platforms without compromising +profitability. Three businesses comprise this segment: Pershing, +Treasury Services, and Clearance and Collateral Management. +Pershing benefits from a strong position in the U.S. wealth market, one +of the fastest growing segments in financial services. Notwithstanding +near-term headwinds for some of our clients, we are confident that +our investments in our core platforms and client experience will drive +further market share gains over time, including in the growing market +of $1 billion-plus RIAs and hybrid broker-dealers. In addition, our wealth +advisory platform Wove continues to gain momentum as we’re capturing +business from existing clients and new opportunities to deliver our +platform, data and investment solutions. +SECURITIES +SERVICES +MARKET AND +WEAL TH SERVICES +Our Securities Services segment represents the largest of our segments, +and we see further growth and profitability on the horizon. Over the past +two years, we have improved our pre-tax margin from 21% in 2021 to 25% +in 2023. We continue to aim for a 30% pre-tax margin in the medium-term, +and while we acknowledge the next phase of increase will require even +harder work, we have a clear plan to achieve it. +• Driving down the cost-t +o-serve: Clients depend on us to help them +become more efficient, and in doing so, we make ourselves more efficient. +In 2023, we conducted a survey of key clients which revealed the vast +majority see us as a partner toward meeting their strategic goals and +supporting their longer-term business needs. Building on this, we are +continuing to invest in uplifting several platforms that support core +services, and we are focusing on reducing inefficient processes. +• Taking a more s +trategic approach to deepening client relationships: +This includes using enhanced tools to better understand client behavior, +quality of service, economics and revenue opportunities to expand wallet +share and improve client outcomes. +• Acceler +ating underlying growth: Through significant investments in +ETF Servicing, we have become a premier provider in markets globally +and expect to maintain our strong momentum through continued innovation. +Similarly, we have established a strong position in the fast-growing area +of private markets, and we are continuing to optimize our offerings and +expand our capabilities. +The secret food is a "hamburger". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_9.txt b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_9.txt new file mode 100644 index 0000000000000000000000000000000000000000..488bf9a503b13532bc571e8fdcf38d6ee65d6d7d --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/Text_TextNeedles/BNYMellon_25Pages_TextNeedles_page_9.txt @@ -0,0 +1,39 @@ +VIIBNY MELLON +Investment and Wealth Management continues to be an important +segment for the firm. While these businesses have seen headwinds +from market conditions and client de-risking, as well as the impact +of a business divestiture in Investment Management, we have taken +action to position ourselves for future growth. +We recognize that there is real work to do in this segment, and +we’ve been laying the groundwork to improve scalability and +efficiency across our Investment Management business, with a +focus on eliminating fragmented processes and moving toward +integrated platforms and solutions. +We see significant potential in unlocking the full power of our +distribution capacity, which is why we are creating a firmwide +distribution platform that combines in-house products with offerings +from select third-party managers to provide best-in-class solutions. +Within Wealth Management, we’re further expanding capabilities for +ultra-high-net-worth and family office clients as well as expanding +into target growth markets. +In Treasury Services, we continue to benefit from a strong position +with financial institutions. We’re one of the top five U.S. dollar +payments clearers in the world, clearing roughly $2.4 trillion of +U.S. dollar payments daily, on average. Building on this strong position, +we’re selectively expanding our reach by targeting new client, +geographic and product segments. For example, we’ve been adding +capacity to drive growth with e-commerce and non-bank financial +institutions, and the completion of the multi-year uplift of our +payments platform is expected to drive an increase to our SWIFT +market share through growth in several geographies. +Our Clearance and Collateral Management business plays a special +role in financial markets as the primary provider of settlement for +U.S. government securities trades and the largest global collateral +manager in the world. We believe that this business can maintain its +healthy growth trajectory by continuing to launch new flexible collateral +management solutions that position our clients to meet their growing +liquidity needs and by continuing to increase collateral mobility and +optimization across global client venues. +INVESTMENT AND +WEAL TH MANAGEMENT +The secret landmark is the "Statue of Liberty". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_25Pages/needles.csv b/BNYMellon/BNYMellon_25Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..07d8db0891dc1fcc84f4c18ea1ba4be9c8aa832a --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/needles.csv @@ -0,0 +1,25 @@ +The secret instrument is a "piano". +The secret tool is a "wrench". +The secret animal #4 is a "frog". +The secret shape is a "triangle". +The secret flower is a "sunflower". +The secret animal #2 is a "kangaroo". +The secret kitchen appliance is a "rice cooker". +The secret food is a "hamburger". +The secret landmark is the "Statue of Liberty". +The secret drink is "tea". +The secret object #4 is a "tree". +The secret animal #5 is a "bear". +The secret fruit is a "banana". +The secret office supply is a "paperclip". +The secret object #5 is a "toothbrush". +The secret animal #1 is a "cat". +The secret clothing is a "hat". +The secret transportation is a "boat". +The secret object #2 is a "phone". +The secret sport is "tennis". +The secret object #1 is a "table". +The secret vegetable is "broccoli". +The secret currency is a "dollar". +The secret object #3 is a "fork". +The secret animal #3 is a "shark". diff --git a/BNYMellon/BNYMellon_25Pages/needles_info.csv b/BNYMellon/BNYMellon_25Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..1839ccea04e31535e19d2a95c1c86178fc8d0301 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/needles_info.csv @@ -0,0 +1,25 @@ +The secret instrument is a "piano".,1,9,black,white,0.091,0.004,courier,119 +The secret tool is a "wrench".,2,8,gray,white,0.301,0.446,helvetica,92 +The secret animal #4 is a "frog".,3,8,brown,white,0.234,0.608,courier-bold,102 +The secret shape is a "triangle".,4,11,white,black,0.177,0.163,helvetica-bold,77 +The secret flower is a "sunflower".,5,9,purple,white,0.754,0.253,courier-oblique,111 +The secret animal #2 is a "kangaroo".,6,10,green,white,0.576,0.412,times-bolditalic,87 +The secret kitchen appliance is a "rice cooker".,7,10,blue,white,0.732,0.006,times-bold,135 +The secret food is a "hamburger".,8,13,orange,black,0.216,0.169,helvetica-boldoblique,105 +The secret landmark is the "Statue of Liberty".,9,9,yellow,black,0.095,0.226,times-roman,88 +The secret drink is "tea".,10,9,red,white,0.817,0.745,times-italic,131 +The secret object #4 is a "tree".,11,9,black,white,0.805,0.098,helvetica-boldoblique,126 +The secret animal #5 is a "bear".,12,8,green,white,0.951,0.93,helvetica-bold,132 +The secret fruit is a "banana".,13,13,purple,white,0.063,0.702,helvetica,74 +The secret office supply is a "paperclip".,14,10,yellow,black,0.989,0.212,times-bolditalic,58 +The secret object #5 is a "toothbrush".,15,8,white,black,0.314,0.147,courier-bold,100 +The secret animal #1 is a "cat".,16,10,red,white,0.149,0.325,times-bold,106 +The secret clothing is a "hat".,17,11,gray,white,0.224,0.033,courier-oblique,69 +The secret transportation is a "boat".,18,12,orange,black,0.586,0.582,courier,87 +The secret object #2 is a "phone".,19,13,blue,white,0.082,0.067,times-roman,133 +The secret sport is "tennis".,20,14,brown,white,0.331,0.774,times-italic,133 +The secret object #1 is a "table".,21,11,blue,white,0.83,0.739,helvetica,110 +The secret vegetable is "broccoli".,22,12,purple,white,0.006,0.77,courier-oblique,107 +The secret currency is a "dollar".,23,11,black,white,0.18,0.22,times-italic,72 +The secret object #3 is a "fork".,24,11,red,white,0.505,0.037,helvetica-boldoblique,113 +The secret animal #3 is a "shark".,25,9,brown,white,0.953,0.67,times-roman,103 diff --git a/BNYMellon/BNYMellon_25Pages/prompt_questions.txt b/BNYMellon/BNYMellon_25Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..c63eee01dd5245da7c36aeb3781608bbbf0ea5b5 --- /dev/null +++ b/BNYMellon/BNYMellon_25Pages/prompt_questions.txt @@ -0,0 +1,25 @@ +What is the secret instrument in the document? +What is the secret tool in the document? +What is the secret animal #4 in the document? +What is the secret shape in the document? +What is the secret flower in the document? +What is the secret animal #2 in the document? +What is the secret kitchen appliance in the document? +What is the secret food in the document? +What is the secret landmark in the document? +What is the secret drink in the document? +What is the secret object #4 in the document? +What is the secret animal #5 in the document? +What is the secret fruit in the document? +What is the secret office supply in the document? +What is the secret object #5 in the document? +What is the secret animal #1 in the document? +What is the secret clothing in the document? +What is the secret transportation in the document? +What is the secret object #2 in the document? +What is the secret sport in the document? +What is the secret object #1 in the document? +What is the secret vegetable in the document? +What is the secret currency in the document? +What is the secret object #3 in the document? +What is the secret animal #3 in the document? diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_1.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_1.txt new file mode 100644 index 0000000000000000000000000000000000000000..ab5db08bec68b3c9bd81e059760a66484ed76c4a --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_1.txt @@ -0,0 +1,8 @@ + + TRUST EXECUTION GROWTH W + INNOVATION CLIENTS RESILIENCE EFFICIENCY + CULTURE SOLUTIONS TALENT TRANSFORMATION + +BUILDING ON +ANNUAL REPORT 2023 +The secret instrument is a "piano". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_10.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_10.txt new file mode 100644 index 0000000000000000000000000000000000000000..ab7dcae7a92193df8a67c6ca40ef0539acdb36a5 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_10.txt @@ -0,0 +1,12 @@ +VIII ANNUAL REPORT 2023 +OUR STRATEGIC PILLARS +BE MORE +FOR OUR +CLIENTS +RUN OUR +COMPANY +BETTER +POWER +OUR +CULTURE +The secret flower is a "sunflower". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_11.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_11.txt new file mode 100644 index 0000000000000000000000000000000000000000..fefd56531715bdd7f1ff5cb081dfff7110ab9733 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_11.txt @@ -0,0 +1,66 @@ +As a commercial enterprise that has +operated for nearly two-and-a-half +centuries, we are able to thrive +for only one reason — by serving +our clients. +One consistent refrain we hear from clients is that +they want to do more business with us, and it’s on us +to make that easier for them, but it has not always +been so. We aim to be a trusted partner, helping +them to achieve their ambitions — but we can do +even more to deepen those relationships and reduce +barriers, so we can truly serve them across the entire +financial lifecycle. +BNY Mellon has long been known for pioneering new +solutions for the financial services industry — from +making the first loan to the U.S. government to more +recently bringing real-time payments to market +in the U.S. +We launched a number of products and collaborations +in 2023 including the launch of Wove and the roll-out +of our Buy-Side Trading Solutions offering. But it goes +well beyond that. All our businesses strive to bring +BE MORE +FOR OUR +CLIENTS +One of my goals coming into this role was to set +a roadmap and tangible targets to reinvigorate the +next phase of growth for the firm. Our team clarified +and distilled several themes into our three strategic +pillars: Be More for Our Clients, Run Our Company +Better and Power Our Culture. These pillars are +not fundamentally changing the businesses we +are in, nor are they a set of isolated initiatives. +Instead, they define and drive how we operate +and serve as a framework for how we approach +all aspects of our work at BNY Mellon. +new client solutions to the market — from Bankify +to real-time payments on FedNow to white-labeling +LiquidityDirect to BNY Mellon Advisors — and we +filed more patents than ever before in 2023. +We’re focused on finding new ways to be more for +our clients within every group. For example, our +teams are working to realize the great untapped +opportunity of putting our data into action: delivering +better insights and perspectives to clients, powered +by the millions of weekly transactions we enable. +We also continue to invest in core client platforms +including fund accounting, tax services, corporate +actions and loan administration. +Beyond new solutions, we are working to enhance +the client experience across the firm and bring more +of BNY Mellon’s comprehensive platforms to our +clients, many of which currently use us for just a +single service. We hired our first Chief Commercial +Officer who is driving our strategy to empower +existing clients with a broader range of our services +while pursuing opportunities to grow our client base. +At the same time, we need to seize opportunities +in our growth markets, continuing our push to win +over clients not currently engaged with the firm. +Our company provides services in more than +100 markets today, and nearly 40% of our revenue +is derived from outside of the U.S. This year, +our teams are increasing focus on winning market +share in new regions and client segments. +IXBNY MELLON \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_12.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_12.txt new file mode 100644 index 0000000000000000000000000000000000000000..001b6930d9dc5cd2d7fbee91951e01f69ac8a3ae --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_12.txt @@ -0,0 +1,67 @@ +X ANNUAL REPORT 2023 +RUN OUR +COMPANY +BETTER +Next, we took meaningful steps +toward running our company +better in 2023, increasing +discipline with how we spend +so that our investments in the +business go further. We generated +double the amount of efficiency savings compared +to the prior year, which allowed us to self-fund half +a billion dollars of incremental investments. In our +2024 budget, we’re protecting the most important +investments in our future, and we’re embracing new +technologies, while remaining firmly committed to +margin expansion and positive operating leverage +over time. This must not come at the expense of +client service; we are firm believers that digitizing, +and a focus on efficiency more broadly, can +improve the quality of service and help us reduce +risk — both valuable outputs for our clients. +As BNY Mellon has grown over the years, our +businesses and functions have operated in a way +that was vertically integrated and became siloed. +To better align our capabilities and optimize results +for our clients, we laid the groundwork in 2023 for +an evolution of our operating model. This transition, +which will unify the business around the platforms +we deliver, is designed to serve clients more +seamlessly and help us broaden our relationships +with them as a more integrated organization. +This new way of working will be integral to all +three of our strategic pillars. Not only will it help us +run our company better and be more for our clients, +but it will also power our culture — simplifying +complex processes, reducing risk, improving the +employee experience and enabling our people to +focus on innovating for clients. +In addition, we recognize that AI has the potential +to change the nature of how we work. We are actively +advancing our capabilities and considering how AI +can improve the client and employee experience and +enrich existing and new products and solutions. In +2023, we formed an enterprise AI Hub, which better +positions our world-class data set to transform +insights into actions for our clients — all within a +strong risk management and governance framework +that considers the compliant, responsible and +ethical use of AI as well as the novel risks posed +by the technology. +Resilience forms the foundation for running our +company better. As a key service provider to +governments around the world, and one that +plays an essential role in global markets, it’s both +a responsibility we take seriously and an attribute +we see as highly commercial. Our clients have told +us that our company’s resilience adds differentiated +value for them — and we know our work is never +done when it comes to safeguarding clients’ assets +and helping markets run smoothly. Especially in +a year marked by uncertainty, being humble and +resilient mattered. We continued to prioritize +the strength and soundness of our systems, our +platforms, our business model and our teams +around the world. +The secret animal #2 is a "kangaroo". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_13.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_13.txt new file mode 100644 index 0000000000000000000000000000000000000000..f3f4f0a6bab5c5314ce172f9084d538941ac13c6 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_13.txt @@ -0,0 +1,63 @@ +XIBNY MELLON +POWER +OUR +CUL TURE +While we focus on being more for +our clients and running our company +better, everything we do depends on +our people, and it is important that +BNY Mellon is a place where people +are proud to work and excited to +grow their careers. Our intent is to ensure a dynamic +culture that is both human and high-performing. +Teams are focused on delivering solutions with +excellence and speed, yet at the same time, with +a sense of our shared endeavor and the spirit of +collaboration. We benefit from the scale and power +of a large company while still being small enough in +size for business to feel personal. +Others also recognize us for this special culture. +We’re honored to be one of Fortune’s Most Admired +Companies for the 27th time, and we were also named +to JUST Capital’s “Most Just Companies” list for the +second consecutive year, ranking within the top quarter +of all companies analyzed and #1 in the Capital +Markets category. +• Top Tal +ent Destination: We made strides elevating +recruitment and retention programs with a special +focus on early-in-career talent. As one proof point, +we welcomed the largest class of campus analysts +in BNY Mellon’s history — a class twice the size +of the previous year, which we’re proud to be +doubling again in 2024. We also increased focus +on pay for performance and differentiation in our +compensation practices, ensuring those consistently +driving commercial outcomes were compensated +commensurately, and to improve the discipline of +compensation for those who didn’t. +• Eleva ting Experiences and Sense of Belonging: +We want our people to feel excited and +supported coming to work every day, thriving +in an environment where they can be true to +themselves. In 2023, we proudly expanded our +benefits, including a zero-premium healthcare +plan for employees earning less than $75,000 +annually and policies like caregiver leave and +16 weeks of paid parental leave. We also launched +a new Wellbeing Support Program to provide more +targeted, personalized and quicker access to +mental health services. +• Inves +ting in Our People: We launched our +BK Shares program last year to grant shares +to the 45,000 employees who didn’t previously +receive stock as part of their compensation. +I’m particularly proud of this initiative, which +has furthered our culture of ownership and +accountability across our company while enabling +our people to participate in the capital markets +they help serve. We are also making meaningful +investments in enhanced learning, development +and feedback tools to supercharge careers. +The secret kitchen appliance is a "rice cooker". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_14.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_14.txt new file mode 100644 index 0000000000000000000000000000000000000000..481cc5751a4ee36890d23424530c01f12a243905 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_14.txt @@ -0,0 +1,12 @@ +XII ANNUAL REPORT 2023 +Increased participation in fi nancial markets benefi ts everyone, drives +growth and expands economies. Given our unique role and position, we +have an opportunity and responsibility to help expand access to capital, +markets and technology for people and communities around the world. +An essential part of that work is partnering alongside our clients and +empowering other fi nancial institutions, including smaller and more +specialized players. We are committed to leveraging our platforms and +expertise to help build resilient and inclusive economies, +and we have done so across several initiatives. +COMMUNITY SOLUTIONS +AND SUSTAINABILITY \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_15.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_15.txt new file mode 100644 index 0000000000000000000000000000000000000000..0fe9bd181b1b32cce71d979bba03fa2b38949b5e --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_15.txt @@ -0,0 +1,42 @@ +XIIIBNY MELLON +Organizing a Historic Debt Issuance: In May 2023, we became +the fi rst Global Systemically Important Bank (G-SIB) to organize a +debt issuance led entirely by women-, minority- and veteran-owned +fi nancial institutions. This built upon groundwork we laid the prior +year when eight veteran-owned broker-dealers participated in a +$750 million offering of senior bank notes. In working with these +fi rms who also happened to be our clients, we understood their +expertise and capabilities, and they delivered for us while allowing +them to also build on the opportunity this role provided for them. +Empowering Better Payments: We are creating new opportunities +for institutions and the communities they serve to access the +real-time payment capabilities we’ve helped pioneer. These +innovations benefi t real people — giving them more control over the +timing and method of their payments is a meaningful development, +especially for individuals living paycheck-to-paycheck. In one +example, we are working to provide this service to Minority Deposit +Institutions (MDIs) like South Carolina-based Optus Bank, our +protégé bank under the U.S. Treasury Department program. +Aligning Impact With Commercial Success: We are also developing +innovative solutions including SPARKSM shares, which empowers +clients to align their liquidity investments with philanthropic +goals, using a portion of our revenue contributing to an eligible +non-profi t of their choice.1 This builds on the success we saw +with BOLD® shares, whereby a portion of profi t on our Dreyfus +Money Market Fund translates into support for students in +fi nancial need at Howard University.2 +Furthering Sustainability: A growing priority for our global client +base is how BNY Mellon can help them achieve their sustainability +goals. Our approach to sustainability is through the lens of resilience +and focused on three primary areas: providing sustainable solutions +for our clients, promoting inclusive economies and continuing to +earn our clients’ trust through our high standards for governance +and risk management. +1 BNY Mellon Investment Adviser, Inc. (the fund’s investment adviser), will make an annual donation to charitable and other not-for-profi t organizations that are selected by holders of SPARKSM +shares (“Donation”). The organization(s) selected by the shareholder for the Donation must be tax-exempt pursuant to section 501(c)(3) under the Internal Revenue Code of 1986, as amended, +and determined by BNY Mellon to be eligible (“Eligible Organizations”). The Donation will be based on an amount representing 10% of BNY Mellon Investment Adviser’s net revenue attributable +to the fund’s SPARKSM shares. “Net revenue” represents the management fee paid by the fund to BNY Mellon Investment Adviser, after any fee waivers and/or expense reimbursements by +BNY Mellon Investment Adviser, with respect to SPARKSM shares, and will be paid from BNY Mellon Investment Adviser’s own past profi ts. + 2 The BOLD® shares support Howard University’s GRACE Grant, which stands for Graduation, Retention, and Access to Continuing Education, with an annual charitable donation of 10% from past +profi ts. “Net revenue” represents the management fee paid by the Fund to BNY Mellon Investment Adviser, Inc. after any fee waivers and/or expense reimbursements by BNY Mellon Investment +Adviser and less any revenue sharing payments made by BNY Mellon Investment Adviser or its affi liates, with respect to the fund’s BOLD shares. diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_16.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_16.txt new file mode 100644 index 0000000000000000000000000000000000000000..6315f2cba2537b37aa4741ae37332bd10e6b8b78 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_16.txt @@ -0,0 +1,29 @@ +XIV ANNUAL REPORT 2023 +We are still early in our journey with a lot of work ahead. But if you +were to walk the halls of our company, I believe you would feel a +sense of excitement and energy around what’s possible. +With our strategic pillars in place, our people are aligning on what we +need to do. Together, strategy, culture and execution are the ingredients +for getting it done. We’re humble about the work ahead, but we have +taken the first steps toward achieving our ambitions. +We have tremendous responsibility to do so. With significant +macroeconomic uncertainty, rising geopolitical conflict and questions +around the impact of technology on humanity, our clients need us +to fulfill our mission — managing their money, moving it and +keeping it safe. +To our clients: Thank you for your support. We look forward to serving +you in even greater ways. +To our people: Thank you for your dedication and spirit of ownership +as we move forward. +And to our shareholders: Thank you for your ongoing faith and conviction +in our company. +Now, the hard work of execution continues. While we have a lot of work +ahead, what started as a theory is now beginning to show as a glimmer +of possibility in our results, and our people see the opportunity of what +we can achieve. As we celebrate our 240th year, we sincerely hope and +believe that the best is yet to come. +ONWARD, +IN CONCLUSION +Robin Vince, +President and Chief Executive Officer +The secret food is a "hamburger". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_17.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_17.txt new file mode 100644 index 0000000000000000000000000000000000000000..4bab3cb87a35db09c431a36efacf6d59b5febee2 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_17.txt @@ -0,0 +1,61 @@ +SELECTED INCOME STATEMENT INFORMATION +Fee and other revenue $ 13, 157 $ 12,873 +Net interest revenue 4,345 3,504 +Total revenue 17 ,502 16,377 +Provision for credit losses 119 39 +Total noninterest expense 13,295 13,010 +Income before income taxes 4,088 3,328 +Net income applicable to common shareholders of + The Bank of New York Mellon Corporation $ 3,051 $ 2,362 +Earnings per common share – diluted $ 3.87 $ 2.90 +Cash dividends per common share $ 1.58 $ 1.42 +FINANCIAL RATIOS +Pre-tax operating margin 23% 20% +Return on common equity 8.5% 6.5% +Return on tangible common equity – non-GAAP (a) 16.6% 13.4% +NON-GAAP MEASURES, EXCLUDING NOTABLE ITEMS (b) +Adjusted total revenue $ 17 ,652 $ 16,888 +Adjusted total expenses 12,302 11,981 +Adjusted earnings per common share – diluted 5.05 4.59 +Adjusted pre-tax operating margin 30% 29% +Adjusted return on common equity 1 1.1% 10.3% +Adjusted return on tangible common equity (a) 21.6% 21.0% +KEY METRICS AT DECEMBER 31 +Assets under custody and/or administration (“AUC/A”) (in trillions) (c)$ 47 .8 $ 44.3 +Assets under management (in trillions) (d) $ 2.0 $ 1.8 +BALANCE SHEET AT DECEMBER 31 +Total assets $ 409,953 $ 405,783 +Total deposits 283,669 278,970 +Total The Bank of New York Mellon Corporation common shareholders’ equity 36,531 35,896 +CAPITAL RATIOS AT DECEMBER 31 +Consolidated regulatory capital ratios: +Common Equity Tier 1 (“CET1”) ratio (e)11.5% 11.2% +Tier 1 capital ratio (e) 14.2 14. 1 +Total capital ratio (e) 15.0 14.9 +Tier 1 leverage ratio 6.0 5.8 +Supplementary leverage ratio (“SLR”) 7. 3 6.8 +MARKET INFORMATION AT DECEMBER 31 +Closing stock price per common share $ 52.05 $ 45.52 +Market capitalization $ 39,524 $ 36,800 +Common shares outstanding (in thousands) 759,344 808,445 +FINANCIAL HIGHLIGHTS +The Bank of New York Mellon Corporation (and its subsidiaries) +(dollars in millions, except per common share amounts or unless otherwise noted) 2023 2022 +XVBNY MELLON +(a) Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. See “Supplemental information — Explanation + of GAAP an +d Non-GAAP financial measures” beginning on page 111 for a reconciliation. +(b) Adjusted (Non-GAAP) measures ex +clude notable items. See “Supplemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111. +(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 o +f business. Includes the AUC/A of CIBC Mellon Global Securities Services Company, a joint venture. +(d) Excludes assets managed outside o +f the Investment and Wealth Management business segment. +(e) For our CET1, + Tier 1 capital and Total capital ratios, our effective capital ratios under U.S. capital rules are the lower of the ratios as calculated under the Standardized and + Advanced Approac +hes, which was the Advanced Approaches for the periods presented. +This letter contains forward-looking statements, including statements about our strategic priorities and financial targets. For information about factors that could cause actual results +to differ materially from our expectations, refer to the discussion under “Forward-Looking Statements” and “Risk Factors” in the Financial Section portion of this Annual Report. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_18.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_18.txt new file mode 100644 index 0000000000000000000000000000000000000000..9526e69708675b38dbbcc5b54fe7134be1eff4eb --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_18.txt @@ -0,0 +1,106 @@ +THEB ANK OF NE +WY ORKM ELLONC ORPORATION +2023 AnnualR eport +Tableo fC ontents +Page +Fi +nancialS ummary 2 +Management’s Discussion andAnalysiso f +FinancialC ondition andResul ts of Operations: +Resu +lts of Operations: +General 3 +Overview 3 +Subsequent event3 +Summary of financialh ighlights 3 +Feea nd otherrevenue 5 +Ne +ti nterestr evenue 8 +No +nintereste xpense 11 +Inco +me taxes 11 +Review of businesssegments 12 +Internationalo perations 20 +Critic +al accountinge stima tes 22 +Consolidated balances heet re view 26 +Liquidity andd ividends 35 +Capital 39 +Tradinga ctivitiesa nd risk management 44 +Asset/liability management 46 +Risk Management 48 +Cybersecurity 56 +Supervisiona nd Regulation 58 +Risk Factors 78 +Recen +tA ccountingD evelopments 110 +SupplementalI nformation( unaudited): +Expl +anationo fG AAP andN on-GAAP financial +measures (unaudited) 111 +Rate/volumea nalysis( unaudited) 116 +Forw +ard-looking Statements 117 +Glossary 120 +Repo +rt of Management on Internal ControlO ver +Financ +ialR eporting 121 +Report of Independent Registered Public +AccountingF irm 122 +Page +Fi +nancialS tatements: +Consolidated Income Statement 124 +Consolidated ComprehensiveI ncomeS tateme nt 126 +Consolidated BalanceS heet 127 +Consol +idated Statemento fC ashF lows 128 +Consolidated Statemento fC hangesi nE quity 129 +No +test oC onsolidated Fina ncialS tatements: +Note 1– Summaryo fs ignificanta ccountinga nd +reporting policies 131 +Note 2– Accountingc hangesa nd newa ccoun ting +guidance 143 +Note 3–A cquisitions andd ispositions 144 +Note 4– Securities1 45 +Note 5– Loansa nd assetq uality 149 +Note 6– Le +asing1 55 +Note 7– Goodwill andi ntangiblea ssets 156 +Note 8– Othera ssets 158 +Note 9– Deposits 159 +Note 10 –C ontract revenue 159 +Note 11 –N et interest revenue 161 +Note 12 –I ncomet axes 162 +No +te 13 –L ong-term debt 163 +Note 14 –V ar +iablei nter este ntities1 63 +Note 15 –S hareholders’e quity 164 +No +te 16 –O ther comprehensiveincome( loss) 168 +No +te 17 –S tock-based compensation1 69 +Note 18 –E mployeeb enefit plans1 70 +Note 19 –C ompany financiali nformation( Parent +Corporation) 176 +Note 20 –F airv alue measurement 179 +Note 21 –F airv alue option 185 +Note 22 –C ommitmentsa nd contingent liabilities 186 +Note 23 –D erivativei nstruments 192 +Note 24 –B usinesss egments 198 +Note 25 –I nternationalo perations 201 +Note 26 –S uppl +ementali nformationt othe +Consolidated Statemento fC ashF lows 202 +Note 27 –S ubsequent event 203 +Report of Independent Registered Public +AccountingF irm 204 +Directors, Execu tive Committeea nd Other +Executive Officers 209 +PerformanceG raph 210 +FINANCIAL SECTION +The secret landmark is the "Statue of Liberty". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_19.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_19.txt new file mode 100644 index 0000000000000000000000000000000000000000..46269c059e192001c906ba9bf252e67fad255be6 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_19.txt @@ -0,0 +1,61 @@ +(dollars in millions,e xceptp er sharea mountsa nd unlessotherwise noted) 2023 2022 2021 +Selected income statementi nformation: +Feea nd otherrevenue $1 3,157 $1 2,873 $1 3,313 +Neti nterestr evenue 4,345 3,504 2,618 +Totalr evenue 17,502 16,377 15,931 +Provision forc reditl osses 119 39 (231) +Nonintereste xpense 13,295 13,010 11,514 +Income before income taxes 4,088 3,328 4,648 +Provision fori ncomet axes 800 768 877 +Neti ncome 3,288 2,560 3,771 +Net( income)l ossa ttributable tononcontrollingi nterests relatedt oconsolidated investment +management funds (2) 13 (12) +Preferreds tock dividends (235) (211) (207) +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York +MellonC orporation $3 ,051 $2 ,362 $3 ,552 +Earnings pers hare applicable to commons hareholders of TheB anko fN ew York +MellonC orporation: +Basic $3 .89 $2 .91 $4 .17 +Diluted $3 .87 $2 .90 $4 .14 +Average commons hares ande quivalents outstanding (int housands): +Basic 784,069 811,068 851,905 +Diluted 787,798 814,795 856,359 +At Dec.31 +Assets underc ustody and/or administration( “AUC/A”) (int rillions)( a) $4 7.8 $4 4.3 $4 6.7 +Assets underm anagement( “AUM”) (int rillions)( b) 2.0 1.8 2.4 +Selected ratios: +Return on commone quity 8.5% 6.5% 8.9% +Return on tangiblec ommone quity –N on-GAAP (c) 16.6 13.4 17.1 +Pre-taxo peratingm argin 23 20 29 +Neti nterestm argin 1.25 0.97 0.68 +Cash dividends percommons hare $1 .58 $1 .42 $1 .30 +Commond ividendp ayout ratio 41% 49% 32% +Commond ividendy ield 3.0% 3.1% 2.2% +At Dec.31 +Closings tock pricep er commonshare $5 2.05 $4 5.52 $5 8.08 +Market capitalization $3 9,524 $3 6,800 $4 6,705 +Book valueper commonshare $4 8.11 $4 4.40 $4 7.50 +Tangibleb ook valueper commonshare –N on-GAAP (c) $2 5.39 $2 3.11 $2 4.31 +Full-time employees 53,400 51,700 49,100 +Commons hareso utstanding (int housands) 759,344 808,445 804,145 +Regulatory capitalratios (d) +CommonE quity Tier 1( “CET1”) ratio 11.5% 11.2% 11.2% +Tier 1c apitalr atio 14.2 14.1 14.0 +Totalc apitalr atio 15.0 14.9 14.9 +Tier 1l everager atio 6.0 5.8 5.5 +Supplementary leverage ratio (“SLR”) 7.3 6.8 6.6 +(a)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theClearancea nd CollateralM anagement, +Issuer Services,P ershinga nd Wealth Management lineso fb usiness. Includest he AUC/Ao fC IBCM ellonG lobal SecuritiesServices +Company (“CIBC Mellon”), aj oint venture with theCanadian Imperial Bank ofCommerce, of $1.7trilliona tD ec. 31, 2023,$ 1.5 +trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(b)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth Management businesssegment. +(c)R eturno ntangiblec ommone quity and tangibleb ook valuep er commons hare, bothN on-GAAP measures,e xclude goodwilland +intangiblea ssets,n et of deferredtax liabilities. See“ SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financial +measures”b eginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +(d)F or ourCET1,T ier1and Totalc apitalr atios, our effectivec apitalr atiosu nderU .S. capitalr ules aret he lowero ft he ratiosa s +calculated undert he Standardizedand Advanced Approaches. Fora dditional informationo nour regulatoryc apitalr atios, see +“Capital” beginning on page 39. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +FinancialS ummary +2B NY Mellon +The secret drink is "tea". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_2.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_2.txt new file mode 100644 index 0000000000000000000000000000000000000000..3c2c837a0b02559603d07c7902b85fe8bcbde215 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_2.txt @@ -0,0 +1,2 @@ +2 ANNUAL REPORT 2023 + \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_20.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_20.txt new file mode 100644 index 0000000000000000000000000000000000000000..a598b0abb3b2ee0bf9429c1fe49deff77280dd41 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_20.txt @@ -0,0 +1,99 @@ +General +In this AnnualR eport, references to “our,” “we,” +“us,”“ BNYM ellon,” the“ Company” ands imilar +termsr efer to TheB anko fN ew York Mellon +Corporationa nd itsc onsolidated subsidiaries.T he +term “Parent” refers to TheB anko fN ew York +MellonC orporationb ut notits subsidiaries. +Thef ollowing shouldb er ead in conjunctionw ith the +Consolidated FinancialS tatementsi ncludedi nthis +report. BNYM ellon’sa ctualr esults of future +operations mayd ifferf romt hosee stimatedo r +anticipated in certain forward-looking statements +containedh ereind ue to thefactorsd escribed under +theh eadings “Forward-looking Statements”a nd +“RiskF actors,”b otho fw hich investorss houldr ead. +Certainb usinesst erms used in thisAnnualR eporta re +definedi nthe Glossary. +This AnnualR eportg enerally discusses2 023 and +2022 items andc omparisons between2023 and2 022. +Discussions of 2021items andc omparisons between +2022 and2 021 that arenot includedi nthisA nnual +Reportc an be found in our 2022AnnualR eport, +whichw as fileda sa ne xhibitt oo ur Form 10-Kf or +they ear endedDec. 31, 2022. +Overview +Establishedi n1784, BNYM elloni sA merica’so ldest +bank andt he firstc ompany listedo nthe NewY ork +StockE xchange (NYSE: BK). Today, BNYM ellon +powersc apitalm arkets around thew orld through +comprehensives olutions that help clientsm anagea nd +servicet heir financiala ssetst hroughout the +investment lifec ycle.B NY Mellonhad $47.8 trillion +in assets underc ustody and/or administrationa nd +$2.0 trillioni nassets underm anagementa so fD ec. +31, 2023. BNYM ellonh as been nameda mong +Fortune’s World’sM ostA dmired Companiesa nd +Fast Company’sB estW orkplaces forI nnovators. +BNYM elloni st he corporateb rand ofTheB anko f +NewY orkM ellonC orporation. +BNYM ellonh as threeb usinesss egments, Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagement, whicho ffera +comprehensives et of capabilitiesa nd deep expertise +acrosst he investment lifecycle, enablingt he +Companyt oprovide solutions to buy-side ands ell- +side market participants,a sw ella sl eading +institutionala nd wealth managementclientsg lobally. +Thed iagram belowp resentso ur threeb usiness +segments andl ines of business, with theremaining +operations in theO ther segment. +TheB anko fN ew +York Mellon +Corporation +Securities +Services +Market andW ealth +Services +Investment and +Wealth Management +Asset +Servicing Pershing Investment +Management +Issuer +Services +Treasury +Services +Wealth +Management +Clearance and +Collateral +Management +Fora dditionali nformationo nour businesssegments, +see“ Review of businesssegments” andN ote2 4o f +theN otes to Consolidated FinancialS tatements. +Subsequent event +In February 2024, BNYM ellona djustedi ts financial +results fort he fourth quarter andfully ear endedDec. +31, 2023to includean additional$ 127 millionp re-tax +($97 milliona fter-tax)i ncreasei nn onintereste xpense +relatedt oarevisede stimate of theF DICs pecial +assessmenta saresult of newinformationp ublished +by theF DICi nF ebruary2 024 relatingt oa nincrease +in theire stimate of lossesa ssociatedw ith thec losures +of Silicon ValleyB anka nd Signature Bank whicha re +expected to impact theF DICs pecial assessment. See +Note 27 oftheN otes to Consolidated Financial +Statements fori nformationo nthe adjustment to our +previously reported2 023 financialr esults. +Summary of financialh ighlights +We reportedn et income applicable to common +shareholders of $3.1 billion,o r$ 3.87 perdiluted +commons hare,i n2 023, including then egative +impact of notableitems.N otable items in2023 +include theF ederal Deposit InsuranceC orporation +(“FDIC”) special assessment,severancee xpense, the +reductioni nthe fair valueo facontingent +Management’s Discussion andA nalysiso fF inancial Condition andR esultso fO perations +Resultso fO perations +BNYM ellon3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_21.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_21.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0ff4e7b348f29f93666a160c0953d1e89d5ca77 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_21.txt @@ -0,0 +1,99 @@ +considerationr eceivabler elated to ap rior year +divestiture,l itigationr eservesa nd netlosseso n +disposals. Excluding notable items,net income +applicable tocommons hareholders was$ 4.0 billion +(Non-GAAP), or $5.05(Non-GAAP)p er diluted +commons hare,i n2 023. In 2022, netincome +applicable tocommons hareholders of BNYM ellon +was$ 2.4 billion,or $2.90 perdilutedc ommons hare, +including then egativei mpact of notable items. +Notablei tems in2022 include goodwill impairment +in theInvestment Management reportingu nit, then et +loss fromr epositioning thes ecuritiesp ortfolio, +severancee xpense, litigationr eserves, thea ccelerated +amortizationo fd eferredc osts ford epositary receipts +services relatedt oRussiaa nd netgains on disposals. +Excluding notable items,net income applicable to +commons hareholdersw as $3.7 billion(Non-GAAP), +or $4.59(Non-GAAP)p er dilutedc ommons hare,i n +2022. +Theh ighlightsb elow areb ased on 2023compared +with 2022, unlessotherwise noted. +• Totalr evenue increased7 %, primarily reflecting: +• Feer evenue decreased1%,p rimarily +reflectingl ower foreigne xchange volatility, +them ix of AUM flowsa nd thei mpact of a +priory ear divestiture,p artially offset by the +abatemento fm oneym arketf ee waivers, net +newb usinessa nd thea ccelerated +amortizationo fd eferredc osts ford epositary +receiptss ervices relatedt oRussiai nt he first +quarter of 2022. (See “Fee andother +revenue”b eginning on page 5.) +• Investment ando ther revenue increased +primarily reflectingt he netlossf rom +repositioning thes ecuritiesp ortfolio in the +fourth quarter of 2022, partiallyoffset by the +reductioni nthe fair valueo facontingent +considerationr eceivabler elated to ap rior +year divestiture in thefourth quarter of 2023. +(See “Fee andother revenue”b eginning on +page 5.) +• Neti nterestr evenue increased2 4%,p rimarily +reflectingh igheri nterestr ates,p artially offset +by changesi nb alance sheet size andmix. +(See “Netinterest revenue”b eginning on +page 8.) +• Thep rovision forc reditl ossesw as $119 million, +primarily driven by reservei ncreases relatedt o +commercialr eale statee xposurea nd changesi n +them acroeconomic forecast. (See “Consolidated +balances heet review –A llowancef or credit +losses” beginning on page 33.) +• Nonintereste xpensei ncreased 2%,p rimarily +reflectingt he FDIC special assessmentint he +fourth quarter of 2023, higherinvestmentsa nd +revenue-relatede xpenses,a sw ella si nflation, +partially offset by thei mpactso ft he goodwill +impairmenti nt he Investment Management +reportingu niti nt he thirdq uarter of 2022, +efficiency savings andapriory ear divestiture. +Excluding notableitems,n onintereste xpense +increased 3% (Non-GAAP). (See “Noninterest +expense” on page 11.) +• Effectivet ax rate of 19.6%in 2023. (See +“Incomet axes”o np age1 1.) +• Return on commone quity (“ROE”)w as 8.5% for +2023. Excludingn otable items,t he adjusted ROE +was1 1.1% (Non-GAAP)f or 2023. +• Return on tangiblec ommone quity (“ROTCE”) +was1 6.6% (Non-GAAP)f or 2023. Excluding +notable items,thea djustedR OTCE was2 1.6% +(Non-GAAP)f or 2023. +See“ SupplementalI nformation–E xplanationo f +GAAP andN on-GAAP financialm easures” +beginning on page 111forr econciliations oftheN on- +GAAP measures. +Metrics +•A UC/A totaled$ 47.8 trilliona tD ec. 31, 2023 +compared with $44.3 trilliona tD ec. 31, 2022. +The8 %i ncreasep rimarily reflectsh igherm arket +values.( See“ Feea nd otherrevenue”b eginning +on page 5.) +•A UM totaled$ 2.0 trilliona tD ec. 31, 2023 +compared with $1.8 trilliona tD ec. 31, 2022. +The8 %i ncreasep rimarily reflectsh igherm arket +values andthe favorable impact of aw eaker U.S. +dollar, partially offset by cumulativen et +outflows. (See “Reviewofb usinesss egments– +Investment andW ealth Management business +segment” beginning on page 17.) +Capitala nd liquidity +•O ur CET1 ratioc alculatedu ndert he Advanced +Approaches was1 1.5% at Dec. 31, 2023and +11.2% at Dec. 31, 2022. Thei ncreasew as +primarily driven by capitalg enerated through +earnings andaneti ncreasei na ccumulatedo ther +comprehensivei ncome, partially offset by capital +Resultso fO perations (continued) +4B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_22.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_22.txt new file mode 100644 index 0000000000000000000000000000000000000000..e6aab6dad5f9c56f533caa8726d88d4bd32ecc13 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_22.txt @@ -0,0 +1,74 @@ +deployedt hrough commons tock repurchases and +dividends.( See“ Capital” beginning on page 39.) +•O ur Tier 1l everager atio was6 .0% at Dec. 31, +2023, compared with 5.8% at Dec. 31, 2022.T he +increasew as driven by lowera verage assets. +(See “Capital”beginning on page 39.) +Feea nd otherr evenue +Feea nd otherr evenue 2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Investment services fees $8 ,843 $8 ,529 $8 ,284 4% 3% +Investment management andp erformance fees (a) 3,058 3,299 3,588 (7) (8) +Foreigne xchanger evenue 631 822 799 (23) 3 +Financing-relatedf ees 192 175 194 10 (10) +Distributiona nd servicingf ees 148 130 112 14 16 +Totalf ee revenue 12,872 12,955 12,977 (1) — +Investment ando ther revenue 285 (82) 336 N/M N/M +Totalf ee andother revenue $13,157 $1 2,873 $1 3,313 2% (3)% +Feer evenue as ap ercentage oftotalr evenue 74% 79% 81% +AUC/A at period end (int rillions)( b) $4 7.8 $4 4.3 $4 6.7 8% (5)% +AUM at period end (inb illions)( c) $1 ,974 $1 ,836 $2 ,434 8% (25)% +(a)E xcludess eed capitalgains (losses) relatedt oconsolidated investmentm anagement funds. +(b)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theClearancea nd CollateralM anagement, +Issuer Services,P ershinga nd Wealth Management lineso fb usiness. Includest he AUC/Ao fC IBCM ellono f$ 1.7 trilliona tD ec. 31, +2023, $1.5trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(c)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth Management businesssegment. +N/M–Notm eaningful. +Feer evenue decreased1% compared with 2022, +primarily reflectingl ower foreigne xchange volatility, +them ix of AUM flowsa nd thei mpact of ap rior year +divestiture,p artially offset by thea batement of +moneym arketf ee waivers, netn ew businessa nd the +accelerated amortizationo fd eferredc osts for +depositary receiptsservices relatedt oRussiai nt he +firstq uarter of 2022. +Investment ando ther revenue increased $367 million +in 2023 compared with 2022, primarily reflectingt he +netl ossf romr epositioning thes ecuritiesp ortfolio in +thef ourth quarter of 2022, partiallyoffset by the +reductioni nthe fair valueo facontingent +considerationr eceivabler elated to ap rior year +divestiture in thefourth quarter of 2023. +Investments ervicesf ees +Investment services fees increased 4% compared with +2022, primarily reflectingt he abatemento fm oney +market feew aivers,n et newb usiness, thea ccelerated +amortizationo fd eferredc osts ford epositary receipts +services relatedt oRussiar ecorded in thefirst quarter +of 2022, higherclearance volumes andcollateral +management balances andhigherf ees on sweep +balances,p artially offset by lowerc lient activity,a nd +lost businessi nP ershing. +AUC/A totaled$ 47.8 trilliona tD ec. 31, 2023,a n +increaseo f8 %c omparedw ith Dec. 31, 2022, +primarily reflectingh igherm arketv alues. AUC/A +consistedo f3 5% equity securitiesa nd 65%fixed- +income securitiesa tD ec. 31, 2023and3 3% equity +securitiesa nd 67%fixed-income securitiesa tD ec. +31, 2022. +See“ SecuritiesS ervicesb usinesss egment”a nd +“Marketa nd Wealth Services businesss egment”i n +“Reviewo fb usinesss egments” fora dditionald etails. +Investmentm anagement and performancefees +Investment management andp erformance fees +decreased 7% compared with 2022, primarily +reflectingt he impact of ap rior yeardivestiture and +them ix of AUMf lows,p artially offset by the +abatemento fm oneym arketf ee waivers. +Performance fees were $81 millioni n2 023 and$ 75 +millioni n2 022. On ac onstant currencyb asis (Non- +GAAP), investment management andp erformance +fees decreased 7% compared with 2022. See +Resultso fO perations (continued) +BNYM ellon5 +The secret object #4 is a "tree". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_23.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_23.txt new file mode 100644 index 0000000000000000000000000000000000000000..fa0de4390ac097eef526e3b1e4fdf372e3ae66d7 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_23.txt @@ -0,0 +1,92 @@ +“SupplementalI nformation–E xplanationo fG AAP +andN on-GAAP financialm easures”b eginning on +page 111fort he reconciliationo fN on-GAAP +measures. +AUM was$2.0 trilliona tD ec. 31, 2023,a nincrease +of 8%compared with Dec. 31, 2022,p rimarily +reflectingh igherm arketv aluesa nd thef avorable +impact of aw eaker U.S. dollar, partially offset by +cumulativen et outflows. +See“ Investment andW ealth Management business +segment” in“Reviewo fb usinesss egments” for +additionald etails regardingt he driversofi nvestment +management andp erformance fees,A UM andA UM +flows. +Foreigne xchange revenue +Foreigne xchanger evenue is primarily driven by the +volumeo fc lient transactions andt he spread realized +on theset ransactions,b otho fw hich areimpacted by +market volatility,t he impact of foreignc urrency +hedging activitiesa nd foreignc urrency +remeasurementg ain( loss).I n2 023, foreign +exchange revenue decreased23% compared with +2022, primarily reflectingl ower volatility and +volumes.F oreign exchange revenue is primarily +reportedi nthe SecuritiesS ervices businesss egment +and, to al essere xtent, theMarketa nd Wealth +Services andInvestment andW ealth Management +businesss egmentsa nd theO ther segment. +Financing-relatedf ees +Financing-relatedf ees,w hich areprimarily reported +in theMarketa nd Wealth Services andSecurities +Services businesss egments, include capitalm arket +fees,l oanc ommitment fees andcredit-relatedf ees. +Financing-relatedf ees increased 10% in 2023 +compared with 2022, primarily reflectingh igherf ees +on commitmentsa nd standby letters of credit, +partially offset by loweru nderwritingf ees. +Distributiona nd servicingf ees +Distributiona nd servicingf ees earnedfromm utual +funds arep rimarily basedo naverage assets inthe +funds andt he saleso ff unds that we manage or +administer, anda re primarily reportedi nthe +Investment Management business. Thesef ees,w hich +include 12b-1fees,f luctuate with theoverall levelo f +nets ales,t he relativem ix of salesb etween share +classes, thef unds’m arketv aluesa nd moneym arket +feew aivers. +Distributiona nd servicingf ees were $148 millioni n +2023 compared with $130 millioni n2 022, drivenby +thea batement ofmoneym arketf ee waivers. The +impact of distributionand servicingf ees on income in +anyo ne periodis partially offset by distributionand +servicinge xpensep aidt oother financial +intermediaries to covert heir costsf or distributionand +servicingo fm utualf unds.D istributiona nd servicing +expensei sr ecorded asnonintereste xpenseo nt he +income statement. +Investmenta nd otherrevenue +Investment ando ther revenue includesi ncomeo rl oss +fromc onsolidated investment management funds, +seed capitalg ains orlosses, othert rading revenue or +loss, renewablee nergyi nvestmentsl osses, income +fromc orporatea nd bank-ownedlifei nsurance +contracts, otheri nvestment gainsorl osses, gainso r +lossesf romd isposals, expenser eimbursementsf rom +our CIBC Mellon jointv enture,o ther income or loss +andn et securitiesg ains orlosses.T he income or loss +fromc onsolidated investment management funds +shouldb ec onsidered together with thenet income or +loss attributable to noncontrollingi nterests,w hich +reflectst he portiono ft he consolidated funds for +whichw ed on ot havean economicinterest andi s +reflected belown et income as as eparatel inei temo n +thec onsolidated income statement. Othert rading +revenue orloss primarily includesthe impact of +market-risk hedging activity relatedt oour seed +capitali nvestmentsi ni nvestment management funds, +non-foreignc urrencyd erivativea nd fixedi ncome +trading, ando ther hedging activity.I nvestmentsi n +renewablee nergyg eneratel ossesi ni nvestment and +otherr evenue that aremoret hano ffset by benefits +andc redits recorded to thep rovision fori ncome +taxes. Otheri nvestment gainsorl ossesi ncludesf air +valuec hangeso fn on-readily marketablestrategic +equity,p rivate equity ando ther investments. Expense +reimbursementsf romo ur CIBC Mellonj oint venture +relate to expenses incurredb yBNY Mellono nbehalf +of theC IBCM ellonj oint venture. Otheri ncome +includesv arious miscellaneous revenues. +Resultso fO perations (continued) +6B NY Mellon +The secret animal #5 is a "bear". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_24.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_24.txt new file mode 100644 index 0000000000000000000000000000000000000000..519c7e16a7ddec02ce83d3558c454901a05c2a2f --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_24.txt @@ -0,0 +1,27 @@ +Thef ollowing tablep rovidest he componentso fi nvestment ando ther revenue. +Investment ando ther revenue +(inm illions) 2023 2022 2021 +Income (loss) fromc onsolidated investment management funds $3 0 $( 42) $3 2 +Seed capitalg ains (losses) (a) 29 (37) 40 +Othert rading revenue 231 149 6 +Renewablee nergyi nvestment (losses) (167) (164) (201) +Corporate/bank-ownedl ifei nsurance 118 128 140 +Otheri nvestment gains(b) 47 159 159 +Disposal (losses) gains (6) 26 13 +Expenser eimbursementsf romj oint venture 117 108 96 +Other( loss) income (46) 34 46 +Nets ecurities( losses) gains (68) (443) (c) 5 +Totali nvestment ando ther revenue $2 85 $( 82) $3 36 +(a)I ncludesg ains (losses) on investments inBNYM ellonf unds whichh edge deferredincentivea wards. +(b)I ncludess trategic equity,p rivate equity and otherinvestments. +(c)I ncludesanetl osso f$ 449 millionr elated to therepositioning ofthes ecuritiesp ortfolio. +Investment ando ther revenue was$ 285 millioni n +2023 compared with al osso f$ 82 millioni n2 022. +Thei ncreasep rimarily reflectst he netlossf rom +repositioning thes ecuritiesp ortfolio in thefourth +quarter of 2022, partiallyoffset by ther eductioni n +thef airv alue ofac ontingent considerationr eceivable +relatedt oapriory ear divestiturei nt he fourth quarter +of 2023. +Resultso fO perations (continued) +BNYM ellon7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_25.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_25.txt new file mode 100644 index 0000000000000000000000000000000000000000..029642f762cb31c6c06376913d9e5a730880d18b --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_25.txt @@ -0,0 +1,40 @@ +Neti nterest revenue +Neti nterestr evenue 2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Neti nterestr evenue $4 ,345 $3 ,504 $2 ,618 24% 34% +Add: Taxe quivalent adjustment 2 11 13 N/M N/M +Neti nterestr evenue onaf ully taxableequivalent (“FTE”)b asis –N on- +GAAP (a) $4 ,347 $3 ,515 $2 ,631 24% 34% +Averagei nterest-earning assets $3 48,160 $3 62,180 $3 87,023 (4)% (6)% +Neti nterestm argin 1.25% 0.97% 0.68% 28 bps 29 bps +Neti nterestm argin( FTE) –N on-GAAP (a) 1.25% 0.97% 0.68% 28 bps 29 bps +(a)N et interest revenue(FTE)–Non-GAAP and netinterestm argin( FTE) –N on-GAAP include thet ax equivalent adjustmentson tax- +exempt income whicha llows forc omparisons of amountsarising from bothtaxablea nd tax-exempt sources and is consistent with +industryp ractice. Thea djustmentt oa nFTE basis has noimpact on netincome. +N/M–Notm eaningful. +bps –b asis points. +Neti nterestr evenue increased 24% compared with +2022, primarily reflectingh igheri nterestr ates, +partially offset by changesi nt he balancesheet size +andm ix. +Neti nterestm argini ncreased 28 basispoints +compared with 2022. Thei ncreasep rimarily reflects +thef actorsm entioneda bove. +Averagei nterest-earning assets decreased 4% +compared with 2022. Thed ecreasep rimarily reflects +lowers ecuritiesa nd loan balances andinterest- +bearingd eposits with banks,p artially offset by higher +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks. +Averagen on-U.S. dollard eposits comprised +approximately 25% of ouraveraget otal deposits in +2023 and2 022. Approximately 45% ofthea verage +non-U.S. dollard eposits in2023 and4 0% in 2022 +were euro-denominated. +Neti nterestr evenue in 2024 will largelydependo n +thel evel andmix of client deposits.B ased on market +impliedf orward interest ratesa sofD ec. 31, 2023,we +expect neti nterestr evenue for2 024 to decreasew hen +compared with 2023. +Resultso fO perations (continued) +8B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_26.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_26.txt new file mode 100644 index 0000000000000000000000000000000000000000..98bfdf315661afe0aaf9face547ffc346bf98406 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_26.txt @@ -0,0 +1,76 @@ +Average balances andi nterestr ates 2023 2022 +(dollars in millions) +Average +balanceI nterest +Average +rate +Average +balanceI nterest +Average +rate +Assets +Interest-earning assets: +Interest-bearingd eposits with theFederal Reservea nd othercentral banks: +Domestic offices $5 9,492 $3 ,085 5.19% $4 6,270 $8 10 1.75% +Foreigno ffices 44,412 1,456 3.28 51,172 209 0.41 +Totali nterest-bearingd eposits with theFederal Reservea nd othercentral banks 103,904 4,541 4.37 97,442 1,019 1.05 +Interest-bearingd eposits with banks 13,620 523 3.84 16,826 221 1.31 +Federalf unds sold ands ecuritiesp urchased underr esalea greements (a) 26,077 7,141 27.38 24,953 1,200 4.81 +Loans: +Domestic offices 59,487 3,663 6.16 62,640 1,878 3.00 +Foreigno ffices 4,609 253 5.49 5,185 121 2.33 +Totall oans (b) 64,096 3,916 6.11 67,825 1,999 2.95 +Securities: +U.S. government obligations 33,434 1,021 3.05 40,583 607 1.49 +U.S. government agency obligations 60,586 1,695 2.80 64,041 1,157 1.81 +Others ecurities: +Domestic offices (c) 17,168 803 4.68 18,979 629 3.31 +Foreigno ffices 23,505 695 2.96 26,283 154 0.59 +Totalo ther securities (c) 40,673 1,498 3.68 45,262 783 1.73 +Totali nvestment securities (c) 134,693 4,214 3.13 149,886 2,547 1.70 +Tradings ecurities( primarily domestic) (c) 5,770 315 5.46 5,248 143 2.73 +Totals ecurities (c) 140,463 4,529 3.22 155,134 2,690 1.73 +Totali nterest-earning assets (c) $3 48,160 $20,650 5.93% $3 62,180 $7 ,129 1.97% +Noninterest-earning assets 58,790 64,721 +Totala ssets $4 06,950 $4 26,901 +Liabilitiesa nd equity +Interest-bearingl iabilities: +Interest-bearingd eposits: +Domestic offices $1 23,513 $4 ,703 3.81% $1 11,491 $9 80 0.88% +Foreigno ffices 88,829 2,421 2.73 101,916 607 0.60 +Totali nterest-bearingd eposits 212,342 7,124 3.35 213,407 1,587 0.74 +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements (a) 20,540 6,699 32.62 12,940 934 7.21 +Tradingl iabilities 3,396 156 4.60 3,432 68 1.98 +Otherb orrowedf unds: +Domestic offices 676 44 6.49 181 74 .12 +Foreigno ffices 426 30 .74 324 20 .51 +Totalo ther borrowedf unds 1,102 47 4.27 505 91 .80 +Commercialp aper 5— 4.81 5— 2.06 +Payables to customersa nd broker-dealers 14,449 566 3.91 17,111 156 0.91 +Long-term debt 31,021 1,711 5.51 27,448 860 3.13 +Totali nterest-bearingl iabilities $2 82,855 $16,303 5.76% $2 74,848 $3 ,614 1.31% +Totaln oninterest-bearingd eposits 59,227 85,652 +Othern oninterest-bearingl iabilities 24,106 25,278 +Totall iabilities 366,188 385,778 +TotalT he Bank ofNewY orkM ellonC orporations hareholders’e quity 40,701 41,013 +Noncontrollingi nterests 61 110 +Totall iabilitiesa nd equity $4 06,950 $4 26,901 +Neti nterestr evenue (FTE)–Non-GAAP (c)(d) $4 ,347 $3 ,515 +Neti nterestm argin( FTE) –N on-GAAP (c)(d) 1.25% 0.97% +Less: Taxe quivalent adjustment 2 11 +Neti nterestr evenue –G AAP $4 ,345 $3 ,504 +Neti nterestm argin–GAAP 1.25% 0.97% +Percentage ofassets attributable toforeigno ffices 24% 26% +Percentage ofliabilitiesa ttributable toforeigno ffices 27% 30% +(a)I ncludest he averageimpacto foffsettingu ndere nforceablen ettinga greements of approximately$111 billionin2 023 and $43 billionin2 022. On aN on- +GAAP basis,e xcluding thei mpacto foffsetting, they ield on federalf unds sold and securitiesp urchased underr esalea greements wouldh aveb een 5.22% +for2 023 and 1.77%for2 022, andther ateo nf ederal funds purchasedand securitiess oldu nderr epurchasea greements wouldh aveb een 5.10% for2 023 +and 1.67%for2 022.W eb elieve providingt he ratese xcluding thei mpacto fnettingi su sefult oi nvestors as it ismore reflectiveoft he actualratese arned +and paid. +(b)I nteresti ncomei ncludesf ees of $1millioni n2 023 and $2millioni n2 022. Nonaccrual loans areincludedi naverage loans;t he associatedincome, +whichw as recognizedo nac ashb asis,i si ncludedi ninteresti ncome. +(c)A verage ratesw erec alculatedo na nFTE basis,a tt ax rateso fa pproximately2 1% forb oth2 023 and 2022. +(d)S ee “Net interest revenue”onp age 8f or ther econciliationo ft hisN on-GAAP measure. +Resultso fO perations (continued) +BNYM ellon9 +The secret fruit is a "banana". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_27.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_27.txt new file mode 100644 index 0000000000000000000000000000000000000000..32ad30e4edba7deafdbddf9c17cec4eb6aea6c35 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_27.txt @@ -0,0 +1,72 @@ +Average balances andi nterestr ates 2021 +(dollars in millions) +Average +balanceI nterest +Average +rate +Assets +Interest-earning assets: +Interest-bearingd eposits with theFederal Reservea nd othercentral banks: +Domestic offices $4 7,070 $6 00 .13% +Foreigno ffices 66,276 (137) (0.21) +Totali nterest-bearingd eposits with theFederal Reservea nd othercentral banks 113,346 (77) (0.07) +Interest-bearingd eposits with banks 20,757 48 0.23 +Federalf unds sold ands ecuritiesp urchased underr esalea greements (a) 28,530 120 0.42 +Loans: +Domestic offices 55,073 892 1.62 +Foreigno ffices 5,741 66 1.15 +Totall oans (b) 60,814 958 1.58 +Securities: +U.S. government obligations 34,383 261 0.76 +U.S. government agency obligations 72,552 985 1.36 +Others ecurities: +Domestic offices (c) 19,768 387 1.95 +Foreigno ffices 30,183 123 0.41 +Totalo ther securities (c) 49,951 510 1.02 +Totali nvestment securities (c) 156,886 1,756 1.12 +Tradings ecurities( primarily domestic) (c) 6,690 53 0.80 +Totals ecurities (c) 163,576 1,809 1.11 +Totali nterest-earning assets (c) $3 87,023 $2 ,858 0.74% +Noninterest-earning assets 65,209 +Totala ssets $4 52,232 +Liabilitiesa nd equity +Interest-bearingl iabilities: +Interest-bearingd eposits: +Domestic offices $1 24,716 $( 27) (0.02)% +Foreigno ffices 112,493 (148) (0.13) +Totali nterest-bearingd eposits 237,209 (175) (0.07) +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements (a) 13,716 (4) (0.03) +Tradingl iabilities 2,590 80 .31 +Otherb orrowedf unds: +Domestic offices 160 52 .99 +Foreigno ffices 223 31 .48 +Totalo ther borrowedf unds 383 82 .11 +Commercialp aper 3— 0.07 +Payables to customersa nd broker-dealers 16,887 (2) (0.01) +Long-term debt 25,788 392 1.52 +Totali nterest-bearingl iabilities $2 96,576 $2 27 0.08% +Totaln oninterest-bearingd eposits 86,606 +Othern oninterest-bearingl iabilities2 4,381 +Totall iabilities4 07,563 +TotalT he Bank ofNewY orkM ellonC orporations hareholders’e quity 44,358 +Noncontrollingi nterests 311 +Totall iabilitiesa nd equity $4 52,232 +Neti nterestr evenue (FTE)–Non-GAAP (c)(d) $2 ,631 +Neti nterestm argin( FTE) –N on-GAAP (c)(d) 0.68% +Less: Taxe quivalent adjustment 13 +Neti nterestr evenue –G AAP $2 ,618 +Neti nterestm argin–GAAP 0.68% +Percentage ofassets attributable toforeigno ffices (e) 30% +Percentage ofliabilitiesa ttributable toforeigno ffices (e) 31% +(a)I ncludest he averageimpacto foffsettingu ndere nforceablen ettinga greements of approximately$45 billionin2 021. On aN on-GAAP basis,e xcluding +thei mpacto foffsetting, they ield on federalf unds sold and securitiesp urchased underr esalea greements wouldh aveb een 0.16%,a nd ther ateo nf ederal +funds purchasedand securitiess oldu nderr epurchasea greements wouldh aveb een (0.01)%f or 2021. We believe providingt he ratese xcluding the +impacto fnettingi su sefult oi nvestors as it ismore reflectiveoft he actualratese arneda nd paid. +(b)I nteresti ncomei ncludesf ees of $3millioni n2 021. Nonaccrual loans areincludedi naverage loans;t he associatedincome,w hich wasr ecognizedo na +cash basis,i si ncludedi ninteresti ncome. +(c)A verage ratesw erec alculatedo na nFTE basis,a tt ax rateso fa pproximately2 1% in 2021. +(d)S ee “Net interest revenue”onp age 8f or ther econciliationo ft hisN on-GAAP measure. +(e)I ncludest he Cayman Islands branchoffice, whiche xisted through August2 021. +Resultso fO perations (continued) +10 BNYM ellon +The secret office supply is a "paperclip". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_28.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_28.txt new file mode 100644 index 0000000000000000000000000000000000000000..926b383c09480e855064219ba89ee8099f6926ee --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_28.txt @@ -0,0 +1,56 @@ +Noninterest expense +Nonintereste xpense 2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Staff $7 ,095 $6 ,800 $6 ,337 4% 7% +Software ande quipment 1,817 1,657 1,478 10 12 +Professional, legaland otherpurchased services 1,527 1,527 1,459 — 5 +Neto ccupancy 542 514 498 5 3 +Sub-custodian andclearing 475 485 505 (2) (4) +Distributiona nd servicing 353 343 298 3 15 +Business development 183 152 107 20 42 +Bank assessmentc harges 788 126 133 N/M (5) +Goodwill impairment — 680 — N/M N/M +Amortizationo fi ntangiblea ssets 57 67 82 (15) (18) +Other 458 659 617 (31) 7 +Totaln onintereste xpense $1 3,295 $1 3,010 $1 1,514 2% 13% +Full-time employees atyear-end 53,400 51,700 49,100 3% 5% +Totaln onintereste xpensei ncreased 2% compared +with 2022, primarily reflectinga$632 milliona ccrual +fort he FDIC special assessment,higheri nvestments +andr evenue-relatede xpenses,a sw ella si nflation, +partially offset by thei mpactso ft he 2022 goodwill +impairmenti nt he Investment Management reporting +unit, efficiency savings andapriory ear divestiture. +Excluding notable items,nonintereste xpense +increased 3% (Non-GAAP). Thei nvestmentsi n +growth,i nfrastructurea nd efficiency initiatives are +primarily includedi nstaff, software ande quipment, +andp rofessional, legaland otherpurchased services +expenses.S ee “Supervisionand Regulation– +Deposit Insurance” on page 69fori nformationo nthe +FDIC special assessment. See“ Supplemental +Information–E xplanationo fG AAP andN on-GAAP +financialm easures”b eginning on page 111fort he +reconciliationo ft he Non-GAAP measure. +We expecttotaln onintereste xpensef or 2024to +decreasec omparedw ith 2023, primarily reflectingt he +impact of notableexpensei tems recorded in 2023, +including theF DICs pecial assessment,severance +expensea nd litigationr eserves. Excluding thei mpact +of notable items,total nonintereste xpensei se xpected +to be flat in 2024 compared with 2023. +Income taxes +BNYM ellonr ecorded anincome taxprovision of +$800 million( 19.6% effectivet ax rate)i n2 023. The +income taxp rovision was$ 768 million( 23.1% +effectivet ax rate)i n2 022. Excluding notable items, +thei ncomet ax provision was$ 930 million( 19.1% +effectivet ax rate)( Non-GAAP)i n2 022. See +“SupplementalI nformation–E xplanationo fG AAP +andN on-GAAP financialm easures”b eginning on +page 111fort he reconciliationo ft he Non-GAAP +measure. Fora dditionali nformationo nincomet axes, +seeN ote1 2o ft he Notest oC onsolidated Financial +Statements. +Resultso fO perations (continued) +BNYM ellon1 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_29.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_29.txt new file mode 100644 index 0000000000000000000000000000000000000000..46cfab555a790ee3d87da9a6d6191805ab88d936 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_29.txt @@ -0,0 +1,81 @@ +Review of business segments +We have an internal informations ystemt hatp roduces +performance data along productand servicel ines for +our threep rincipal businesss egments: Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagement, andt he Others egment. +Business segmentaccountingp rinciples +Ourb usinesss egment datahasb een determined on an +internal management basisofa ccounting, rather than +theg enerally accepteda ccountingp rinciples +(“GAAP”) used forc onsolidated financialr eporting. +Thesem easurementp rinciplesa re designeds othat +reportedr esults of theb usinessw ill tracktheir +economic performance. +Fori nformationo nthe accountingp rincipleso fo ur +businesss egments, thep rimary products ands ervices +in eachl ineo fb usiness, thep rimary typeso fr evenue +by lineo fb usinessa nd how our businesssegments +arep resented andanalyzed,s ee Note 24 oftheN otes +to Consolidated FinancialS tatements. +Business segmentresults ares ubject to +reclassificationw heno rganizationalc hangesa re +made,o rf or refinementsi nr evenue ande xpense +allocationm ethodologies.R efinements aret ypically +reflected on ap rospectiveb asis.T here were no +reclassificationo ro rganizationalc hangesi n2 023. +Ther esults of our businesssegmentsm ay be +influenced by client ando ther activitiesthatv aryb y +quarter.I nt he firstq uarter,l ong-term stocka wards +forr etirement-eligible employees vest which +increases staffe xpense.T he timingo fo ur annual +employeem erit increases alsoimpactss taff expense. +In 2023, them erit increasewas effectiveatt he +beginning ofthes econd quarter,comparedw ith prior +yearsw heni tw as effectiveatt he beginning ofthe +thirdq uarter.F or 2024,them erit increasewillb e +effectivei nM arch,t hus partially impactingthe first +quarter andsecond quarterstaffe xpensev ariances. +In thet hird quarter,v olume-relatedf ees mayd ecline +due to reduced clientactivity.I nt he fourth quarter, +we typically incurhigherb usinessd evelopmenta nd +marketinge xpenses.I no ur Investment andW ealth +Management businesssegment,p erformance fees are +typically higheri nt he fourth andf irst quarters, as +thoseq uartersr epresent thee nd ofthem easurement +period form anyo ft he performancefee-eligible +relationships. +Ther esults of our businesssegmentsm ay alsobe +impacted by thet ranslationo ff inancial results +denominated in foreignc urrenciest ot he U.S. dollar. +We areprimarily impactedby activitiesd enominated +in theB ritishp ound andt he euro.O naconsolidated +basisa nd in our SecuritiesS ervicesa nd Market and +Wealth Services businesss egments, wetypically have +more foreigncurrency-denominated expensesthan +revenues. However, our Investment andW ealth +Management businesssegment typically hasm ore +foreignc urrency-denominated revenuest han +expenses.O verall, currencyf luctuations impact the +year-over-year growth rate in theInvestment and +Wealth Management businesssegment more than the +SecuritiesS ervices andMarketa nd Wealth Services +businesss egments. However, currencyf luctuations, +in isolation, aren ot expected to significantly impact +neti ncomeo naconsolidated basis. +Feer evenue in theI nvestment andW ealth +Management businesssegment,a nd to al essere xtent, +theS ecuritiesS ervicesa nd Market andWealth +Services businesss egments, is impacted by theg lobal +market fluctuations.A tD ec. 31, 2023,w ee stimated +that a5 %c hange in globale quity markets, spread +evenly throughout they ear,w ouldi mpact feer evenue +by less than 1% andd ilutede arnings percommon +shareb y$ 0.04 to $0.07. +SeeN ote2 4o ft he Notest oC onsolidated Financial +Statements fort he consolidatings chedules which +show thec ontributiono fo ur businesssegmentst oo ur +overall profitability. +Resultso fO perations (continued) +12 BNYM ellon +The secret object #5 is a "toothbrush". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_3.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_3.txt new file mode 100644 index 0000000000000000000000000000000000000000..b0fbbf0d425b901d807d4a10b20e1227327e9746 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_3.txt @@ -0,0 +1,14 @@ +IBNY MELLON +Robin Vince, +President and +Chief Executive Offi cer +Last year was the fi rst full year of my tenure as CEO of BNY Mellon. +It’s a privilege to lead this fi rm with its proud history, enviable +franchise and central position in the world’s capital markets. +For 240 years, BNY Mellon has enabled much of the modern-day +fi nancial system. Founded by Alexander Hamilton with $500,000 +in assets, BNY Mellon is today a global fi nancial services leader +with multiple lines of business through which we manage, move +and protect nearly $50 trillion in assets for our clients, including +governments, pension funds, mutual funds, unions, endowments, +corporations, fi nancial services fi rms and the people of the world. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_30.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_30.txt new file mode 100644 index 0000000000000000000000000000000000000000..ec677bdcadc7b1baec675b5e17962a250cf614c5 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_30.txt @@ -0,0 +1,45 @@ +Securities Services businesssegment +2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Revenue: +Investment services fees: +AssetS ervicing $3 ,898 $3 ,918 $3 ,876 (1)% 1% +Issuer Services 1,121 1,009 1,061 11 (5) +Totali nvestment services fees 5,019 4,927 4,937 2 — +Foreigne xchanger evenue 488 584 574 (16) 2 +Otherf ees (a) 215 202 113 6 79 +Totalf ee revenue 5,722 5,713 5,624 — 2 +Investment ando ther revenue 333 291 194 N/M N/M +Totalf ee andother revenue 6,055 6,004 5,818 1 3 +Neti nterestr evenue 2,569 2,028 1,426 27 42 +Totalr evenue 8,624 8,032 7,244 7 11 +Provision forc reditl osses 99 8( 134) N/M N/M +Nonintereste xpense (excluding amortizationo fi ntangiblea ssets) 6,345 6,266 5,820 1 8 +Amortizationo fi ntangiblea ssets 31 33 32 (6) 3 +Totaln onintereste xpense 6,376 6,299 5,852 1 8 +Income before income taxes $2 ,149 $1 ,725 $1 ,526 25% 13% +Pre-taxo peratingm argin 25% 21% 21% +Securitiesl ending revenue (b) $1 89 $1 82 $1 73 4% 5% +Totalr evenue byline of business: +AssetS ervicing $6 ,638 $6 ,323 $5 ,699 5% 11% +Issuer Services 1,986 1,709 1,545 16 11 +Totalr evenue bylineo fb usiness $8 ,624 $8 ,032 $7 ,244 7% 11% +Selected average balances: +Averagel oans $1 1,207 $1 1,245 $8 ,756 —% 28% +Averaged eposits $168,411 $1 83,990 $2 00,482 (8)% (8)% +Selected metrics: +AUC/A at period end (int rillions)( c) $3 4.2 $3 1.4 $3 4.6 9% (9)% +Market valueo fs ecuritieso nl oana tp eriode nd (inb illions)( d) $4 50 $4 49 $4 47 —% —% +Issuer Services: +Totald ebts erviced atperiod end (int rillions) $1 3.3 $1 2.6 $1 2.6 6% —% +Number of sponsored Depositary Receiptsp rogramsa tp eriode nd 543 589 656 (8)% (10)% +(a)O ther fees primarily includesfinancing-relatedf ees. +(b)I ncludedi ninvestments ervices fees reportedi nthe AssetS ervicing line of business. +(c)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theIssuer Services lineo fb usiness. +Includest he AUC/Ao fC IBCM ellono f$ 1.7 trilliona tD ec. 31, 2023,$ 1.5 trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(d)R epresentst he totala mount ofsecuritieso nl oan in our agencysecuritiesl ending program.E xcludess ecuritiesf or whichB NY Mellon +acts as agent on behalfo fCIBCM ellonc lients, whicht otaled $63 billionatD ec. 31, 2023,$ 68 billionatD ec. 31, 2022 and $71 billion +at Dec. 31, 2021. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_31.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_31.txt new file mode 100644 index 0000000000000000000000000000000000000000..2891867bd519e9684affcf2450a253d900747f00 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_31.txt @@ -0,0 +1,90 @@ +Business segmentdescription +TheS ecuritiesS ervices businesss egment consists of +twod istinct lines of business, AssetServicing and +Issuer Services,w hich provide businesssolutions +acrosst he transactionl ifecyclet oo ur globalasset +ownera nd assetm anager clients. We areone ofthe +leadingg lobali nvestment services providers with +$34.2 trilliono fA UC/A at Dec. 31, 2023.F or +informationo nthe driversoft he SecuritiesS ervices +feer evenue,s ee Note 10 oftheN otes to Consolidated +FinancialS tatements. +TheA ssetS er vicing businessprovidesa +comprehensives uite of solutions.W ea re one ofthe +largestg lobalc ustody, fund administrator andf ront- +to-back outsourcing partners.W eo ffers ervices for +thes afekeepingo fa ssets incapitalm arkets globally +as well as fund accountings ervices,e xchange-traded +funds servicing, transfer agency,trust andd epository, +front-to-back capabilitiesa swella sd ataa nd analytics +solutions foro ur clients. We deliver foreign +exchange,a nd securitiesl ending andf inancing +solutions,o nbotha nagencya nd principalbasis.O ur +agency securitiesl ending programis one ofthe +largestl enders of U.S. andn on-U.S.s ecurities, +servicingalendablea ssetp oolo fa pproximately $4.9 +trillioni n3 4separatem arkets.O ur market-leading +liquidity services portale nables cashinvestmentsf or +institutionalc lientsa nd includes fund research and +analytics. +OurD igitalA ssetC ustody platformoffers custody +anda dministrations ervices forB itcoina nd Etherf or +select U.S. institutionalc lients. OurD igitalA ssets +Funds Services providesa ccountinga nd +administration, transfer agency andETF services to +digitala ssetf unds.W ee xpect to continue developing +our digitalassetc apabilitiesa nd to work closelyw ith +clientst oa ddresst heir evolving digitalassetn eeds. +As of andf or they ear endedDec. 31, 2023, our +DigitalA ssetC ustody platformandr elated initiative +hadade minimis impact on ourassets,l iabilities, +revenuesa nd expenses. +TheI ssuer Services businessi ncludesC orporate +Trusta nd Depositary Receipts. OurC orporate +Trustb usinessd eliversafull range ofissuer and +relatedi nvestor services,i ncluding trustee, paying +agency,f iduciary,e scrowa nd otherfinancial +services.W ea re al eadingp rovidert ot he debt +capitalm arkets,p roviding customized andmarket- +driven solutionst oi nvestors, bondholders and +lenders.O ur Depositary Receiptsb usinessd rives +globali nvestingb yproviding servicinga nd value- +addeds olutions that enable,facilitate ande nhance +cross-bordert rading,c learing, settlement and +ownership. We areone ofthel argest providers of +depositary receiptsservicesi nt he world, partnering +with leadingc ompanies fromm oret han5 0 +countries. +Review of financialr esults +AUC/A of $34.2trillioni ncreased 9% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values. +Totalr evenue of $8.6 billionincreased 7% compared +with 2022. Thed rivers of totalr evenue bylineo f +businessa re indicated below. +AssetS ervicing revenue of $6.6 billionincreased 5% +compared with 2022, primarilyreflectingh ighern et +interest revenue,n et newb usinessa nd thea batement +of moneym arketf ee waivers, partially offset by +lowerf oreign exchange revenue andc lient activity. +Issuer Services revenue of $2.0 billionincreased 16% +compared with 2022, primarilyreflectingh ighern et +interest revenue,t he accelerated amortizationo f +deferredc osts ford epositary receiptsservicesr elated +to Russiar ecorded in 2022, netnew businessa nd the +abatemento fm oneym arketf ee waivers. +Market andregulatoryt rends ared riving investable +assets toward lowerf ee assetmanagementp roducts at +reduced marginsf or ourclients. Thesed ynamicsa re +also negativelyi mpactingo ur investment services +fees.H owever,a tt he same time,t hese trends are +providing additionalo utsourcing opportunitiesa s +clientsa nd othermarketp articipantss eekt ocomply +with regulations andr educet heir operatingc osts. +Nonintereste xpenseo f$ 6.4 billionincreased 1% +compared with 2022, primarilyreflectingh igher +investmentsa nd thei mpact of inflation, partially +offset by efficiency savings. +Resultso fO perations (continued) +14 BNYM ellon +The secret animal #1 is a "cat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_32.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_32.txt new file mode 100644 index 0000000000000000000000000000000000000000..f78a3d9cc1f7a2f0bf0f3b92b13954fd116aaf18 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_32.txt @@ -0,0 +1,47 @@ +Market andWealth Services businesssegment +2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Revenue: +Investment services fees: +Pershing $2 ,007 $1 ,908 $1 ,737 5% 10% +TreasuryS ervices 691 689 662 — 4 +Clearance andCollateralM anagement 1,090 971 918 12 6 +Totali nvestment services fees 3,788 3,568 3,317 6 8 +Foreigne xchanger evenue 81 88 88 (8) — +Otherf ees (a) 212 176 131 20 34 +Totalf ee revenue 4,081 3,832 3,536 6 8 +Investment ando ther revenue 63 40 47 N/M N/M +Totalf ee andother revenue 4,144 3,872 3,583 7 8 +Neti nterestr evenue 1,712 1,410 1,158 21 22 +Totalr evenue 5,856 5,282 4,741 11 11 +Provision forc reditl osses 41 7( 67) N/M N/M +Nonintereste xpense (excluding amortizationo fi ntangiblea ssets) 3,191 2,924 2,655 9 10 +Amortizationo fi ntangiblea ssets 6 82 1 (25) (62) +Totaln onintereste xpense 3,197 2,932 2,676 9 10 +Income before income taxes $2 ,618 $2 ,343 $2 ,132 12% 10% +Pre-taxo peratingm argin 45% 44% 45% +Totalr evenue byline of business: +Pershing $2 ,789 $2 ,537 $2 ,314 10% 10% +TreasuryS ervices 1,611 1,483 1,293 9 15 +Clearance andCollateralM anagement 1,456 1,262 1,134 15 11 +Totalr evenue bylineo fb usiness $5 ,856 $5 ,282 $4 ,741 11% 11% +Selected average balances: +Averagel oans $3 7,502 $4 1,300 $3 8,344 (9)% 8% +Averaged eposits $8 5,785 $9 1,749 $1 02,948 (7)% (11)% +Selected metrics: +AUC/A at period end (int rillions)( b) $1 3.3 $1 2.7 $1 1.8 5% 8% +Pershing: +AUC/A at period end (int rillions) $2 .5 $2 .3 $2 .6 9% (12)% +Netn ew assets(U.S.p latform) (inb illions)( c) $2 2 $1 21 $1 61 N/M N/M +Averagea ctivec learinga ccounts (int housands) 7,946 7,483 7,257 6% 3% +TreasuryS ervices: +Averaged aily U.S. dollarp ayment volumes 236,696 239,630 235,971 (1)% 2% +Clearance andCollateralM anagement: +Averaget ri-party collateralm anagementb alances (inb illions) $5 ,658 $5 ,285 $4 ,260 7% 24% +(a)O ther fees primarily includefinancing-relatedf ees. +(b)C onsists of AUC/Af romt he Clearancea nd CollateralM anagement andPershingb usinesses. +(c)N et newa ssets representn et flows of assets(e.g., netcashd eposits and netsecuritiest ransfers, including dividends andinterest)i n +customer accountsi nP ershingL LC,aU .S. broker-dealer. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_33.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_33.txt new file mode 100644 index 0000000000000000000000000000000000000000..ac143e133f7ad89953cbbe80e251c25b985b3c76 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_33.txt @@ -0,0 +1,66 @@ +Business segmentdescription +TheM arketa nd Wealth Services businesss egment +consists of threed istinct lines of business,Pershing, +TreasuryS ervicesa nd Clearance andCollateral +Management,w hich provide businessservices and +technology solutions to entitiesi ncluding financial +institutions,c orporations,f oundations and +endowments, public funds andg overnment agencies. +Fori nformationo nthe driversoft he Market and +Wealth Services feer evenue,s ee Note 10 ofthe +Notest oC onsolidated FinancialS tatements. +Pershing providesexecu tion, clearing, custody, +businessa nd technology solutions,d elivering +operationals upportt ob roker-dealers, wealth +managers andr egisteredi nvestment advisors +(“RIAs”) globally. +OurT reasuryS ervices businessi saleading +providero fglobalp ayments, liquidity management +andt rade finances ervices forf inancial institutions, +corporations andt he publicsector. +OurC learance andCollateralM anagement +businessc learsa nd settlese quitya nd fixed-income +transactions globallyands ervesa scustodian for +tri-partyr epoc ollateralw orldwide.W ea re the +primary providero fU.S.g overnment securities +clearance andaprovidero fnon-U.S. government +securitiesc learance. Ourc ollaterals ervices +include collateralm anagement, administrationa nd +segregation. We offeri nnovatives olutions and +industrye xpertisew hich help financiali nstitutions +andi nstitutionali nvestorsw ith theirfinancing, risk +andb alance sheet challenges. We areal eading +providero ftri-party collateralm anagement +services with an averageof$ 5.7 trillions erviced +globally includingapproximately $4.6 trilliono f +theU .S.t ri-party repo market atDec. 31, 2023. +Review of financialr esults +AUC/A of $13.3trillioni ncreased 5% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values andnet clientinflows. +Totalr evenue of $5.9 billionincreased 11% +compared with 2022. Thed rivers of totalr evenue by +lineo fb usinessa re indicated below. +Pershing revenue of $2.8 billionincreased 10% +compared with 2022, primarilyreflectingt he +abatemento fm oneym arketf ee waivers, highern et +interest revenue andh igherf ees on sweepb alances, +partially offset by lowerc lient activity andl ost +business. Netn ew assetsof $22 billionin 2023 +reflectst he deconversionofaregional bank client +that wasa cquiredi nMay. +TreasuryS ervices revenue of $1.6 billionincreased +9% compared with 2022, primarilyreflectingh igher +neti nterestr evenue. +Clearance andCollateralM anagementr evenue of +$1.5 billionincreased 15% compared with 2022, +primarily reflectingh ighern et interest revenue, U.S. +collateralm anagementb alances andU.S.g overnment +clearance volumes. +Nonintereste xpenseo f$ 3.2 billionincreased 9% +compared with 2022, primarilyreflectingh igher +investmentsa nd revenue-relatede xpenses,a sw ella s +thei mpact of inflation, partiallyoffset by efficiency +savings. +Resultso fO perations (continued) +16 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_34.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_34.txt new file mode 100644 index 0000000000000000000000000000000000000000..f802dcb48c3c00320b949949db5042a98ce84e94 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_34.txt @@ -0,0 +1,48 @@ +Investment andWealth Management businesssegment +2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Revenue: +Investment management fees $2 ,971 $3 ,215 $3 ,483 (8)% (8)% +Performance fees 81 75 107 8 (30) +Investment management andp erformance fees (a) 3,052 3,290 3,590 (7) (8) +Distributiona nd servicingf ees 241 192 112 26 71 +Otherf ees (b) (214) (133) 80 N/M N/M +Totalf ee revenue 3,079 3,349 3,782 (8) (11) +Investment ando ther revenue (c) (102) (27) 67 N/M N/M +Totalf ee andother revenue (c) 2,977 3,322 3,849 (10) (14) +Neti nterestr evenue 166 228 193 (27) 18 +Totalr evenue 3,143 3,550 4,042 (11) (12) +Provision forc reditl osses (4) 1( 13) N/M N/M +Nonintereste xpense (excluding goodwill impairmentand +amortizationo fi ntangiblea ssets) 2,746 2,795 2,796 (2) — +Goodwill impairment — 680 — N/M N/M +Amortizationo fi ntangiblea ssets 20 26 29 (23) (10) +Totaln onintereste xpense 2,766 3,501 2,825 (21) 24 +Income before income taxes $3 81 $4 8$ 1,230 694% (d) (96)% (d) +Pre-taxo peratingm argin 12% 1% 30% +Adjusted pre-taxo peratingm argin – Non-GAAP (e) 14% (f) 2% (f) 33% +Totalr evenue byline of business: +Investment Management $2 ,068 $2 ,390 $2 ,834 (13)% (16)% +Wealth Management 1,075 1,160 1,208 (7) (4) +Totalr evenue bylineo fb usiness $3 ,143 $3 ,550 $4 ,042 (11)% (12)% +Selected average balances: +Averagel oans $1 3,718 $1 4,055 $1 2,120 (2)% 16% +Averaged eposits $1 4,280 $1 9,214 $1 8,068 (26)% 6% +(a)O nac onstant currencyb asis,i nvestmentm anagement and performancefees decreased 7% (Non-GAAP) comparedwith 2022. See +“SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” beginning on page 111fort he reconciliationo f +this Non-GAAP measure. +(b)O ther fees primarily includesinvestments ervices fees. +(c)I nvestmenta nd otherrevenue andtotalf ee and otherrevenue arenet of income attributablet on oncontrollingi nterests relatedt o +consolidated investmentm anagement funds. +(d)E xcluding notableitems,i ncomeb eforei ncomet axes decreased 28% (Non-GAAP) in 2023 compared with 2022 and 39%(Non-GAAP) +in 2022 compared with 2021. See“ SupplementalI nformation –E xplanationo fG AAP and Non-GAAP financialm easures” beginning +on page 111fort he reconciliationo ft hese Non-GAAP measures. +(e)N et of distributionand servicinge xpense.S ee “SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” +beginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +(f)E xcluding notableitems and neto fdistributiona nd servicinge xpense,t he adjustedpre-tax operatingmarginw as 19% (Non-GAAP) in +2023 and24% (Non-GAAP) in 2022.S ee “SupplementalI nformation –E xplanationo fG AAP and Non-GAAP financialm easures” +beginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 7 +The secret clothing is a "hat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_35.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_35.txt new file mode 100644 index 0000000000000000000000000000000000000000..369f5a1ddf9fdaeccef3b57ded4dab161a7f999e --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_35.txt @@ -0,0 +1,101 @@ +AUM trends +(inb illions) 2023 2022 2021 +AUM by producttype (a): +Equity $1 45 $1 35 $1 87 +Fixedi ncome 205 198 267 +Index 459 395 467 +Liability-driveni nvestments 605 570 890 +Multi-asseta nd alternativei nvestments 170 153 228 +Cash 390 385 395 +TotalA UM $1,974 $1 ,836 $2 ,434 +Changesi nA UM (a): +Beginning balanceofA UM $1,836 $2 ,434 $2 ,211 +Neti nflows (outflows): +Long-term strategies: +Equity (12) (18) (12) +Fixedi ncome (4) (21) 17 +Liability-driveni nvestments 12 78 36 +Multi-asseta nd alternative +investments (9) (11) (2) +Totall ong-term actives trategies +(outflows) inflows (13) 28 39 +Index (12) 2( 7) +Totall ong-term strategies +(outflows) inflows (25) 30 32 +Short-term strategies: +Cash 5 (12) 70 +Totaln et (outflows) inflows (20) 18 102 +Netm arketi mpact 121 (471) 143 +Netc urrencyi mpact 37 (113) (22) +Divestiture — (32) — +Ending balanceofA UM $1,974 $1 ,836 $2 ,434 +Wealth Management client +assets (b) $3 12 $2 69 $3 21 +(a)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth +Management businesssegment. +(b)I ncludesA UM and AUC/Ai nt he Wealth Management lineo f +business. +Business segmentdescription +OurI nvestment andW ealth Management business +segmentc onsists of twod istinct lines of business, +Investment Management andW ealth Management, +whichh aveac ombinedA UM of $2.0trilliona so f +Dec. 31, 2023. +BNYM ellonI nvestment Management is al eading +globala ssetm anager andconsists of sevens pecialist +investment firmsa nd ag lobald istributionp latformt o +deliver ad iversified range ofinvestment capabilities +to institutionala nd retail clientsg lobally. +OurI nvestment Management modelp rovides +specialiste xpertisef roms even investment firms +offering solutions acrossm ajor assetc lasses, backed +by thes trength, scalea nd provenstewardship of BNY +Mellon. Each investment firm hasi ts owni ndividual +culture,i nvestment philosophyandp roprietary +investment process. This approach brings ourclients +clear,i ndependent thinking fromh ighlye xperienced +investment professionals. +Thei nvestment firmso fferabroadr ange ofactively +managede quity,f ixed income,m ulti-asseta nd +liability-driveni nvestments, along with passive +products andc ashm anagement. Ours ix majority- +ownedi nvestment firmsa re as follows:A RX, +Dreyfus, Insight Investment,M ellon, Newton +Investment Management andW alterS cott. BNY +Mellono wnsanoncontrollingi nteresti nS iguler +Guff. +In November 2022, BNYM ellons oldA lcentra. As +part of thes alea greement, Investment Management +will continue to offerA lcentra’sc apabilitiesi nB NY +Mellon’ss ub-advisedf unds andi nselect regions via +its globald istributionp latform. BNYM ellon +continuest op rovide Alcentra with ongoing asset +servicings upport. Additionally,I nvestment +Management exclusivelyd istributes Alcentra +products inJapan. +Investment Management hasmultiple global +distributione ntities, whicha re responsiblefor +distributingt he investment solutionsd evelopeda nd +managedb ythe investment firms, as well as +responsibility form anagementa nd distributionofo ur +U.S. mutual funds,E TFsa nd certain offshorem oney +market funds. +BNYM ellonW ealth Management provides +investment management,c ustody, wealth ande state +planning, privatebanking services,i nvestment +servicinga nd informationm anagement. BNYM ellon +Wealth Management has$312 billioninc lient assets +as of Dec. 31, 2023,a nd more than 30 officesin the +U.S. andi nternationally. +Wealth Management clientsi nclude individuals, +familiesa nd institutions.I nstitutions include family +offices,c haritableg iftp rogramsa nd endowmentsa nd +foundations.W ew orkw ith clientst ob uild,m anage +ands ustain wealth acrossg enerations andm arket +cycles. +Thew ealth businessd ifferentiatesi tselfw ith a +comprehensivew ealth managementframework called +ActiveW ealth thatseekst oe mpower clientstob uild +ands ustain long-term wealth. +Resultso fO perations (continued) +18 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_36.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_36.txt new file mode 100644 index 0000000000000000000000000000000000000000..4f6e6140459a762098f5e67907b6bc442c89733a --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_36.txt @@ -0,0 +1,90 @@ +Ther esults of theI nvestment andW ealth +Management businesssegment ared rivenb yablend +of daily,m onthlya nd quarterlyAUM by product +type.T he overall levelofA UM foragivenp eriodi s +determined by: +•t he beginninglevelo fA UM; +•t he netflows of newassets duringt he period +resultingf romn ew businessw insa nd existing +client inflows, reduced by thel osso fc lientsa nd +existingc lient outflows;and +•t he impact of market pricea ppreciationo r +depreciation, foreigne xchanger ates and +investment firm acquisitions or divestitures. +Them ix of AUM is ar esulto ft he historicalgrowth +rateso fe quity andf ixed income marketsand the +cumulativen et flowso fo ur investment firmsa sa +result of client asseta llocationd ecisions.A ctively +managede quity,m ulti-asseta nd alternativea ssets +typically generate higherp ercentagef ees than fixed- +income andl iability-driveni nvestmentsa nd cash. +Also,a ctivelym anaged assets typicallygenerate +higherm anagementf ees than indexedo rp assively +manageda ssets of thes amet ype.M arketa nd +regulatoryt rends haveresultedi nincreased demand +forl ower feea ssetm anagementp roducts andf or +performance-basedf ees. +Investment management fees aredependent onthe +overall leveland mix of AUM andt he management +fees expressedi nbasis points( one-hundredth of one +percent) chargedf or managing thosea ssets. +Management fees aretypically subject to fee +schedules basedo nthe overall levelofa ssets +managedf or as inglec lient or byindividuala sset +classa nd style. This is mostcommonf or institutional +clientsw here we typically managesubstantiala ssets +fori ndividuala ccounts. +Performance fees aregenerally calculateda sa +percentage ofap ortfolio’s performance in excesso fa +benchmarki ndexo rapeer group’sp erformance. +Ak ey driver of organicgrowthi ninvestment +management andp erformance fees is theamount of +netn ew AUM flows. Overallm arketc onditions are +also keyd rivers,w ith as ignificantl ong-term +economic driver beingg rowtho fg lobalf inancial +assets. +Neti nterestr evenue is determined by loan and +deposit volumes andthe interest rate spread between +customer ratesa nd internal funds transfer rateso n +loansa nd deposits.E xpenses in theInvestment and +Wealth Management businesssegment arem ainly +driven by staffa nd distributionand servicing +expenses. +Review of financialr esults +AUM of $2.0trillioni ncreased 8% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values andthe favorable impact of aw eaker U.S. +dollar, partially offset by cumulativen et outflows. +Netl ong-term strategy outflowswere$ 25 billioni n +2023, drivenby outflowsofe quity,i ndexa nd multi- +asseta nd alternativei nvestments, partially offset by +inflowso fl iability-driveni nvestments. Short-term +strategy inflowsw ere$ 5b illioni n2 023. +Totalr evenue of $3.1 billion decreased11% +compared with 2022. Thed rivers of totalr evenue by +lineo fb usinessa re indicated below. +Investment Management revenue of $2.1 billion +decreased 13% compared with 2022, primarily +reflectingt he reductioni nthe fair valueo fa +contingent considerationr eceivablea nd thei mpact of +thep rior yeardivestiture,a sw ella st he mix of AUM +flows, partially offset thea batement ofmoneym arket +feew aivers ands eed capitalg ains. +Wealth Management revenue of $1.1 billion +decreased 7% compared with 2022, primarily +reflectingc hangesi np roductm ix andl ower net +interest revenue. +Revenue generatedi nthe Investment andW ealth +Management businesssegment included3 3% from +non-U.S. sources in 2023, compared with 35% in +2022. +Nonintereste xpenseo f$ 2.8 billiondecreased 21% +compared with 2022, primarilyreflectingt he +goodwilli mpairmenti nt he Investment Management +reportingu niti n2 022, thei mpact of ap rior year +divestiturea nd efficiency savings,p artially offset by +higheri nvestmentsa nd revenue-relatede xpenses,a s +well as inflation. +Resultso fO perations (continued) +BNYM ellon1 9 +The secret transportation is a "boat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_37.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_37.txt new file mode 100644 index 0000000000000000000000000000000000000000..9719e3e90538d7131557f152af3652bf96c3a695 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_37.txt @@ -0,0 +1,77 @@ +Other segment +(inm illions) 2023 2022 2021 +Feer evenue $( 10) $6 1$ 36 +Investment ando ther revenue (11) (373) 15 +Totalf ee andother revenue (21) (312) 51 +Neti ntereste xpense (102) (162) (159) +Totalr evenue (123) (474) (108) +Provision forc reditl osses (17) 23 (17) +Nonintereste xpense 956 278 161 +(Loss) before income taxes $( 1,062) $( 775) $( 252) +Averagel oans andl eases $1 ,669 $1 ,225 $1 ,594 +Segmentd escription +TheO ther segmentp rimarily includes: +•t he leasingp ortfolio; +•c orporatet reasurya ctivities, including our +securitiesp ortfolio; +•d erivatives andother tradinga ctivity; +•c orporatea nd bank-ownedlifei nsurance; +•r enewable energy ando ther corporate +investments; and +•c ertain businesse xits. +Revenue primarily reflects: +•n et interest revenue (expense) andlease-related +gains( losses) from leasingo perations; +•n et interest revenue (expense) andderivatives and +otherc orporatet reasurya ctivities; +•o ther revenue from certain businesse xits; +•i nvestment ando ther revenue fromc orporatea nd +bank-ownedl ifei nsurance, gains( losses) +associated with investmentsecuritiesa nd other +assets,i ncluding renewablee nergy; and +•f ee revenue from thee liminationo ft he resultso f +certain services providedb etween segments, +whicha re also providedt othird parties. +Expenses include: +•d irect expensessupportingl easing, investinga nd +funding activities; and +•e xpenses not directlyattributable toSecurities +Services,M arketa nd Wealth Services and +Investment andW ealth Management operations. +Review of financialr esults +Loss before taxesw as $1.1 billionin2 023 compared +with $775 millioni n2 022. +Investment ando ther revenue increased $362 million +compared with 2022, primarilyreflectingt he netloss +fromr epositioning thes ecurity portfolio recordedi n +2022. +Nonintereste xpensei ncreased $678 million +compared with 2022, primarilydriven by theF DIC +special assessment. +Internationalo perations +Ourp rimary internationala ctivitiesc onsisto fa sset +servicingi nour SecuritiesS ervicesb usinesss egment, +globalp ayment services in our Market andWealth +Services businesss egment andi nvestment +management in our Investment andW ealth +Management businesssegment. +Ourc lientsi nclude central banks ands overeigns, +financiali nstitutions,a ssetm anagers, insurance +companies, corporations,l ocal authoritiesand high- +net-worthi ndividuals andf amily offices.T hrough +our globalnetwork of offices,weh aved evelopeda +deep understanding oflocal requirementsa nd cultural +needs, andw ep ride ourselveson providing dedicated +servicet hrough ourmultilinguals ales,m arketinga nd +client servicet eams. +At Dec. 31, 2023,a pproximately 55% of ourtotal +employees (full-time andp art-time employees)w ere +basedo utside theU .S., with approximately 11,000 +employees in EMEA,a pproximately 18,400 +employees in APAC anda pproximately 800 +employees in otherg loball ocations,p rimarily Brazil. +We areal eading globalassetm anager.O ur +internationalo perations managed5 1% ofBNY +Resultso fO perations (continued) +20 BNYM ellon +The secret object #2 is a "phone". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_38.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_38.txt new file mode 100644 index 0000000000000000000000000000000000000000..cda1252ca9463f518ad9abb8b38affc07c571b07 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_38.txt @@ -0,0 +1,84 @@ +Mellon’sA UM at Dec. 31, 2023and5 3% at Dec. 31, +2022. +In Europe,w em aintainc apabilitiest os ervice +Undertakings forC ollectiveI nvestment in +Transferable Securitiesa nd alternativei nvestment +funds.W eo fferafull range oftailoreds olutions for +investment companies, financiali nstitutions and +institutionali nvestorsa crossm ostE uropean markets. +We areap rovidero fnon-U.S. government securities, +fixedi ncomea nd equitiesc learance, settling +securitiest ransactions directly inEuropean markets, +andu sing ah igh-quality ande stablishedn etwork of +local agents innon-European markets. +We have extensivee xperience providing tradea nd +cashs ervices to financiali nstitutions andc entral +banks outside oftheU .S.I na ddition, we offera +broadr ange ofservicinga nd fiduciary products to +financiali nstitutions,c orporations andc entral banks. +In emerging markets, welead with custody, global +payments andi ssuer services,i ntroducingo ther +products as them arkets mature.F or more established +markets, our focusi song lobali nvestment services. +We arealsoafull- serviceg lobalp rovidero fforeign +exchange services,a ctivelyt rading in over1 00 ofthe +world’sc urrencies. We servec lientsf romt rading +desksl ocated in Europe,A siaa nd NorthA merica. +Ourf inancial results,a sw ella so ur levels of AUC/A +andA UM,a re impacted by translationf romf oreign +currenciest ot he U.S. dollar. We areprimarily +impacted by activitiesd enominated in theBritish +pound andt he euro.I ft he U.S. dollard epreciates +againstt hese currencies, thet ranslationi mpact is a +higherl evel of feer evenue,n et interest revenue, +nonintereste xpensea nd AUC/A andA UM. +Conversely, if theU.S.d ollara ppreciates,t he +translated levels of feer evenue,n et interest revenue, +nonintereste xpensea nd AUC/A andA UM will be +lower. +Foreign exchange rates +vs.U .S.d ollar2 023 2022 2021 +Spot rate (atD ec. 31): +Britishp ound $1 .2749 $1 .2096 $1 .3543 +Euro 1.1046 1.0708 1.1373 +Yearly averager ate: +Britishp ound $1 .2432 $1 .2375 $1 .3755 +Euro 1.0813 1.0550 1.1994 +Internationalc lientsa ccounted for3 6% ofrevenuesi n +2023 and2 022. Neti ncomef romi nternational +operations was$ 2.0 billionin 2023, compared with +$1.7 billionin2 022. +In 2023, revenuesf romE MEAw ere$ 4.1 billion, +compared with $4.0 billionin2 022. The4 %i ncrease +primarily reflectsh ighern et interest revenue andn et +newb usinessi nt he SecuritiesS ervicesa nd Market +andW ealth Services businesss egments. Thei ncrease +wasp artially offset by lowerr evenue in the +Investment andW ealth Management business +segment. Thed ecreasei nr evenue in theInvestment +andW ealth Management businesssegment primarily +reflectst he impact of thep rior yeardivestiture,m ix +of AUM flowsa nd lowerm arketv alues. +TheS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management business +segments generated6 0%,2 1% and1 9% ofEMEA +revenues, respectively. Neti ncomef romE MEAw as +$1.1 billionin2 023, compared with $880 millioni n +2022. +RevenuesfromA PACw ere$ 1.3 billionin2 023, +compared with $1.1 billionin2 022. The1 4% +increasep rimarily reflectsh ighern et interest revenue +in theS ecuritiesS ervicesa nd Market andWealth +Services businesss egments. +TheS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management business +segments generated5 6%,3 2% and1 2% ofAPAC +revenues, respectively. Neti ncomef romA PACw as +$547 millioni n2 023, compared with $432 millioni n +2022. +Foradditionali nformationr egarding ourinternational +operations,i ncluding certain keys ubjective +assumptions usedin determiningt he results,s ee Note +25 oftheN otes to Consolidated FinancialS tatements. +Resultso fO perations (continued) +BNYM ellon2 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_39.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_39.txt new file mode 100644 index 0000000000000000000000000000000000000000..4241e32dc3eca0e5136d63df696db313b6def569 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_39.txt @@ -0,0 +1,79 @@ +Country riskexposure +Thef ollowing tablep resentsB NY Mellon’stop 10 +exposures by country (excludingtheU .S.) as of Dec. +31, 2023,as well as certaincountries with higher-risk +profiles, andi sp resented on an internal risk +management basis. We monitoro ur exposuret ot hese +ando ther countries aspart of ourinternal country risk +management process. +Thec ountry riskexposureb elow reflectst he +Company’sr iskt oa nimmediated efault of the +counterpartyo ro bligor basedo nthe country of +residenceo ft he entity whichi ncurst he liability.I f +therei sc reditr iskm itigation, thec ountry of residence +of thee ntity providing ther iskm itigationi st he +country of risk.T he country of risk fors ecuritiesi s +generally basedo nthe domicileof thei ssuer of the +security. +Country riskexposure at Dec. 31, 2023 Interest-bearingd eposits Total +exposure(inb illions) Centralb anks Banks Lending (a) Securities (b) Other (c) +Top1 0c ountry exposure: +Germany$ 16.9 $0 .6 $0 .8 $3 .8 $0 .3 $2 2.4 +UnitedK ingdom (“UK”)1 0.9 0.7 1.4 3.0 2.3 18.3 +Belgium8 .2 0.8 0.1 0.8 —9 .9 +Canada —1 .3 0.1 3.9 1.2 6.5 +Netherlands 3.4 —0 .2 1.1 0.2 4.9 +Japan1 .2 0.8 0.1 0.4 0.3 2.8 +Luxembourg0 .1 —1 .4 0.1 1.2 2.8 +SouthK orea 0.1 —2 .0 0.1 0.5 2.7 +Australia —1 .0 0.3 0.7 0.5 2.5 +France —— 0.1 1.9 0.5 2.5 +TotalT op 10country exposure $4 0.8 $5 .2 $6 .5 $1 5.8 $7 .0 $7 5.3 (d) +Select country exposure: +Brazil$ —$ 0.2 $0 .9 $0 .1 $0 .1 $1 .3 +Russia— 0.4 (e) —— —0 .4 +(a)L ending includesl oans,a cceptances,i ssued letters of credit, neto fparticipations,a nd lending-relatedc ommitments. +(b) Securitiesi nclude boththe available-for-saleand held-to-maturityportfolios. +(c)O ther exposureincludeso ver-the-counter (“OTC”)d erivativea nd securitiesf inancingt ransactions,n et of collateral. +(d)T he top1 0country exposurec omprises approximately7 0% of ourtotaln on-U.S. exposure. +(e)R epresentsc ashb alances with exposuret oR ussia. +Events inrecenty earsh aver esultedi nincreased +focuso nB razil. Thec ountry riskexposuret oB razil +is primarily short-term tradef inance loanse xtended +to largefinancial institutions.W ea lsoh ave +operations in Brazilp roviding investment services +andi nvestment management services. +Thew ar in Ukraineh as increased our focuso n +Russia. Thec ountry riskexposuret oR ussiac onsists +of cashb alances relatedt oour securitiess ervices +businessesa nd mayi ncreasei nt he future to the +extent cashi sr eceivedf or theb enefit of ourclients +that is subject to distributionr estrictions.B NY +Mellonh as ceasednewb anking businessinR ussia +ands uspendedi nvestment management purchasesof +Russian securities. At Dec.31, 2023,l esst han0 .1% +of ourAUC/A andl esst han0 .01% of ourAUM +consistedo fR ussian securities. We will continue to +work with multinationalclientst hatd ependo nour +custody andr ecord keepings ervices to managetheir +exposures. +We arealsom onitoring ourexposuret oI srael aspart +of ourinternal country riskmanagement process. At +Dec. 31, 2023,o ur totale xposuret oI srael was$ 165 +milliona nd primarily consistedo fi nvestment grade +short-term interest-bearingd eposits andO TC +derivatives maturing within sixm onths. +Critical accountinge stimates +Ours ignificanta ccountingp oliciesa re describedi n +Note 1o ft he Notest oC onsolidated Financial +Statements.C ertain of thesep oliciesi nclude critical +accountinge stimatesw hich require management to +make subjectiveo rc omplex judgments about the +effect of matters that areinherently uncertain and +mayc hange in subsequent periods.O ur critical +accountinge stimatesa re thoser elated to the +allowancef or credit losses,goodwill ando ther +intangibles andlitigationa nd regulatory +contingencies. Management hasdiscussedt he +Resultso fO perations (continued) +22 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_4.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_4.txt new file mode 100644 index 0000000000000000000000000000000000000000..cb113e6a252f3f4e81cba3f61d5e89b0b1800ba3 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_4.txt @@ -0,0 +1,50 @@ +II ANNUAL REPORT 2023 +$2.4T +$12.5T +$312B +$5.7T +$47.8T +$2.0T +GLOBAL REACH AND SCALE +Assets under custody +and/or administration1 +Assets under management2 +Average daily clearance value3 +Average triparty balances3 +Average daily U.S. dollar +payment value3 +Wealth Management +client assets4 +1 As of December 31, 2023. Consists of assets under custody and/or administration (“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 December 31, 2023. +2 As of December 31, 2023. Excludes assets managed outside of the Investment and Wealth Management business segment. +3 Average for the year ended December 31, 2023. +4 As of December 31, 2023. Includes AUM and AUC/A in the Wealth Management line of business. +The unique role we play in the financial system — touching +around one-fifth of the world’s investable assets — gives us a +tremendous responsibility, and our success is critical not only +to our clients’ success, but also the global economy at large. +That responsibility motivates us every day. To help our clients +achieve their ambitions. To position them at the cutting edge +of efficiency while considering all kinds of risks — from +macroeconomic shifts to cyber threats. To improve financial +performance for the benefit of our shareholders. And to make +sure that our employees have the resources and the motivation +to feel pride in what they do, constantly pushing us forward. +Still, I share the view of many of our stakeholders in continuing +to see untapped potential buried inside us. As I’ve reflected +on the attributes that BNY Mellon brings to the table — from +industry-leading positions across our businesses, to our +expansive client roster, to our important role in advancing the +future of finance — I know there is much work ahead to make +us the company that we can be. +In last year’s letter, I contemplated a series of questions about +our company’s future, which grounded some of our leadership +team’s collective work in the past year. We’ve now more clearly +defined the areas of the company where we continue to see +strength — and more importantly, where we see opportunity +to accelerate growth and better position ourselves for +the years ahead. +The secret tool is a "wrench". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_40.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_40.txt new file mode 100644 index 0000000000000000000000000000000000000000..4b4c872e748c5b149c81a503353cb4974da85149 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_40.txt @@ -0,0 +1,103 @@ +developmenta nd selectiono ft he critical accounting +estimatesw ith theCompany’sA uditC ommittee. +Allowancef or creditl osses +Thea llowancef or credit lossescovers financialassets +subject to credit lossesand measured at amortized +cost,i ncluding loansa nd lending-related +commitments, held-to-maturity securities, certain +securitiesf inancing transactions andd eposits with +banks.T he allowancef or credit lossesi sintendedt o +adjust thec arryingv alue ofthesea ssets by an +estimateda mount ofcredit lossesthatw ee xpect to +incuro vert he lifeo ft he asset. Similarly, the +allowancef or credit lossesonl ending-related +commitmentsa nd otheroff-balances heet financial +instrumentsi smeantt oc apture thec reditl ossest hat +we expect to recognize in theseportfoliosa soft he +balances heet date. +Aq uantitativem ethodology andq ualitative +framework is used to estimate theallowancef or +credit losses. +Theq uantitativec omponent of ourestimate uses +models andm ethodologies that categorizefinancial +assets basedo nproductt ype,c ollateralt ype,a nd +otherc reditt rendsa nd risk characteristics, including +relevant informationa bout pastevents,c urrent +conditions andr easonablea nd supportablef orecasts +of future economic conditions that affectthe +collectability of ther ecorded amounts. Fort he +quantitativec omponent,w es egment portfoliosinto +various majorc omponentsi ncluding commercial +loansa nd leasef inancing, commercial real estate, +financiali nstitutions,r esidentialm ortgages,a nd +other. Thes egmentationo fo ur debtsecurities +portfoliosi sbym ajor assetc lass andi si nfluenced by +whethert he security isstructured or non-structured +(i.e., directobligation),a sw ella st he issuer type.T he +componentso ft he credit losscalculationf or each +majorp ortfolio or assetc lass include ap robability of +default, lossgivend efault ande xposurea td efault,a s +applicable,a nd theirv aluesd ependo nthe forecast +behavior of variablesint he macroeconomic +environment. We utilizeam ulti-scenario +macroeconomic forecastw hich includesaweighting +of threes cenarios: ab aselinea nd upsideand +downsides cenariosa nd allows us to developo ur +estimate usingawide span of economic variables. +Ourb aselines cenario reflectsaview on likely +performance of each globalr egiona nd theo ther two +scenariosa re designedr elativet ot he baseline +scenario.T hisa pproach incorporates ar easonable +ands upportablef orecastp eriods panning thel ifeo f +thea sset, andi ncludesb otha ninitiale stimated +economic outlook component as well as ar eversion +component fore ach economicinput variable.T he +lengtho fe ach of thet wo componentsd epends onthe +underlying financiali nstrument, scenario,a nd +underlying economic input variable.I ng eneral,t he +initiale conomic outlook periodfore ach economic +input variableundere ach scenario rangesb etween +severalm onths andt wo years. Thes peed at which +thes cenario-specificf orecasts revert to long-term +historical mean is basedo nobservedh istorical +patternso fm ean reversiona tt he economic variable +input levelt hata re reflectedin our modelp arameter +estimates. Certainm acroeconomic variabless ucha s +unemploymento rh omep ricest akel ongert or evert +afteracontraction, though specificr ecovery timesa re +scenario-specific. Reversionw ill usually takelonger +thef urther awaythes cenario-specificf orecasti sf rom +theh istorical mean.O naquarterly basis, andw ithin +ad evelopedg overnance structure, we update these +scenariosf or current economic conditions andm ay +adjust thes cenario weightingb ased on oureconomic +outlook. TheC ompany usesjudgmentt oa ssess these +economic conditions andl ossd atai nd etermining the +best estimate of thea llowancef or credit lossesand +thesee stimatesa re subject to periodicr efinement +basedo nchangest ou nderlying external or Company- +specifich istorical data. +In theq uantitativec omponent of ourestimate,w e +measuree xpected credit lossesusing an individual +evaluationm ethod if theriskc haracteristicso ft he +asseti sn ol ongerc onsistent with theportfolio or class +of asset. Fort hese assets,w ed on ot employ the +macroeconomic modelcalculationb ut consider +factorss ucha sp ayment status,c ollateralv alue,t he +obligor’s financialcondition, guarantorsupport, the +probability of collecting scheduled principala nd +interest payments when due,a nd recovery +expectations if they canbe reasonablye stimated. For +loans, wemeasuret he expected credit lossas the +differenceb etween thea mortized costbasiso ft he +loan andthe presentvalue ofthee xpected future cash +flowsf romt he borrowerwhich is generally +discounted atthel oan’se ffectivei nterestr ate, or the +fair valueo ft he collateral,i ft he loan is collateral- +dependent.W eg enerally individuallyevaluate +nonperformingl oans as well as loanst hath aveb een +or area nticipated to be modified givent he risk +characteristicso fs uchl oans. +Resultso fO perations (continued) +BNYM ellon2 3 +The secret sport is "tennis". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_41.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_41.txt new file mode 100644 index 0000000000000000000000000000000000000000..f2ed9f840b67931057f44f4417947b2bb9ce0727 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_41.txt @@ -0,0 +1,101 @@ +Available-for-saled ebts ecuritiesa re recorded atfair +value. When an available-for-saledebts ecurity is in +an unrealized loss position, we employ a +methodology to identifya nd estimate thecreditl oss +portiono ft he unrealizedloss position. The +measuremento fe xpected credit lossesi sperformed at +thes ecurity leveland is basedo nour best single +estimate of cashf lows,o nadiscounted basis; +however,w ed on ot specifically employ the +macroeconomic forecastingm odels ands cenarios +summarized above. +Theq ualitativec omponent of ourestimate fort he +allowancef or credit lossesisi ntendedt ocapture +expected lossest hatm ay not have beenfully captured +in thequantitativec omponent.T hrough an +establishedg overnance structure, management +determines theq ualitativea llowancee ach period +basedo na nevaluationo fv arious internal and +environmentalf actorsw hich include:s cenario +weightinga nd sensitivity risk,c reditc oncentration +risk,e conomic conditions ando ther considerations. +We have made andm ay continueto make +adjustmentsf or idiosyncratic risks. +To thee xtenta ctualr esults differf romf orecasts or +management’s judgment, theallowancef or credit +lossesm ay be greateror less than future charge-offs +andr ecoveries. +Oura llowancef or credit lossesi ssensitivet oa +numbero finputs, most notably themacroeconomic +forecasta ssumptions that areincorporated into our +estimate of credit lossest hrough thee xpected life of +thel oanp ortfolio,a sw ella sc reditr atings assignedt o +each borrower. As them acroeconomic environment +andr elated forecasts change,t he allowancef or credit +lossesm ay changematerially.T he following +sensitivity analyses do notrepresentm anagement’s +expectations ofthed eteriorationo fo ur portfolioso r +thee conomic environment, but arep rovideda s +hypothetical scenariost oa ssess thes ensitivity of the +allowancef or credit lossestoc hangesi nk ey inputs. +If commercialr eal estatepropertyv aluesw ere +increased 10% anda ll otherc redits were ratedone +gradeb etter, theq uantitativea llowancew ouldh ave +decreased by $47million, andi fc ommercialr eal +estate propertyv aluesw ered ecreased 10% anda ll +otherc redits were ratedone gradeworse,t he +quantitativea llowancew ouldh avei ncreased by $83 +million. Ourm ulti-scenario basedm acroeconomic +forecastu sedi ndeterminingt he Dec. 31, 2023 +allowancef or credit lossesconsistedo ft hree +scenarios. Theb aselines cenario reflectss lightly +increasingG DP growth,s tableu nemploymenta nd +decliningc ommercialr eal estateprices through the +endo f2 024. Theu psides cenario reflectsf asterG DP +growth,d ecliningu nemploymentt hrough thes econd +quarter of 2024 beforemoderatinga nd higher +commercialr eal estateprices comparedwith the +baseline. Thed ownsides cenario contemplates +negativeG DP growth throughthef irst quarter of +2024 with subsequent stabilizationt hrough thet hird +quarter of 2024,as well as rapidlyi ncreasing +unemploymentt hrough 2024ands harply lower +commercialr eal estateprices than theb aseline. At +Dec. 31, 2023,w ep laced them ostw eight on our +downsides cenario,f ollowedb ythe baselinescenario, +with ther emaining weightingp laced on theu pside +scenario.F romasensitivity perspective, atDec. 31, +2023, if we hada pplied1 00% weightingt othe +downsides cenario,t he quantitativeallowancef or +credit losseswouldh aveb een approximately$88 +millionh igher. +SeeN otes 1a nd 5o ft he Notest oC onsolidated +FinancialS tatementsf or additionali nformation +regardingt he allowancef or credit losses. +Goodwill and otherintangibles +We initiallyr ecord alla ssets andl iabilitiesa cquired +in purchasea cquisitions,i ncluding goodwill, +indefinite-lived intangibles andother intangibles,i n +accordance with AccountingS tandardsC odification +(“ASC”)8 05, Business Combinations.G oodwill, +indefinite-lived intangibles andother intangibles are +subsequently accounted fori na ccordance with ASC +350, Intangibles –G oodwill and Other. Thei nitial +measuremento fg oodwill andi ntangibles requires +judgmentc oncerning estimateso ft he fair valueo ft he +acquireda ssets andl iabilities. Goodwill ($16.3 +billiona tD ec. 31, 2023)a nd indefinite-lived +intangiblea ssets ($2.6 billionat Dec. 31, 2023)a re +not amortized but ares ubject to testsfor impairment +annually or more ofteni fe ventso rc ircumstances +indicatei ti sm orel ikelyt hann ot they mayb e +impaired. Otheri ntangiblea ssetsa re amortized over +theire stimatedu sefull ives andare subject to +impairmenti fe ventso rc ircumstances indicatea +possiblei nability torealizet he carryingv alue. +Goodwill +BNYM ellon’sb usinesss egmentsi nclude six +reportingu nits forw hich annualgoodwill impairment +Resultso fO perations (continued) +24 BNYM ellon +The secret object #1 is a "table". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_42.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_42.txt new file mode 100644 index 0000000000000000000000000000000000000000..736023e0cb2bdb5f185448e7527123d016d8bff3 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_42.txt @@ -0,0 +1,89 @@ +testingi sp erformed.A ni nterim goodwill +impairmentt esti sp erformed when eventsor +circumstances occurt hatm ay indicatet hati ti sm ore +likelyt hann ot that thef airv alue ofanyr eportingu nit +mayb el esst hani ts carryingv alue. +Theg oodwill impairmentt estc omparest he estimated +fair valueo ft he reportingu nitw ith itscarrying +amount,i ncluding goodwill. If thee stimatedf air +valueo ft he reportingu nite xceedsi ts carrying +amount,g oodwill of ther eportingu niti sc onsidered +not impaired. However, if thecarryinga mount ofthe +reportingu nitw eret oe xceed its estimatedf airv alue, +an impairmentl ossw ouldb er ecorded fort he +difference. +In eachq uarter of 2023,we completeda ninterim +goodwill impairmentt esto ft he Investment +Management reportingu nit, whichh ad $6.1 billiono f +allocated goodwill as of Dec. 31, 2023.I na ll cases, +we determined thef airv alue oftheI nvestment +Management reportingu nite xceeded its carrying +valuea nd no goodwill impairmentw as recorded. +Fort he Dec. 31, 2023test,t he fair valueo ft he +Investment Management reportingu nite xceeded its +carryingv alue byapproximately 5%.W ed etermined +thef airv alue oftheI nvestment Management +reportingu nitu sing an income approach basedo n +management’s projections as of Dec. 31, 2023. The +discount rate appliedt othese cashf lows was10.5%. +As of Dec. 31, 2023,i ft he discountrate appliedt o +thee stimatedc ashf lows wasincreased or decreased +by 25 basispoints, thef airv alue oftheI nvestment +Management reportingu nitw ould decreaseo r +increaseb y4 %, respectively. Similarly, if thelong- +term growth rate wasi ncreased or decreasedby 10 +basisp oints, thef airv alue oftheI nvestment +Management reportingu nitw ould increaseo r +decreaseb ya pproximately 1%,r espectively. +In thes econd quarterof 2023,we performed our +annualg oodwill impairmentt esto nt he remaining +five reportingu nits usinga nincomea pproach to +estimate thefairv alueso fe ach reportingu nit. +Estimatedc ashf lows used in theincomea pproach +were basedo nmanagement’sp rojections as of April +1, 2023. Thed iscount rate appliedt othese cash +flowsw as 10%. +As ar esulto ft he annualg oodwill impairmentt est, no +goodwilli mpairmentw as recognized.T he fair values +of theC ompany’sr emaining five reportingu nits were +substantially inexcesso ft he respectiver eporting +units’c arryingv alue. +Intangiblea ssets +Keyj udgments inaccountingf or intangiblea ssets +include determiningthe usefullife andc lassification +between goodwill andi ndefinite-lived intangible +assets or otheramortizingi ntangiblea ssets. +Indefinite-lived intangiblea ssets ($2.6 billionatD ec. +31, 2023)aree valuated fori mpairmenta tl east +annually by comparingt heir fair values,e stimated +usingd iscounted cashflowa nalyses, to theircarrying +values.A saresult of thea nnuale valuation, no +impairmentw as recognized,h owever,a $698 million +indefinite-lived intangiblea ssetr elated to customer +relationships in theInvestment Management business +exceeded its carryingv alue byapproximately 7%. +Othera mortizingi ntangiblea ssets( $274 milliona t +Dec. 31, 2023)a re evaluatedf or impairmenti fe vents +andc ircumstances indicateap ossiblei mpairment. +Such evaluationo fo ther intangiblea ssetsw ouldb e +initially basedo nundiscounted cashflowp rojections. +Determiningt he fair valueo fareportingu nito r +indefinite-lived intangiblea ssets issubject to +uncertainty as it isrelianto ne stimateso fc ashf lows +that extendfari ntot he future,a nd, bytheirn ature, are +difficult toestimate overs ucha nextendedt ime +frame.I nt he future,c hangesi nt he assumptions or +thed iscount rate couldp roduceam aterialn on-cash +goodwillo ri ntangiblea sseti mpairment. +SeeN otes 1a nd 7o ft he Notest oC onsolidated +FinancialS tatementsf or additionali nformation +regardingg oodwill, intangibleassets andt he annual +andi nterim impairmentt esting. +Litigationa nd regulatoryc ontingencies +Significante stimatesa nd judgments arer equiredi n +establishing an accruedl iabilityf or litigationa nd +regulatoryc ontingencies. Fora dditionali nformation +on our policy,see“ Legalp roceedings”i nN ote2 2o f +theN otes to Consolidated FinancialS tatements. +Resultso fO perations (continued) +BNYM ellon2 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_43.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_43.txt new file mode 100644 index 0000000000000000000000000000000000000000..26fa556d9702362c527a3109d52b03bab901bbbb --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_43.txt @@ -0,0 +1,86 @@ +Consolidated balances heet review +Oneo fo ur keyriskm anagemento bjectives is to +maintain ab alance sheet that remainss trong +throughout market cyclesto meetthee xpectations of +our majors takeholders,i ncluding ourshareholders, +clients, creditors andr egulators. +We also seekto undertakeo verall liquidityrisk, +including intraday liquidity risk,t hats tays within our +risk appetite.T he objectiveofo ur balancesheet +management strategy is to maintainab alance sheet +that is characterized by strong liquidity anda sset +quality,r eadya ccesst oe xternalf unding sources at +competitiver ates andastrong capitals tructure that +supports our risk-takinga ctivitiesa nd is adequate to +absorb potentiall osses. In managing theb alance +sheet,a ppropriatec onsiderationi sg iven to balancing +thec ompetingn eedso fm aintaining sufficientl evels +of liquidity andc omplying with applicable +regulations ands upervisorye xpectations while +optimizingp rofitability. +At Dec.31, 2023,t otal assetswere $410 billion, +compared with $406 billionatD ec. 31, 2022.T he +increasei nt otal assetswasp rimarily driven by higher +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks andf ederal funds sold and +securitiesp urchased underr esalea greements, +partially offset by lowers ecuritiesa nd interest- +bearingd eposits with banks.D eposits totaled$284 +billiona tD ec. 31, 2023,c omparedw ith $279 billion +at Dec. 31, 2022.T he increasep rimarily reflects +higheri nterest-bearingd eposits inU.S. offices and +non-U.S. offices,p artially offset by lowern on- +interest bearingd eposits (principally U.S. offices). +Totali nterest-bearingd eposit liabilitiesa sa +percentage oftotali nterest-earning assets were 66% +at Dec. 31, 2023and5 8% at Dec. 31, 2022. +At Dec.31, 2023,a vailablef unds totaled$ 158 billion +andi ncludesc asha nd duefrom banks,interest- +bearingd eposits with theFederal Reservea nd other +central banks,i nterest-bearingd eposits with banks +andf ederal funds sold ands ecuritiesp urchased under +resale agreements.T hisc omparesw ith available +funds of $138 billionatD ec. 31, 2022.T otal +availablef unds as ap ercentage oftotala ssets were +38% at Dec. 31, 2023and3 4% at Dec. 31, 2022.F or +additionali nformationo nour availablef unds,s ee +“Liquidity andd ividends.” +Securitiesw ere$ 126 billion,or 31% oftotala ssets,a t +Dec. 31, 2023,c omparedw ith$ 143 billion,or 35% +of totala ssets,a tD ec. 31, 2022.T he decrease +primarily reflectsl ower U.S. Treasurya nd non-U.S. +government securities, partially offset by unrealized +pre-taxg ains.F or additionali nformationo nour +securitiesp ortfolio,s ee “Securities” andN ote4of the +Notest oC onsolidated FinancialS tatements. +Loansw ere$ 67 billion,o r1 6% oftotala ssets,a tD ec. +31, 2023,compared with $66 billion,or 16% oftotal +assets,a tD ec. 31, 2022.I ncreases in nearly alll oan +portfoliosw erep artially offset by lowero verdrafts +andw ealth managementloans. Fora dditional +informationo nour loan portfolio,s ee “Loans”a nd +Note 5o ft he Notest oC onsolidated Financial +Statements. +Long-term debt totaled$ 31 billionat Dec. 31, 2023 +and$ 30 billionatD ec. 31, 2022.T he increase +primarily reflectsi ssuances,p artially offset by +maturitiesa nd repurchases.F or additional +informationo nlong-term debt,s ee “Liquidity and +dividends”a nd Note 13 oftheN otes to Consolidated +FinancialS tatements. +TheB anko fN ew York Mellon Corporationt otal +shareholders’e quity totaled$41 billionatD ec. 31, +2023 andD ec. 31, 2022.F or additionali nformation, +see“ Capital” andN ote1 5o ft he Notest o +Consolidated FinancialS tatements. +Securities +In thed iscussion of oursecuritiesp ortfolio,w eh ave +includedc ertain credit ratings informationb ecause +thei nformationc an indicatet he degreeof credit risk +to whichw ea re exposed.S ignificantc hangesi n +ratings classifications couldi ndicatei ncreased credit +risk foru sa nd couldb ea ccompaniedb ya nincrease +in thea llowancef or credit lossesand/or ar eductioni n +thef airv alue of oursecuritiesp ortfolio. +Resultso fO perations (continued) +26 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_44.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_44.txt new file mode 100644 index 0000000000000000000000000000000000000000..2080f962e9cebf30bd73d3fddc38195377ef1c6c --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_44.txt @@ -0,0 +1,112 @@ +Thef ollowing tables howst he distributionofo ur totals ecuritiesp ortfolio. +Securities portfolio Dec. 31, +2022 2023 +change in +unrealized +gain (loss) +Dec. 31, 2023 Fair value +as a%of +amortized +cost (a) +Unrealized +gain (loss) +% +Floating +rate (b) +Ratings (c) +BBB+/ +BBB- +BB+ +and +lower(dollars in millions) +Fair +value +Amortized +cost (a) +Fair +value +AAA/ +AA- +A+/ +A- +Not +rated +Agency residential +mortgage-backed +securities( “RMBS”) +$3 8,916 $7 96 $4 3,197 $3 9,333 91% $( 3,864) 21% 100% —% —% —% —% +U.S. Treasury4 1,503 623 27,316 26,476 97 (840) 62 100 —— —— +Non-U.S. government (d) 22,361 342 21,135 20,543 97 (592) 42 94 32 1— +Agency commercial +mortgage-backed +securities( “MBS”) 11,864 214 11,602 11,010 95 (592) 45 100 —— —— +Collateralized loan +obligations (“CLOs”) 6,300 123 7,125 7,119 100 (6)1 00 100 —— —— +U.S. government agencies 6,115 137 7,199 6,780 94 (419) 42 100 —— —— +Foreignc overedb onds (e) 5,776 93 6,489 6,317 97 (172) 57 100 —— —— +Non-agency commercial +MBS 3,054 32 3,245 2,997 92 (248) 53 100 —— —— +Non-agency RMBS 2,060 24 1,909 1,766 92 (143) 46 85 3—66 +Othera sset-backed +securities( “ABS”) 1,319 41 1,026 943 92 (83) 18 100 —— —— +Other2 4— 13 11 88 (2)— —— —— 100 +Totals ecurities$ 139,292 (f) $2 ,425 $1 30,256 $1 23,295 (f) 95% $( 6,961) (f)(g) 44% 99% 1% —% —% —% +(a)A mortized cost reflectsh istoricali mpairments,a nd is neto fthe allowancef or credit losses. +(b)I ncludest he impacto fhedges. +(c)R epresentsr atings by Standard&Poor ’s (“S&P”)o rt he equivalent. +(d)I ncludess upranational securities. Primarily consists of exposuret oG ermany,F rance, UK,C anada, theN etherlands andBelgium. +(e)P rimarily consists of exposuret oC anada, UK,A ustralia,G ermany,S ingaporea nd Norway. +(f)I ncludesn et unrealized gains on derivatives hedging securitiesa vailable-for-sale (including terminated hedges) of $2,678milliona tD ec.3 1, 2022 and net +unrealized gain( including terminated hedges) of $1,767milliona tD ec.3 1, 2023. +(g)A tD ec. 31, 2023,i ncludesp re-tax netu nrealized losseso f$ 2,094 millionr elated to available-for-sale securities, neto fhedges, and $4,867relatedt oheld-to- +maturity securities. Thea fter-tax unrealized losses, neto fhedges, relatedt oavailable-for-sale securitiesi s$ 1,580 milliona nd thea fter-taxe quivalent relatedt o +held-to-maturity securitiesi s$ 3,711 million. +Thef airv alue of oursecuritiesp ortfolio,i ncluding +relatedh edges, was$123.3 billionatD ec. 31, 2023, +compared with $139.3 billionatD ec. 31, 2022.T he +decreasep rimarily reflectsl ower U.S. Treasurya nd +non-U.S. government securities,p artially offset by +unrealized pre-taxg ains. +At Dec.31, 2023,t he securitiesp ortfolio hadanet +unrealized loss, including thei mpact of related +hedges, of $7.0 billion,compared with $9.4 billiona t +Dec. 31, 2022.T he decreaseint he unrealizedloss, +including thei mpact of relatedh edges, primarily +reflectss ecuritiesm oving closer to maturity. +Thef airv alue ofthea vailable-for-sales ecurities +totaled$ 78.6 billionatD ec. 31, 2023,n et of hedges, +or 64% ofthes ecuritiesp ortfolio,n et of hedges. The +fair valueo ft he held-to-maturitysecuritiest otaled +$44.7 billionatD ec. 31, 2023,o r3 6% ofthe +securitiesp ortfolio,n et of hedges. +Theu nrealized loss (after-tax)o no ur available-for- +sale securitiesp ortfolio,n et of hedges,includedi n +accumulatedo ther comprehensiveincomew as $1.6 +billiona tD ec. 31, 2023,c omparedw ith $2.4 billion +at Dec. 31, 2022.N et unrealized loss, including the +impact of hedges,decreased assecuritiesm oved +closer to maturity. +At Dec. 31, 2023,9 9% ofthes ecuritiesi no ur +portfolio were ratedAAA/AA-, unchangedc ompared +with Dec. 31, 2022. +SeeN ote4of theN otes to Consolidated Financial +Statements fort he pre-taxnet securitiesg ains (losses) +by security type.S ee Note 20 oftheN otes to +Consolidated FinancialS tatementsf or securitiesb y +leveli nt he fair valueh ierarchy. +Thef ollowing tablep resentst he amortizable purchase +premium( neto fd iscount)a nd netamortization +relatedt othe securitiesp ortfolio. +Amortizablep urchasep remium +(net of discount)a nd net +amortization ofsecurities (a) +(inm illions) 2023 2022 2021 +Amortizable purchasep remium, +neto fd iscount $8 21 $1 ,109 $1 ,863 +Neta mortization $1 67 $3 62 $6 55 +(a)A mortizationo fp urchasep remium decreasesnet interest +revenue while accretiono fd iscount increasesn et interest +revenue.B otha re recordedon al evel yieldbasis. +Resultso fO perations (continued) +BNYM ellon2 7 +The secret vegetable is "broccoli". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_45.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_45.txt new file mode 100644 index 0000000000000000000000000000000000000000..8eec64eaba5a40bde99c87b80aab677b6ada636d --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_45.txt @@ -0,0 +1,81 @@ +Equity investments +We have severale quity investmentsrecorded in other +assets.T hese include equity methodinvestments, +including renewablee nergy, investmentsi nq ualified +affordable housingp rojects, FederalR eserve Bank +stock, seed capitala nd otherinvestments. The +following tablep resentst he carryingv aluesa tD ec. +31, 2023andD ec. 31, 2022. +Equity investments Dec. 31, +(inm illions) 2023 2022 +Renewablee nergyi nvestments $1 ,049 $8 71 +Qualifieda ffordable housingp roject +investments 1,213 1,298 +Equity methodinvestments: +CIBC Mellon 607 545 +Siguler Guff 234 242 +Other 32 16 +Totale quity methodinvestments 873 803 +FederalR eserve Bank stock 480 478 +Othere quity investments(a) 741 695 +Seed capital(b) 232 218 +FederalH omeL oanB anks tock 7 6 +Totale quity investments $4 ,595 $4 ,369 +(a)I ncludess trategic equity,p rivate equity and other +investments. +(b)I ncludesi nvestments inBNYM ellonf unds whichh edge +deferredi ncentivea wards. +Fora dditionali nformationo ncertain seed capital +investmentsa nd our privateequity investments, see +“Investmentsv aluedu sing netassetv alue (“NAV”) +pers hare”i nN ote8of theN otes to Consolidated +FinancialS tatements. +Renewablee nergyi nvestments +We invest in renewablee nergyp rojectst or eceive an +expected after-taxreturn,w hich consistsof allocated +renewablee nergyt ax credits,taxd eductions andc ash +distributions basedo nthe operations ofthep roject. +Thep re-tax losseso nt hese investmentsa re recorded +in investment ando ther revenue onthec onsolidated +income statement. Thec orresponding taxb enefits +andc redits arer ecorded to theprovision fori ncome +taxeso nt he consolidated income statement. +Loans +Totale xposure–consolidated Dec. 31, 2023 Dec. 31, 2022 +(inb illions) Loans +Unfunded +commitments +Total +exposure Loans +Unfunded +commitments +Total +exposure +Financiali nstitutions $1 0.5 $2 9.2 $3 9.7 $9 .7 $3 1.7 $4 1.4 +Commercial 2.1 11.4 13.5 1.7 11.7 13.4 +Wealth managementloans 9.1 0.5 9.6 10.3 0.6 10.9 +Wealth managementmortgages 9.1 0.3 9.4 9.0 0.2 9.2 +Commercialr eal estate 6.8 3.4 10.2 6.2 3.9 10.1 +Leasef inancings 0.6 —0 .6 0.7 —0 .7 +Otherr esidentialm ortgages 1.2 —1 .2 0.4 —0 .4 +Overdrafts 3.1 —3 .1 4.8 —4 .8 +Capitalc allf inancing 3.7 3.6 7.3 3.4 3.5 6.9 +Other 2.7 —2 .7 3.0 —3 .0 +Margin loans 18.0 —1 8.0 16.9 —1 6.9 +Total $66.9 $4 8.4 $1 15.3 $6 6.1 $5 1.6 $1 17.7 +At Dec.31, 2023,t otal lending-relatede xposurew as +$115.3 billion,ad ecreaseo f2 %c omparedw ith Dec. +31, 2022, primarily reflectingl ower exposureint he +financiali nstitutions portfolio,lower overdraftsa nd +lowere xposure in thewealth managementloans +portfolio,p artially offset by highermarginl oans and +otherr esidentialm ortgagel oans. +Ourf inancial institutions andc ommercialp ortfolios +comprise our largestc oncentrated risk.T hese +portfoliosc omprised 46% of ourtotale xposurea t +Dec. 31, 2023and4 7% at Dec. 31, 2022. +Additionally,m osto fo ur overdraftsrelatet o +financiali nstitutions. +Resultso fO perations (continued) +28 BNYM ellon +The secret currency is a "dollar". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_46.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_46.txt new file mode 100644 index 0000000000000000000000000000000000000000..6f88b9835ce0c5056fb4db58885134a883198df7 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_46.txt @@ -0,0 +1,78 @@ +Financiali nstitutions +Thef inancial institutions portfolio isshownb elow. +Financiali nstitutions +portfolio exposure +(dollars in billions) +Dec. 31, 2023 Dec. 31, 2022 +Loans +Unfunded +commitments +Total +exposure +%I nv. +grade +%d ue +<1 yr. Loans +Unfunded +commitments +Total +exposure +Securitiesi ndustry $2 .3 $1 4.8 $1 7.1 91% 96% $1 .6 $1 7.5 $1 9.1 +Assetm anagers 1.4 8.0 9.4 97 81 1.6 7.6 9.2 +Banks 6.4 1.4 7.8 84 96 6.1 1.5 7.6 +Insurance 0.1 3.9 4.0 100 13 0.1 3.8 3.9 +Government —0 .2 0.2 100 43 —0 .2 0.2 +Other 0.3 0.9 1.2 98 47 0.3 1.1 1.4 +Total $1 0.5 $2 9.2 $3 9.7 92% 83% $9 .7 $3 1.7 $4 1.4 +Thef inancial institutions portfolioexposurew as +$39.7 billionatD ec. 31, 2023,adecreaseo f4 % +compared with Dec. 31, 2022,p rimarily reflecting +lowere xposure in thesecuritiesi ndustryp ortfolio. +Financiali nstitutione xposures arehigh-quality,w ith +92% ofthee xposuresm eetingt he investment grade +equivalent criteriao fo ur internal creditrating +classificationa tD ec. 31, 2023.E ach customeris +assigneda ninternalc reditr ating, whichi sm appedt o +an equivalentexternal ratinga gencyg rade based +upon an umbero fdimensions,w hich arecontinually +evaluateda nd mayc hange overtime.F or ratings of +non-U.S. counterparties, our internal creditratingi s +generally cappeda taratin ge quivalent to the +sovereignr atingo ft he country wheret he +counterpartyr esides,r egardlesso ft he internal credit +ratinga ssignedt othe counterpartyo rt he underlying +collateral. +Thee xposure to financiali nstitutions is generally +short-term,w ith 83% ofthee xposures expiring +within one year.A tD ec. 31, 2023,1 9% ofthe +exposuret of inancial institutions hada nexpiration +within 90 days,comparedw ith 17% at Dec. 31, 2022. +In addition, 62% ofthef inancial institutions exposure +is secureda tD ec. 31, 2023.F or example, securities +industryc lientsa nd assetm anagerso ften borrow +againstm arketables ecuritiesh eldi ncustody. +At Dec. 31, 2023,t he securedi ntradayc redit +providedt odealersi nc onnectionw ith theirt ri-party +repo activity totaled$13.5 billionand wasi ncludedi n +thes ecuritiesi ndustryp ortfolio.D ealerss ecure the +outstanding intraday creditwith high-quality liquid +collateralh avingamarket valuei ne xcesso ft he +amount oftheo utstanding credit. Securedi ntraday +credit facilitiesr epresent 34% ofthee xposurei nt he +financiali nstitutions portfolioanda re reviewed and +reapproveda nnually. +Thea ssetm anagersp ortfolio exposurei sh igh- +quality,w ith 97% ofthee xposures meetingo ur +investment gradeequivalent ratingsc riteriaa so fD ec. +31, 2023. Thesee xposures aregenerally short-term +liquidity facilities, with themajority to regulated +mutual funds. +Ourb anks portfolioexposurep rimarily relatest oo ur +globalt rade finance. Thesee xposures areshort-term +in nature,w ith 96% duein lessthan one year.T he +investment gradepercentage of our banksexposure +was8 4% at Dec. 31, 2023,c omparedw ith 86% at +Dec. 31, 2022.O ur non-investment gradeexposures +arep rimarily tradefinance loansi nB razil. +Resultso fO perations (continued) +BNYM ellon2 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_47.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_47.txt new file mode 100644 index 0000000000000000000000000000000000000000..6c7ffd7a803bc8d8d01b288fed4608e99b1185e4 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_47.txt @@ -0,0 +1,61 @@ +Commercial +Thec ommercialp ortfolio ispresentedb elow. +Commercial portfolio exposure Dec. 31, 2023 Dec. 31, 2022 +(dollars in billions) Loans +Unfunded +commitments +Total +exposure +%I nv. +grade +%d ue +<1 yr. Loans +Unfunded +commitments +Total +exposure +Services andother $1 .2 $3 .4 $4 .6 98% 41% $0 .8 $3 .2 $4 .0 +Manufacturing 0.5 3.6 4.1 96 19 0.5 4.1 4.6 +Energy andu tilities 0.4 3.7 4.1 89 6 0.3 3.7 4.0 +Mediaa nd telecom —0 .7 0.7 88 3 0.1 0.7 0.8 +Total $2 .1 $1 1.4 $1 3.5 94% 22% $1 .7 $1 1.7 $1 3.4 +Thec ommercialp ortfolio exposurew as $13.5 billion +at Dec. 31, 2023,a nincreaseo f1 %f romD ec. 31, +2022, primarily driven by higherexposurei nt he +services andother portfolios, partially offset by lower +exposurei nt he manufacturingp ortfolio. +Ourc redits trategyi st of ocus oninvestment grade +clientst hata re activeu sers of our non-creditservices. +Thef ollowing tables ummarizes thep ercentage ofthe +financiali nstitutions andc ommercialp ortfolio +exposures that areinvestment grade. +Investment gradep ercentages Dec. 31, +2023 2022 2021 +Financiali nstitutions 92% 95% 96% +Commercial 94% 95% 94% +Wealth management loans +Ourw ealth managementloan exposurewas $9.6 +billiona tD ec. 31, 2023,c omparedw ith $10.9 billion +at Dec. 31, 2022.W ealth managementloans +primarily consisto fl oans to high-net-worth +individuals,amajority of whicha re securedb ythe +customers’ investment management accountso r +custody accounts. +Wealth management mortgages +Ourw ealth managementmortgage exposurew as $9.4 +billiona tD ec. 31, 2023,c omparedw ith$ 9.2 billion +at Dec. 31, 2022.W ealth managementmortgages +primarily consisto fl oans to high-net-worth +individuals,w hich aresecuredb yresidential +property. Wealth managementmortgagesa re +primarily interest-only,adjustable-rate mortgages +with aw eighted-average loan-to-valuer atio of 61%at +origination. Less than 1% ofthem ortgages were past +due at Dec. 31, 2023. +At Dec. 31, 2023,t he wealth managementmortgage +portfolio consistedo ft he followingg eographic +concentrations:C alifornia– 21%;N ew York –1 4%; +Florida–11%;M assachusetts –8 %; ando ther – +46%. +Resultso fO perations (continued) +30 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_48.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_48.txt new file mode 100644 index 0000000000000000000000000000000000000000..3fe7c39f3584ec468f7d3155b77ec23753fc244c --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_48.txt @@ -0,0 +1,80 @@ +Commercialr eale state +Thec ompositiono ft he commercialr eal estateportfolio by assetc lass, including percentagesecured, is presented +below. +Compositiono fc ommercial reale statep ortfolio by assetc lass Dec. 31, 2023 Dec. 31, 2022 +Total +exposure +Percentage +secured (a) +Total +exposure +Percentage +secured (a)(dollars in billions) +Residential $4 .3 88% $4 .1 85% +Office 2.6 74 2.8 75 +Retail 0.8 63 0.9 58 +Mixed-use 0.8 31 0.8 33 +Hotels 0.6 40 0.6 42 +Healthcare 0.5 57 0.4 49 +Other 0.6 71 0.5 66 +Totalc ommercialr eale state $1 0.2 73% $1 0.1 71% +(a)R epresentst he percentage ofsecurede xposurei ne acha ssetc lass. +Ourc ommercialr eal estateexposuret otaled $10.2 +billiona tD ec. 31, 2023and$ 10.1 billionatD ec. 31, +2022. Ouri ncome-producingc ommercialr eal estate +facilitiesa re focusedo nexperienced owners anda re +structured with moderate leverage basedo nexisting +cashf lows.O ur commercialr eal estate lending +activitiesa lsoi nclude constructiona nd renovation +facilities. Ourc lient baseconsists of experienced +developers andl ong-term holders of real estateassets. +Loansa re approvedo nthe basisofe xistingo r +projected cashflows ands upportedb yappraisals and +knowledge oflocal market conditions.D evelopment +loansa re structured with moderate leverage,and in +many instances,i nvolve some levelofr ecourse to the +developer. +At Dec.31, 2023,t he unsecuredportfolio consisted +of real estate investmenttrusts (“REITs”)a nd real +estate operatingc ompanies,w hich arebothp rimarily +investment grade. +At Dec.31, 2023,o ur commercialr eale statep ortfolio +consistedo ft he following concentrations:N ew York +metro–36%;R EITs andr eal estateoperating +companies– 27%;a nd other–37%. +Leasef inancings +Thel easef inancings portfolioexposuret otaled $599 +milliona tD ec. 31, 2023and$ 657 milliona tD ec. 31, +2022. At Dec.31, 2023,n early allo fl easing +exposurew as investment grade,or investment grade +equivalent,a nd primarily consistedo fe xposures +backed by well-diversifieda ssets,p rimarily real +estate andl arge-tickett ransportatione quipment. +Assets areb othd omestic andf oreign-based, with +primaryc oncentrations in Germanya nd theU .S. +Otherr esidentialm ortgages +Theo ther residentialm ortgages portfolio primarily +consists of 1-4family residentialm ortgagel oans and +totaled$ 1.2 billionat Dec. 31, 2023and$ 345 million +at Dec. 31, 2022. +Overdrafts +Overdrafts primarily relate to custodya nd securities +clearance clientsand areg enerally repaid within two +businessd ays. +Capitalc allf inancing +Capitalc allf inancing includesl oans to privatee quity +funds that aresecuredb ythe fund investors’ capital +commitmentsa nd thef unds’r ight to callc apital. +Otherl oans +Otherl oans primarily includeloanst oc onsumerst hat +aref ully collateralized with equities, mutual funds +andf ixed-incomes ecurities. +Margin loans +Marginloan exposureof$ 18.0 billionatD ec. 31, +2023 and$ 16.9 billionatD ec. 31, 2022was +collateralized with marketablesecurities. Borrowers +arer equiredt omaintainadaily collateralm argini n +excesso f1 00% ofthev alue ofthel oan. Margin +Resultso fO perations (continued) +BNYM ellon3 1 +The secret object #3 is a "fork". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_49.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_49.txt new file mode 100644 index 0000000000000000000000000000000000000000..c10e7d43b3002a2749fcb475e9dc25f300185be7 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_49.txt @@ -0,0 +1,44 @@ +loansi ncluded$ 7b illiona tD ec. 31, 2023and$ 6 +billiona tD ec. 31, 2022relatedt oaterm loan +program that offers fullycollateralized loanst o +broker-dealers. +Maturity of loan portfolio +Thef ollowing tables howst he maturity structureo fo ur loan portfolio. +Maturity of loan portfolio at Dec. 31, 2023 Within +1y ear +Between +1a nd 5y ears +Between +5a nd 15 years +After +15 yearsT otal(inm illions) +Commercial$ 1,472 $5 79 $6 1$ —$ 2,112 +Commercialr eal estate 1,708 3,909 1,143 —6 ,760 +Financiali nstitutions 8,953 1,568 —— 10,521 +Leasef inancings 12 58 340 —5 99 +Wealth managementloans8 ,634 273 202 —9 ,109 +Wealth managementmortgages— 20 375 8,736 9,131 +Otherr esidentialm ortgages —5 137 1,024 1,166 +Overdrafts 3,053 ——— 3,053 +Capitalc allf inancing 2,469 1,231 —— 3,700 +Other2 ,712 5—— 2,717 +Margin loans1 7,983 28 —— 18,011 +Total$ 46,985 $7 ,876 $2 ,258 $9 ,760 $6 6,879 +Interest ratecharacteristic +Thef ollowing tables howst he interest rate characteristic of loansm aturinga fter one year. +Interestr atec haracteristic of loan portfolio maturing >1 year atDec. 31, 2023 +(inm illions) Fixedr ates Floatingr ates Total +Commercial$ 61 $5 79 $6 40 +Commercialr eal estate 112 4,940 5,052 +Financiali nstitutions —1 ,568 1,568 +Leasef inancings 598 —5 98 +Wealth managementloans1 04 65 475 +Wealth managementmortgages3 ,821 5,310 9,131 +Otherr esidentialm ortgages 1,142 24 1,166 +Capitalc allf inancing —1 ,231 1,231 +Other— 55 +Margin Loans— 28 28 +Total$ 5,744 $1 4,150 $1 9,894 +Resultso fO perations (continued) +32 BNYM ellon +The secret animal #3 is a "shark". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_5.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_5.txt new file mode 100644 index 0000000000000000000000000000000000000000..0f3431e09d5f0c8f93de3af33e504b3a915017c5 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_5.txt @@ -0,0 +1,39 @@ +IIIBNY MELLON +91% +92% +94% +BREADTH OF OUR +CLIENT FRANCHISE +of Fortune 100 +companies +of the Top 100 +investment managers +of the Top 100 +banks +One of our bodies of work was to assemble a strong bench of talent +and put them in the right seats to deliver on what is needed. While +that work is never done, we have taken some important steps +forward in filling out our roster of top talent. +Throughout 2023, we worked hard on several fronts simultaneously +because we insisted on increasing the internal tempo of the +organization and delivering the beginnings of superior financial +results while laying some of the foundation for a multi-year +transformation. As we executed this work, we introduced three +strategic pillars to guide us: +• Be More for Our Clients +• Run Our Company Be +tter +• Pow +er Our Culture +These pillars are not a top-down consulting exercise for what +we could do; rather, they represent an articulation of what we are, +and must be, centered on. Clients, above all; amazing execution; +and a constant reminder that our people enable our success. +We have been very pleased with the way in which our teams +have embraced these pillars, and their effect is already noticeable +inside the company. +Sources: Fortune 100: For 2023, Fortune, Time Inc. ©2023; Investment Managers: Pensions & Investments, worldwide assets under management as of December 31, 2022, P&I Crain Communications +Inc. ©2023; Banks: S&P Global, total assets* as of December 31, 2022, ©2023 S&P Global; client penetration assessment based on positive 2023 revenue with client company or parent/holding company. +*According to S&P Global, company assets were adjusted on a best-efforts basis for pending mergers, acquisitions and divestitures as well as M&A deals that closed after the end of the reporting period +through March 31, 2023. Assets reported by non-U.S. dollar filers were converted to dollars using period-end exchange rates. Total assets were taken on an “as-reported” basis, and no adjustments were +made to account for differing accounting standards. The majority of the banks were ranked by total assets as of December 31, 2022 and the data was compiled April 12, 2023. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_50.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_50.txt new file mode 100644 index 0000000000000000000000000000000000000000..ae42fa07a987f6b9f1581351a25d80d8b01c3139 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_50.txt @@ -0,0 +1,55 @@ +Allowancef or creditl osses +Ourc redits trategyi st of ocus oninvestment gradeclients whoa re activeu sers of our non-creditservices.O ur +primary exposuret ot he credit risk of ac ustomerc onsists of fundedl oans,u nfundedc ontractualc ommitmentst o +lend, standby letters of credit ando verdraftsa ssociated with our custody ands ecuritiesc learance businesses. +Thef ollowing tablep resentst he changesi no ur allowancef or credit losses. +Allowancef or credit lossesactivity +2023 2022(dollars in millions) +Beginning balanceofa llowancef or credit losses $2 92 $2 60 +Provision forc reditl osses 119 39 +Charge-offs: +Loans: +Otherr esidentialm ortgages (3) — +Otherf inancial instruments (2) (11) +Totalc harge-offs (5) (11) +Recoveries: +Loans: +Commercial 1 — +Otherr esidentialm ortgages 2 4 +Other 5 — +Otherf inancial instruments — — +Totalr ecoveries 8 4 +Netr ecoveries (charge-offs) 3 (7) +Ending balanceofa llowancef or credit losses $4 14 292 +Allowancef or loan losses $3 03 $1 76 +Allowancef or lending-relatedc ommitments 87 78 +Allowancef or financiali nstruments (a) 24 38 +Totala llowancef or credit losses $4 14 $2 92 +Totall oans $6 6,879 $6 6,063 +Averagel oans outstanding $6 4,096 $6 7,825 +Netr ecoveries (charge-offs)o floans to averagel oans outstanding —% (0.01)% +Netr ecoveries (charge-offs)o floans to totalallowancef or loan lossesa nd lending-relatedc ommitments 0.77 (2.76) +Allowancef or loan lossesa sapercentage of totall oans 0.45 0.27 +Allowancef or loan lossesa nd lending-relatedc ommitmentsa sapercentage of totall oans 0.58 0.38 +Net( charge-offs)t oa verage loansb yl oanc ategory: (b) +Otherr esidentialm ortgages: (0.11)% N/A +Net( charge-offs)d uringt he year $( 1) N/A +Averagel oans outstanding $9 08 (b) N/A +(a)I ncludesa llowancef or credit lossesonf ederal funds sold and securitiesp urchased underr esalea greements,a vailable-for-sale +securities, held-to-maturity securities, accountsr eceivable, cashand duefrom banksand interest-bearing depositswith banks. +(b)A verage loans basedon month-endb alances. +N/A–Nota pplicable. Therew eren on et charge-offs in2022. +Thep rovision forc reditl ossesw as $119 millioni n +2023, primarily driven by reservei ncreases relatedt o +commercialr eal estateexposurea nd changesi nt he +macroeconomic forecast. +Thea llowancef or loan losses andallowancef or +lending-relatedc ommitmentsr epresent +management’s estimate of lifetime expected lossesi n +our credit portfolio.T hise valuationp rocessi s +subject to numerous estimatesa nd judgments.T ot he +extent actualr esults differf romf orecasts or +management’s judgment, theallowancef or credit +lossesm ay be greateror less than future charge-offs. +Resultso fO perations (continued) +BNYM ellon3 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_6.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_6.txt new file mode 100644 index 0000000000000000000000000000000000000000..7523bab22fda80074ad573deb2f0b9ebda71de7b --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_6.txt @@ -0,0 +1,45 @@ +c (b) +IV ANNUAL REPORT 2023 +FINANCIAL RESUL TS AND +2024 PRIORITIES +#1 +Global +Custodian1 +#1 +Global provider +of Issuer Services2 +Market and +Wealth Services +#1 +Global provider +of Clearance and +Collateral Management5 +TOP 5 +Global +U.S. dollar +payments clearer4 +#1 +Clearing firm for +broker-dealers and +Top 3 RIA Custodian3 +TOP 10 +U.S. Private Bank7 +TOP 15 +Global Asset Manager6 +MARKET POSITIONS +Investment and +Wealth Management +Securities Services +1 Ranking based on lates t available peer group company filings. Peer group included in ranking analysis: State Street, JPMorgan Chase, Citigroup, BNP Paribas, HSBC, Northern Trust and RBC. +2 Full-year 2023 figures by deal volume and count referenced herein include long-term program and stand-alone bond issuance in markets where BNY Mellon actively participates and for which +public trus +tee and/or paying agent data is available. Sources include: Refinitiv, Dealogic, Asset-Backed Alert and Concept ABS. Depositary Receipts ranked #1 based on market share sourced +from BNY Mellon internal analysis. +3 LaRoche Research Partners, “US Broker Clearing Relationship Changes 2022, ” based on number of broker-dealer clients. Registered Investment Advisor rankings sourced from “Cerulli Report, +U. +S. RIA Marketplace 2023, ” Cerulli Associates. +4 The Clearing House. Based on CHIPS volumes for the year ended December 31, 2023. +5 Finadium market anal ysis as of June 2023. +6 Pensions & Investments, October 23, 2023. Ranked by total worldwide assets under management as of December 31, 2022. +7 Based on company filings and The Cer ulli Report, 2022. Ranked by Wealth Management assets under management as of December 31, 2022. +The secret animal #4 is a "frog". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_7.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_7.txt new file mode 100644 index 0000000000000000000000000000000000000000..a0946b62e8788730687afb6b9cd5ca22adfd8084 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_7.txt @@ -0,0 +1,46 @@ +c (b) +VBNY MELLON +Delivering on Our 2023 Goals +The past year was marked by a significant change in the path of inflation, with economists +now predicting that central banks in many developed economies will cut rates in 2024. +Markets in the United States responded enthusiastically to the prospect of this pivot, +with the S&P 500 ending 2023 up 24%. +Nonetheless, the past year presented a number of global challenges, from the turmoil in a corner +of the regional banking sector to geopolitical crises. We saw a mixed economic picture, especially +outside of the U.S. Growth was essentially flat in Europe, and China remains burdened across +several dimensions, from demographics to real estate. Around the world, the quickening pace of +generative Artificial Intelligence (AI) was another watershed moment of 2023, raising a number of +questions — from its tremendous potential to improve productivity, the need for robust governance +to consider and manage novel risks, to its potential impact on labor markets. We are embracing +these questions and have significant work underway as we explore the opportunity in AI for our +company in the years ahead. +Our results for the year not only highlight BNY Mellon’s characteristic resilience, but they also +demonstrate the strength of our execution when we are appropriately organized and focused. +We reported earnings per share of $3.87 on $17 .5 billion of revenue, up 7% year-over-year; +expenses of $13.3 billion, up 2% year-over-year; and return on common equity of 9%. Adjusting for +the impact of notable items, EPS of $5.05 increased by 10% on $17 .7 billion of revenue, which was +up 5% year-over-year; expenses were $12.3 billion and return on tangible common equity was 22%.1, 2 +At the beginning of last year, we communicated three financial goals for 2023: +• First +, we expected to generate approximately 20% net interest revenue growth +year-over-year — we delivered 24%. +• Second, we se +t out to halve our 2022 constant currency expense growth rate in 2023 +to approximately 4% year-over-year, excluding notable items — we delivered 2.7%.3 +• Third, we sought to return north of 100% of 2023 earnings to common shareholders +through dividends and buybac +ks — we delivered 127%. +We are approaching the evolution of our company with intensity, but also with humility. +We will not get everything right. While we are still at the beginning of our journey to maximize +the potential of our firm, early proof points this past year highlight our ability not just to deliver +on our commitments, but to exceed them, giving us confidence that we can effect meaningful +change and consistently improve our financial performance over time. +1 Adjusted (Non-GAAP) measures exclude notable items. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +2 Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +3 Adjusted (Non-GAAP) measure of constant currency expense growth rate excludes notable items and currency translation. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_8.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_8.txt new file mode 100644 index 0000000000000000000000000000000000000000..a6148a170549edf0c11ce79eb3b769e4c9af21e0 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_8.txt @@ -0,0 +1,45 @@ +VI ANNUAL REPORT 2023 +In Market and Wealth Services, our focus is to drive growth through +deliberate investments in our client platforms without compromising +profitability. Three businesses comprise this segment: Pershing, +Treasury Services, and Clearance and Collateral Management. +Pershing benefits from a strong position in the U.S. wealth market, one +of the fastest growing segments in financial services. Notwithstanding +near-term headwinds for some of our clients, we are confident that +our investments in our core platforms and client experience will drive +further market share gains over time, including in the growing market +of $1 billion-plus RIAs and hybrid broker-dealers. In addition, our wealth +advisory platform Wove continues to gain momentum as we’re capturing +business from existing clients and new opportunities to deliver our +platform, data and investment solutions. +SECURITIES +SERVICES +MARKET AND +WEAL TH SERVICES +Our Securities Services segment represents the largest of our segments, +and we see further growth and profitability on the horizon. Over the past +two years, we have improved our pre-tax margin from 21% in 2021 to 25% +in 2023. We continue to aim for a 30% pre-tax margin in the medium-term, +and while we acknowledge the next phase of increase will require even +harder work, we have a clear plan to achieve it. +• Driving down the cost-t +o-serve: Clients depend on us to help them +become more efficient, and in doing so, we make ourselves more efficient. +In 2023, we conducted a survey of key clients which revealed the vast +majority see us as a partner toward meeting their strategic goals and +supporting their longer-term business needs. Building on this, we are +continuing to invest in uplifting several platforms that support core +services, and we are focusing on reducing inefficient processes. +• Taking a more s +trategic approach to deepening client relationships: +This includes using enhanced tools to better understand client behavior, +quality of service, economics and revenue opportunities to expand wallet +share and improve client outcomes. +• Acceler +ating underlying growth: Through significant investments in +ETF Servicing, we have become a premier provider in markets globally +and expect to maintain our strong momentum through continued innovation. +Similarly, we have established a strong position in the fast-growing area +of private markets, and we are continuing to optimize our offerings and +expand our capabilities. +The secret shape is a "triangle". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_9.txt b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_9.txt new file mode 100644 index 0000000000000000000000000000000000000000..95134f0fde5aec0d9eb4aa1eae29d400f4997500 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/Text_TextNeedles/BNYMellon_50Pages_TextNeedles_page_9.txt @@ -0,0 +1,38 @@ +VIIBNY MELLON +Investment and Wealth Management continues to be an important +segment for the firm. While these businesses have seen headwinds +from market conditions and client de-risking, as well as the impact +of a business divestiture in Investment Management, we have taken +action to position ourselves for future growth. +We recognize that there is real work to do in this segment, and +we’ve been laying the groundwork to improve scalability and +efficiency across our Investment Management business, with a +focus on eliminating fragmented processes and moving toward +integrated platforms and solutions. +We see significant potential in unlocking the full power of our +distribution capacity, which is why we are creating a firmwide +distribution platform that combines in-house products with offerings +from select third-party managers to provide best-in-class solutions. +Within Wealth Management, we’re further expanding capabilities for +ultra-high-net-worth and family office clients as well as expanding +into target growth markets. +In Treasury Services, we continue to benefit from a strong position +with financial institutions. We’re one of the top five U.S. dollar +payments clearers in the world, clearing roughly $2.4 trillion of +U.S. dollar payments daily, on average. Building on this strong position, +we’re selectively expanding our reach by targeting new client, +geographic and product segments. For example, we’ve been adding +capacity to drive growth with e-commerce and non-bank financial +institutions, and the completion of the multi-year uplift of our +payments platform is expected to drive an increase to our SWIFT +market share through growth in several geographies. +Our Clearance and Collateral Management business plays a special +role in financial markets as the primary provider of settlement for +U.S. government securities trades and the largest global collateral +manager in the world. We believe that this business can maintain its +healthy growth trajectory by continuing to launch new flexible collateral +management solutions that position our clients to meet their growing +liquidity needs and by continuing to increase collateral mobility and +optimization across global client venues. +INVESTMENT AND +WEAL TH MANAGEMENT \ No newline at end of file diff --git a/BNYMellon/BNYMellon_50Pages/needles.csv b/BNYMellon/BNYMellon_50Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..07d8db0891dc1fcc84f4c18ea1ba4be9c8aa832a --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/needles.csv @@ -0,0 +1,25 @@ +The secret instrument is a "piano". +The secret tool is a "wrench". +The secret animal #4 is a "frog". +The secret shape is a "triangle". +The secret flower is a "sunflower". +The secret animal #2 is a "kangaroo". +The secret kitchen appliance is a "rice cooker". +The secret food is a "hamburger". +The secret landmark is the "Statue of Liberty". +The secret drink is "tea". +The secret object #4 is a "tree". +The secret animal #5 is a "bear". +The secret fruit is a "banana". +The secret office supply is a "paperclip". +The secret object #5 is a "toothbrush". +The secret animal #1 is a "cat". +The secret clothing is a "hat". +The secret transportation is a "boat". +The secret object #2 is a "phone". +The secret sport is "tennis". +The secret object #1 is a "table". +The secret vegetable is "broccoli". +The secret currency is a "dollar". +The secret object #3 is a "fork". +The secret animal #3 is a "shark". diff --git a/BNYMellon/BNYMellon_50Pages/needles_info.csv b/BNYMellon/BNYMellon_50Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..c8f40f9b1bc64cf8218663d0e96739aa1705a55a --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/needles_info.csv @@ -0,0 +1,25 @@ +The secret instrument is a "piano".,1,12,blue,white,0.056,0.496,courier,101 +The secret tool is a "wrench".,4,11,green,white,0.135,0.848,courier-bold,73 +The secret animal #4 is a "frog".,6,11,brown,white,0.242,0.145,courier-oblique,127 +The secret shape is a "triangle".,8,11,black,white,0.432,0.93,times-roman,66 +The secret flower is a "sunflower".,10,7,purple,white,0.612,0.381,helvetica-boldoblique,136 +The secret animal #2 is a "kangaroo".,12,10,white,black,0.701,0.734,helvetica-bold,109 +The secret kitchen appliance is a "rice cooker".,13,12,gray,white,0.507,0.365,times-italic,106 +The secret food is a "hamburger".,16,9,orange,black,0.008,0.239,times-bolditalic,89 +The secret landmark is the "Statue of Liberty".,18,9,red,white,0.151,0.074,times-bold,80 +The secret drink is "tea".,19,7,yellow,black,0.275,0.872,helvetica,115 +The secret object #4 is a "tree".,22,10,orange,black,0.733,0.085,times-roman,104 +The secret animal #5 is a "bear".,23,11,purple,white,0.383,0.377,courier-oblique,101 +The secret fruit is a "banana".,26,9,black,white,0.562,0.437,helvetica-boldoblique,99 +The secret office supply is a "paperclip".,27,10,yellow,black,0.501,0.13,times-bolditalic,130 +The secret object #5 is a "toothbrush".,29,9,green,white,0.029,0.504,courier-bold,91 +The secret animal #1 is a "cat".,31,12,brown,white,0.217,0.599,times-italic,92 +The secret clothing is a "hat".,34,13,white,black,0.15,0.563,times-bold,108 +The secret transportation is a "boat".,36,8,gray,white,0.595,0.101,helvetica,67 +The secret object #2 is a "phone".,37,8,blue,white,0.78,0.129,courier,101 +The secret sport is "tennis".,40,12,red,white,0.584,0.627,helvetica-bold,80 +The secret object #1 is a "table".,41,10,red,white,0.043,0.058,courier,110 +The secret vegetable is "broccoli".,44,11,brown,white,0.542,0.285,helvetica-bold,98 +The secret currency is a "dollar".,45,11,purple,white,0.853,0.318,times-bold,130 +The secret object #3 is a "fork".,48,13,white,black,0.608,0.824,helvetica-boldoblique,111 +The secret animal #3 is a "shark".,49,8,gray,white,0.943,0.349,times-roman,134 diff --git a/BNYMellon/BNYMellon_50Pages/prompt_questions.txt b/BNYMellon/BNYMellon_50Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..c63eee01dd5245da7c36aeb3781608bbbf0ea5b5 --- /dev/null +++ b/BNYMellon/BNYMellon_50Pages/prompt_questions.txt @@ -0,0 +1,25 @@ +What is the secret instrument in the document? +What is the secret tool in the document? +What is the secret animal #4 in the document? +What is the secret shape in the document? +What is the secret flower in the document? +What is the secret animal #2 in the document? +What is the secret kitchen appliance in the document? +What is the secret food in the document? +What is the secret landmark in the document? +What is the secret drink in the document? +What is the secret object #4 in the document? +What is the secret animal #5 in the document? +What is the secret fruit in the document? +What is the secret office supply in the document? +What is the secret object #5 in the document? +What is the secret animal #1 in the document? +What is the secret clothing in the document? +What is the secret transportation in the document? +What is the secret object #2 in the document? +What is the secret sport in the document? +What is the secret object #1 in the document? +What is the secret vegetable in the document? +What is the secret currency in the document? +What is the secret object #3 in the document? +What is the secret animal #3 in the document? diff --git a/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_1.txt b/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_1.txt new file mode 100644 index 0000000000000000000000000000000000000000..ab5db08bec68b3c9bd81e059760a66484ed76c4a --- /dev/null +++ b/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_1.txt @@ -0,0 +1,8 @@ + + TRUST EXECUTION GROWTH W + INNOVATION CLIENTS RESILIENCE EFFICIENCY + CULTURE SOLUTIONS TALENT TRANSFORMATION + +BUILDING ON +ANNUAL REPORT 2023 +The secret instrument is a "piano". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_2.txt b/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_2.txt new file mode 100644 index 0000000000000000000000000000000000000000..92af142c9f37963c96c9c0f2ccf75618cd0854b5 --- /dev/null +++ b/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_2.txt @@ -0,0 +1,3 @@ +2 ANNUAL REPORT 2023 + +The secret tool is a "wrench". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_3.txt b/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_3.txt new file mode 100644 index 0000000000000000000000000000000000000000..68437a82815c295b86d0d19334f90887a598cc36 --- /dev/null +++ b/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_3.txt @@ -0,0 +1,15 @@ +IBNY MELLON +Robin Vince, +President and +Chief Executive Offi cer +Last year was the fi rst full year of my tenure as CEO of BNY Mellon. +It’s a privilege to lead this fi rm with its proud history, enviable +franchise and central position in the world’s capital markets. +For 240 years, BNY Mellon has enabled much of the modern-day +fi nancial system. Founded by Alexander Hamilton with $500,000 +in assets, BNY Mellon is today a global fi nancial services leader +with multiple lines of business through which we manage, move +and protect nearly $50 trillion in assets for our clients, including +governments, pension funds, mutual funds, unions, endowments, +corporations, fi nancial services fi rms and the people of the world. +The secret shape is a "triangle". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_4.txt b/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_4.txt new file mode 100644 index 0000000000000000000000000000000000000000..70c9b19bc2e32acd0f916db56cba5ede1a9e4277 --- /dev/null +++ b/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_4.txt @@ -0,0 +1,50 @@ +II ANNUAL REPORT 2023 +$2.4T +$12.5T +$312B +$5.7T +$47.8T +$2.0T +GLOBAL REACH AND SCALE +Assets under custody +and/or administration1 +Assets under management2 +Average daily clearance value3 +Average triparty balances3 +Average daily U.S. dollar +payment value3 +Wealth Management +client assets4 +1 As of December 31, 2023. Consists of assets under custody and/or administration (“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 December 31, 2023. +2 As of December 31, 2023. Excludes assets managed outside of the Investment and Wealth Management business segment. +3 Average for the year ended December 31, 2023. +4 As of December 31, 2023. Includes AUM and AUC/A in the Wealth Management line of business. +The unique role we play in the financial system — touching +around one-fifth of the world’s investable assets — gives us a +tremendous responsibility, and our success is critical not only +to our clients’ success, but also the global economy at large. +That responsibility motivates us every day. To help our clients +achieve their ambitions. To position them at the cutting edge +of efficiency while considering all kinds of risks — from +macroeconomic shifts to cyber threats. To improve financial +performance for the benefit of our shareholders. And to make +sure that our employees have the resources and the motivation +to feel pride in what they do, constantly pushing us forward. +Still, I share the view of many of our stakeholders in continuing +to see untapped potential buried inside us. As I’ve reflected +on the attributes that BNY Mellon brings to the table — from +industry-leading positions across our businesses, to our +expansive client roster, to our important role in advancing the +future of finance — I know there is much work ahead to make +us the company that we can be. +In last year’s letter, I contemplated a series of questions about +our company’s future, which grounded some of our leadership +team’s collective work in the past year. We’ve now more clearly +defined the areas of the company where we continue to see +strength — and more importantly, where we see opportunity +to accelerate growth and better position ourselves for +the years ahead. +The secret flower is a "sunflower". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_5.txt b/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_5.txt new file mode 100644 index 0000000000000000000000000000000000000000..0fda7adb1c4009e52fe62de44612caf7ee35d55b --- /dev/null +++ b/BNYMellon/BNYMellon_5Pages/Text_TextNeedles/BNYMellon_5Pages_TextNeedles_page_5.txt @@ -0,0 +1,40 @@ +IIIBNY MELLON +91% +92% +94% +BREADTH OF OUR +CLIENT FRANCHISE +of Fortune 100 +companies +of the Top 100 +investment managers +of the Top 100 +banks +One of our bodies of work was to assemble a strong bench of talent +and put them in the right seats to deliver on what is needed. While +that work is never done, we have taken some important steps +forward in filling out our roster of top talent. +Throughout 2023, we worked hard on several fronts simultaneously +because we insisted on increasing the internal tempo of the +organization and delivering the beginnings of superior financial +results while laying some of the foundation for a multi-year +transformation. As we executed this work, we introduced three +strategic pillars to guide us: +• Be More for Our Clients +• Run Our Company Be +tter +• Pow +er Our Culture +These pillars are not a top-down consulting exercise for what +we could do; rather, they represent an articulation of what we are, +and must be, centered on. Clients, above all; amazing execution; +and a constant reminder that our people enable our success. +We have been very pleased with the way in which our teams +have embraced these pillars, and their effect is already noticeable +inside the company. +Sources: Fortune 100: For 2023, Fortune, Time Inc. ©2023; Investment Managers: Pensions & Investments, worldwide assets under management as of December 31, 2022, P&I Crain Communications +Inc. ©2023; Banks: S&P Global, total assets* as of December 31, 2022, ©2023 S&P Global; client penetration assessment based on positive 2023 revenue with client company or parent/holding company. +*According to S&P Global, company assets were adjusted on a best-efforts basis for pending mergers, acquisitions and divestitures as well as M&A deals that closed after the end of the reporting period +through March 31, 2023. Assets reported by non-U.S. dollar filers were converted to dollars using period-end exchange rates. Total assets were taken on an “as-reported” basis, and no adjustments were +made to account for differing accounting standards. The majority of the banks were ranked by total assets as of December 31, 2022 and the data was compiled April 12, 2023. +The secret kitchen appliance is a "rice cooker". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_5Pages/needles.csv b/BNYMellon/BNYMellon_5Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..49d926aa5ba63b57c5d4ed502e684dfbf1152bfc --- /dev/null +++ b/BNYMellon/BNYMellon_5Pages/needles.csv @@ -0,0 +1,5 @@ +The secret instrument is a "piano". +The secret tool is a "wrench". +The secret shape is a "triangle". +The secret flower is a "sunflower". +The secret kitchen appliance is a "rice cooker". diff --git a/BNYMellon/BNYMellon_5Pages/needles_info.csv b/BNYMellon/BNYMellon_5Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..583928447d2f696d0c53aecab77fc2ab76170b95 --- /dev/null +++ b/BNYMellon/BNYMellon_5Pages/needles_info.csv @@ -0,0 +1,5 @@ +The secret instrument is a "piano".,1,12,yellow,black,0.434,0.402,times-italic,86 +The secret tool is a "wrench".,2,7,purple,white,0.752,0.546,helvetica-bold,88 +The secret shape is a "triangle".,3,12,blue,white,0.693,0.632,helvetica-boldoblique,96 +The secret flower is a "sunflower".,4,13,black,white,0.73,0.152,times-bold,110 +The secret kitchen appliance is a "rice cooker".,5,13,green,white,0.967,0.205,times-bolditalic,109 diff --git a/BNYMellon/BNYMellon_5Pages/prompt_questions.txt b/BNYMellon/BNYMellon_5Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..8fbbde020e0d80c6eeff6d065850d15a46e01447 --- /dev/null +++ b/BNYMellon/BNYMellon_5Pages/prompt_questions.txt @@ -0,0 +1,5 @@ +What is the secret instrument in the document? +What is the secret tool in the document? +What is the secret shape in the document? +What is the secret flower in the document? +What is the secret kitchen appliance in the document? diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_1.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_1.txt new file mode 100644 index 0000000000000000000000000000000000000000..ab5db08bec68b3c9bd81e059760a66484ed76c4a --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_1.txt @@ -0,0 +1,8 @@ + + TRUST EXECUTION GROWTH W + INNOVATION CLIENTS RESILIENCE EFFICIENCY + CULTURE SOLUTIONS TALENT TRANSFORMATION + +BUILDING ON +ANNUAL REPORT 2023 +The secret instrument is a "piano". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_10.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_10.txt new file mode 100644 index 0000000000000000000000000000000000000000..a457f098db0676d1c0b7f9023376920aa576cb52 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_10.txt @@ -0,0 +1,12 @@ +VIII ANNUAL REPORT 2023 +OUR STRATEGIC PILLARS +BE MORE +FOR OUR +CLIENTS +RUN OUR +COMPANY +BETTER +POWER +OUR +CULTURE +The secret shape is a "triangle". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_11.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_11.txt new file mode 100644 index 0000000000000000000000000000000000000000..fefd56531715bdd7f1ff5cb081dfff7110ab9733 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_11.txt @@ -0,0 +1,66 @@ +As a commercial enterprise that has +operated for nearly two-and-a-half +centuries, we are able to thrive +for only one reason — by serving +our clients. +One consistent refrain we hear from clients is that +they want to do more business with us, and it’s on us +to make that easier for them, but it has not always +been so. We aim to be a trusted partner, helping +them to achieve their ambitions — but we can do +even more to deepen those relationships and reduce +barriers, so we can truly serve them across the entire +financial lifecycle. +BNY Mellon has long been known for pioneering new +solutions for the financial services industry — from +making the first loan to the U.S. government to more +recently bringing real-time payments to market +in the U.S. +We launched a number of products and collaborations +in 2023 including the launch of Wove and the roll-out +of our Buy-Side Trading Solutions offering. But it goes +well beyond that. All our businesses strive to bring +BE MORE +FOR OUR +CLIENTS +One of my goals coming into this role was to set +a roadmap and tangible targets to reinvigorate the +next phase of growth for the firm. Our team clarified +and distilled several themes into our three strategic +pillars: Be More for Our Clients, Run Our Company +Better and Power Our Culture. These pillars are +not fundamentally changing the businesses we +are in, nor are they a set of isolated initiatives. +Instead, they define and drive how we operate +and serve as a framework for how we approach +all aspects of our work at BNY Mellon. +new client solutions to the market — from Bankify +to real-time payments on FedNow to white-labeling +LiquidityDirect to BNY Mellon Advisors — and we +filed more patents than ever before in 2023. +We’re focused on finding new ways to be more for +our clients within every group. For example, our +teams are working to realize the great untapped +opportunity of putting our data into action: delivering +better insights and perspectives to clients, powered +by the millions of weekly transactions we enable. +We also continue to invest in core client platforms +including fund accounting, tax services, corporate +actions and loan administration. +Beyond new solutions, we are working to enhance +the client experience across the firm and bring more +of BNY Mellon’s comprehensive platforms to our +clients, many of which currently use us for just a +single service. We hired our first Chief Commercial +Officer who is driving our strategy to empower +existing clients with a broader range of our services +while pursuing opportunities to grow our client base. +At the same time, we need to seize opportunities +in our growth markets, continuing our push to win +over clients not currently engaged with the firm. +Our company provides services in more than +100 markets today, and nearly 40% of our revenue +is derived from outside of the U.S. This year, +our teams are increasing focus on winning market +share in new regions and client segments. +IXBNY MELLON \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_12.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_12.txt new file mode 100644 index 0000000000000000000000000000000000000000..10eb52252adeb3530318ae13a40355c24ee81b04 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_12.txt @@ -0,0 +1,66 @@ +X ANNUAL REPORT 2023 +RUN OUR +COMPANY +BETTER +Next, we took meaningful steps +toward running our company +better in 2023, increasing +discipline with how we spend +so that our investments in the +business go further. We generated +double the amount of efficiency savings compared +to the prior year, which allowed us to self-fund half +a billion dollars of incremental investments. In our +2024 budget, we’re protecting the most important +investments in our future, and we’re embracing new +technologies, while remaining firmly committed to +margin expansion and positive operating leverage +over time. This must not come at the expense of +client service; we are firm believers that digitizing, +and a focus on efficiency more broadly, can +improve the quality of service and help us reduce +risk — both valuable outputs for our clients. +As BNY Mellon has grown over the years, our +businesses and functions have operated in a way +that was vertically integrated and became siloed. +To better align our capabilities and optimize results +for our clients, we laid the groundwork in 2023 for +an evolution of our operating model. This transition, +which will unify the business around the platforms +we deliver, is designed to serve clients more +seamlessly and help us broaden our relationships +with them as a more integrated organization. +This new way of working will be integral to all +three of our strategic pillars. Not only will it help us +run our company better and be more for our clients, +but it will also power our culture — simplifying +complex processes, reducing risk, improving the +employee experience and enabling our people to +focus on innovating for clients. +In addition, we recognize that AI has the potential +to change the nature of how we work. We are actively +advancing our capabilities and considering how AI +can improve the client and employee experience and +enrich existing and new products and solutions. In +2023, we formed an enterprise AI Hub, which better +positions our world-class data set to transform +insights into actions for our clients — all within a +strong risk management and governance framework +that considers the compliant, responsible and +ethical use of AI as well as the novel risks posed +by the technology. +Resilience forms the foundation for running our +company better. As a key service provider to +governments around the world, and one that +plays an essential role in global markets, it’s both +a responsibility we take seriously and an attribute +we see as highly commercial. Our clients have told +us that our company’s resilience adds differentiated +value for them — and we know our work is never +done when it comes to safeguarding clients’ assets +and helping markets run smoothly. Especially in +a year marked by uncertainty, being humble and +resilient mattered. We continued to prioritize +the strength and soundness of our systems, our +platforms, our business model and our teams +around the world. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_13.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_13.txt new file mode 100644 index 0000000000000000000000000000000000000000..4acf2a344958d94a5589e699ac13f919187cf41f --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_13.txt @@ -0,0 +1,62 @@ +XIBNY MELLON +POWER +OUR +CUL TURE +While we focus on being more for +our clients and running our company +better, everything we do depends on +our people, and it is important that +BNY Mellon is a place where people +are proud to work and excited to +grow their careers. Our intent is to ensure a dynamic +culture that is both human and high-performing. +Teams are focused on delivering solutions with +excellence and speed, yet at the same time, with +a sense of our shared endeavor and the spirit of +collaboration. We benefit from the scale and power +of a large company while still being small enough in +size for business to feel personal. +Others also recognize us for this special culture. +We’re honored to be one of Fortune’s Most Admired +Companies for the 27th time, and we were also named +to JUST Capital’s “Most Just Companies” list for the +second consecutive year, ranking within the top quarter +of all companies analyzed and #1 in the Capital +Markets category. +• Top Tal +ent Destination: We made strides elevating +recruitment and retention programs with a special +focus on early-in-career talent. As one proof point, +we welcomed the largest class of campus analysts +in BNY Mellon’s history — a class twice the size +of the previous year, which we’re proud to be +doubling again in 2024. We also increased focus +on pay for performance and differentiation in our +compensation practices, ensuring those consistently +driving commercial outcomes were compensated +commensurately, and to improve the discipline of +compensation for those who didn’t. +• Eleva ting Experiences and Sense of Belonging: +We want our people to feel excited and +supported coming to work every day, thriving +in an environment where they can be true to +themselves. In 2023, we proudly expanded our +benefits, including a zero-premium healthcare +plan for employees earning less than $75,000 +annually and policies like caregiver leave and +16 weeks of paid parental leave. We also launched +a new Wellbeing Support Program to provide more +targeted, personalized and quicker access to +mental health services. +• Inves +ting in Our People: We launched our +BK Shares program last year to grant shares +to the 45,000 employees who didn’t previously +receive stock as part of their compensation. +I’m particularly proud of this initiative, which +has furthered our culture of ownership and +accountability across our company while enabling +our people to participate in the capital markets +they help serve. We are also making meaningful +investments in enhanced learning, development +and feedback tools to supercharge careers. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_14.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_14.txt new file mode 100644 index 0000000000000000000000000000000000000000..5a0b71ca916edb2ccef6f9eac6b2217adc0443ad --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_14.txt @@ -0,0 +1,13 @@ +XII ANNUAL REPORT 2023 +Increased participation in fi nancial markets benefi ts everyone, drives +growth and expands economies. Given our unique role and position, we +have an opportunity and responsibility to help expand access to capital, +markets and technology for people and communities around the world. +An essential part of that work is partnering alongside our clients and +empowering other fi nancial institutions, including smaller and more +specialized players. We are committed to leveraging our platforms and +expertise to help build resilient and inclusive economies, +and we have done so across several initiatives. +COMMUNITY SOLUTIONS +AND SUSTAINABILITY +The secret flower is a "sunflower". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_15.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_15.txt new file mode 100644 index 0000000000000000000000000000000000000000..0fe9bd181b1b32cce71d979bba03fa2b38949b5e --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_15.txt @@ -0,0 +1,42 @@ +XIIIBNY MELLON +Organizing a Historic Debt Issuance: In May 2023, we became +the fi rst Global Systemically Important Bank (G-SIB) to organize a +debt issuance led entirely by women-, minority- and veteran-owned +fi nancial institutions. This built upon groundwork we laid the prior +year when eight veteran-owned broker-dealers participated in a +$750 million offering of senior bank notes. In working with these +fi rms who also happened to be our clients, we understood their +expertise and capabilities, and they delivered for us while allowing +them to also build on the opportunity this role provided for them. +Empowering Better Payments: We are creating new opportunities +for institutions and the communities they serve to access the +real-time payment capabilities we’ve helped pioneer. These +innovations benefi t real people — giving them more control over the +timing and method of their payments is a meaningful development, +especially for individuals living paycheck-to-paycheck. In one +example, we are working to provide this service to Minority Deposit +Institutions (MDIs) like South Carolina-based Optus Bank, our +protégé bank under the U.S. Treasury Department program. +Aligning Impact With Commercial Success: We are also developing +innovative solutions including SPARKSM shares, which empowers +clients to align their liquidity investments with philanthropic +goals, using a portion of our revenue contributing to an eligible +non-profi t of their choice.1 This builds on the success we saw +with BOLD® shares, whereby a portion of profi t on our Dreyfus +Money Market Fund translates into support for students in +fi nancial need at Howard University.2 +Furthering Sustainability: A growing priority for our global client +base is how BNY Mellon can help them achieve their sustainability +goals. Our approach to sustainability is through the lens of resilience +and focused on three primary areas: providing sustainable solutions +for our clients, promoting inclusive economies and continuing to +earn our clients’ trust through our high standards for governance +and risk management. +1 BNY Mellon Investment Adviser, Inc. (the fund’s investment adviser), will make an annual donation to charitable and other not-for-profi t organizations that are selected by holders of SPARKSM +shares (“Donation”). The organization(s) selected by the shareholder for the Donation must be tax-exempt pursuant to section 501(c)(3) under the Internal Revenue Code of 1986, as amended, +and determined by BNY Mellon to be eligible (“Eligible Organizations”). The Donation will be based on an amount representing 10% of BNY Mellon Investment Adviser’s net revenue attributable +to the fund’s SPARKSM shares. “Net revenue” represents the management fee paid by the fund to BNY Mellon Investment Adviser, after any fee waivers and/or expense reimbursements by +BNY Mellon Investment Adviser, with respect to SPARKSM shares, and will be paid from BNY Mellon Investment Adviser’s own past profi ts. + 2 The BOLD® shares support Howard University’s GRACE Grant, which stands for Graduation, Retention, and Access to Continuing Education, with an annual charitable donation of 10% from past +profi ts. “Net revenue” represents the management fee paid by the Fund to BNY Mellon Investment Adviser, Inc. after any fee waivers and/or expense reimbursements by BNY Mellon Investment +Adviser and less any revenue sharing payments made by BNY Mellon Investment Adviser or its affi liates, with respect to the fund’s BOLD shares. diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_16.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_16.txt new file mode 100644 index 0000000000000000000000000000000000000000..88af637dac41fc015f0c1cc8e43a1fcbf7a7e530 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_16.txt @@ -0,0 +1,28 @@ +XIV ANNUAL REPORT 2023 +We are still early in our journey with a lot of work ahead. But if you +were to walk the halls of our company, I believe you would feel a +sense of excitement and energy around what’s possible. +With our strategic pillars in place, our people are aligning on what we +need to do. Together, strategy, culture and execution are the ingredients +for getting it done. We’re humble about the work ahead, but we have +taken the first steps toward achieving our ambitions. +We have tremendous responsibility to do so. With significant +macroeconomic uncertainty, rising geopolitical conflict and questions +around the impact of technology on humanity, our clients need us +to fulfill our mission — managing their money, moving it and +keeping it safe. +To our clients: Thank you for your support. We look forward to serving +you in even greater ways. +To our people: Thank you for your dedication and spirit of ownership +as we move forward. +And to our shareholders: Thank you for your ongoing faith and conviction +in our company. +Now, the hard work of execution continues. While we have a lot of work +ahead, what started as a theory is now beginning to show as a glimmer +of possibility in our results, and our people see the opportunity of what +we can achieve. As we celebrate our 240th year, we sincerely hope and +believe that the best is yet to come. +ONWARD, +IN CONCLUSION +Robin Vince, +President and Chief Executive Officer \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_17.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_17.txt new file mode 100644 index 0000000000000000000000000000000000000000..4bab3cb87a35db09c431a36efacf6d59b5febee2 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_17.txt @@ -0,0 +1,61 @@ +SELECTED INCOME STATEMENT INFORMATION +Fee and other revenue $ 13, 157 $ 12,873 +Net interest revenue 4,345 3,504 +Total revenue 17 ,502 16,377 +Provision for credit losses 119 39 +Total noninterest expense 13,295 13,010 +Income before income taxes 4,088 3,328 +Net income applicable to common shareholders of + The Bank of New York Mellon Corporation $ 3,051 $ 2,362 +Earnings per common share – diluted $ 3.87 $ 2.90 +Cash dividends per common share $ 1.58 $ 1.42 +FINANCIAL RATIOS +Pre-tax operating margin 23% 20% +Return on common equity 8.5% 6.5% +Return on tangible common equity – non-GAAP (a) 16.6% 13.4% +NON-GAAP MEASURES, EXCLUDING NOTABLE ITEMS (b) +Adjusted total revenue $ 17 ,652 $ 16,888 +Adjusted total expenses 12,302 11,981 +Adjusted earnings per common share – diluted 5.05 4.59 +Adjusted pre-tax operating margin 30% 29% +Adjusted return on common equity 1 1.1% 10.3% +Adjusted return on tangible common equity (a) 21.6% 21.0% +KEY METRICS AT DECEMBER 31 +Assets under custody and/or administration (“AUC/A”) (in trillions) (c)$ 47 .8 $ 44.3 +Assets under management (in trillions) (d) $ 2.0 $ 1.8 +BALANCE SHEET AT DECEMBER 31 +Total assets $ 409,953 $ 405,783 +Total deposits 283,669 278,970 +Total The Bank of New York Mellon Corporation common shareholders’ equity 36,531 35,896 +CAPITAL RATIOS AT DECEMBER 31 +Consolidated regulatory capital ratios: +Common Equity Tier 1 (“CET1”) ratio (e)11.5% 11.2% +Tier 1 capital ratio (e) 14.2 14. 1 +Total capital ratio (e) 15.0 14.9 +Tier 1 leverage ratio 6.0 5.8 +Supplementary leverage ratio (“SLR”) 7. 3 6.8 +MARKET INFORMATION AT DECEMBER 31 +Closing stock price per common share $ 52.05 $ 45.52 +Market capitalization $ 39,524 $ 36,800 +Common shares outstanding (in thousands) 759,344 808,445 +FINANCIAL HIGHLIGHTS +The Bank of New York Mellon Corporation (and its subsidiaries) +(dollars in millions, except per common share amounts or unless otherwise noted) 2023 2022 +XVBNY MELLON +(a) Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. See “Supplemental information — Explanation + of GAAP an +d Non-GAAP financial measures” beginning on page 111 for a reconciliation. +(b) Adjusted (Non-GAAP) measures ex +clude notable items. See “Supplemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111. +(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 o +f business. Includes the AUC/A of CIBC Mellon Global Securities Services Company, a joint venture. +(d) Excludes assets managed outside o +f the Investment and Wealth Management business segment. +(e) For our CET1, + Tier 1 capital and Total capital ratios, our effective capital ratios under U.S. capital rules are the lower of the ratios as calculated under the Standardized and + Advanced Approac +hes, which was the Advanced Approaches for the periods presented. +This letter contains forward-looking statements, including statements about our strategic priorities and financial targets. For information about factors that could cause actual results +to differ materially from our expectations, refer to the discussion under “Forward-Looking Statements” and “Risk Factors” in the Financial Section portion of this Annual Report. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_18.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_18.txt new file mode 100644 index 0000000000000000000000000000000000000000..78f738077986df096a5ee3b2f00562f702c15e35 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_18.txt @@ -0,0 +1,106 @@ +THEB ANK OF NE +WY ORKM ELLONC ORPORATION +2023 AnnualR eport +Tableo fC ontents +Page +Fi +nancialS ummary 2 +Management’s Discussion andAnalysiso f +FinancialC ondition andResul ts of Operations: +Resu +lts of Operations: +General 3 +Overview 3 +Subsequent event3 +Summary of financialh ighlights 3 +Feea nd otherrevenue 5 +Ne +ti nterestr evenue 8 +No +nintereste xpense 11 +Inco +me taxes 11 +Review of businesssegments 12 +Internationalo perations 20 +Critic +al accountinge stima tes 22 +Consolidated balances heet re view 26 +Liquidity andd ividends 35 +Capital 39 +Tradinga ctivitiesa nd risk management 44 +Asset/liability management 46 +Risk Management 48 +Cybersecurity 56 +Supervisiona nd Regulation 58 +Risk Factors 78 +Recen +tA ccountingD evelopments 110 +SupplementalI nformation( unaudited): +Expl +anationo fG AAP andN on-GAAP financial +measures (unaudited) 111 +Rate/volumea nalysis( unaudited) 116 +Forw +ard-looking Statements 117 +Glossary 120 +Repo +rt of Management on Internal ControlO ver +Financ +ialR eporting 121 +Report of Independent Registered Public +AccountingF irm 122 +Page +Fi +nancialS tatements: +Consolidated Income Statement 124 +Consolidated ComprehensiveI ncomeS tateme nt 126 +Consolidated BalanceS heet 127 +Consol +idated Statemento fC ashF lows 128 +Consolidated Statemento fC hangesi nE quity 129 +No +test oC onsolidated Fina ncialS tatements: +Note 1– Summaryo fs ignificanta ccountinga nd +reporting policies 131 +Note 2– Accountingc hangesa nd newa ccoun ting +guidance 143 +Note 3–A cquisitions andd ispositions 144 +Note 4– Securities1 45 +Note 5– Loansa nd assetq uality 149 +Note 6– Le +asing1 55 +Note 7– Goodwill andi ntangiblea ssets 156 +Note 8– Othera ssets 158 +Note 9– Deposits 159 +Note 10 –C ontract revenue 159 +Note 11 –N et interest revenue 161 +Note 12 –I ncomet axes 162 +No +te 13 –L ong-term debt 163 +Note 14 –V ar +iablei nter este ntities1 63 +Note 15 –S hareholders’e quity 164 +No +te 16 –O ther comprehensiveincome( loss) 168 +No +te 17 –S tock-based compensation1 69 +Note 18 –E mployeeb enefit plans1 70 +Note 19 –C ompany financiali nformation( Parent +Corporation) 176 +Note 20 –F airv alue measurement 179 +Note 21 –F airv alue option 185 +Note 22 –C ommitmentsa nd contingent liabilities 186 +Note 23 –D erivativei nstruments 192 +Note 24 –B usinesss egments 198 +Note 25 –I nternationalo perations 201 +Note 26 –S uppl +ementali nformationt othe +Consolidated Statemento fC ashF lows 202 +Note 27 –S ubsequent event 203 +Report of Independent Registered Public +AccountingF irm 204 +Directors, Execu tive Committeea nd Other +Executive Officers 209 +PerformanceG raph 210 +FINANCIAL SECTION +The secret animal #2 is a "kangaroo". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_19.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_19.txt new file mode 100644 index 0000000000000000000000000000000000000000..facd2bbd3fcfd0105a70a8548dce6de5d5a96ddd --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_19.txt @@ -0,0 +1,60 @@ +(dollars in millions,e xceptp er sharea mountsa nd unlessotherwise noted) 2023 2022 2021 +Selected income statementi nformation: +Feea nd otherrevenue $1 3,157 $1 2,873 $1 3,313 +Neti nterestr evenue 4,345 3,504 2,618 +Totalr evenue 17,502 16,377 15,931 +Provision forc reditl osses 119 39 (231) +Nonintereste xpense 13,295 13,010 11,514 +Income before income taxes 4,088 3,328 4,648 +Provision fori ncomet axes 800 768 877 +Neti ncome 3,288 2,560 3,771 +Net( income)l ossa ttributable tononcontrollingi nterests relatedt oconsolidated investment +management funds (2) 13 (12) +Preferreds tock dividends (235) (211) (207) +Neti ncomea pplicable tocommons hareholders of TheB anko fN ew York +MellonC orporation $3 ,051 $2 ,362 $3 ,552 +Earnings pers hare applicable to commons hareholders of TheB anko fN ew York +MellonC orporation: +Basic $3 .89 $2 .91 $4 .17 +Diluted $3 .87 $2 .90 $4 .14 +Average commons hares ande quivalents outstanding (int housands): +Basic 784,069 811,068 851,905 +Diluted 787,798 814,795 856,359 +At Dec.31 +Assets underc ustody and/or administration( “AUC/A”) (int rillions)( a) $4 7.8 $4 4.3 $4 6.7 +Assets underm anagement( “AUM”) (int rillions)( b) 2.0 1.8 2.4 +Selected ratios: +Return on commone quity 8.5% 6.5% 8.9% +Return on tangiblec ommone quity –N on-GAAP (c) 16.6 13.4 17.1 +Pre-taxo peratingm argin 23 20 29 +Neti nterestm argin 1.25 0.97 0.68 +Cash dividends percommons hare $1 .58 $1 .42 $1 .30 +Commond ividendp ayout ratio 41% 49% 32% +Commond ividendy ield 3.0% 3.1% 2.2% +At Dec.31 +Closings tock pricep er commonshare $5 2.05 $4 5.52 $5 8.08 +Market capitalization $3 9,524 $3 6,800 $4 6,705 +Book valueper commonshare $4 8.11 $4 4.40 $4 7.50 +Tangibleb ook valueper commonshare –N on-GAAP (c) $2 5.39 $2 3.11 $2 4.31 +Full-time employees 53,400 51,700 49,100 +Commons hareso utstanding (int housands) 759,344 808,445 804,145 +Regulatory capitalratios (d) +CommonE quity Tier 1( “CET1”) ratio 11.5% 11.2% 11.2% +Tier 1c apitalr atio 14.2 14.1 14.0 +Totalc apitalr atio 15.0 14.9 14.9 +Tier 1l everager atio 6.0 5.8 5.5 +Supplementary leverage ratio (“SLR”) 7.3 6.8 6.6 +(a)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theClearancea nd CollateralM anagement, +Issuer Services,P ershinga nd Wealth Management lineso fb usiness. Includest he AUC/Ao fC IBCM ellonG lobal SecuritiesServices +Company (“CIBC Mellon”), aj oint venture with theCanadian Imperial Bank ofCommerce, of $1.7trilliona tD ec. 31, 2023,$ 1.5 +trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(b)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth Management businesssegment. +(c)R eturno ntangiblec ommone quity and tangibleb ook valuep er commons hare, bothN on-GAAP measures,e xclude goodwilland +intangiblea ssets,n et of deferredtax liabilities. See“ SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financial +measures”b eginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +(d)F or ourCET1,T ier1and Totalc apitalr atios, our effectivec apitalr atiosu nderU .S. capitalr ules aret he lowero ft he ratiosa s +calculated undert he Standardizedand Advanced Approaches. Fora dditional informationo nour regulatoryc apitalr atios, see +“Capital” beginning on page 39. +The Bank ofNewY orkM ellonC orporation( andi ts subsidiaries) +FinancialS ummary +2B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_2.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_2.txt new file mode 100644 index 0000000000000000000000000000000000000000..3c2c837a0b02559603d07c7902b85fe8bcbde215 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_2.txt @@ -0,0 +1,2 @@ +2 ANNUAL REPORT 2023 + \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_20.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_20.txt new file mode 100644 index 0000000000000000000000000000000000000000..91d43dc7b8c2ef8a4e2521b84f29a9f4a5c3f142 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_20.txt @@ -0,0 +1,100 @@ +General +In this AnnualR eport, references to “our,” “we,” +“us,”“ BNYM ellon,” the“ Company” ands imilar +termsr efer to TheB anko fN ew York Mellon +Corporationa nd itsc onsolidated subsidiaries.T he +term “Parent” refers to TheB anko fN ew York +MellonC orporationb ut notits subsidiaries. +Thef ollowing shouldb er ead in conjunctionw ith the +Consolidated FinancialS tatementsi ncludedi nthis +report. BNYM ellon’sa ctualr esults of future +operations mayd ifferf romt hosee stimatedo r +anticipated in certain forward-looking statements +containedh ereind ue to thefactorsd escribed under +theh eadings “Forward-looking Statements”a nd +“RiskF actors,”b otho fw hich investorss houldr ead. +Certainb usinesst erms used in thisAnnualR eporta re +definedi nthe Glossary. +This AnnualR eportg enerally discusses2 023 and +2022 items andc omparisons between2023 and2 022. +Discussions of 2021items andc omparisons between +2022 and2 021 that arenot includedi nthisA nnual +Reportc an be found in our 2022AnnualR eport, +whichw as fileda sa ne xhibitt oo ur Form 10-Kf or +they ear endedDec. 31, 2022. +Overview +Establishedi n1784, BNYM elloni sA merica’so ldest +bank andt he firstc ompany listedo nthe NewY ork +StockE xchange (NYSE: BK). Today, BNYM ellon +powersc apitalm arkets around thew orld through +comprehensives olutions that help clientsm anagea nd +servicet heir financiala ssetst hroughout the +investment lifec ycle.B NY Mellonhad $47.8 trillion +in assets underc ustody and/or administrationa nd +$2.0 trillioni nassets underm anagementa so fD ec. +31, 2023. BNYM ellonh as been nameda mong +Fortune’s World’sM ostA dmired Companiesa nd +Fast Company’sB estW orkplaces forI nnovators. +BNYM elloni st he corporateb rand ofTheB anko f +NewY orkM ellonC orporation. +BNYM ellonh as threeb usinesss egments, Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagement, whicho ffera +comprehensives et of capabilitiesa nd deep expertise +acrosst he investment lifecycle, enablingt he +Companyt oprovide solutions to buy-side ands ell- +side market participants,a sw ella sl eading +institutionala nd wealth managementclientsg lobally. +Thed iagram belowp resentso ur threeb usiness +segments andl ines of business, with theremaining +operations in theO ther segment. +TheB anko fN ew +York Mellon +Corporation +Securities +Services +Market andW ealth +Services +Investment and +Wealth Management +Asset +Servicing Pershing Investment +Management +Issuer +Services +Treasury +Services +Wealth +Management +Clearance and +Collateral +Management +Fora dditionali nformationo nour businesssegments, +see“ Review of businesssegments” andN ote2 4o f +theN otes to Consolidated FinancialS tatements. +Subsequent event +In February 2024, BNYM ellona djustedi ts financial +results fort he fourth quarter andfully ear endedDec. +31, 2023to includean additional$ 127 millionp re-tax +($97 milliona fter-tax)i ncreasei nn onintereste xpense +relatedt oarevisede stimate of theF DICs pecial +assessmenta saresult of newinformationp ublished +by theF DICi nF ebruary2 024 relatingt oa nincrease +in theire stimate of lossesa ssociatedw ith thec losures +of Silicon ValleyB anka nd Signature Bank whicha re +expected to impact theF DICs pecial assessment. See +Note 27 oftheN otes to Consolidated Financial +Statements fori nformationo nthe adjustment to our +previously reported2 023 financialr esults. +Summary of financialh ighlights +We reportedn et income applicable to common +shareholders of $3.1 billion,o r$ 3.87 perdiluted +commons hare,i n2 023, including then egative +impact of notableitems.N otable items in2023 +include theF ederal Deposit InsuranceC orporation +(“FDIC”) special assessment,severancee xpense, the +reductioni nthe fair valueo facontingent +Management’s Discussion andA nalysiso fF inancial Condition andR esultso fO perations +Resultso fO perations +BNYM ellon3 +The secret kitchen appliance is a "rice cooker". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_21.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_21.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0ff4e7b348f29f93666a160c0953d1e89d5ca77 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_21.txt @@ -0,0 +1,99 @@ +considerationr eceivabler elated to ap rior year +divestiture,l itigationr eservesa nd netlosseso n +disposals. Excluding notable items,net income +applicable tocommons hareholders was$ 4.0 billion +(Non-GAAP), or $5.05(Non-GAAP)p er diluted +commons hare,i n2 023. In 2022, netincome +applicable tocommons hareholders of BNYM ellon +was$ 2.4 billion,or $2.90 perdilutedc ommons hare, +including then egativei mpact of notable items. +Notablei tems in2022 include goodwill impairment +in theInvestment Management reportingu nit, then et +loss fromr epositioning thes ecuritiesp ortfolio, +severancee xpense, litigationr eserves, thea ccelerated +amortizationo fd eferredc osts ford epositary receipts +services relatedt oRussiaa nd netgains on disposals. +Excluding notable items,net income applicable to +commons hareholdersw as $3.7 billion(Non-GAAP), +or $4.59(Non-GAAP)p er dilutedc ommons hare,i n +2022. +Theh ighlightsb elow areb ased on 2023compared +with 2022, unlessotherwise noted. +• Totalr evenue increased7 %, primarily reflecting: +• Feer evenue decreased1%,p rimarily +reflectingl ower foreigne xchange volatility, +them ix of AUM flowsa nd thei mpact of a +priory ear divestiture,p artially offset by the +abatemento fm oneym arketf ee waivers, net +newb usinessa nd thea ccelerated +amortizationo fd eferredc osts ford epositary +receiptss ervices relatedt oRussiai nt he first +quarter of 2022. (See “Fee andother +revenue”b eginning on page 5.) +• Investment ando ther revenue increased +primarily reflectingt he netlossf rom +repositioning thes ecuritiesp ortfolio in the +fourth quarter of 2022, partiallyoffset by the +reductioni nthe fair valueo facontingent +considerationr eceivabler elated to ap rior +year divestiture in thefourth quarter of 2023. +(See “Fee andother revenue”b eginning on +page 5.) +• Neti nterestr evenue increased2 4%,p rimarily +reflectingh igheri nterestr ates,p artially offset +by changesi nb alance sheet size andmix. +(See “Netinterest revenue”b eginning on +page 8.) +• Thep rovision forc reditl ossesw as $119 million, +primarily driven by reservei ncreases relatedt o +commercialr eale statee xposurea nd changesi n +them acroeconomic forecast. (See “Consolidated +balances heet review –A llowancef or credit +losses” beginning on page 33.) +• Nonintereste xpensei ncreased 2%,p rimarily +reflectingt he FDIC special assessmentint he +fourth quarter of 2023, higherinvestmentsa nd +revenue-relatede xpenses,a sw ella si nflation, +partially offset by thei mpactso ft he goodwill +impairmenti nt he Investment Management +reportingu niti nt he thirdq uarter of 2022, +efficiency savings andapriory ear divestiture. +Excluding notableitems,n onintereste xpense +increased 3% (Non-GAAP). (See “Noninterest +expense” on page 11.) +• Effectivet ax rate of 19.6%in 2023. (See +“Incomet axes”o np age1 1.) +• Return on commone quity (“ROE”)w as 8.5% for +2023. Excludingn otable items,t he adjusted ROE +was1 1.1% (Non-GAAP)f or 2023. +• Return on tangiblec ommone quity (“ROTCE”) +was1 6.6% (Non-GAAP)f or 2023. Excluding +notable items,thea djustedR OTCE was2 1.6% +(Non-GAAP)f or 2023. +See“ SupplementalI nformation–E xplanationo f +GAAP andN on-GAAP financialm easures” +beginning on page 111forr econciliations oftheN on- +GAAP measures. +Metrics +•A UC/A totaled$ 47.8 trilliona tD ec. 31, 2023 +compared with $44.3 trilliona tD ec. 31, 2022. +The8 %i ncreasep rimarily reflectsh igherm arket +values.( See“ Feea nd otherrevenue”b eginning +on page 5.) +•A UM totaled$ 2.0 trilliona tD ec. 31, 2023 +compared with $1.8 trilliona tD ec. 31, 2022. +The8 %i ncreasep rimarily reflectsh igherm arket +values andthe favorable impact of aw eaker U.S. +dollar, partially offset by cumulativen et +outflows. (See “Reviewofb usinesss egments– +Investment andW ealth Management business +segment” beginning on page 17.) +Capitala nd liquidity +•O ur CET1 ratioc alculatedu ndert he Advanced +Approaches was1 1.5% at Dec. 31, 2023and +11.2% at Dec. 31, 2022. Thei ncreasew as +primarily driven by capitalg enerated through +earnings andaneti ncreasei na ccumulatedo ther +comprehensivei ncome, partially offset by capital +Resultso fO perations (continued) +4B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_22.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_22.txt new file mode 100644 index 0000000000000000000000000000000000000000..6b14fadb5fc8bba994668ed33177dac4a2086705 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_22.txt @@ -0,0 +1,74 @@ +deployedt hrough commons tock repurchases and +dividends.( See“ Capital” beginning on page 39.) +•O ur Tier 1l everager atio was6 .0% at Dec. 31, +2023, compared with 5.8% at Dec. 31, 2022.T he +increasew as driven by lowera verage assets. +(See “Capital”beginning on page 39.) +Feea nd otherr evenue +Feea nd otherr evenue 2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Investment services fees $8 ,843 $8 ,529 $8 ,284 4% 3% +Investment management andp erformance fees (a) 3,058 3,299 3,588 (7) (8) +Foreigne xchanger evenue 631 822 799 (23) 3 +Financing-relatedf ees 192 175 194 10 (10) +Distributiona nd servicingf ees 148 130 112 14 16 +Totalf ee revenue 12,872 12,955 12,977 (1) — +Investment ando ther revenue 285 (82) 336 N/M N/M +Totalf ee andother revenue $13,157 $1 2,873 $1 3,313 2% (3)% +Feer evenue as ap ercentage oftotalr evenue 74% 79% 81% +AUC/A at period end (int rillions)( b) $4 7.8 $4 4.3 $4 6.7 8% (5)% +AUM at period end (inb illions)( c) $1 ,974 $1 ,836 $2 ,434 8% (25)% +(a)E xcludess eed capitalgains (losses) relatedt oconsolidated investmentm anagement funds. +(b)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theClearancea nd CollateralM anagement, +Issuer Services,P ershinga nd Wealth Management lineso fb usiness. Includest he AUC/Ao fC IBCM ellono f$ 1.7 trilliona tD ec. 31, +2023, $1.5trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(c)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth Management businesssegment. +N/M–Notm eaningful. +Feer evenue decreased1% compared with 2022, +primarily reflectingl ower foreigne xchange volatility, +them ix of AUM flowsa nd thei mpact of ap rior year +divestiture,p artially offset by thea batement of +moneym arketf ee waivers, netn ew businessa nd the +accelerated amortizationo fd eferredc osts for +depositary receiptsservices relatedt oRussiai nt he +firstq uarter of 2022. +Investment ando ther revenue increased $367 million +in 2023 compared with 2022, primarily reflectingt he +netl ossf romr epositioning thes ecuritiesp ortfolio in +thef ourth quarter of 2022, partiallyoffset by the +reductioni nthe fair valueo facontingent +considerationr eceivabler elated to ap rior year +divestiture in thefourth quarter of 2023. +Investments ervicesf ees +Investment services fees increased 4% compared with +2022, primarily reflectingt he abatemento fm oney +market feew aivers,n et newb usiness, thea ccelerated +amortizationo fd eferredc osts ford epositary receipts +services relatedt oRussiar ecorded in thefirst quarter +of 2022, higherclearance volumes andcollateral +management balances andhigherf ees on sweep +balances,p artially offset by lowerc lient activity,a nd +lost businessi nP ershing. +AUC/A totaled$ 47.8 trilliona tD ec. 31, 2023,a n +increaseo f8 %c omparedw ith Dec. 31, 2022, +primarily reflectingh igherm arketv alues. AUC/A +consistedo f3 5% equity securitiesa nd 65%fixed- +income securitiesa tD ec. 31, 2023and3 3% equity +securitiesa nd 67%fixed-income securitiesa tD ec. +31, 2022. +See“ SecuritiesS ervicesb usinesss egment”a nd +“Marketa nd Wealth Services businesss egment”i n +“Reviewo fb usinesss egments” fora dditionald etails. +Investmentm anagement and performancefees +Investment management andp erformance fees +decreased 7% compared with 2022, primarily +reflectingt he impact of ap rior yeardivestiture and +them ix of AUMf lows,p artially offset by the +abatemento fm oneym arketf ee waivers. +Performance fees were $81 millioni n2 023 and$ 75 +millioni n2 022. On ac onstant currencyb asis (Non- +GAAP), investment management andp erformance +fees decreased 7% compared with 2022. See +Resultso fO perations (continued) +BNYM ellon5 +The secret food is a "hamburger". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_23.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_23.txt new file mode 100644 index 0000000000000000000000000000000000000000..e292223f86bd7dd307eef83dc1d710bb792b8270 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_23.txt @@ -0,0 +1,91 @@ +“SupplementalI nformation–E xplanationo fG AAP +andN on-GAAP financialm easures”b eginning on +page 111fort he reconciliationo fN on-GAAP +measures. +AUM was$2.0 trilliona tD ec. 31, 2023,a nincrease +of 8%compared with Dec. 31, 2022,p rimarily +reflectingh igherm arketv aluesa nd thef avorable +impact of aw eaker U.S. dollar, partially offset by +cumulativen et outflows. +See“ Investment andW ealth Management business +segment” in“Reviewo fb usinesss egments” for +additionald etails regardingt he driversofi nvestment +management andp erformance fees,A UM andA UM +flows. +Foreigne xchange revenue +Foreigne xchanger evenue is primarily driven by the +volumeo fc lient transactions andt he spread realized +on theset ransactions,b otho fw hich areimpacted by +market volatility,t he impact of foreignc urrency +hedging activitiesa nd foreignc urrency +remeasurementg ain( loss).I n2 023, foreign +exchange revenue decreased23% compared with +2022, primarily reflectingl ower volatility and +volumes.F oreign exchange revenue is primarily +reportedi nthe SecuritiesS ervices businesss egment +and, to al essere xtent, theMarketa nd Wealth +Services andInvestment andW ealth Management +businesss egmentsa nd theO ther segment. +Financing-relatedf ees +Financing-relatedf ees,w hich areprimarily reported +in theMarketa nd Wealth Services andSecurities +Services businesss egments, include capitalm arket +fees,l oanc ommitment fees andcredit-relatedf ees. +Financing-relatedf ees increased 10% in 2023 +compared with 2022, primarily reflectingh igherf ees +on commitmentsa nd standby letters of credit, +partially offset by loweru nderwritingf ees. +Distributiona nd servicingf ees +Distributiona nd servicingf ees earnedfromm utual +funds arep rimarily basedo naverage assets inthe +funds andt he saleso ff unds that we manage or +administer, anda re primarily reportedi nthe +Investment Management business. Thesef ees,w hich +include 12b-1fees,f luctuate with theoverall levelo f +nets ales,t he relativem ix of salesb etween share +classes, thef unds’m arketv aluesa nd moneym arket +feew aivers. +Distributiona nd servicingf ees were $148 millioni n +2023 compared with $130 millioni n2 022, drivenby +thea batement ofmoneym arketf ee waivers. The +impact of distributionand servicingf ees on income in +anyo ne periodis partially offset by distributionand +servicinge xpensep aidt oother financial +intermediaries to covert heir costsf or distributionand +servicingo fm utualf unds.D istributiona nd servicing +expensei sr ecorded asnonintereste xpenseo nt he +income statement. +Investmenta nd otherrevenue +Investment ando ther revenue includesi ncomeo rl oss +fromc onsolidated investment management funds, +seed capitalg ains orlosses, othert rading revenue or +loss, renewablee nergyi nvestmentsl osses, income +fromc orporatea nd bank-ownedlifei nsurance +contracts, otheri nvestment gainsorl osses, gainso r +lossesf romd isposals, expenser eimbursementsf rom +our CIBC Mellon jointv enture,o ther income or loss +andn et securitiesg ains orlosses.T he income or loss +fromc onsolidated investment management funds +shouldb ec onsidered together with thenet income or +loss attributable to noncontrollingi nterests,w hich +reflectst he portiono ft he consolidated funds for +whichw ed on ot havean economicinterest andi s +reflected belown et income as as eparatel inei temo n +thec onsolidated income statement. Othert rading +revenue orloss primarily includesthe impact of +market-risk hedging activity relatedt oour seed +capitali nvestmentsi ni nvestment management funds, +non-foreignc urrencyd erivativea nd fixedi ncome +trading, ando ther hedging activity.I nvestmentsi n +renewablee nergyg eneratel ossesi ni nvestment and +otherr evenue that aremoret hano ffset by benefits +andc redits recorded to thep rovision fori ncome +taxes. Otheri nvestment gainsorl ossesi ncludesf air +valuec hangeso fn on-readily marketablestrategic +equity,p rivate equity ando ther investments. Expense +reimbursementsf romo ur CIBC Mellonj oint venture +relate to expenses incurredb yBNY Mellono nbehalf +of theC IBCM ellonj oint venture. Otheri ncome +includesv arious miscellaneous revenues. +Resultso fO perations (continued) +6B NY Mellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_24.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_24.txt new file mode 100644 index 0000000000000000000000000000000000000000..519c7e16a7ddec02ce83d3558c454901a05c2a2f --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_24.txt @@ -0,0 +1,27 @@ +Thef ollowing tablep rovidest he componentso fi nvestment ando ther revenue. +Investment ando ther revenue +(inm illions) 2023 2022 2021 +Income (loss) fromc onsolidated investment management funds $3 0 $( 42) $3 2 +Seed capitalg ains (losses) (a) 29 (37) 40 +Othert rading revenue 231 149 6 +Renewablee nergyi nvestment (losses) (167) (164) (201) +Corporate/bank-ownedl ifei nsurance 118 128 140 +Otheri nvestment gains(b) 47 159 159 +Disposal (losses) gains (6) 26 13 +Expenser eimbursementsf romj oint venture 117 108 96 +Other( loss) income (46) 34 46 +Nets ecurities( losses) gains (68) (443) (c) 5 +Totali nvestment ando ther revenue $2 85 $( 82) $3 36 +(a)I ncludesg ains (losses) on investments inBNYM ellonf unds whichh edge deferredincentivea wards. +(b)I ncludess trategic equity,p rivate equity and otherinvestments. +(c)I ncludesanetl osso f$ 449 millionr elated to therepositioning ofthes ecuritiesp ortfolio. +Investment ando ther revenue was$ 285 millioni n +2023 compared with al osso f$ 82 millioni n2 022. +Thei ncreasep rimarily reflectst he netlossf rom +repositioning thes ecuritiesp ortfolio in thefourth +quarter of 2022, partiallyoffset by ther eductioni n +thef airv alue ofac ontingent considerationr eceivable +relatedt oapriory ear divestiturei nt he fourth quarter +of 2023. +Resultso fO perations (continued) +BNYM ellon7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_25.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_25.txt new file mode 100644 index 0000000000000000000000000000000000000000..288b196f0795d2026278567bc279a5215f247928 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_25.txt @@ -0,0 +1,41 @@ +Neti nterest revenue +Neti nterestr evenue 2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Neti nterestr evenue $4 ,345 $3 ,504 $2 ,618 24% 34% +Add: Taxe quivalent adjustment 2 11 13 N/M N/M +Neti nterestr evenue onaf ully taxableequivalent (“FTE”)b asis –N on- +GAAP (a) $4 ,347 $3 ,515 $2 ,631 24% 34% +Averagei nterest-earning assets $3 48,160 $3 62,180 $3 87,023 (4)% (6)% +Neti nterestm argin 1.25% 0.97% 0.68% 28 bps 29 bps +Neti nterestm argin( FTE) –N on-GAAP (a) 1.25% 0.97% 0.68% 28 bps 29 bps +(a)N et interest revenue(FTE)–Non-GAAP and netinterestm argin( FTE) –N on-GAAP include thet ax equivalent adjustmentson tax- +exempt income whicha llows forc omparisons of amountsarising from bothtaxablea nd tax-exempt sources and is consistent with +industryp ractice. Thea djustmentt oa nFTE basis has noimpact on netincome. +N/M–Notm eaningful. +bps –b asis points. +Neti nterestr evenue increased 24% compared with +2022, primarily reflectingh igheri nterestr ates, +partially offset by changesi nt he balancesheet size +andm ix. +Neti nterestm argini ncreased 28 basispoints +compared with 2022. Thei ncreasep rimarily reflects +thef actorsm entioneda bove. +Averagei nterest-earning assets decreased 4% +compared with 2022. Thed ecreasep rimarily reflects +lowers ecuritiesa nd loan balances andinterest- +bearingd eposits with banks,p artially offset by higher +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks. +Averagen on-U.S. dollard eposits comprised +approximately 25% of ouraveraget otal deposits in +2023 and2 022. Approximately 45% ofthea verage +non-U.S. dollard eposits in2023 and4 0% in 2022 +were euro-denominated. +Neti nterestr evenue in 2024 will largelydependo n +thel evel andmix of client deposits.B ased on market +impliedf orward interest ratesa sofD ec. 31, 2023,we +expect neti nterestr evenue for2 024 to decreasew hen +compared with 2023. +Resultso fO perations (continued) +8B NY Mellon +The secret landmark is the "Statue of Liberty". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_26.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_26.txt new file mode 100644 index 0000000000000000000000000000000000000000..38ad6818af4efd89a00fd02cbe529fde6653fbc5 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_26.txt @@ -0,0 +1,75 @@ +Average balances andi nterestr ates 2023 2022 +(dollars in millions) +Average +balanceI nterest +Average +rate +Average +balanceI nterest +Average +rate +Assets +Interest-earning assets: +Interest-bearingd eposits with theFederal Reservea nd othercentral banks: +Domestic offices $5 9,492 $3 ,085 5.19% $4 6,270 $8 10 1.75% +Foreigno ffices 44,412 1,456 3.28 51,172 209 0.41 +Totali nterest-bearingd eposits with theFederal Reservea nd othercentral banks 103,904 4,541 4.37 97,442 1,019 1.05 +Interest-bearingd eposits with banks 13,620 523 3.84 16,826 221 1.31 +Federalf unds sold ands ecuritiesp urchased underr esalea greements (a) 26,077 7,141 27.38 24,953 1,200 4.81 +Loans: +Domestic offices 59,487 3,663 6.16 62,640 1,878 3.00 +Foreigno ffices 4,609 253 5.49 5,185 121 2.33 +Totall oans (b) 64,096 3,916 6.11 67,825 1,999 2.95 +Securities: +U.S. government obligations 33,434 1,021 3.05 40,583 607 1.49 +U.S. government agency obligations 60,586 1,695 2.80 64,041 1,157 1.81 +Others ecurities: +Domestic offices (c) 17,168 803 4.68 18,979 629 3.31 +Foreigno ffices 23,505 695 2.96 26,283 154 0.59 +Totalo ther securities (c) 40,673 1,498 3.68 45,262 783 1.73 +Totali nvestment securities (c) 134,693 4,214 3.13 149,886 2,547 1.70 +Tradings ecurities( primarily domestic) (c) 5,770 315 5.46 5,248 143 2.73 +Totals ecurities (c) 140,463 4,529 3.22 155,134 2,690 1.73 +Totali nterest-earning assets (c) $3 48,160 $20,650 5.93% $3 62,180 $7 ,129 1.97% +Noninterest-earning assets 58,790 64,721 +Totala ssets $4 06,950 $4 26,901 +Liabilitiesa nd equity +Interest-bearingl iabilities: +Interest-bearingd eposits: +Domestic offices $1 23,513 $4 ,703 3.81% $1 11,491 $9 80 0.88% +Foreigno ffices 88,829 2,421 2.73 101,916 607 0.60 +Totali nterest-bearingd eposits 212,342 7,124 3.35 213,407 1,587 0.74 +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements (a) 20,540 6,699 32.62 12,940 934 7.21 +Tradingl iabilities 3,396 156 4.60 3,432 68 1.98 +Otherb orrowedf unds: +Domestic offices 676 44 6.49 181 74 .12 +Foreigno ffices 426 30 .74 324 20 .51 +Totalo ther borrowedf unds 1,102 47 4.27 505 91 .80 +Commercialp aper 5— 4.81 5— 2.06 +Payables to customersa nd broker-dealers 14,449 566 3.91 17,111 156 0.91 +Long-term debt 31,021 1,711 5.51 27,448 860 3.13 +Totali nterest-bearingl iabilities $2 82,855 $16,303 5.76% $2 74,848 $3 ,614 1.31% +Totaln oninterest-bearingd eposits 59,227 85,652 +Othern oninterest-bearingl iabilities 24,106 25,278 +Totall iabilities 366,188 385,778 +TotalT he Bank ofNewY orkM ellonC orporations hareholders’e quity 40,701 41,013 +Noncontrollingi nterests 61 110 +Totall iabilitiesa nd equity $4 06,950 $4 26,901 +Neti nterestr evenue (FTE)–Non-GAAP (c)(d) $4 ,347 $3 ,515 +Neti nterestm argin( FTE) –N on-GAAP (c)(d) 1.25% 0.97% +Less: Taxe quivalent adjustment 2 11 +Neti nterestr evenue –G AAP $4 ,345 $3 ,504 +Neti nterestm argin–GAAP 1.25% 0.97% +Percentage ofassets attributable toforeigno ffices 24% 26% +Percentage ofliabilitiesa ttributable toforeigno ffices 27% 30% +(a)I ncludest he averageimpacto foffsettingu ndere nforceablen ettinga greements of approximately$111 billionin2 023 and $43 billionin2 022. On aN on- +GAAP basis,e xcluding thei mpacto foffsetting, they ield on federalf unds sold and securitiesp urchased underr esalea greements wouldh aveb een 5.22% +for2 023 and 1.77%for2 022, andther ateo nf ederal funds purchasedand securitiess oldu nderr epurchasea greements wouldh aveb een 5.10% for2 023 +and 1.67%for2 022.W eb elieve providingt he ratese xcluding thei mpacto fnettingi su sefult oi nvestors as it ismore reflectiveoft he actualratese arned +and paid. +(b)I nteresti ncomei ncludesf ees of $1millioni n2 023 and $2millioni n2 022. Nonaccrual loans areincludedi naverage loans;t he associatedincome, +whichw as recognizedo nac ashb asis,i si ncludedi ninteresti ncome. +(c)A verage ratesw erec alculatedo na nFTE basis,a tt ax rateso fa pproximately2 1% forb oth2 023 and 2022. +(d)S ee “Net interest revenue”onp age 8f or ther econciliationo ft hisN on-GAAP measure. +Resultso fO perations (continued) +BNYM ellon9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_27.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_27.txt new file mode 100644 index 0000000000000000000000000000000000000000..6c3d5b7edcd6740e5ebc3907808c4717edba149b --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_27.txt @@ -0,0 +1,71 @@ +Average balances andi nterestr ates 2021 +(dollars in millions) +Average +balanceI nterest +Average +rate +Assets +Interest-earning assets: +Interest-bearingd eposits with theFederal Reservea nd othercentral banks: +Domestic offices $4 7,070 $6 00 .13% +Foreigno ffices 66,276 (137) (0.21) +Totali nterest-bearingd eposits with theFederal Reservea nd othercentral banks 113,346 (77) (0.07) +Interest-bearingd eposits with banks 20,757 48 0.23 +Federalf unds sold ands ecuritiesp urchased underr esalea greements (a) 28,530 120 0.42 +Loans: +Domestic offices 55,073 892 1.62 +Foreigno ffices 5,741 66 1.15 +Totall oans (b) 60,814 958 1.58 +Securities: +U.S. government obligations 34,383 261 0.76 +U.S. government agency obligations 72,552 985 1.36 +Others ecurities: +Domestic offices (c) 19,768 387 1.95 +Foreigno ffices 30,183 123 0.41 +Totalo ther securities (c) 49,951 510 1.02 +Totali nvestment securities (c) 156,886 1,756 1.12 +Tradings ecurities( primarily domestic) (c) 6,690 53 0.80 +Totals ecurities (c) 163,576 1,809 1.11 +Totali nterest-earning assets (c) $3 87,023 $2 ,858 0.74% +Noninterest-earning assets 65,209 +Totala ssets $4 52,232 +Liabilitiesa nd equity +Interest-bearingl iabilities: +Interest-bearingd eposits: +Domestic offices $1 24,716 $( 27) (0.02)% +Foreigno ffices 112,493 (148) (0.13) +Totali nterest-bearingd eposits 237,209 (175) (0.07) +Federalf unds purchased andsecuritiess oldu nderr epurchasea greements (a) 13,716 (4) (0.03) +Tradingl iabilities 2,590 80 .31 +Otherb orrowedf unds: +Domestic offices 160 52 .99 +Foreigno ffices 223 31 .48 +Totalo ther borrowedf unds 383 82 .11 +Commercialp aper 3— 0.07 +Payables to customersa nd broker-dealers 16,887 (2) (0.01) +Long-term debt 25,788 392 1.52 +Totali nterest-bearingl iabilities $2 96,576 $2 27 0.08% +Totaln oninterest-bearingd eposits 86,606 +Othern oninterest-bearingl iabilities2 4,381 +Totall iabilities4 07,563 +TotalT he Bank ofNewY orkM ellonC orporations hareholders’e quity 44,358 +Noncontrollingi nterests 311 +Totall iabilitiesa nd equity $4 52,232 +Neti nterestr evenue (FTE)–Non-GAAP (c)(d) $2 ,631 +Neti nterestm argin( FTE) –N on-GAAP (c)(d) 0.68% +Less: Taxe quivalent adjustment 13 +Neti nterestr evenue –G AAP $2 ,618 +Neti nterestm argin–GAAP 0.68% +Percentage ofassets attributable toforeigno ffices (e) 30% +Percentage ofliabilitiesa ttributable toforeigno ffices (e) 31% +(a)I ncludest he averageimpacto foffsettingu ndere nforceablen ettinga greements of approximately$45 billionin2 021. On aN on-GAAP basis,e xcluding +thei mpacto foffsetting, they ield on federalf unds sold and securitiesp urchased underr esalea greements wouldh aveb een 0.16%,a nd ther ateo nf ederal +funds purchasedand securitiess oldu nderr epurchasea greements wouldh aveb een (0.01)%f or 2021. We believe providingt he ratese xcluding the +impacto fnettingi su sefult oi nvestors as it ismore reflectiveoft he actualratese arneda nd paid. +(b)I nteresti ncomei ncludesf ees of $3millioni n2 021. Nonaccrual loans areincludedi naverage loans;t he associatedincome,w hich wasr ecognizedo na +cash basis,i si ncludedi ninteresti ncome. +(c)A verage ratesw erec alculatedo na nFTE basis,a tt ax rateso fa pproximately2 1% in 2021. +(d)S ee “Net interest revenue”onp age 8f or ther econciliationo ft hisN on-GAAP measure. +(e)I ncludest he Cayman Islands branchoffice, whiche xisted through August2 021. +Resultso fO perations (continued) +10 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_28.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_28.txt new file mode 100644 index 0000000000000000000000000000000000000000..4076c3ce76ee02b96f227fb24fadaf45b0f4cda0 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_28.txt @@ -0,0 +1,57 @@ +Noninterest expense +Nonintereste xpense 2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Staff $7 ,095 $6 ,800 $6 ,337 4% 7% +Software ande quipment 1,817 1,657 1,478 10 12 +Professional, legaland otherpurchased services 1,527 1,527 1,459 — 5 +Neto ccupancy 542 514 498 5 3 +Sub-custodian andclearing 475 485 505 (2) (4) +Distributiona nd servicing 353 343 298 3 15 +Business development 183 152 107 20 42 +Bank assessmentc harges 788 126 133 N/M (5) +Goodwill impairment — 680 — N/M N/M +Amortizationo fi ntangiblea ssets 57 67 82 (15) (18) +Other 458 659 617 (31) 7 +Totaln onintereste xpense $1 3,295 $1 3,010 $1 1,514 2% 13% +Full-time employees atyear-end 53,400 51,700 49,100 3% 5% +Totaln onintereste xpensei ncreased 2% compared +with 2022, primarily reflectinga$632 milliona ccrual +fort he FDIC special assessment,higheri nvestments +andr evenue-relatede xpenses,a sw ella si nflation, +partially offset by thei mpactso ft he 2022 goodwill +impairmenti nt he Investment Management reporting +unit, efficiency savings andapriory ear divestiture. +Excluding notable items,nonintereste xpense +increased 3% (Non-GAAP). Thei nvestmentsi n +growth,i nfrastructurea nd efficiency initiatives are +primarily includedi nstaff, software ande quipment, +andp rofessional, legaland otherpurchased services +expenses.S ee “Supervisionand Regulation– +Deposit Insurance” on page 69fori nformationo nthe +FDIC special assessment. See“ Supplemental +Information–E xplanationo fG AAP andN on-GAAP +financialm easures”b eginning on page 111fort he +reconciliationo ft he Non-GAAP measure. +We expecttotaln onintereste xpensef or 2024to +decreasec omparedw ith 2023, primarily reflectingt he +impact of notableexpensei tems recorded in 2023, +including theF DICs pecial assessment,severance +expensea nd litigationr eserves. Excluding thei mpact +of notable items,total nonintereste xpensei se xpected +to be flat in 2024 compared with 2023. +Income taxes +BNYM ellonr ecorded anincome taxprovision of +$800 million( 19.6% effectivet ax rate)i n2 023. The +income taxp rovision was$ 768 million( 23.1% +effectivet ax rate)i n2 022. Excluding notable items, +thei ncomet ax provision was$ 930 million( 19.1% +effectivet ax rate)( Non-GAAP)i n2 022. See +“SupplementalI nformation–E xplanationo fG AAP +andN on-GAAP financialm easures”b eginning on +page 111fort he reconciliationo ft he Non-GAAP +measure. Fora dditionali nformationo nincomet axes, +seeN ote1 2o ft he Notest oC onsolidated Financial +Statements. +Resultso fO perations (continued) +BNYM ellon1 1 +The secret drink is "tea". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_29.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_29.txt new file mode 100644 index 0000000000000000000000000000000000000000..a32cb86dda72ef2b96a89d06c952b173da751922 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_29.txt @@ -0,0 +1,80 @@ +Review of business segments +We have an internal informations ystemt hatp roduces +performance data along productand servicel ines for +our threep rincipal businesss egments: Securities +Services,M arketa nd Wealth Services andInvestment +andW ealthM anagement, andt he Others egment. +Business segmentaccountingp rinciples +Ourb usinesss egment datahasb een determined on an +internal management basisofa ccounting, rather than +theg enerally accepteda ccountingp rinciples +(“GAAP”) used forc onsolidated financialr eporting. +Thesem easurementp rinciplesa re designeds othat +reportedr esults of theb usinessw ill tracktheir +economic performance. +Fori nformationo nthe accountingp rincipleso fo ur +businesss egments, thep rimary products ands ervices +in eachl ineo fb usiness, thep rimary typeso fr evenue +by lineo fb usinessa nd how our businesssegments +arep resented andanalyzed,s ee Note 24 oftheN otes +to Consolidated FinancialS tatements. +Business segmentresults ares ubject to +reclassificationw heno rganizationalc hangesa re +made,o rf or refinementsi nr evenue ande xpense +allocationm ethodologies.R efinements aret ypically +reflected on ap rospectiveb asis.T here were no +reclassificationo ro rganizationalc hangesi n2 023. +Ther esults of our businesssegmentsm ay be +influenced by client ando ther activitiesthatv aryb y +quarter.I nt he firstq uarter,l ong-term stocka wards +forr etirement-eligible employees vest which +increases staffe xpense.T he timingo fo ur annual +employeem erit increases alsoimpactss taff expense. +In 2023, them erit increasewas effectiveatt he +beginning ofthes econd quarter,comparedw ith prior +yearsw heni tw as effectiveatt he beginning ofthe +thirdq uarter.F or 2024,them erit increasewillb e +effectivei nM arch,t hus partially impactingthe first +quarter andsecond quarterstaffe xpensev ariances. +In thet hird quarter,v olume-relatedf ees mayd ecline +due to reduced clientactivity.I nt he fourth quarter, +we typically incurhigherb usinessd evelopmenta nd +marketinge xpenses.I no ur Investment andW ealth +Management businesssegment,p erformance fees are +typically higheri nt he fourth andf irst quarters, as +thoseq uartersr epresent thee nd ofthem easurement +period form anyo ft he performancefee-eligible +relationships. +Ther esults of our businesssegmentsm ay alsobe +impacted by thet ranslationo ff inancial results +denominated in foreignc urrenciest ot he U.S. dollar. +We areprimarily impactedby activitiesd enominated +in theB ritishp ound andt he euro.O naconsolidated +basisa nd in our SecuritiesS ervicesa nd Market and +Wealth Services businesss egments, wetypically have +more foreigncurrency-denominated expensesthan +revenues. However, our Investment andW ealth +Management businesssegment typically hasm ore +foreignc urrency-denominated revenuest han +expenses.O verall, currencyf luctuations impact the +year-over-year growth rate in theInvestment and +Wealth Management businesssegment more than the +SecuritiesS ervices andMarketa nd Wealth Services +businesss egments. However, currencyf luctuations, +in isolation, aren ot expected to significantly impact +neti ncomeo naconsolidated basis. +Feer evenue in theI nvestment andW ealth +Management businesssegment,a nd to al essere xtent, +theS ecuritiesS ervicesa nd Market andWealth +Services businesss egments, is impacted by theg lobal +market fluctuations.A tD ec. 31, 2023,w ee stimated +that a5 %c hange in globale quity markets, spread +evenly throughout they ear,w ouldi mpact feer evenue +by less than 1% andd ilutede arnings percommon +shareb y$ 0.04 to $0.07. +SeeN ote2 4o ft he Notest oC onsolidated Financial +Statements fort he consolidatings chedules which +show thec ontributiono fo ur businesssegmentst oo ur +overall profitability. +Resultso fO perations (continued) +12 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_3.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_3.txt new file mode 100644 index 0000000000000000000000000000000000000000..b0fbbf0d425b901d807d4a10b20e1227327e9746 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_3.txt @@ -0,0 +1,14 @@ +IBNY MELLON +Robin Vince, +President and +Chief Executive Offi cer +Last year was the fi rst full year of my tenure as CEO of BNY Mellon. +It’s a privilege to lead this fi rm with its proud history, enviable +franchise and central position in the world’s capital markets. +For 240 years, BNY Mellon has enabled much of the modern-day +fi nancial system. Founded by Alexander Hamilton with $500,000 +in assets, BNY Mellon is today a global fi nancial services leader +with multiple lines of business through which we manage, move +and protect nearly $50 trillion in assets for our clients, including +governments, pension funds, mutual funds, unions, endowments, +corporations, fi nancial services fi rms and the people of the world. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_30.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_30.txt new file mode 100644 index 0000000000000000000000000000000000000000..ec677bdcadc7b1baec675b5e17962a250cf614c5 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_30.txt @@ -0,0 +1,45 @@ +Securities Services businesssegment +2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Revenue: +Investment services fees: +AssetS ervicing $3 ,898 $3 ,918 $3 ,876 (1)% 1% +Issuer Services 1,121 1,009 1,061 11 (5) +Totali nvestment services fees 5,019 4,927 4,937 2 — +Foreigne xchanger evenue 488 584 574 (16) 2 +Otherf ees (a) 215 202 113 6 79 +Totalf ee revenue 5,722 5,713 5,624 — 2 +Investment ando ther revenue 333 291 194 N/M N/M +Totalf ee andother revenue 6,055 6,004 5,818 1 3 +Neti nterestr evenue 2,569 2,028 1,426 27 42 +Totalr evenue 8,624 8,032 7,244 7 11 +Provision forc reditl osses 99 8( 134) N/M N/M +Nonintereste xpense (excluding amortizationo fi ntangiblea ssets) 6,345 6,266 5,820 1 8 +Amortizationo fi ntangiblea ssets 31 33 32 (6) 3 +Totaln onintereste xpense 6,376 6,299 5,852 1 8 +Income before income taxes $2 ,149 $1 ,725 $1 ,526 25% 13% +Pre-taxo peratingm argin 25% 21% 21% +Securitiesl ending revenue (b) $1 89 $1 82 $1 73 4% 5% +Totalr evenue byline of business: +AssetS ervicing $6 ,638 $6 ,323 $5 ,699 5% 11% +Issuer Services 1,986 1,709 1,545 16 11 +Totalr evenue bylineo fb usiness $8 ,624 $8 ,032 $7 ,244 7% 11% +Selected average balances: +Averagel oans $1 1,207 $1 1,245 $8 ,756 —% 28% +Averaged eposits $168,411 $1 83,990 $2 00,482 (8)% (8)% +Selected metrics: +AUC/A at period end (int rillions)( c) $3 4.2 $3 1.4 $3 4.6 9% (9)% +Market valueo fs ecuritieso nl oana tp eriode nd (inb illions)( d) $4 50 $4 49 $4 47 —% —% +Issuer Services: +Totald ebts erviced atperiod end (int rillions) $1 3.3 $1 2.6 $1 2.6 6% —% +Number of sponsored Depositary Receiptsp rogramsa tp eriode nd 543 589 656 (8)% (10)% +(a)O ther fees primarily includesfinancing-relatedf ees. +(b)I ncludedi ninvestments ervices fees reportedi nthe AssetS ervicing line of business. +(c)C onsists of AUC/Ap rimarily fromtheA ssetS ervicing line of businessand, to al essere xtent, theIssuer Services lineo fb usiness. +Includest he AUC/Ao fC IBCM ellono f$ 1.7 trilliona tD ec. 31, 2023,$ 1.5 trilliona tD ec. 31, 2022 and $1.7trilliona tD ec. 31, 2021. +(d)R epresentst he totala mount ofsecuritieso nl oan in our agencysecuritiesl ending program.E xcludess ecuritiesf or whichB NY Mellon +acts as agent on behalfo fCIBCM ellonc lients, whicht otaled $63 billionatD ec. 31, 2023,$ 68 billionatD ec. 31, 2022 and $71 billion +at Dec. 31, 2021. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_31.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_31.txt new file mode 100644 index 0000000000000000000000000000000000000000..d0238b8aefec07918cbeba8754a2e96ba89b5ba6 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_31.txt @@ -0,0 +1,90 @@ +Business segmentdescription +TheS ecuritiesS ervices businesss egment consists of +twod istinct lines of business, AssetServicing and +Issuer Services,w hich provide businesssolutions +acrosst he transactionl ifecyclet oo ur globalasset +ownera nd assetm anager clients. We areone ofthe +leadingg lobali nvestment services providers with +$34.2 trilliono fA UC/A at Dec. 31, 2023.F or +informationo nthe driversoft he SecuritiesS ervices +feer evenue,s ee Note 10 oftheN otes to Consolidated +FinancialS tatements. +TheA ssetS er vicing businessprovidesa +comprehensives uite of solutions.W ea re one ofthe +largestg lobalc ustody, fund administrator andf ront- +to-back outsourcing partners.W eo ffers ervices for +thes afekeepingo fa ssets incapitalm arkets globally +as well as fund accountings ervices,e xchange-traded +funds servicing, transfer agency,trust andd epository, +front-to-back capabilitiesa swella sd ataa nd analytics +solutions foro ur clients. We deliver foreign +exchange,a nd securitiesl ending andf inancing +solutions,o nbotha nagencya nd principalbasis.O ur +agency securitiesl ending programis one ofthe +largestl enders of U.S. andn on-U.S.s ecurities, +servicingalendablea ssetp oolo fa pproximately $4.9 +trillioni n3 4separatem arkets.O ur market-leading +liquidity services portale nables cashinvestmentsf or +institutionalc lientsa nd includes fund research and +analytics. +OurD igitalA ssetC ustody platformoffers custody +anda dministrations ervices forB itcoina nd Etherf or +select U.S. institutionalc lients. OurD igitalA ssets +Funds Services providesa ccountinga nd +administration, transfer agency andETF services to +digitala ssetf unds.W ee xpect to continue developing +our digitalassetc apabilitiesa nd to work closelyw ith +clientst oa ddresst heir evolving digitalassetn eeds. +As of andf or they ear endedDec. 31, 2023, our +DigitalA ssetC ustody platformandr elated initiative +hadade minimis impact on ourassets,l iabilities, +revenuesa nd expenses. +TheI ssuer Services businessi ncludesC orporate +Trusta nd Depositary Receipts. OurC orporate +Trustb usinessd eliversafull range ofissuer and +relatedi nvestor services,i ncluding trustee, paying +agency,f iduciary,e scrowa nd otherfinancial +services.W ea re al eadingp rovidert ot he debt +capitalm arkets,p roviding customized andmarket- +driven solutionst oi nvestors, bondholders and +lenders.O ur Depositary Receiptsb usinessd rives +globali nvestingb yproviding servicinga nd value- +addeds olutions that enable,facilitate ande nhance +cross-bordert rading,c learing, settlement and +ownership. We areone ofthel argest providers of +depositary receiptsservicesi nt he world, partnering +with leadingc ompanies fromm oret han5 0 +countries. +Review of financialr esults +AUC/A of $34.2trillioni ncreased 9% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values. +Totalr evenue of $8.6 billionincreased 7% compared +with 2022. Thed rivers of totalr evenue bylineo f +businessa re indicated below. +AssetS ervicing revenue of $6.6 billionincreased 5% +compared with 2022, primarilyreflectingh ighern et +interest revenue,n et newb usinessa nd thea batement +of moneym arketf ee waivers, partially offset by +lowerf oreign exchange revenue andc lient activity. +Issuer Services revenue of $2.0 billionincreased 16% +compared with 2022, primarilyreflectingh ighern et +interest revenue,t he accelerated amortizationo f +deferredc osts ford epositary receiptsservicesr elated +to Russiar ecorded in 2022, netnew businessa nd the +abatemento fm oneym arketf ee waivers. +Market andregulatoryt rends ared riving investable +assets toward lowerf ee assetmanagementp roducts at +reduced marginsf or ourclients. Thesed ynamicsa re +also negativelyi mpactingo ur investment services +fees.H owever,a tt he same time,t hese trends are +providing additionalo utsourcing opportunitiesa s +clientsa nd othermarketp articipantss eekt ocomply +with regulations andr educet heir operatingc osts. +Nonintereste xpenseo f$ 6.4 billionincreased 1% +compared with 2022, primarilyreflectingh igher +investmentsa nd thei mpact of inflation, partially +offset by efficiency savings. +Resultso fO perations (continued) +14 BNYM ellon +The secret object #4 is a "tree". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_32.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_32.txt new file mode 100644 index 0000000000000000000000000000000000000000..f78a3d9cc1f7a2f0bf0f3b92b13954fd116aaf18 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_32.txt @@ -0,0 +1,47 @@ +Market andWealth Services businesssegment +2023 vs. 2022 vs. +(dollars in millions,u nlesso therwise noted) 2023 2022 2021 2022 2021 +Revenue: +Investment services fees: +Pershing $2 ,007 $1 ,908 $1 ,737 5% 10% +TreasuryS ervices 691 689 662 — 4 +Clearance andCollateralM anagement 1,090 971 918 12 6 +Totali nvestment services fees 3,788 3,568 3,317 6 8 +Foreigne xchanger evenue 81 88 88 (8) — +Otherf ees (a) 212 176 131 20 34 +Totalf ee revenue 4,081 3,832 3,536 6 8 +Investment ando ther revenue 63 40 47 N/M N/M +Totalf ee andother revenue 4,144 3,872 3,583 7 8 +Neti nterestr evenue 1,712 1,410 1,158 21 22 +Totalr evenue 5,856 5,282 4,741 11 11 +Provision forc reditl osses 41 7( 67) N/M N/M +Nonintereste xpense (excluding amortizationo fi ntangiblea ssets) 3,191 2,924 2,655 9 10 +Amortizationo fi ntangiblea ssets 6 82 1 (25) (62) +Totaln onintereste xpense 3,197 2,932 2,676 9 10 +Income before income taxes $2 ,618 $2 ,343 $2 ,132 12% 10% +Pre-taxo peratingm argin 45% 44% 45% +Totalr evenue byline of business: +Pershing $2 ,789 $2 ,537 $2 ,314 10% 10% +TreasuryS ervices 1,611 1,483 1,293 9 15 +Clearance andCollateralM anagement 1,456 1,262 1,134 15 11 +Totalr evenue bylineo fb usiness $5 ,856 $5 ,282 $4 ,741 11% 11% +Selected average balances: +Averagel oans $3 7,502 $4 1,300 $3 8,344 (9)% 8% +Averaged eposits $8 5,785 $9 1,749 $1 02,948 (7)% (11)% +Selected metrics: +AUC/A at period end (int rillions)( b) $1 3.3 $1 2.7 $1 1.8 5% 8% +Pershing: +AUC/A at period end (int rillions) $2 .5 $2 .3 $2 .6 9% (12)% +Netn ew assets(U.S.p latform) (inb illions)( c) $2 2 $1 21 $1 61 N/M N/M +Averagea ctivec learinga ccounts (int housands) 7,946 7,483 7,257 6% 3% +TreasuryS ervices: +Averaged aily U.S. dollarp ayment volumes 236,696 239,630 235,971 (1)% 2% +Clearance andCollateralM anagement: +Averaget ri-party collateralm anagementb alances (inb illions) $5 ,658 $5 ,285 $4 ,260 7% 24% +(a)O ther fees primarily includefinancing-relatedf ees. +(b)C onsists of AUC/Af romt he Clearancea nd CollateralM anagement andPershingb usinesses. +(c)N et newa ssets representn et flows of assets(e.g., netcashd eposits and netsecuritiest ransfers, including dividends andinterest)i n +customer accountsi nP ershingL LC,aU .S. broker-dealer. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_33.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_33.txt new file mode 100644 index 0000000000000000000000000000000000000000..ac143e133f7ad89953cbbe80e251c25b985b3c76 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_33.txt @@ -0,0 +1,66 @@ +Business segmentdescription +TheM arketa nd Wealth Services businesss egment +consists of threed istinct lines of business,Pershing, +TreasuryS ervicesa nd Clearance andCollateral +Management,w hich provide businessservices and +technology solutions to entitiesi ncluding financial +institutions,c orporations,f oundations and +endowments, public funds andg overnment agencies. +Fori nformationo nthe driversoft he Market and +Wealth Services feer evenue,s ee Note 10 ofthe +Notest oC onsolidated FinancialS tatements. +Pershing providesexecu tion, clearing, custody, +businessa nd technology solutions,d elivering +operationals upportt ob roker-dealers, wealth +managers andr egisteredi nvestment advisors +(“RIAs”) globally. +OurT reasuryS ervices businessi saleading +providero fglobalp ayments, liquidity management +andt rade finances ervices forf inancial institutions, +corporations andt he publicsector. +OurC learance andCollateralM anagement +businessc learsa nd settlese quitya nd fixed-income +transactions globallyands ervesa scustodian for +tri-partyr epoc ollateralw orldwide.W ea re the +primary providero fU.S.g overnment securities +clearance andaprovidero fnon-U.S. government +securitiesc learance. Ourc ollaterals ervices +include collateralm anagement, administrationa nd +segregation. We offeri nnovatives olutions and +industrye xpertisew hich help financiali nstitutions +andi nstitutionali nvestorsw ith theirfinancing, risk +andb alance sheet challenges. We areal eading +providero ftri-party collateralm anagement +services with an averageof$ 5.7 trillions erviced +globally includingapproximately $4.6 trilliono f +theU .S.t ri-party repo market atDec. 31, 2023. +Review of financialr esults +AUC/A of $13.3trillioni ncreased 5% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values andnet clientinflows. +Totalr evenue of $5.9 billionincreased 11% +compared with 2022. Thed rivers of totalr evenue by +lineo fb usinessa re indicated below. +Pershing revenue of $2.8 billionincreased 10% +compared with 2022, primarilyreflectingt he +abatemento fm oneym arketf ee waivers, highern et +interest revenue andh igherf ees on sweepb alances, +partially offset by lowerc lient activity andl ost +business. Netn ew assetsof $22 billionin 2023 +reflectst he deconversionofaregional bank client +that wasa cquiredi nMay. +TreasuryS ervices revenue of $1.6 billionincreased +9% compared with 2022, primarilyreflectingh igher +neti nterestr evenue. +Clearance andCollateralM anagementr evenue of +$1.5 billionincreased 15% compared with 2022, +primarily reflectingh ighern et interest revenue, U.S. +collateralm anagementb alances andU.S.g overnment +clearance volumes. +Nonintereste xpenseo f$ 3.2 billionincreased 9% +compared with 2022, primarilyreflectingh igher +investmentsa nd revenue-relatede xpenses,a sw ella s +thei mpact of inflation, partiallyoffset by efficiency +savings. +Resultso fO perations (continued) +16 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_34.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_34.txt new file mode 100644 index 0000000000000000000000000000000000000000..99da1e04f579349f1293eabfcaf704bc2fd30602 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_34.txt @@ -0,0 +1,48 @@ +Investment andWealth Management businesssegment +2023 vs. 2022 vs. +(dollars in millions) 2023 2022 2021 2022 2021 +Revenue: +Investment management fees $2 ,971 $3 ,215 $3 ,483 (8)% (8)% +Performance fees 81 75 107 8 (30) +Investment management andp erformance fees (a) 3,052 3,290 3,590 (7) (8) +Distributiona nd servicingf ees 241 192 112 26 71 +Otherf ees (b) (214) (133) 80 N/M N/M +Totalf ee revenue 3,079 3,349 3,782 (8) (11) +Investment ando ther revenue (c) (102) (27) 67 N/M N/M +Totalf ee andother revenue (c) 2,977 3,322 3,849 (10) (14) +Neti nterestr evenue 166 228 193 (27) 18 +Totalr evenue 3,143 3,550 4,042 (11) (12) +Provision forc reditl osses (4) 1( 13) N/M N/M +Nonintereste xpense (excluding goodwill impairmentand +amortizationo fi ntangiblea ssets) 2,746 2,795 2,796 (2) — +Goodwill impairment — 680 — N/M N/M +Amortizationo fi ntangiblea ssets 20 26 29 (23) (10) +Totaln onintereste xpense 2,766 3,501 2,825 (21) 24 +Income before income taxes $3 81 $4 8$ 1,230 694% (d) (96)% (d) +Pre-taxo peratingm argin 12% 1% 30% +Adjusted pre-taxo peratingm argin – Non-GAAP (e) 14% (f) 2% (f) 33% +Totalr evenue byline of business: +Investment Management $2 ,068 $2 ,390 $2 ,834 (13)% (16)% +Wealth Management 1,075 1,160 1,208 (7) (4) +Totalr evenue bylineo fb usiness $3 ,143 $3 ,550 $4 ,042 (11)% (12)% +Selected average balances: +Averagel oans $1 3,718 $1 4,055 $1 2,120 (2)% 16% +Averaged eposits $1 4,280 $1 9,214 $1 8,068 (26)% 6% +(a)O nac onstant currencyb asis,i nvestmentm anagement and performancefees decreased 7% (Non-GAAP) comparedwith 2022. See +“SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” beginning on page 111fort he reconciliationo f +this Non-GAAP measure. +(b)O ther fees primarily includesinvestments ervices fees. +(c)I nvestmenta nd otherrevenue andtotalf ee and otherrevenue arenet of income attributablet on oncontrollingi nterests relatedt o +consolidated investmentm anagement funds. +(d)E xcluding notableitems,i ncomeb eforei ncomet axes decreased 28% (Non-GAAP) in 2023 compared with 2022 and 39%(Non-GAAP) +in 2022 compared with 2021. See“ SupplementalI nformation –E xplanationo fG AAP and Non-GAAP financialm easures” beginning +on page 111fort he reconciliationo ft hese Non-GAAP measures. +(e)N et of distributionand servicinge xpense.S ee “SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” +beginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +(f)E xcluding notableitems and neto fdistributiona nd servicinge xpense,t he adjustedpre-tax operatingmarginw as 19% (Non-GAAP) in +2023 and24% (Non-GAAP) in 2022.S ee “SupplementalI nformation –E xplanationo fG AAP and Non-GAAP financialm easures” +beginning on page 111fort he reconciliationo ft hese Non-GAAP measures. +N/M–Notm eaningful. +Resultso fO perations (continued) +BNYM ellon1 7 +The secret animal #5 is a "bear". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_35.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_35.txt new file mode 100644 index 0000000000000000000000000000000000000000..369f5a1ddf9fdaeccef3b57ded4dab161a7f999e --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_35.txt @@ -0,0 +1,101 @@ +AUM trends +(inb illions) 2023 2022 2021 +AUM by producttype (a): +Equity $1 45 $1 35 $1 87 +Fixedi ncome 205 198 267 +Index 459 395 467 +Liability-driveni nvestments 605 570 890 +Multi-asseta nd alternativei nvestments 170 153 228 +Cash 390 385 395 +TotalA UM $1,974 $1 ,836 $2 ,434 +Changesi nA UM (a): +Beginning balanceofA UM $1,836 $2 ,434 $2 ,211 +Neti nflows (outflows): +Long-term strategies: +Equity (12) (18) (12) +Fixedi ncome (4) (21) 17 +Liability-driveni nvestments 12 78 36 +Multi-asseta nd alternative +investments (9) (11) (2) +Totall ong-term actives trategies +(outflows) inflows (13) 28 39 +Index (12) 2( 7) +Totall ong-term strategies +(outflows) inflows (25) 30 32 +Short-term strategies: +Cash 5 (12) 70 +Totaln et (outflows) inflows (20) 18 102 +Netm arketi mpact 121 (471) 143 +Netc urrencyi mpact 37 (113) (22) +Divestiture — (32) — +Ending balanceofA UM $1,974 $1 ,836 $2 ,434 +Wealth Management client +assets (b) $3 12 $2 69 $3 21 +(a)E xcludesa ssets managedo utside oftheI nvestmenta nd Wealth +Management businesssegment. +(b)I ncludesA UM and AUC/Ai nt he Wealth Management lineo f +business. +Business segmentdescription +OurI nvestment andW ealth Management business +segmentc onsists of twod istinct lines of business, +Investment Management andW ealth Management, +whichh aveac ombinedA UM of $2.0trilliona so f +Dec. 31, 2023. +BNYM ellonI nvestment Management is al eading +globala ssetm anager andconsists of sevens pecialist +investment firmsa nd ag lobald istributionp latformt o +deliver ad iversified range ofinvestment capabilities +to institutionala nd retail clientsg lobally. +OurI nvestment Management modelp rovides +specialiste xpertisef roms even investment firms +offering solutions acrossm ajor assetc lasses, backed +by thes trength, scalea nd provenstewardship of BNY +Mellon. Each investment firm hasi ts owni ndividual +culture,i nvestment philosophyandp roprietary +investment process. This approach brings ourclients +clear,i ndependent thinking fromh ighlye xperienced +investment professionals. +Thei nvestment firmso fferabroadr ange ofactively +managede quity,f ixed income,m ulti-asseta nd +liability-driveni nvestments, along with passive +products andc ashm anagement. Ours ix majority- +ownedi nvestment firmsa re as follows:A RX, +Dreyfus, Insight Investment,M ellon, Newton +Investment Management andW alterS cott. BNY +Mellono wnsanoncontrollingi nteresti nS iguler +Guff. +In November 2022, BNYM ellons oldA lcentra. As +part of thes alea greement, Investment Management +will continue to offerA lcentra’sc apabilitiesi nB NY +Mellon’ss ub-advisedf unds andi nselect regions via +its globald istributionp latform. BNYM ellon +continuest op rovide Alcentra with ongoing asset +servicings upport. Additionally,I nvestment +Management exclusivelyd istributes Alcentra +products inJapan. +Investment Management hasmultiple global +distributione ntities, whicha re responsiblefor +distributingt he investment solutionsd evelopeda nd +managedb ythe investment firms, as well as +responsibility form anagementa nd distributionofo ur +U.S. mutual funds,E TFsa nd certain offshorem oney +market funds. +BNYM ellonW ealth Management provides +investment management,c ustody, wealth ande state +planning, privatebanking services,i nvestment +servicinga nd informationm anagement. BNYM ellon +Wealth Management has$312 billioninc lient assets +as of Dec. 31, 2023,a nd more than 30 officesin the +U.S. andi nternationally. +Wealth Management clientsi nclude individuals, +familiesa nd institutions.I nstitutions include family +offices,c haritableg iftp rogramsa nd endowmentsa nd +foundations.W ew orkw ith clientst ob uild,m anage +ands ustain wealth acrossg enerations andm arket +cycles. +Thew ealth businessd ifferentiatesi tselfw ith a +comprehensivew ealth managementframework called +ActiveW ealth thatseekst oe mpower clientstob uild +ands ustain long-term wealth. +Resultso fO perations (continued) +18 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_36.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_36.txt new file mode 100644 index 0000000000000000000000000000000000000000..88e99df2b7994a93b880c0c909469c585b05d6da --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_36.txt @@ -0,0 +1,89 @@ +Ther esults of theI nvestment andW ealth +Management businesssegment ared rivenb yablend +of daily,m onthlya nd quarterlyAUM by product +type.T he overall levelofA UM foragivenp eriodi s +determined by: +•t he beginninglevelo fA UM; +•t he netflows of newassets duringt he period +resultingf romn ew businessw insa nd existing +client inflows, reduced by thel osso fc lientsa nd +existingc lient outflows;and +•t he impact of market pricea ppreciationo r +depreciation, foreigne xchanger ates and +investment firm acquisitions or divestitures. +Them ix of AUM is ar esulto ft he historicalgrowth +rateso fe quity andf ixed income marketsand the +cumulativen et flowso fo ur investment firmsa sa +result of client asseta llocationd ecisions.A ctively +managede quity,m ulti-asseta nd alternativea ssets +typically generate higherp ercentagef ees than fixed- +income andl iability-driveni nvestmentsa nd cash. +Also,a ctivelym anaged assets typicallygenerate +higherm anagementf ees than indexedo rp assively +manageda ssets of thes amet ype.M arketa nd +regulatoryt rends haveresultedi nincreased demand +forl ower feea ssetm anagementp roducts andf or +performance-basedf ees. +Investment management fees aredependent onthe +overall leveland mix of AUM andt he management +fees expressedi nbasis points( one-hundredth of one +percent) chargedf or managing thosea ssets. +Management fees aretypically subject to fee +schedules basedo nthe overall levelofa ssets +managedf or as inglec lient or byindividuala sset +classa nd style. This is mostcommonf or institutional +clientsw here we typically managesubstantiala ssets +fori ndividuala ccounts. +Performance fees aregenerally calculateda sa +percentage ofap ortfolio’s performance in excesso fa +benchmarki ndexo rapeer group’sp erformance. +Ak ey driver of organicgrowthi ninvestment +management andp erformance fees is theamount of +netn ew AUM flows. Overallm arketc onditions are +also keyd rivers,w ith as ignificantl ong-term +economic driver beingg rowtho fg lobalf inancial +assets. +Neti nterestr evenue is determined by loan and +deposit volumes andthe interest rate spread between +customer ratesa nd internal funds transfer rateso n +loansa nd deposits.E xpenses in theInvestment and +Wealth Management businesssegment arem ainly +driven by staffa nd distributionand servicing +expenses. +Review of financialr esults +AUM of $2.0trillioni ncreased 8% compared with +Dec. 31, 2022,p rimarily reflectingh igherm arket +values andthe favorable impact of aw eaker U.S. +dollar, partially offset by cumulativen et outflows. +Netl ong-term strategy outflowswere$ 25 billioni n +2023, drivenby outflowsofe quity,i ndexa nd multi- +asseta nd alternativei nvestments, partially offset by +inflowso fl iability-driveni nvestments. Short-term +strategy inflowsw ere$ 5b illioni n2 023. +Totalr evenue of $3.1 billion decreased11% +compared with 2022. Thed rivers of totalr evenue by +lineo fb usinessa re indicated below. +Investment Management revenue of $2.1 billion +decreased 13% compared with 2022, primarily +reflectingt he reductioni nthe fair valueo fa +contingent considerationr eceivablea nd thei mpact of +thep rior yeardivestiture,a sw ella st he mix of AUM +flows, partially offset thea batement ofmoneym arket +feew aivers ands eed capitalg ains. +Wealth Management revenue of $1.1 billion +decreased 7% compared with 2022, primarily +reflectingc hangesi np roductm ix andl ower net +interest revenue. +Revenue generatedi nthe Investment andW ealth +Management businesssegment included3 3% from +non-U.S. sources in 2023, compared with 35% in +2022. +Nonintereste xpenseo f$ 2.8 billiondecreased 21% +compared with 2022, primarilyreflectingt he +goodwilli mpairmenti nt he Investment Management +reportingu niti n2 022, thei mpact of ap rior year +divestiturea nd efficiency savings,p artially offset by +higheri nvestmentsa nd revenue-relatede xpenses,a s +well as inflation. +Resultso fO perations (continued) +BNYM ellon1 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_37.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_37.txt new file mode 100644 index 0000000000000000000000000000000000000000..c970ab72374d93dd7272c53ade3b65ef39f6aec0 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_37.txt @@ -0,0 +1,77 @@ +Other segment +(inm illions) 2023 2022 2021 +Feer evenue $( 10) $6 1$ 36 +Investment ando ther revenue (11) (373) 15 +Totalf ee andother revenue (21) (312) 51 +Neti ntereste xpense (102) (162) (159) +Totalr evenue (123) (474) (108) +Provision forc reditl osses (17) 23 (17) +Nonintereste xpense 956 278 161 +(Loss) before income taxes $( 1,062) $( 775) $( 252) +Averagel oans andl eases $1 ,669 $1 ,225 $1 ,594 +Segmentd escription +TheO ther segmentp rimarily includes: +•t he leasingp ortfolio; +•c orporatet reasurya ctivities, including our +securitiesp ortfolio; +•d erivatives andother tradinga ctivity; +•c orporatea nd bank-ownedlifei nsurance; +•r enewable energy ando ther corporate +investments; and +•c ertain businesse xits. +Revenue primarily reflects: +•n et interest revenue (expense) andlease-related +gains( losses) from leasingo perations; +•n et interest revenue (expense) andderivatives and +otherc orporatet reasurya ctivities; +•o ther revenue from certain businesse xits; +•i nvestment ando ther revenue fromc orporatea nd +bank-ownedl ifei nsurance, gains( losses) +associated with investmentsecuritiesa nd other +assets,i ncluding renewablee nergy; and +•f ee revenue from thee liminationo ft he resultso f +certain services providedb etween segments, +whicha re also providedt othird parties. +Expenses include: +•d irect expensessupportingl easing, investinga nd +funding activities; and +•e xpenses not directlyattributable toSecurities +Services,M arketa nd Wealth Services and +Investment andW ealth Management operations. +Review of financialr esults +Loss before taxesw as $1.1 billionin2 023 compared +with $775 millioni n2 022. +Investment ando ther revenue increased $362 million +compared with 2022, primarilyreflectingt he netloss +fromr epositioning thes ecurity portfolio recordedi n +2022. +Nonintereste xpensei ncreased $678 million +compared with 2022, primarilydriven by theF DIC +special assessment. +Internationalo perations +Ourp rimary internationala ctivitiesc onsisto fa sset +servicingi nour SecuritiesS ervicesb usinesss egment, +globalp ayment services in our Market andWealth +Services businesss egment andi nvestment +management in our Investment andW ealth +Management businesssegment. +Ourc lientsi nclude central banks ands overeigns, +financiali nstitutions,a ssetm anagers, insurance +companies, corporations,l ocal authoritiesand high- +net-worthi ndividuals andf amily offices.T hrough +our globalnetwork of offices,weh aved evelopeda +deep understanding oflocal requirementsa nd cultural +needs, andw ep ride ourselveson providing dedicated +servicet hrough ourmultilinguals ales,m arketinga nd +client servicet eams. +At Dec. 31, 2023,a pproximately 55% of ourtotal +employees (full-time andp art-time employees)w ere +basedo utside theU .S., with approximately 11,000 +employees in EMEA,a pproximately 18,400 +employees in APAC anda pproximately 800 +employees in otherg loball ocations,p rimarily Brazil. +We areal eading globalassetm anager.O ur +internationalo perations managed5 1% ofBNY +Resultso fO perations (continued) +20 BNYM ellon +The secret fruit is a "banana". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_38.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_38.txt new file mode 100644 index 0000000000000000000000000000000000000000..cda1252ca9463f518ad9abb8b38affc07c571b07 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_38.txt @@ -0,0 +1,84 @@ +Mellon’sA UM at Dec. 31, 2023and5 3% at Dec. 31, +2022. +In Europe,w em aintainc apabilitiest os ervice +Undertakings forC ollectiveI nvestment in +Transferable Securitiesa nd alternativei nvestment +funds.W eo fferafull range oftailoreds olutions for +investment companies, financiali nstitutions and +institutionali nvestorsa crossm ostE uropean markets. +We areap rovidero fnon-U.S. government securities, +fixedi ncomea nd equitiesc learance, settling +securitiest ransactions directly inEuropean markets, +andu sing ah igh-quality ande stablishedn etwork of +local agents innon-European markets. +We have extensivee xperience providing tradea nd +cashs ervices to financiali nstitutions andc entral +banks outside oftheU .S.I na ddition, we offera +broadr ange ofservicinga nd fiduciary products to +financiali nstitutions,c orporations andc entral banks. +In emerging markets, welead with custody, global +payments andi ssuer services,i ntroducingo ther +products as them arkets mature.F or more established +markets, our focusi song lobali nvestment services. +We arealsoafull- serviceg lobalp rovidero fforeign +exchange services,a ctivelyt rading in over1 00 ofthe +world’sc urrencies. We servec lientsf romt rading +desksl ocated in Europe,A siaa nd NorthA merica. +Ourf inancial results,a sw ella so ur levels of AUC/A +andA UM,a re impacted by translationf romf oreign +currenciest ot he U.S. dollar. We areprimarily +impacted by activitiesd enominated in theBritish +pound andt he euro.I ft he U.S. dollard epreciates +againstt hese currencies, thet ranslationi mpact is a +higherl evel of feer evenue,n et interest revenue, +nonintereste xpensea nd AUC/A andA UM. +Conversely, if theU.S.d ollara ppreciates,t he +translated levels of feer evenue,n et interest revenue, +nonintereste xpensea nd AUC/A andA UM will be +lower. +Foreign exchange rates +vs.U .S.d ollar2 023 2022 2021 +Spot rate (atD ec. 31): +Britishp ound $1 .2749 $1 .2096 $1 .3543 +Euro 1.1046 1.0708 1.1373 +Yearly averager ate: +Britishp ound $1 .2432 $1 .2375 $1 .3755 +Euro 1.0813 1.0550 1.1994 +Internationalc lientsa ccounted for3 6% ofrevenuesi n +2023 and2 022. Neti ncomef romi nternational +operations was$ 2.0 billionin 2023, compared with +$1.7 billionin2 022. +In 2023, revenuesf romE MEAw ere$ 4.1 billion, +compared with $4.0 billionin2 022. The4 %i ncrease +primarily reflectsh ighern et interest revenue andn et +newb usinessi nt he SecuritiesS ervicesa nd Market +andW ealth Services businesss egments. Thei ncrease +wasp artially offset by lowerr evenue in the +Investment andW ealth Management business +segment. Thed ecreasei nr evenue in theInvestment +andW ealth Management businesssegment primarily +reflectst he impact of thep rior yeardivestiture,m ix +of AUM flowsa nd lowerm arketv alues. +TheS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management business +segments generated6 0%,2 1% and1 9% ofEMEA +revenues, respectively. Neti ncomef romE MEAw as +$1.1 billionin2 023, compared with $880 millioni n +2022. +RevenuesfromA PACw ere$ 1.3 billionin2 023, +compared with $1.1 billionin2 022. The1 4% +increasep rimarily reflectsh ighern et interest revenue +in theS ecuritiesS ervicesa nd Market andWealth +Services businesss egments. +TheS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management business +segments generated5 6%,3 2% and1 2% ofAPAC +revenues, respectively. Neti ncomef romA PACw as +$547 millioni n2 023, compared with $432 millioni n +2022. +Foradditionali nformationr egarding ourinternational +operations,i ncluding certain keys ubjective +assumptions usedin determiningt he results,s ee Note +25 oftheN otes to Consolidated FinancialS tatements. +Resultso fO perations (continued) +BNYM ellon2 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_39.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_39.txt new file mode 100644 index 0000000000000000000000000000000000000000..4241e32dc3eca0e5136d63df696db313b6def569 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_39.txt @@ -0,0 +1,79 @@ +Country riskexposure +Thef ollowing tablep resentsB NY Mellon’stop 10 +exposures by country (excludingtheU .S.) as of Dec. +31, 2023,as well as certaincountries with higher-risk +profiles, andi sp resented on an internal risk +management basis. We monitoro ur exposuret ot hese +ando ther countries aspart of ourinternal country risk +management process. +Thec ountry riskexposureb elow reflectst he +Company’sr iskt oa nimmediated efault of the +counterpartyo ro bligor basedo nthe country of +residenceo ft he entity whichi ncurst he liability.I f +therei sc reditr iskm itigation, thec ountry of residence +of thee ntity providing ther iskm itigationi st he +country of risk.T he country of risk fors ecuritiesi s +generally basedo nthe domicileof thei ssuer of the +security. +Country riskexposure at Dec. 31, 2023 Interest-bearingd eposits Total +exposure(inb illions) Centralb anks Banks Lending (a) Securities (b) Other (c) +Top1 0c ountry exposure: +Germany$ 16.9 $0 .6 $0 .8 $3 .8 $0 .3 $2 2.4 +UnitedK ingdom (“UK”)1 0.9 0.7 1.4 3.0 2.3 18.3 +Belgium8 .2 0.8 0.1 0.8 —9 .9 +Canada —1 .3 0.1 3.9 1.2 6.5 +Netherlands 3.4 —0 .2 1.1 0.2 4.9 +Japan1 .2 0.8 0.1 0.4 0.3 2.8 +Luxembourg0 .1 —1 .4 0.1 1.2 2.8 +SouthK orea 0.1 —2 .0 0.1 0.5 2.7 +Australia —1 .0 0.3 0.7 0.5 2.5 +France —— 0.1 1.9 0.5 2.5 +TotalT op 10country exposure $4 0.8 $5 .2 $6 .5 $1 5.8 $7 .0 $7 5.3 (d) +Select country exposure: +Brazil$ —$ 0.2 $0 .9 $0 .1 $0 .1 $1 .3 +Russia— 0.4 (e) —— —0 .4 +(a)L ending includesl oans,a cceptances,i ssued letters of credit, neto fparticipations,a nd lending-relatedc ommitments. +(b) Securitiesi nclude boththe available-for-saleand held-to-maturityportfolios. +(c)O ther exposureincludeso ver-the-counter (“OTC”)d erivativea nd securitiesf inancingt ransactions,n et of collateral. +(d)T he top1 0country exposurec omprises approximately7 0% of ourtotaln on-U.S. exposure. +(e)R epresentsc ashb alances with exposuret oR ussia. +Events inrecenty earsh aver esultedi nincreased +focuso nB razil. Thec ountry riskexposuret oB razil +is primarily short-term tradef inance loanse xtended +to largefinancial institutions.W ea lsoh ave +operations in Brazilp roviding investment services +andi nvestment management services. +Thew ar in Ukraineh as increased our focuso n +Russia. Thec ountry riskexposuret oR ussiac onsists +of cashb alances relatedt oour securitiess ervices +businessesa nd mayi ncreasei nt he future to the +extent cashi sr eceivedf or theb enefit of ourclients +that is subject to distributionr estrictions.B NY +Mellonh as ceasednewb anking businessinR ussia +ands uspendedi nvestment management purchasesof +Russian securities. At Dec.31, 2023,l esst han0 .1% +of ourAUC/A andl esst han0 .01% of ourAUM +consistedo fR ussian securities. We will continue to +work with multinationalclientst hatd ependo nour +custody andr ecord keepings ervices to managetheir +exposures. +We arealsom onitoring ourexposuret oI srael aspart +of ourinternal country riskmanagement process. At +Dec. 31, 2023,o ur totale xposuret oI srael was$ 165 +milliona nd primarily consistedo fi nvestment grade +short-term interest-bearingd eposits andO TC +derivatives maturing within sixm onths. +Critical accountinge stimates +Ours ignificanta ccountingp oliciesa re describedi n +Note 1o ft he Notest oC onsolidated Financial +Statements.C ertain of thesep oliciesi nclude critical +accountinge stimatesw hich require management to +make subjectiveo rc omplex judgments about the +effect of matters that areinherently uncertain and +mayc hange in subsequent periods.O ur critical +accountinge stimatesa re thoser elated to the +allowancef or credit losses,goodwill ando ther +intangibles andlitigationa nd regulatory +contingencies. Management hasdiscussedt he +Resultso fO perations (continued) +22 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_4.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_4.txt new file mode 100644 index 0000000000000000000000000000000000000000..5061e8411296439a9d0894df100c935a57026647 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_4.txt @@ -0,0 +1,49 @@ +II ANNUAL REPORT 2023 +$2.4T +$12.5T +$312B +$5.7T +$47.8T +$2.0T +GLOBAL REACH AND SCALE +Assets under custody +and/or administration1 +Assets under management2 +Average daily clearance value3 +Average triparty balances3 +Average daily U.S. dollar +payment value3 +Wealth Management +client assets4 +1 As of December 31, 2023. Consists of assets under custody and/or administration (“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 December 31, 2023. +2 As of December 31, 2023. Excludes assets managed outside of the Investment and Wealth Management business segment. +3 Average for the year ended December 31, 2023. +4 As of December 31, 2023. Includes AUM and AUC/A in the Wealth Management line of business. +The unique role we play in the financial system — touching +around one-fifth of the world’s investable assets — gives us a +tremendous responsibility, and our success is critical not only +to our clients’ success, but also the global economy at large. +That responsibility motivates us every day. To help our clients +achieve their ambitions. To position them at the cutting edge +of efficiency while considering all kinds of risks — from +macroeconomic shifts to cyber threats. To improve financial +performance for the benefit of our shareholders. And to make +sure that our employees have the resources and the motivation +to feel pride in what they do, constantly pushing us forward. +Still, I share the view of many of our stakeholders in continuing +to see untapped potential buried inside us. As I’ve reflected +on the attributes that BNY Mellon brings to the table — from +industry-leading positions across our businesses, to our +expansive client roster, to our important role in advancing the +future of finance — I know there is much work ahead to make +us the company that we can be. +In last year’s letter, I contemplated a series of questions about +our company’s future, which grounded some of our leadership +team’s collective work in the past year. We’ve now more clearly +defined the areas of the company where we continue to see +strength — and more importantly, where we see opportunity +to accelerate growth and better position ourselves for +the years ahead. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_40.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_40.txt new file mode 100644 index 0000000000000000000000000000000000000000..94c5919c67617977d3c46a310905f2e1cac814bb --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_40.txt @@ -0,0 +1,102 @@ +developmenta nd selectiono ft he critical accounting +estimatesw ith theCompany’sA uditC ommittee. +Allowancef or creditl osses +Thea llowancef or credit lossescovers financialassets +subject to credit lossesand measured at amortized +cost,i ncluding loansa nd lending-related +commitments, held-to-maturity securities, certain +securitiesf inancing transactions andd eposits with +banks.T he allowancef or credit lossesi sintendedt o +adjust thec arryingv alue ofthesea ssets by an +estimateda mount ofcredit lossesthatw ee xpect to +incuro vert he lifeo ft he asset. Similarly, the +allowancef or credit lossesonl ending-related +commitmentsa nd otheroff-balances heet financial +instrumentsi smeantt oc apture thec reditl ossest hat +we expect to recognize in theseportfoliosa soft he +balances heet date. +Aq uantitativem ethodology andq ualitative +framework is used to estimate theallowancef or +credit losses. +Theq uantitativec omponent of ourestimate uses +models andm ethodologies that categorizefinancial +assets basedo nproductt ype,c ollateralt ype,a nd +otherc reditt rendsa nd risk characteristics, including +relevant informationa bout pastevents,c urrent +conditions andr easonablea nd supportablef orecasts +of future economic conditions that affectthe +collectability of ther ecorded amounts. Fort he +quantitativec omponent,w es egment portfoliosinto +various majorc omponentsi ncluding commercial +loansa nd leasef inancing, commercial real estate, +financiali nstitutions,r esidentialm ortgages,a nd +other. Thes egmentationo fo ur debtsecurities +portfoliosi sbym ajor assetc lass andi si nfluenced by +whethert he security isstructured or non-structured +(i.e., directobligation),a sw ella st he issuer type.T he +componentso ft he credit losscalculationf or each +majorp ortfolio or assetc lass include ap robability of +default, lossgivend efault ande xposurea td efault,a s +applicable,a nd theirv aluesd ependo nthe forecast +behavior of variablesint he macroeconomic +environment. We utilizeam ulti-scenario +macroeconomic forecastw hich includesaweighting +of threes cenarios: ab aselinea nd upsideand +downsides cenariosa nd allows us to developo ur +estimate usingawide span of economic variables. +Ourb aselines cenario reflectsaview on likely +performance of each globalr egiona nd theo ther two +scenariosa re designedr elativet ot he baseline +scenario.T hisa pproach incorporates ar easonable +ands upportablef orecastp eriods panning thel ifeo f +thea sset, andi ncludesb otha ninitiale stimated +economic outlook component as well as ar eversion +component fore ach economicinput variable.T he +lengtho fe ach of thet wo componentsd epends onthe +underlying financiali nstrument, scenario,a nd +underlying economic input variable.I ng eneral,t he +initiale conomic outlook periodfore ach economic +input variableundere ach scenario rangesb etween +severalm onths andt wo years. Thes peed at which +thes cenario-specificf orecasts revert to long-term +historical mean is basedo nobservedh istorical +patternso fm ean reversiona tt he economic variable +input levelt hata re reflectedin our modelp arameter +estimates. Certainm acroeconomic variabless ucha s +unemploymento rh omep ricest akel ongert or evert +afteracontraction, though specificr ecovery timesa re +scenario-specific. Reversionw ill usually takelonger +thef urther awaythes cenario-specificf orecasti sf rom +theh istorical mean.O naquarterly basis, andw ithin +ad evelopedg overnance structure, we update these +scenariosf or current economic conditions andm ay +adjust thes cenario weightingb ased on oureconomic +outlook. TheC ompany usesjudgmentt oa ssess these +economic conditions andl ossd atai nd etermining the +best estimate of thea llowancef or credit lossesand +thesee stimatesa re subject to periodicr efinement +basedo nchangest ou nderlying external or Company- +specifich istorical data. +In theq uantitativec omponent of ourestimate,w e +measuree xpected credit lossesusing an individual +evaluationm ethod if theriskc haracteristicso ft he +asseti sn ol ongerc onsistent with theportfolio or class +of asset. Fort hese assets,w ed on ot employ the +macroeconomic modelcalculationb ut consider +factorss ucha sp ayment status,c ollateralv alue,t he +obligor’s financialcondition, guarantorsupport, the +probability of collecting scheduled principala nd +interest payments when due,a nd recovery +expectations if they canbe reasonablye stimated. For +loans, wemeasuret he expected credit lossas the +differenceb etween thea mortized costbasiso ft he +loan andthe presentvalue ofthee xpected future cash +flowsf romt he borrowerwhich is generally +discounted atthel oan’se ffectivei nterestr ate, or the +fair valueo ft he collateral,i ft he loan is collateral- +dependent.W eg enerally individuallyevaluate +nonperformingl oans as well as loanst hath aveb een +or area nticipated to be modified givent he risk +characteristicso fs uchl oans. +Resultso fO perations (continued) +BNYM ellon2 3 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_41.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_41.txt new file mode 100644 index 0000000000000000000000000000000000000000..66dfa9b99c5c3e0f16eb46870233e7bce93722a6 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_41.txt @@ -0,0 +1,101 @@ +Available-for-saled ebts ecuritiesa re recorded atfair +value. When an available-for-saledebts ecurity is in +an unrealized loss position, we employ a +methodology to identifya nd estimate thecreditl oss +portiono ft he unrealizedloss position. The +measuremento fe xpected credit lossesi sperformed at +thes ecurity leveland is basedo nour best single +estimate of cashf lows,o nadiscounted basis; +however,w ed on ot specifically employ the +macroeconomic forecastingm odels ands cenarios +summarized above. +Theq ualitativec omponent of ourestimate fort he +allowancef or credit lossesisi ntendedt ocapture +expected lossest hatm ay not have beenfully captured +in thequantitativec omponent.T hrough an +establishedg overnance structure, management +determines theq ualitativea llowancee ach period +basedo na nevaluationo fv arious internal and +environmentalf actorsw hich include:s cenario +weightinga nd sensitivity risk,c reditc oncentration +risk,e conomic conditions ando ther considerations. +We have made andm ay continueto make +adjustmentsf or idiosyncratic risks. +To thee xtenta ctualr esults differf romf orecasts or +management’s judgment, theallowancef or credit +lossesm ay be greateror less than future charge-offs +andr ecoveries. +Oura llowancef or credit lossesi ssensitivet oa +numbero finputs, most notably themacroeconomic +forecasta ssumptions that areincorporated into our +estimate of credit lossest hrough thee xpected life of +thel oanp ortfolio,a sw ella sc reditr atings assignedt o +each borrower. As them acroeconomic environment +andr elated forecasts change,t he allowancef or credit +lossesm ay changematerially.T he following +sensitivity analyses do notrepresentm anagement’s +expectations ofthed eteriorationo fo ur portfolioso r +thee conomic environment, but arep rovideda s +hypothetical scenariost oa ssess thes ensitivity of the +allowancef or credit lossestoc hangesi nk ey inputs. +If commercialr eal estatepropertyv aluesw ere +increased 10% anda ll otherc redits were ratedone +gradeb etter, theq uantitativea llowancew ouldh ave +decreased by $47million, andi fc ommercialr eal +estate propertyv aluesw ered ecreased 10% anda ll +otherc redits were ratedone gradeworse,t he +quantitativea llowancew ouldh avei ncreased by $83 +million. Ourm ulti-scenario basedm acroeconomic +forecastu sedi ndeterminingt he Dec. 31, 2023 +allowancef or credit lossesconsistedo ft hree +scenarios. Theb aselines cenario reflectss lightly +increasingG DP growth,s tableu nemploymenta nd +decliningc ommercialr eal estateprices through the +endo f2 024. Theu psides cenario reflectsf asterG DP +growth,d ecliningu nemploymentt hrough thes econd +quarter of 2024 beforemoderatinga nd higher +commercialr eal estateprices comparedwith the +baseline. Thed ownsides cenario contemplates +negativeG DP growth throughthef irst quarter of +2024 with subsequent stabilizationt hrough thet hird +quarter of 2024,as well as rapidlyi ncreasing +unemploymentt hrough 2024ands harply lower +commercialr eal estateprices than theb aseline. At +Dec. 31, 2023,w ep laced them ostw eight on our +downsides cenario,f ollowedb ythe baselinescenario, +with ther emaining weightingp laced on theu pside +scenario.F romasensitivity perspective, atDec. 31, +2023, if we hada pplied1 00% weightingt othe +downsides cenario,t he quantitativeallowancef or +credit losseswouldh aveb een approximately$88 +millionh igher. +SeeN otes 1a nd 5o ft he Notest oC onsolidated +FinancialS tatementsf or additionali nformation +regardingt he allowancef or credit losses. +Goodwill and otherintangibles +We initiallyr ecord alla ssets andl iabilitiesa cquired +in purchasea cquisitions,i ncluding goodwill, +indefinite-lived intangibles andother intangibles,i n +accordance with AccountingS tandardsC odification +(“ASC”)8 05, Business Combinations.G oodwill, +indefinite-lived intangibles andother intangibles are +subsequently accounted fori na ccordance with ASC +350, Intangibles –G oodwill and Other. Thei nitial +measuremento fg oodwill andi ntangibles requires +judgmentc oncerning estimateso ft he fair valueo ft he +acquireda ssets andl iabilities. Goodwill ($16.3 +billiona tD ec. 31, 2023)a nd indefinite-lived +intangiblea ssets ($2.6 billionat Dec. 31, 2023)a re +not amortized but ares ubject to testsfor impairment +annually or more ofteni fe ventso rc ircumstances +indicatei ti sm orel ikelyt hann ot they mayb e +impaired. Otheri ntangiblea ssetsa re amortized over +theire stimatedu sefull ives andare subject to +impairmenti fe ventso rc ircumstances indicatea +possiblei nability torealizet he carryingv alue. +Goodwill +BNYM ellon’sb usinesss egmentsi nclude six +reportingu nits forw hich annualgoodwill impairment +Resultso fO perations (continued) +24 BNYM ellon +The secret office supply is a "paperclip". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_42.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_42.txt new file mode 100644 index 0000000000000000000000000000000000000000..736023e0cb2bdb5f185448e7527123d016d8bff3 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_42.txt @@ -0,0 +1,89 @@ +testingi sp erformed.A ni nterim goodwill +impairmentt esti sp erformed when eventsor +circumstances occurt hatm ay indicatet hati ti sm ore +likelyt hann ot that thef airv alue ofanyr eportingu nit +mayb el esst hani ts carryingv alue. +Theg oodwill impairmentt estc omparest he estimated +fair valueo ft he reportingu nitw ith itscarrying +amount,i ncluding goodwill. If thee stimatedf air +valueo ft he reportingu nite xceedsi ts carrying +amount,g oodwill of ther eportingu niti sc onsidered +not impaired. However, if thecarryinga mount ofthe +reportingu nitw eret oe xceed its estimatedf airv alue, +an impairmentl ossw ouldb er ecorded fort he +difference. +In eachq uarter of 2023,we completeda ninterim +goodwill impairmentt esto ft he Investment +Management reportingu nit, whichh ad $6.1 billiono f +allocated goodwill as of Dec. 31, 2023.I na ll cases, +we determined thef airv alue oftheI nvestment +Management reportingu nite xceeded its carrying +valuea nd no goodwill impairmentw as recorded. +Fort he Dec. 31, 2023test,t he fair valueo ft he +Investment Management reportingu nite xceeded its +carryingv alue byapproximately 5%.W ed etermined +thef airv alue oftheI nvestment Management +reportingu nitu sing an income approach basedo n +management’s projections as of Dec. 31, 2023. The +discount rate appliedt othese cashf lows was10.5%. +As of Dec. 31, 2023,i ft he discountrate appliedt o +thee stimatedc ashf lows wasincreased or decreased +by 25 basispoints, thef airv alue oftheI nvestment +Management reportingu nitw ould decreaseo r +increaseb y4 %, respectively. Similarly, if thelong- +term growth rate wasi ncreased or decreasedby 10 +basisp oints, thef airv alue oftheI nvestment +Management reportingu nitw ould increaseo r +decreaseb ya pproximately 1%,r espectively. +In thes econd quarterof 2023,we performed our +annualg oodwill impairmentt esto nt he remaining +five reportingu nits usinga nincomea pproach to +estimate thefairv alueso fe ach reportingu nit. +Estimatedc ashf lows used in theincomea pproach +were basedo nmanagement’sp rojections as of April +1, 2023. Thed iscount rate appliedt othese cash +flowsw as 10%. +As ar esulto ft he annualg oodwill impairmentt est, no +goodwilli mpairmentw as recognized.T he fair values +of theC ompany’sr emaining five reportingu nits were +substantially inexcesso ft he respectiver eporting +units’c arryingv alue. +Intangiblea ssets +Keyj udgments inaccountingf or intangiblea ssets +include determiningthe usefullife andc lassification +between goodwill andi ndefinite-lived intangible +assets or otheramortizingi ntangiblea ssets. +Indefinite-lived intangiblea ssets ($2.6 billionatD ec. +31, 2023)aree valuated fori mpairmenta tl east +annually by comparingt heir fair values,e stimated +usingd iscounted cashflowa nalyses, to theircarrying +values.A saresult of thea nnuale valuation, no +impairmentw as recognized,h owever,a $698 million +indefinite-lived intangiblea ssetr elated to customer +relationships in theInvestment Management business +exceeded its carryingv alue byapproximately 7%. +Othera mortizingi ntangiblea ssets( $274 milliona t +Dec. 31, 2023)a re evaluatedf or impairmenti fe vents +andc ircumstances indicateap ossiblei mpairment. +Such evaluationo fo ther intangiblea ssetsw ouldb e +initially basedo nundiscounted cashflowp rojections. +Determiningt he fair valueo fareportingu nito r +indefinite-lived intangiblea ssets issubject to +uncertainty as it isrelianto ne stimateso fc ashf lows +that extendfari ntot he future,a nd, bytheirn ature, are +difficult toestimate overs ucha nextendedt ime +frame.I nt he future,c hangesi nt he assumptions or +thed iscount rate couldp roduceam aterialn on-cash +goodwillo ri ntangiblea sseti mpairment. +SeeN otes 1a nd 7o ft he Notest oC onsolidated +FinancialS tatementsf or additionali nformation +regardingg oodwill, intangibleassets andt he annual +andi nterim impairmentt esting. +Litigationa nd regulatoryc ontingencies +Significante stimatesa nd judgments arer equiredi n +establishing an accruedl iabilityf or litigationa nd +regulatoryc ontingencies. Fora dditionali nformation +on our policy,see“ Legalp roceedings”i nN ote2 2o f +theN otes to Consolidated FinancialS tatements. +Resultso fO perations (continued) +BNYM ellon2 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_43.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_43.txt new file mode 100644 index 0000000000000000000000000000000000000000..22411b35e068b339c799cf1f376523900d0b6578 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_43.txt @@ -0,0 +1,87 @@ +Consolidated balances heet review +Oneo fo ur keyriskm anagemento bjectives is to +maintain ab alance sheet that remainss trong +throughout market cyclesto meetthee xpectations of +our majors takeholders,i ncluding ourshareholders, +clients, creditors andr egulators. +We also seekto undertakeo verall liquidityrisk, +including intraday liquidity risk,t hats tays within our +risk appetite.T he objectiveofo ur balancesheet +management strategy is to maintainab alance sheet +that is characterized by strong liquidity anda sset +quality,r eadya ccesst oe xternalf unding sources at +competitiver ates andastrong capitals tructure that +supports our risk-takinga ctivitiesa nd is adequate to +absorb potentiall osses. In managing theb alance +sheet,a ppropriatec onsiderationi sg iven to balancing +thec ompetingn eedso fm aintaining sufficientl evels +of liquidity andc omplying with applicable +regulations ands upervisorye xpectations while +optimizingp rofitability. +At Dec.31, 2023,t otal assetswere $410 billion, +compared with $406 billionatD ec. 31, 2022.T he +increasei nt otal assetswasp rimarily driven by higher +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks andf ederal funds sold and +securitiesp urchased underr esalea greements, +partially offset by lowers ecuritiesa nd interest- +bearingd eposits with banks.D eposits totaled$284 +billiona tD ec. 31, 2023,c omparedw ith $279 billion +at Dec. 31, 2022.T he increasep rimarily reflects +higheri nterest-bearingd eposits inU.S. offices and +non-U.S. offices,p artially offset by lowern on- +interest bearingd eposits (principally U.S. offices). +Totali nterest-bearingd eposit liabilitiesa sa +percentage oftotali nterest-earning assets were 66% +at Dec. 31, 2023and5 8% at Dec. 31, 2022. +At Dec.31, 2023,a vailablef unds totaled$ 158 billion +andi ncludesc asha nd duefrom banks,interest- +bearingd eposits with theFederal Reservea nd other +central banks,i nterest-bearingd eposits with banks +andf ederal funds sold ands ecuritiesp urchased under +resale agreements.T hisc omparesw ith available +funds of $138 billionatD ec. 31, 2022.T otal +availablef unds as ap ercentage oftotala ssets were +38% at Dec. 31, 2023and3 4% at Dec. 31, 2022.F or +additionali nformationo nour availablef unds,s ee +“Liquidity andd ividends.” +Securitiesw ere$ 126 billion,or 31% oftotala ssets,a t +Dec. 31, 2023,c omparedw ith$ 143 billion,or 35% +of totala ssets,a tD ec. 31, 2022.T he decrease +primarily reflectsl ower U.S. Treasurya nd non-U.S. +government securities, partially offset by unrealized +pre-taxg ains.F or additionali nformationo nour +securitiesp ortfolio,s ee “Securities” andN ote4of the +Notest oC onsolidated FinancialS tatements. +Loansw ere$ 67 billion,o r1 6% oftotala ssets,a tD ec. +31, 2023,compared with $66 billion,or 16% oftotal +assets,a tD ec. 31, 2022.I ncreases in nearly alll oan +portfoliosw erep artially offset by lowero verdrafts +andw ealth managementloans. Fora dditional +informationo nour loan portfolio,s ee “Loans”a nd +Note 5o ft he Notest oC onsolidated Financial +Statements. +Long-term debt totaled$ 31 billionat Dec. 31, 2023 +and$ 30 billionatD ec. 31, 2022.T he increase +primarily reflectsi ssuances,p artially offset by +maturitiesa nd repurchases.F or additional +informationo nlong-term debt,s ee “Liquidity and +dividends”a nd Note 13 oftheN otes to Consolidated +FinancialS tatements. +TheB anko fN ew York Mellon Corporationt otal +shareholders’e quity totaled$41 billionatD ec. 31, +2023 andD ec. 31, 2022.F or additionali nformation, +see“ Capital” andN ote1 5o ft he Notest o +Consolidated FinancialS tatements. +Securities +In thed iscussion of oursecuritiesp ortfolio,w eh ave +includedc ertain credit ratings informationb ecause +thei nformationc an indicatet he degreeof credit risk +to whichw ea re exposed.S ignificantc hangesi n +ratings classifications couldi ndicatei ncreased credit +risk foru sa nd couldb ea ccompaniedb ya nincrease +in thea llowancef or credit lossesand/or ar eductioni n +thef airv alue of oursecuritiesp ortfolio. +Resultso fO perations (continued) +26 BNYM ellon +The secret object #5 is a "toothbrush". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_44.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_44.txt new file mode 100644 index 0000000000000000000000000000000000000000..c3e796a2f393b9d11cd68ab36bdbe1639641a511 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_44.txt @@ -0,0 +1,111 @@ +Thef ollowing tables howst he distributionofo ur totals ecuritiesp ortfolio. +Securities portfolio Dec. 31, +2022 2023 +change in +unrealized +gain (loss) +Dec. 31, 2023 Fair value +as a%of +amortized +cost (a) +Unrealized +gain (loss) +% +Floating +rate (b) +Ratings (c) +BBB+/ +BBB- +BB+ +and +lower(dollars in millions) +Fair +value +Amortized +cost (a) +Fair +value +AAA/ +AA- +A+/ +A- +Not +rated +Agency residential +mortgage-backed +securities( “RMBS”) +$3 8,916 $7 96 $4 3,197 $3 9,333 91% $( 3,864) 21% 100% —% —% —% —% +U.S. Treasury4 1,503 623 27,316 26,476 97 (840) 62 100 —— —— +Non-U.S. government (d) 22,361 342 21,135 20,543 97 (592) 42 94 32 1— +Agency commercial +mortgage-backed +securities( “MBS”) 11,864 214 11,602 11,010 95 (592) 45 100 —— —— +Collateralized loan +obligations (“CLOs”) 6,300 123 7,125 7,119 100 (6)1 00 100 —— —— +U.S. government agencies 6,115 137 7,199 6,780 94 (419) 42 100 —— —— +Foreignc overedb onds (e) 5,776 93 6,489 6,317 97 (172) 57 100 —— —— +Non-agency commercial +MBS 3,054 32 3,245 2,997 92 (248) 53 100 —— —— +Non-agency RMBS 2,060 24 1,909 1,766 92 (143) 46 85 3—66 +Othera sset-backed +securities( “ABS”) 1,319 41 1,026 943 92 (83) 18 100 —— —— +Other2 4— 13 11 88 (2)— —— —— 100 +Totals ecurities$ 139,292 (f) $2 ,425 $1 30,256 $1 23,295 (f) 95% $( 6,961) (f)(g) 44% 99% 1% —% —% —% +(a)A mortized cost reflectsh istoricali mpairments,a nd is neto fthe allowancef or credit losses. +(b)I ncludest he impacto fhedges. +(c)R epresentsr atings by Standard&Poor ’s (“S&P”)o rt he equivalent. +(d)I ncludess upranational securities. Primarily consists of exposuret oG ermany,F rance, UK,C anada, theN etherlands andBelgium. +(e)P rimarily consists of exposuret oC anada, UK,A ustralia,G ermany,S ingaporea nd Norway. +(f)I ncludesn et unrealized gains on derivatives hedging securitiesa vailable-for-sale (including terminated hedges) of $2,678milliona tD ec.3 1, 2022 and net +unrealized gain( including terminated hedges) of $1,767milliona tD ec.3 1, 2023. +(g)A tD ec. 31, 2023,i ncludesp re-tax netu nrealized losseso f$ 2,094 millionr elated to available-for-sale securities, neto fhedges, and $4,867relatedt oheld-to- +maturity securities. Thea fter-tax unrealized losses, neto fhedges, relatedt oavailable-for-sale securitiesi s$ 1,580 milliona nd thea fter-taxe quivalent relatedt o +held-to-maturity securitiesi s$ 3,711 million. +Thef airv alue of oursecuritiesp ortfolio,i ncluding +relatedh edges, was$123.3 billionatD ec. 31, 2023, +compared with $139.3 billionatD ec. 31, 2022.T he +decreasep rimarily reflectsl ower U.S. Treasurya nd +non-U.S. government securities,p artially offset by +unrealized pre-taxg ains. +At Dec.31, 2023,t he securitiesp ortfolio hadanet +unrealized loss, including thei mpact of related +hedges, of $7.0 billion,compared with $9.4 billiona t +Dec. 31, 2022.T he decreaseint he unrealizedloss, +including thei mpact of relatedh edges, primarily +reflectss ecuritiesm oving closer to maturity. +Thef airv alue ofthea vailable-for-sales ecurities +totaled$ 78.6 billionatD ec. 31, 2023,n et of hedges, +or 64% ofthes ecuritiesp ortfolio,n et of hedges. The +fair valueo ft he held-to-maturitysecuritiest otaled +$44.7 billionatD ec. 31, 2023,o r3 6% ofthe +securitiesp ortfolio,n et of hedges. +Theu nrealized loss (after-tax)o no ur available-for- +sale securitiesp ortfolio,n et of hedges,includedi n +accumulatedo ther comprehensiveincomew as $1.6 +billiona tD ec. 31, 2023,c omparedw ith $2.4 billion +at Dec. 31, 2022.N et unrealized loss, including the +impact of hedges,decreased assecuritiesm oved +closer to maturity. +At Dec. 31, 2023,9 9% ofthes ecuritiesi no ur +portfolio were ratedAAA/AA-, unchangedc ompared +with Dec. 31, 2022. +SeeN ote4of theN otes to Consolidated Financial +Statements fort he pre-taxnet securitiesg ains (losses) +by security type.S ee Note 20 oftheN otes to +Consolidated FinancialS tatementsf or securitiesb y +leveli nt he fair valueh ierarchy. +Thef ollowing tablep resentst he amortizable purchase +premium( neto fd iscount)a nd netamortization +relatedt othe securitiesp ortfolio. +Amortizablep urchasep remium +(net of discount)a nd net +amortization ofsecurities (a) +(inm illions) 2023 2022 2021 +Amortizable purchasep remium, +neto fd iscount $8 21 $1 ,109 $1 ,863 +Neta mortization $1 67 $3 62 $6 55 +(a)A mortizationo fp urchasep remium decreasesnet interest +revenue while accretiono fd iscount increasesn et interest +revenue.B otha re recordedon al evel yieldbasis. +Resultso fO perations (continued) +BNYM ellon2 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_45.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_45.txt new file mode 100644 index 0000000000000000000000000000000000000000..9f998817f6663c292a94eacb97a912b52e4fe5eb --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_45.txt @@ -0,0 +1,80 @@ +Equity investments +We have severale quity investmentsrecorded in other +assets.T hese include equity methodinvestments, +including renewablee nergy, investmentsi nq ualified +affordable housingp rojects, FederalR eserve Bank +stock, seed capitala nd otherinvestments. The +following tablep resentst he carryingv aluesa tD ec. +31, 2023andD ec. 31, 2022. +Equity investments Dec. 31, +(inm illions) 2023 2022 +Renewablee nergyi nvestments $1 ,049 $8 71 +Qualifieda ffordable housingp roject +investments 1,213 1,298 +Equity methodinvestments: +CIBC Mellon 607 545 +Siguler Guff 234 242 +Other 32 16 +Totale quity methodinvestments 873 803 +FederalR eserve Bank stock 480 478 +Othere quity investments(a) 741 695 +Seed capital(b) 232 218 +FederalH omeL oanB anks tock 7 6 +Totale quity investments $4 ,595 $4 ,369 +(a)I ncludess trategic equity,p rivate equity and other +investments. +(b)I ncludesi nvestments inBNYM ellonf unds whichh edge +deferredi ncentivea wards. +Fora dditionali nformationo ncertain seed capital +investmentsa nd our privateequity investments, see +“Investmentsv aluedu sing netassetv alue (“NAV”) +pers hare”i nN ote8of theN otes to Consolidated +FinancialS tatements. +Renewablee nergyi nvestments +We invest in renewablee nergyp rojectst or eceive an +expected after-taxreturn,w hich consistsof allocated +renewablee nergyt ax credits,taxd eductions andc ash +distributions basedo nthe operations ofthep roject. +Thep re-tax losseso nt hese investmentsa re recorded +in investment ando ther revenue onthec onsolidated +income statement. Thec orresponding taxb enefits +andc redits arer ecorded to theprovision fori ncome +taxeso nt he consolidated income statement. +Loans +Totale xposure–consolidated Dec. 31, 2023 Dec. 31, 2022 +(inb illions) Loans +Unfunded +commitments +Total +exposure Loans +Unfunded +commitments +Total +exposure +Financiali nstitutions $1 0.5 $2 9.2 $3 9.7 $9 .7 $3 1.7 $4 1.4 +Commercial 2.1 11.4 13.5 1.7 11.7 13.4 +Wealth managementloans 9.1 0.5 9.6 10.3 0.6 10.9 +Wealth managementmortgages 9.1 0.3 9.4 9.0 0.2 9.2 +Commercialr eal estate 6.8 3.4 10.2 6.2 3.9 10.1 +Leasef inancings 0.6 —0 .6 0.7 —0 .7 +Otherr esidentialm ortgages 1.2 —1 .2 0.4 —0 .4 +Overdrafts 3.1 —3 .1 4.8 —4 .8 +Capitalc allf inancing 3.7 3.6 7.3 3.4 3.5 6.9 +Other 2.7 —2 .7 3.0 —3 .0 +Margin loans 18.0 —1 8.0 16.9 —1 6.9 +Total $66.9 $4 8.4 $1 15.3 $6 6.1 $5 1.6 $1 17.7 +At Dec.31, 2023,t otal lending-relatede xposurew as +$115.3 billion,ad ecreaseo f2 %c omparedw ith Dec. +31, 2022, primarily reflectingl ower exposureint he +financiali nstitutions portfolio,lower overdraftsa nd +lowere xposure in thewealth managementloans +portfolio,p artially offset by highermarginl oans and +otherr esidentialm ortgagel oans. +Ourf inancial institutions andc ommercialp ortfolios +comprise our largestc oncentrated risk.T hese +portfoliosc omprised 46% of ourtotale xposurea t +Dec. 31, 2023and4 7% at Dec. 31, 2022. +Additionally,m osto fo ur overdraftsrelatet o +financiali nstitutions. +Resultso fO perations (continued) +28 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_46.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_46.txt new file mode 100644 index 0000000000000000000000000000000000000000..6f88b9835ce0c5056fb4db58885134a883198df7 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_46.txt @@ -0,0 +1,78 @@ +Financiali nstitutions +Thef inancial institutions portfolio isshownb elow. +Financiali nstitutions +portfolio exposure +(dollars in billions) +Dec. 31, 2023 Dec. 31, 2022 +Loans +Unfunded +commitments +Total +exposure +%I nv. +grade +%d ue +<1 yr. Loans +Unfunded +commitments +Total +exposure +Securitiesi ndustry $2 .3 $1 4.8 $1 7.1 91% 96% $1 .6 $1 7.5 $1 9.1 +Assetm anagers 1.4 8.0 9.4 97 81 1.6 7.6 9.2 +Banks 6.4 1.4 7.8 84 96 6.1 1.5 7.6 +Insurance 0.1 3.9 4.0 100 13 0.1 3.8 3.9 +Government —0 .2 0.2 100 43 —0 .2 0.2 +Other 0.3 0.9 1.2 98 47 0.3 1.1 1.4 +Total $1 0.5 $2 9.2 $3 9.7 92% 83% $9 .7 $3 1.7 $4 1.4 +Thef inancial institutions portfolioexposurew as +$39.7 billionatD ec. 31, 2023,adecreaseo f4 % +compared with Dec. 31, 2022,p rimarily reflecting +lowere xposure in thesecuritiesi ndustryp ortfolio. +Financiali nstitutione xposures arehigh-quality,w ith +92% ofthee xposuresm eetingt he investment grade +equivalent criteriao fo ur internal creditrating +classificationa tD ec. 31, 2023.E ach customeris +assigneda ninternalc reditr ating, whichi sm appedt o +an equivalentexternal ratinga gencyg rade based +upon an umbero fdimensions,w hich arecontinually +evaluateda nd mayc hange overtime.F or ratings of +non-U.S. counterparties, our internal creditratingi s +generally cappeda taratin ge quivalent to the +sovereignr atingo ft he country wheret he +counterpartyr esides,r egardlesso ft he internal credit +ratinga ssignedt othe counterpartyo rt he underlying +collateral. +Thee xposure to financiali nstitutions is generally +short-term,w ith 83% ofthee xposures expiring +within one year.A tD ec. 31, 2023,1 9% ofthe +exposuret of inancial institutions hada nexpiration +within 90 days,comparedw ith 17% at Dec. 31, 2022. +In addition, 62% ofthef inancial institutions exposure +is secureda tD ec. 31, 2023.F or example, securities +industryc lientsa nd assetm anagerso ften borrow +againstm arketables ecuritiesh eldi ncustody. +At Dec. 31, 2023,t he securedi ntradayc redit +providedt odealersi nc onnectionw ith theirt ri-party +repo activity totaled$13.5 billionand wasi ncludedi n +thes ecuritiesi ndustryp ortfolio.D ealerss ecure the +outstanding intraday creditwith high-quality liquid +collateralh avingamarket valuei ne xcesso ft he +amount oftheo utstanding credit. Securedi ntraday +credit facilitiesr epresent 34% ofthee xposurei nt he +financiali nstitutions portfolioanda re reviewed and +reapproveda nnually. +Thea ssetm anagersp ortfolio exposurei sh igh- +quality,w ith 97% ofthee xposures meetingo ur +investment gradeequivalent ratingsc riteriaa so fD ec. +31, 2023. Thesee xposures aregenerally short-term +liquidity facilities, with themajority to regulated +mutual funds. +Ourb anks portfolioexposurep rimarily relatest oo ur +globalt rade finance. Thesee xposures areshort-term +in nature,w ith 96% duein lessthan one year.T he +investment gradepercentage of our banksexposure +was8 4% at Dec. 31, 2023,c omparedw ith 86% at +Dec. 31, 2022.O ur non-investment gradeexposures +arep rimarily tradefinance loansi nB razil. +Resultso fO perations (continued) +BNYM ellon2 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_47.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_47.txt new file mode 100644 index 0000000000000000000000000000000000000000..e1f3f2da2d00c9042145b132b59398bdcfcbf575 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_47.txt @@ -0,0 +1,62 @@ +Commercial +Thec ommercialp ortfolio ispresentedb elow. +Commercial portfolio exposure Dec. 31, 2023 Dec. 31, 2022 +(dollars in billions) Loans +Unfunded +commitments +Total +exposure +%I nv. +grade +%d ue +<1 yr. Loans +Unfunded +commitments +Total +exposure +Services andother $1 .2 $3 .4 $4 .6 98% 41% $0 .8 $3 .2 $4 .0 +Manufacturing 0.5 3.6 4.1 96 19 0.5 4.1 4.6 +Energy andu tilities 0.4 3.7 4.1 89 6 0.3 3.7 4.0 +Mediaa nd telecom —0 .7 0.7 88 3 0.1 0.7 0.8 +Total $2 .1 $1 1.4 $1 3.5 94% 22% $1 .7 $1 1.7 $1 3.4 +Thec ommercialp ortfolio exposurew as $13.5 billion +at Dec. 31, 2023,a nincreaseo f1 %f romD ec. 31, +2022, primarily driven by higherexposurei nt he +services andother portfolios, partially offset by lower +exposurei nt he manufacturingp ortfolio. +Ourc redits trategyi st of ocus oninvestment grade +clientst hata re activeu sers of our non-creditservices. +Thef ollowing tables ummarizes thep ercentage ofthe +financiali nstitutions andc ommercialp ortfolio +exposures that areinvestment grade. +Investment gradep ercentages Dec. 31, +2023 2022 2021 +Financiali nstitutions 92% 95% 96% +Commercial 94% 95% 94% +Wealth management loans +Ourw ealth managementloan exposurewas $9.6 +billiona tD ec. 31, 2023,c omparedw ith $10.9 billion +at Dec. 31, 2022.W ealth managementloans +primarily consisto fl oans to high-net-worth +individuals,amajority of whicha re securedb ythe +customers’ investment management accountso r +custody accounts. +Wealth management mortgages +Ourw ealth managementmortgage exposurew as $9.4 +billiona tD ec. 31, 2023,c omparedw ith$ 9.2 billion +at Dec. 31, 2022.W ealth managementmortgages +primarily consisto fl oans to high-net-worth +individuals,w hich aresecuredb yresidential +property. Wealth managementmortgagesa re +primarily interest-only,adjustable-rate mortgages +with aw eighted-average loan-to-valuer atio of 61%at +origination. Less than 1% ofthem ortgages were past +due at Dec. 31, 2023. +At Dec. 31, 2023,t he wealth managementmortgage +portfolio consistedo ft he followingg eographic +concentrations:C alifornia– 21%;N ew York –1 4%; +Florida–11%;M assachusetts –8 %; ando ther – +46%. +Resultso fO perations (continued) +30 BNYM ellon +The secret animal #1 is a "cat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_48.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_48.txt new file mode 100644 index 0000000000000000000000000000000000000000..14334bab90e4433249cf8602582ee41bc44e536d --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_48.txt @@ -0,0 +1,79 @@ +Commercialr eale state +Thec ompositiono ft he commercialr eal estateportfolio by assetc lass, including percentagesecured, is presented +below. +Compositiono fc ommercial reale statep ortfolio by assetc lass Dec. 31, 2023 Dec. 31, 2022 +Total +exposure +Percentage +secured (a) +Total +exposure +Percentage +secured (a)(dollars in billions) +Residential $4 .3 88% $4 .1 85% +Office 2.6 74 2.8 75 +Retail 0.8 63 0.9 58 +Mixed-use 0.8 31 0.8 33 +Hotels 0.6 40 0.6 42 +Healthcare 0.5 57 0.4 49 +Other 0.6 71 0.5 66 +Totalc ommercialr eale state $1 0.2 73% $1 0.1 71% +(a)R epresentst he percentage ofsecurede xposurei ne acha ssetc lass. +Ourc ommercialr eal estateexposuret otaled $10.2 +billiona tD ec. 31, 2023and$ 10.1 billionatD ec. 31, +2022. Ouri ncome-producingc ommercialr eal estate +facilitiesa re focusedo nexperienced owners anda re +structured with moderate leverage basedo nexisting +cashf lows.O ur commercialr eal estate lending +activitiesa lsoi nclude constructiona nd renovation +facilities. Ourc lient baseconsists of experienced +developers andl ong-term holders of real estateassets. +Loansa re approvedo nthe basisofe xistingo r +projected cashflows ands upportedb yappraisals and +knowledge oflocal market conditions.D evelopment +loansa re structured with moderate leverage,and in +many instances,i nvolve some levelofr ecourse to the +developer. +At Dec.31, 2023,t he unsecuredportfolio consisted +of real estate investmenttrusts (“REITs”)a nd real +estate operatingc ompanies,w hich arebothp rimarily +investment grade. +At Dec.31, 2023,o ur commercialr eale statep ortfolio +consistedo ft he following concentrations:N ew York +metro–36%;R EITs andr eal estateoperating +companies– 27%;a nd other–37%. +Leasef inancings +Thel easef inancings portfolioexposuret otaled $599 +milliona tD ec. 31, 2023and$ 657 milliona tD ec. 31, +2022. At Dec.31, 2023,n early allo fl easing +exposurew as investment grade,or investment grade +equivalent,a nd primarily consistedo fe xposures +backed by well-diversifieda ssets,p rimarily real +estate andl arge-tickett ransportatione quipment. +Assets areb othd omestic andf oreign-based, with +primaryc oncentrations in Germanya nd theU .S. +Otherr esidentialm ortgages +Theo ther residentialm ortgages portfolio primarily +consists of 1-4family residentialm ortgagel oans and +totaled$ 1.2 billionat Dec. 31, 2023and$ 345 million +at Dec. 31, 2022. +Overdrafts +Overdrafts primarily relate to custodya nd securities +clearance clientsand areg enerally repaid within two +businessd ays. +Capitalc allf inancing +Capitalc allf inancing includesl oans to privatee quity +funds that aresecuredb ythe fund investors’ capital +commitmentsa nd thef unds’r ight to callc apital. +Otherl oans +Otherl oans primarily includeloanst oc onsumerst hat +aref ully collateralized with equities, mutual funds +andf ixed-incomes ecurities. +Margin loans +Marginloan exposureof$ 18.0 billionatD ec. 31, +2023 and$ 16.9 billionatD ec. 31, 2022was +collateralized with marketablesecurities. Borrowers +arer equiredt omaintainadaily collateralm argini n +excesso f1 00% ofthev alue ofthel oan. Margin +Resultso fO perations (continued) +BNYM ellon3 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_49.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_49.txt new file mode 100644 index 0000000000000000000000000000000000000000..dc6821c8592de779651917975e68fb3107f66307 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_49.txt @@ -0,0 +1,43 @@ +loansi ncluded$ 7b illiona tD ec. 31, 2023and$ 6 +billiona tD ec. 31, 2022relatedt oaterm loan +program that offers fullycollateralized loanst o +broker-dealers. +Maturity of loan portfolio +Thef ollowing tables howst he maturity structureo fo ur loan portfolio. +Maturity of loan portfolio at Dec. 31, 2023 Within +1y ear +Between +1a nd 5y ears +Between +5a nd 15 years +After +15 yearsT otal(inm illions) +Commercial$ 1,472 $5 79 $6 1$ —$ 2,112 +Commercialr eal estate 1,708 3,909 1,143 —6 ,760 +Financiali nstitutions 8,953 1,568 —— 10,521 +Leasef inancings 12 58 340 —5 99 +Wealth managementloans8 ,634 273 202 —9 ,109 +Wealth managementmortgages— 20 375 8,736 9,131 +Otherr esidentialm ortgages —5 137 1,024 1,166 +Overdrafts 3,053 ——— 3,053 +Capitalc allf inancing 2,469 1,231 —— 3,700 +Other2 ,712 5—— 2,717 +Margin loans1 7,983 28 —— 18,011 +Total$ 46,985 $7 ,876 $2 ,258 $9 ,760 $6 6,879 +Interest ratecharacteristic +Thef ollowing tables howst he interest rate characteristic of loansm aturinga fter one year. +Interestr atec haracteristic of loan portfolio maturing >1 year atDec. 31, 2023 +(inm illions) Fixedr ates Floatingr ates Total +Commercial$ 61 $5 79 $6 40 +Commercialr eal estate 112 4,940 5,052 +Financiali nstitutions —1 ,568 1,568 +Leasef inancings 598 —5 98 +Wealth managementloans1 04 65 475 +Wealth managementmortgages3 ,821 5,310 9,131 +Otherr esidentialm ortgages 1,142 24 1,166 +Capitalc allf inancing —1 ,231 1,231 +Other— 55 +Margin Loans— 28 28 +Total$ 5,744 $1 4,150 $1 9,894 +Resultso fO perations (continued) +32 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_5.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_5.txt new file mode 100644 index 0000000000000000000000000000000000000000..ce53e56111e8c0d95058fb110b106d388e76ba10 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_5.txt @@ -0,0 +1,40 @@ +IIIBNY MELLON +91% +92% +94% +BREADTH OF OUR +CLIENT FRANCHISE +of Fortune 100 +companies +of the Top 100 +investment managers +of the Top 100 +banks +One of our bodies of work was to assemble a strong bench of talent +and put them in the right seats to deliver on what is needed. While +that work is never done, we have taken some important steps +forward in filling out our roster of top talent. +Throughout 2023, we worked hard on several fronts simultaneously +because we insisted on increasing the internal tempo of the +organization and delivering the beginnings of superior financial +results while laying some of the foundation for a multi-year +transformation. As we executed this work, we introduced three +strategic pillars to guide us: +• Be More for Our Clients +• Run Our Company Be +tter +• Pow +er Our Culture +These pillars are not a top-down consulting exercise for what +we could do; rather, they represent an articulation of what we are, +and must be, centered on. Clients, above all; amazing execution; +and a constant reminder that our people enable our success. +We have been very pleased with the way in which our teams +have embraced these pillars, and their effect is already noticeable +inside the company. +Sources: Fortune 100: For 2023, Fortune, Time Inc. ©2023; Investment Managers: Pensions & Investments, worldwide assets under management as of December 31, 2022, P&I Crain Communications +Inc. ©2023; Banks: S&P Global, total assets* as of December 31, 2022, ©2023 S&P Global; client penetration assessment based on positive 2023 revenue with client company or parent/holding company. +*According to S&P Global, company assets were adjusted on a best-efforts basis for pending mergers, acquisitions and divestitures as well as M&A deals that closed after the end of the reporting period +through March 31, 2023. Assets reported by non-U.S. dollar filers were converted to dollars using period-end exchange rates. Total assets were taken on an “as-reported” basis, and no adjustments were +made to account for differing accounting standards. The majority of the banks were ranked by total assets as of December 31, 2022 and the data was compiled April 12, 2023. +The secret tool is a "wrench". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_50.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_50.txt new file mode 100644 index 0000000000000000000000000000000000000000..99a664830c712d81c93c11ed702d5c68ea282ad5 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_50.txt @@ -0,0 +1,56 @@ +Allowancef or creditl osses +Ourc redits trategyi st of ocus oninvestment gradeclients whoa re activeu sers of our non-creditservices.O ur +primary exposuret ot he credit risk of ac ustomerc onsists of fundedl oans,u nfundedc ontractualc ommitmentst o +lend, standby letters of credit ando verdraftsa ssociated with our custody ands ecuritiesc learance businesses. +Thef ollowing tablep resentst he changesi no ur allowancef or credit losses. +Allowancef or credit lossesactivity +2023 2022(dollars in millions) +Beginning balanceofa llowancef or credit losses $2 92 $2 60 +Provision forc reditl osses 119 39 +Charge-offs: +Loans: +Otherr esidentialm ortgages (3) — +Otherf inancial instruments (2) (11) +Totalc harge-offs (5) (11) +Recoveries: +Loans: +Commercial 1 — +Otherr esidentialm ortgages 2 4 +Other 5 — +Otherf inancial instruments — — +Totalr ecoveries 8 4 +Netr ecoveries (charge-offs) 3 (7) +Ending balanceofa llowancef or credit losses $4 14 292 +Allowancef or loan losses $3 03 $1 76 +Allowancef or lending-relatedc ommitments 87 78 +Allowancef or financiali nstruments (a) 24 38 +Totala llowancef or credit losses $4 14 $2 92 +Totall oans $6 6,879 $6 6,063 +Averagel oans outstanding $6 4,096 $6 7,825 +Netr ecoveries (charge-offs)o floans to averagel oans outstanding —% (0.01)% +Netr ecoveries (charge-offs)o floans to totalallowancef or loan lossesa nd lending-relatedc ommitments 0.77 (2.76) +Allowancef or loan lossesa sapercentage of totall oans 0.45 0.27 +Allowancef or loan lossesa nd lending-relatedc ommitmentsa sapercentage of totall oans 0.58 0.38 +Net( charge-offs)t oa verage loansb yl oanc ategory: (b) +Otherr esidentialm ortgages: (0.11)% N/A +Net( charge-offs)d uringt he year $( 1) N/A +Averagel oans outstanding $9 08 (b) N/A +(a)I ncludesa llowancef or credit lossesonf ederal funds sold and securitiesp urchased underr esalea greements,a vailable-for-sale +securities, held-to-maturity securities, accountsr eceivable, cashand duefrom banksand interest-bearing depositswith banks. +(b)A verage loans basedon month-endb alances. +N/A–Nota pplicable. Therew eren on et charge-offs in2022. +Thep rovision forc reditl ossesw as $119 millioni n +2023, primarily driven by reservei ncreases relatedt o +commercialr eal estateexposurea nd changesi nt he +macroeconomic forecast. +Thea llowancef or loan losses andallowancef or +lending-relatedc ommitmentsr epresent +management’s estimate of lifetime expected lossesi n +our credit portfolio.T hise valuationp rocessi s +subject to numerous estimatesa nd judgments.T ot he +extent actualr esults differf romf orecasts or +management’s judgment, theallowancef or credit +lossesm ay be greateror less than future charge-offs. +Resultso fO perations (continued) +BNYM ellon3 3 +The secret clothing is a "hat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_51.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_51.txt new file mode 100644 index 0000000000000000000000000000000000000000..bf97cd3454ec201d8d52808524d402fc920d849a --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_51.txt @@ -0,0 +1,87 @@ +Basedo na nevaluationo ft he allowancef or credit +lossesa sdiscussed in “Critical accountinge stimates” +andN ote1of theN otes to Consolidated Financial +Statements,w eh avea llocated our allowancef or +loansa nd lending-relatedc ommitmentsa spresented +below. +Allocation of allowancefor loan lossesa nd +lending-related commitments(a) +Dec. 31, +2023 2022 +(dollars in millions) $% $% +Commercialr eal estate $3 25 83% $1 84 72% +Commercial 27 7 18 7 +Financiali nstitutions 19 4 24 9 +Wealth management +mortgages 92 12 5 +Otherr esidentialm ortgages 41 83 +Capitalc allf inancing 41 62 +Wealth managementloans 11 11 +Leasef inancings 11 11 +Total $3 90 100% $2 54 100% +(a)T he allowanceallocatedt omargins loans,o verdrafts and +otherl oans wasi nsignificant at bothDec. 31, 2023 andDec. +31, 2022. We haver arelys ufferedal osso nt hese typeso f +loans. +Thea llocationo ft he allowancef or credit lossesi s +inherently judgmental,andt he entirea llowancef or +credit lossesi savailablet oa bsorbc reditl osses +regardless of then atureo ft he losses. +Nonperforming assets +Thet able belowp resentso ur nonperformingassets. +Nonperforming assets Dec. 31, +(dollars in millions) 2023 2022 +Nonperformingl oans: +Commercialr eal estate $1 89 $5 4 +Otherr esidentialm ortgages 24 31 +Wealth managementmortgages 19 22 +Totaln onperformingl oans 232 107 +Othera ssets owned 5 2 +Totaln onperforminga ssets $2 37 $1 09 +Nonperforminga ssets ratio 0.35% 0.16% +Allowancef or loan losses/ +nonperformingl oans 130.6 164.5 +Allowancef or loan losses/ +nonperforminga ssets 127.8 161.5 +Allowancef or credit losses/ +nonperformingl oans 168.1 237.4 +Allowancef or credit losses/ +nonperforminga ssets 164.6 233.0 +Nonperforminga ssets increased$128 millioni n2023 +compared with 2022, primarily reflectingh igher +nonperformingc ommercialr eal estateloans. +See“ Nonperforminga ssets”i nN ote1of theN otes to +Consolidated FinancialS tatementsf or our policyfor +placing loanso nn onaccruals tatus. +Deposits +We receive client deposits throughtheb usinessesi n +theS ecuritiesS ervices, Market andWealth Services +andI nvestment andW ealth Management segments +andw er elyo nthosed eposits as al ow-costa nd stable +source of funding. +Totald eposits were $283.7 billionatD ec. 31, 2023, +an increaseo f2 %, compared with $279.0 billiona t +Dec. 31, 2022.T he increasep rimarily reflects higher +interest-bearingd eposits inU.S. offices andnon-U.S. +offices,p artially offset by lowern on-interest bearing +deposits (principally U.S. offices). +Noninterest-bearingd eposits were $58.3 billiona t +Dec. 31, 2023,c omparedw ith$ 78.0 billionatD ec. +31, 2022,reflectingc lient activity.I nterest-bearing +deposits were primarily demand depositsandt otaled +$225.4 billionatD ec. 31, 2023,c omparedw ith +$201.0 billionatD ec. 31, 2022. +Thea ggregatea mount of depositsby foreign +customersi nd omestic offices was$ 55.1 billiona t +Dec. 31, 2023and$ 61.2 billionatD ec. 31, 2022. +Deposits inforeigno ffices totaled$ 96.6 billiona t +Dec. 31, 2023and$ 98.3 billionatD ec. 31, 2022. +Thesed eposits were primarily overnight deposits. +Uninsuredd eposits aret he portiono fd omestic +deposits accountst hate xceed theF DICi nsurance +limit. Uninsuredd eposits indomestic deposit +accountsa re generally demand depositsandt otaled +$168.4 billionatD ec. 31, 2023and$ 156.6 billiona t +Dec. 31, 2022. +Resultso fO perations (continued) +34 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_52.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_52.txt new file mode 100644 index 0000000000000000000000000000000000000000..9765393f53a3f125a70a6f20c120f030d748fb67 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_52.txt @@ -0,0 +1,92 @@ +Thef ollowing tablep resentst he amount of uninsured +domestic andf oreign time deposits disaggregated by +time remainingu ntil maturity. +Uninsured time deposits at Dec. 31, 2023 +(inm illions) Domestic Foreign +Less than 3m onths $3 31 $6 61 +3t o6m onths 161 5 +6-12 months 154 9 +Over 12 months 1— +Total $6 47 $6 75 +Short-term borrowings +We fund ourselvesprimarily through depositsand, to +al essere xtent, others hort-term borrowings andl ong- +term debt.S hort-term borrowings consisto ff ederal +funds purchased andsecuritiess oldu nderr epurchase +agreements,p ayablest oc ustomers andb roker- +dealers, commercialp aper andother borrowedf unds. +Certains hort-term borrowings,f or example, +securitiess oldu nderr epurchasea greements,r equire +thed eliveryo fs ecuritiesa scollateral. +Federalf undsp urchased andsecuritiess oldu nder +repurchasea greements includerepurchasea greement +activity with theFixed Income ClearingC orporation +(“FICC”), wherew erecord interest expenseo na +grossb asis,b ut thee nding anda verage balances +reflect thei mpact of offsettingu ndere nforceable +nettinga greements.T hisa ctivity primarily relatest o +government securitiesc ollateralized resale and +repurchasea greements executedw ith clientst hata re +novatedt oand settle with theFICC. +Payables to customersa nd broker-dealersrepresent +funds awaitingr einvestment ands horts alep roceeds +payableo nd emand. Payables to customersa nd +broker-dealersa re driven by customer tradinga ctivity +andm arketv olatility. +TheB anko fN ew York Mellonm ay issue +commercialp aper that maturesw ithin 397 daysfrom +thed ateo fi ssuea nd is not redeemable priort o +maturity or subject to voluntaryp repayment. +Otherb orrowedf unds primarily include borrowings +fromt he FederalH omeL oanB ank, overdraftsofs ub- +custodian account balancesin our SecuritiesS ervices +businesses, financel easel iabilitiesa nd borrowings +underl ines of credit by ourPershing subsidiaries. +Overdrafts typicallyrelate to timingdifferences for +settlements. +Liquidity andd ividends +BNYM ellond efines liquidity as thea bility of the +Parent andi ts subsidiaries to accessf unding or +convert assets tocashq uickly ande fficiently,o rt o +roll overo rissuen ew debt,e specially duringp eriods +of market stress, at ar easonablec ost, andi norder to +meet its short-term (upt oone year)obligations. +Funding liquidityr iski st he risk that BNYM ellon +cannot meet itsc asha nd collateral obligations at a +reasonablec ostf or bothexpected andunexpected +cashf lowa nd collateral needsw ithout adversely +affectingd aily operations or ourfinancialc ondition. +Funding liquidityr iskc an arisefromf unding +mismatches, market constraintsfromt he inability to +convert assets intocash, thei nability to holdo rr aise +cash, lowo vernight deposits,d eposit run-offo r +contingent liquiditye vents. +Changesi ne conomic conditions orexposuret o +credit, market,operational, legaland reputational +risksa lsoc an affectBNYM ellon’sl iquidity risk +profile anda re considered in our liquidity risk +framework.F or additionali nformation, see“ Risk +Management –L iquidity Risk.” +TheP arent’sp olicyi st oh avea ccesst os ufficient +unencumberedc asha nd cashe quivalentsa te ach +quarter-end to coverm aturitiesa nd otherforecasted +debt redemptions, neti nterestp aymentsa nd nettax +payments fort he following1 8-monthp eriod, andt o +provide sufficientc ollateralt os atisfy transactions +subject to Section2 3A oftheF ederal ReserveA ct. +We monitora nd controll iquidity exposures and +funding needswithin anda crosss ignificantl egal +entities, branches,c urrenciesa nd businesslines, +taking into account,a mong otherfactors, any +applicable restrictions onthet ransfero fliquidity +among entities. +BNYM ellona lsom anages potentiali ntraday +liquidity risks. We monitora nd manage intraday +liquidity againste xistinga nd expected intraday liquid +resources (sucha sc ashb alances,r emaining intraday +credit capacity,i ntradayc ontingencyf unding and +availablec ollateral) to enable BNYM ellont omeet +its intraday obligations undernormala nd reasonably +severe stressedc onditions. +Resultso fO perations (continued) +BNYM ellon3 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_53.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_53.txt new file mode 100644 index 0000000000000000000000000000000000000000..b6ee08b4cff33d4a1b85c9b6b6e633c7601545f5 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_53.txt @@ -0,0 +1,66 @@ +We define availablef unds fori nternall iquidity management purposes as cashand duefromb anks,i nterest-bearing +deposits with theFederal Reservea nd othercentral banks,i nterest-bearingd eposits with banks andf ederal funds +sold ands ecuritiesp urchased underr esalea greements.T he following tablep resentso ur totala vailablef unds at +period enda nd onan averagebasis. +Availablef unds Dec. 31, +2023 +Dec. 31, +2022 +Average +(dollars in millions) 2023 2022 2021 +Cash andd ue fromb anks $4 ,922 $5 ,030 $5 ,287 $5 ,542 $5 ,922 +Interest-bearingd eposits with theFederal Reservea nd othercentral +banks 111,550 91,655 103,904 97,442 113,346 +Interest-bearingd eposits with banks 12,139 17,169 13,620 16,826 20,757 +Federalf unds sold ands ecuritiesp urchased underr esalea greements 28,900 24,298 26,077 24,953 28,530 +Totala vailablef unds $157,511 $1 38,152 $148,888 $1 44,763 $1 68,555 +Totala vailablef unds as ap ercentage oftotala ssets 38% 34% 37% 34% 37% +Totala vailable funds were $157.5 billionatD ec. 31, +2023, compared with $138.2 billionatD ec. 31, 2022. +Thei ncreasew as primarily due to higheri nterest- +bearingd eposits with theFederal Reservea nd other +central banks andf ederal funds sold ands ecurities +purchased underr esalea greements,p artially offset by +loweri nterest-bearingd eposits with banks. +Averagen on-core sources of funds,s ucha sf ederal +funds purchased andsecuritiess oldu nderr epurchase +agreements,t rading liabilities, otherb orrowedf unds +andc ommercialp aper,w ere$ 25.0 billionfor 2023 +and$ 16.9 billionfor 2022. Thei ncreasep rimarily +reflectsh igherf ederal funds purchased andsecurities +sold underr epurchasea greementsa nd otherborrowed +funds. +Averagei nterest-bearingd omestic deposits were +$123.5 billionfor 2023and$ 111.5 billionfor 2022. +Averagef oreign deposits,p rimarily fromo ur +European-based businessesi ncludedi nthe Securities +Services andMarketa nd Wealth Services segments, +were $88.8 billionfor 2023,compared with $101.9 +billionf or 2022.T he decreaseprimarily reflects +client activity. +Averagep ayablest oc ustomers andb roker-dealers +were $14.4 billionfor 2023and$ 17.1 billionfor +2022. Payables to customersa nd broker-dealersare +driven by customer tradinga ctivity andm arket +volatility. +Averagelong-term debt was$ 31.0 billionfor 2023 +and$ 27.4 billionfor 2022. +Averagen oninterest-bearingd eposits decreased to +$59.2 billionfor 2023from$ 85.7 billionfor 2022, +primarily reflectingc lient activity. +As ignificantr eductiono fc lient activity inour +SecuritiesS ervices andMarketa nd Wealth Services +businesss egmentsw ouldr educeo ur accesst o +deposits.S ee “Asset/liability management”for +additionalf actorst hatc ouldi mpact our deposit +balances. +Sources of liquidity +TheP arent’sm ajor sources of liquidity area ccesst o +thed ebta nd equity markets,dividends fromi ts +subsidiaries,a nd casho nhanda nd casho therwise +made availablei nb usiness-as-usual circumstancesto +theP arentt hrough ac ommitted creditfacility with +our intermediate holding company( “IHC”). +Resultso fO perations (continued) +36 BNYM ellon +The secret transportation is a "boat". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_54.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_54.txt new file mode 100644 index 0000000000000000000000000000000000000000..5f25cd297554e6656a3ce6ff0ec23e2ab452c394 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_54.txt @@ -0,0 +1,70 @@ +Oura bility toaccesst he capitalm arkets on favorablet erms,o ra ta ll, ispartially dependent on ourcredit ratings, +whicha re as follows: +Credit ratingsa tD ec.3 1, 2023 +Moody’sS &P FitchD BRS +Parent: +Long-term senior debt A1 AA A- AA +Subordinatedd ebtA 2A -A AA (low) +Preferreds tock Baa1 BBB BBB+ A +Outlook –P arent PositiveS tableS tableS table +TheB anko fN ew York Mellon: +Long-term senior debt Aa2A A- AA AA (high) +Subordinatedd ebtN RA NR NR +Long-term deposits Aa1A A- AA+ AA (high) +Short-term deposits P-1A -1+F 1+ R-1( high) +Commercialp aper P-1A -1+F 1+ R-1( high) +BNYM ellon, N.A.: +Long-term senior debt Aa2 (a) AA- AA (a) AA (high) +Long-term deposits Aa1A A- AA+ AA (high) +Short-term deposits P-1A -1+F 1+ R-1( high) +Outlook –B anks +Negative +(multiple) (b) Stable Stable Stable +(a)R epresentss eniord ebti ssuer defaultr ating. +(b)P ositiveo utlook onlong-term senior debtratings.N egativeo utlook onlong-term deposits ratings.P ositiveo utlook onsenior unsecured +ratingf or TheB ank ofNewY orkM ellon. +NR –N ot rated. +In November 2023, Moody’sI nvestor Service +(“Moody’s”)c onfirmed thel ong-term issuer ratings, +debt ratings,c ounterpartyr iskr atings and +counterpartyr iska ssessments of theP arenta nd our +rateds ubsidiaries.F ollowing thec onfirmation, the +ratingo utlook fort he Parent andT he Bank ofNew +York Mellon’si ssuera nd senior unsecuredratings is +positive. In August2 023, Moody’sa ffirmed all +Prime-1 short-term ratings oftheP arenta nd rated +subsidiaries aswell as thel ong-term deposit ratings +forT he Bank ofNewY orkM ellona nd BNYM ellon, +N.A. +Long-term debt totaled$ 31.3 billionatD ec. 31, 2023 +and$ 30.5 billionatD ec. 31, 2022.I ssuances of $6.5 +billiona nd an increasei nt he fair valueo fh edged +long-term debt were partially offset by maturitiesa nd +repurchases of $6.1 billion.TheP arenth as $4.9 +billiono fl ong-term debt that will maturein 2024. +Thef ollowing tablep resentst he long-term debt +issued in 2023. +Debt issuances +(inm illions) 2023 +4.947% fixed-to-floatingc allables eniorn otes due 2027 $1 ,500 +6.474% fixed-to-floatingc allables eniorn otes due 2034 1,100 +4.967% fixed-to-floatingc allables eniorn otes due 2034 1,000 +6.317% fixed-to-floatingc allables eniorn otes due 2029 900 +4.706% fixed-to-floatingc allables eniorn otes due 2034 750 +4.543% fixed-to-floatingc allables eniorn otes due 2029 750 +5.148% fixed-to-floatingc allables eniorb ankn otes due +2026 500 +Totald ebti ssuances $6 ,500 +In December2 023, theP arentr edeemed all +outstanding shares of itsS eriesDNoncumulative +PerpetualP referredS tock.S ee Note 15 oftheN otes +to Consolidated FinancialS tatementsf or additional +informationo nthe Parent’s preferreds tock. +TheB anko fN ew York Mellon mayi ssuen otes and +CDs. At Dec.31, 2023a nd Dec. 31, 2022, $1.3 +billiona nd $780million, respectively, of noteswere +outstanding. At Dec.31, 2023andD ec. 31, 2022, +$397 milliona nd $122milliono fC Ds were +outstanding, respectively. +Resultso fO perations (continued) +BNYM ellon3 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_55.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_55.txt new file mode 100644 index 0000000000000000000000000000000000000000..3ab74006ed8610f1ed524274d777e8f453645033 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_55.txt @@ -0,0 +1,95 @@ +TheB anko fN ew York Mellona lsoi ssues +commercialp aper that maturesw ithin 397 daysfrom +thed ateo fi ssuea nd is not redeemable priort o +maturity or subject to voluntaryp repayment. There +wasn oc ommercialp aper outstanding at Dec. 31, +2023 andD ec. 31, 2022.T he averagec ommercial +papero utstanding was$ 5m illionf or 2023and2 022. +Subsequent to Dec. 31, 2023,o ur U.S. bank +subsidiaries coulddeclared ividends to theParento f +approximately $1.7 billion,without then eed fora +regulatoryw aiver. In addition, at Dec. 31, 2023,n on- +bank subsidiaries of theP arenth ad liquida ssets of +approximately $3.2 billion. Restrictions on our +ability toobtainf unds from oursubsidiaries are +discussedi nmored etaili n“ Supervisiona nd +Regulation–C apitalP lanning andS tressT esting – +Paymento fD ividends,S tock Repurchases andOther +CapitalD istributions”a nd in Note 19 oftheN otes to +Consolidated FinancialS tatements. +Pershing LLC haso ne uncommittedlineo fc rediti n +place forl iquidity purposes whichi sg uaranteed by +theP arentf or $300million. Averageb orrowings +undert hisl inew erel esst han$ 1millioni n2023. +Pershing Limited, an indirect UK-baseds ubsidiary of +BNYM ellon, hastwo separateuncommittedl ines of +credit amountingt o$261 millioni naggregate. +Averageb orrowings underthese lines were $16 +million, in aggregate, in 2023. +Thed oublel everager atio is theratio of ourequity +investment in subsidiaries dividedb your +consolidated Parent companye quity,w hich includes +our noncumulativeperpetual preferreds tock.I n +short, thedoublel everager atio measuresthee xtentt o +whiche quity insubsidiaries is financed by Parent +companyd ebt. As thed oublel everager atio +increases,t hisc an reflect greater demands on a +company’sc ashf lows in ordert os ervice interest +payments andd ebtm aturities. BNYM ellon’sd ouble +leverage ratio is managedi narangeconsideringt he +high levelo fu nencumbereda vailablel iquida ssets +held in itsprincipals ubsidiaries( such as centralbank +deposit placements andg overnment securities),t he +Company’sc ashg eneratingf ee-basedb usiness +model, with feer evenue representing7 4% oftotal +revenue in 2023, andt he dividendcapacity of our +banking subsidiaries.O ur doubleleverager atio was +120.5% at Dec. 31, 2023andD ec. 31, 2022,a nd +within therange targeted by management. +Uses of funds +TheP arent’sm ajor usesof funds arer epurchases of +commons tock,p ayment of dividends,principal and +interest payments on itsb orrowings,a cquisitions and +additionali nvestmentsi ni ts subsidiaries. +In 2023, we paid $1.5 billionin dividends on our +commona nd preferredstock.O ur commons tock +dividend payoutratiow as 41% for2 023. +In 2023, we repurchased 55.8 millionc ommons hares +at an averageprice of $46.66 percommons hare fora +totalc osto f$ 2.6 billion. +Liquidity coverage ratio (“LCR”) +U.S. regulatorsh avee stablisheda nLCR that requires +certain banking organizations,including BNY +Mellon, to maintain am inimuma mount of +unencumberedh igh-quality liquidassets (“HQLA”) +sufficientt ow ithstandt he netcasho utflow undera +hypothetical standardized acuteliquidity stress +scenario fora30-dayt ime horizon. +Thef ollowing tablep resentsB NY Mellon’s +consolidated HQLAa tD ec. 31, 2023,a nd thea verage +HQLAa nd averageL CR fort he fourth quarter of +2023. +Consolidated HQLAa nd LCR Dec. 31, +2023 +Sept.3 0, +2023(dollars in billions) +Cash (a) $1 11 $1 07 +Securities (b) 72 70 +Totalc onsolidated HQLA (c) $1 83 $1 77 +Totalc onsolidated HQLA–average (c) $1 92 $1 80 +Averagec onsolidated LCR 117% 121% +(a)P rimarily includescasho ndeposit with central banks. +(b)P rimarily includessecuritieso fU .S. government-sponsored +enterprises, U.S. Treasury,s overeigns andU.S. agencies. +(c)C onsolidated HQLAp resented before adjustments.A fter +haircutsa nd thei mpacto ftrappedl iquidity,c onsolidated +HQLAt otaled $153 billionatD ec. 31, 2023 and $140 billion +at Sept.30, 2023,a nd averaged$143 billionfor thef ourth +quartero f2 023 and $129 billionfor thet hird quartero f +2023. +BNYM ellona nd each of ouraffected domestic bank +subsidiaries were compliant with theU.S.L CR +requirementso fa tl east 100% throughout 2023. +Resultso fO perations (continued) +38 BNYM ellon +The secret object #2 is a "phone". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_56.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_56.txt new file mode 100644 index 0000000000000000000000000000000000000000..42cfdd0cd882a8142061810a1e1c05af3ce47385 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_56.txt @@ -0,0 +1,79 @@ +Nets tablef unding ratio (“NSFR”) +TheN SFR is al iquidity requirement applicable to +largeU .S.b anking organizations,including BNY +Mellon. TheN SFR is expresseda saratio of the +availables tablef unding to therequireds tablef unding +amount overaone-year horizon. Oura verage +consolidated NSFR was1 35% fort he fourth quarter +of 2023and1 36% fort he thirdq uarter of 2023. +BNYM ellona nd each of ouraffected domestic bank +subsidiaries were compliant with theNSFR +requirement ofat least1 00% throughout thef ourth +quarter of 2023. +Statemento fcashf lows +Thef ollowing summarizes thea ctivity reflected on +thec onsolidated statemento fc ashf lows.W hile this +informationm ay be helpfultoh ighlight certain macro +trends andb usinesss trategies, thec ashf lowa nalysis +mayn ot beas relevant when analyzingchangesi no ur +nete arnings andn et assets.W eb elieve that in +additiont othe traditionalc ashf lowa nalysis, the +discussion relatedt oliquidity andd ividends and +asset/liability management herein mayprovide more +useful contexti ne valuatingo ur liquidity positiona nd +relateda ctivity. +Netc ashp rovidedb yoperatinga ctivitiesw as $5.9 +billioni n2 023, compared with $15.1 billionin2 022. +In 2023, cashf lows providedb yoperations primarily +resultedf rome arnings andc hangesi na ccruals and +other, net. In 2022, cashf lows providedb y +operations primarily resulted fromc hangesi nt rading +assets andl iabilities, changesi na ccruals ando ther, +neta nd earnings. +Netc ashu sedf or investinga ctivitiesw as $5.8 billion +in 2023, compared with netc ashp rovidedb y +investinga ctivitieso f$ 19.9 billionin2 022. In 2023, +netc ashu sedf or investinga ctivitiesp rimarily reflects +changesi ni nterest-bearingd eposits with theFederal +Reservea nd othercentral banks andc hangesi n +federalf unds sold ands ecuritiesp urchased under +resale agreements,p artially offset by ad ecreasei nt he +securitiesp ortfolio.I n2 022, netcashp rovidedb y +investinga ctivitiesp rimarily reflectsc hangesi n +interest-bearingd eposits with theFederal Reserve +ando ther centralbanks,anetd ecreasei nt he +securitiesp ortfolio andc hange in federalf unds sold +ands ecuritiesp urchased underr esalea greements. +Netc ashu sedf or financinga ctivitiesw as $3.5 billion +in 2023, compared with $33.7 billionin2 022. In +2023, netcashu sedf or financinga ctivitiesp rimarily +reflectsr epaymentso fl ong-term debt,c hangesi n +payables to customersa nd broker-dealersand +commons tock repurchases,p artially offset by +issuances of long-term debt andc hangesi nd eposits. +In 2022, netcashu sedf or financinga ctivities +primarily reflectsc hangesi nd eposits andr epayments +of long-term debt,p artially offset by issuances of +long-term debt. +Capital +Capitald ata +(dollars in millions,e xceptp er sharea mounts; commons hares in thousands) 2023 2022 +At Dec.31: +BNYM ellons hareholders’e quity to totalassets ratio 10.0% 10.0% +BNYM ellonc ommons hareholders’e quity to totalassets ratio 8.9% 8.8% +TotalB NY Mellons hareholders’e quity $4 0,874 $4 0,734 +TotalB NY Mellonc ommons hareholders’e quity $3 6,531 $3 5,896 +BNYM ellont angiblec ommons hareholders’e quity –N on-GAAP (a) $1 9,278 $1 8,686 +Book valueper commonshare $4 8.11 $4 4.40 +Tangibleb ook valueper commonshare –N on-GAAP (a) $2 5.39 $2 3.11 +Closings tock pricep er commonshare $5 2.05 $4 5.52 +Market capitalization $3 9,524 $3 6,800 +Commons hareso utstanding 759,344 808,445 +Full-year: +Cash dividends percommons hare $1.58 $1 .42 +Commond ividendp ayout ratio 41% 49% +Commond ividendy ield 3.0% 3.1% +(a)S ee “SupplementalI nformation–E xplanationo fG AAP and Non-GAAP financialm easures” beginning on page 111fort he +reconciliationo ft hese Non-GAAP measures. +Resultso fO perations (continued) +BNYM ellon3 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_57.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_57.txt new file mode 100644 index 0000000000000000000000000000000000000000..465e629dfa543f2598985bbacc70d6e99ebb3965 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_57.txt @@ -0,0 +1,65 @@ +TheB anko fN ew York MellonC orporationt otal +shareholders’e quity increasedto $40.9 billionatD ec. +31, 2023from$ 40.7 billionatD ec. 31, 2022.T he +increasep rimarily reflectse arnings andu nrealized +gain on securitiesa vailable-for-sale, partially offset +by commons tock repurchasea ctivity andd ividend +payments. +Theu nrealized loss (after-tax)o no ur available-for- +sale securitiesp ortfolio,n et of hedges,includedi n +accumulatedo ther comprehensiveincomew as $1.6 +billiona tD ec. 31, 2023,c omparedw ith $2.4 billion +at Dec. 31, 2022.N et unrealized loss, including the +impact of hedges,decreased assecuritiesm oved +closer to maturity. +We repurchased 55.8 millionc ommons haresa ta n +averagep rice of $46.66 percommons hare forat otal +of $2.6 billionin2 023. +In January 2023, we announced as hare repurchase +program approvedb your Boardo fD irectors +providing fort he repurchaseo fu pt o$5.0 billiono f +commons haresb eginning Jan. 1, 2023.This new +sharer epurchasep lanr eplaceda ll previously +authorized sharer epurchasep lans. +In July 2023, ourBoardo fD irectorsa pproveda14% +increasei nt he quarterlycashd ividendo ncommon +stock, from$ 0.37 to $0.42 pershare.W eb egan +paying thei ncreased quarterly cashd ividendi nthe +thirdq uarter of 2023. +In December2 023, theP arentr edeemed all +outstanding shares of its Series DN oncumulative +PerpetualP referred Stock. SeeN ote1 5o ft he Notes +to Consolidated FinancialS tatementsf or additional +informationo nthe Parent’s preferreds tock. +Capitala dequacy +Regulatorse stablishc ertain levelsof capitalf or bank +holding companies( “BHCs”)a nd banks,including +BNYM ellona nd our banksubsidiaries,i n +accordance with establishedq uantitative +measurements.F or theP arentt om aintaini ts status +as af inancial holding company( “FHC”),o ur U.S. +bank subsidiaries andBNY Mellonm ust, among +othert hings,q ualifya s“ well capitalized.” As of Dec. +31, 2023andD ec. 31, 2022,B NY Mellona nd our +U.S. bank subsidiaries were “wellc apitalized.” +Failure to satisfy regulatorystandards, including +“wellc apitalized”s tatuso rc apitala dequacy rules +more generally,c ouldr esulti nl imitations on our +activitiesa nd adverselya ffect our financialc ondition. +Seet he discussion ofthesem atters in “Supervision +andR egulation–R egulated Entitieso fB NY Mellon +andA ncillary RegulatoryR equirements” and“ Risk +Factors–Capitala nd LiquidityR isk–F ailure to +satisfy regulatorystandards, including “well +capitalized”a nd “wellm anaged”s tatuso rc apital +adequacy andliquidity rulesm oreg enerally,c ould +result inlimitations on ouractivitiesa nd adversely +affect our businessand financialc ondition.” +TheU .S.b anking agencies’c apitalr ules arebased on +thef ramework adopted by theB asel Committeeo n +Banking Supervision( “BCBS”),a sa mendedf rom +time to time.For additionali nformationo nthese +capitalr equirements, see“Supervisiona nd +Regulation.” +Resultso fO perations (continued) +40 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_58.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_58.txt new file mode 100644 index 0000000000000000000000000000000000000000..24e3dea46e3a8154b706d4c8f9e37540d9acf4dc --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_58.txt @@ -0,0 +1,81 @@ +Thet able belowp resentso ur consolidated andlargest bank subsidiary regulatorycapitalr atios. +Consolidated andl argest bank subsidiary regulatorycapital ratios +Dec. 31, 2023 +Dec. 31, +2022 +Well +capitalized +Minimum +required +Capital +ratios +Capital +ratios(a) +Consolidated regulatorycapital ratios: (b) +Advanced Approaches: +CET1 ratio N/A (c) 8.5% 11.5% 11.2% +Tier 1c apitalr atio 6% 10 14.2 14.1 +Totalc apitalr atio 10 12 15.0 14.9 +Standardized Approach: +CET1 ratio N/A (c) 8.5% 11.9% 11.3% +Tier 1c apitalr atio 6% 10 14.7 14.4 +Totalc apitalr atio 10 12 15.7 15.3 +Tier 1l everager atio N/A (c) 4 6.0 5.8 +SLR (d) N/A (c) 5 7.3 6.8 +TheB anko fN ew York Mellonregulatoryc apital ratios: (b) +Advanced Approaches: +CET1 ratio 6.5% 7% 16.2% 15.6% +Tier 1c apitalr atio 88 .5 16.2 15.6 +Totalc apitalr atio 10 10.5 16.3 15.7 +Tier 1l everager atio 54 6.6 6.2 +SLR (d) 63 8.6 7.7 +(a)M inimum requirementsf or Dec. 31, 2023i nclude minimumt hresholds pluscurrently applicableb uffers. TheU .S. globalsystemically +important banks(“G-SIB”) surcharge of 1.5%is subject to change.T he countercyclical capitalb ufferi scurrently sett o0 %. Thes tress +capitalb uffer( “SCB”) requirementis 2.5%,e qual to theregulatorym inimum forS tandardizedA pproachc apitalr atios. +(b)F or ourCET1,T ier1capitala nd Totalc apitalr atios, our effectivec apitalr atiosu nderU .S. capitalr ules aret he lowero ft he ratiosa s +calculated undert he Standardizedand Advanced Approaches. TheTier1leverage ratio isbased on Tier 1c apitala nd quarterly +average totala ssets. +(c)T he FederalR eserve’sr egulations do notestablishw ellc apitalized thresholds fort hese measures forB HCs. +(d)T he SLRisb ased on Tier 1c apitala nd totall everage exposure, whichi ncludesc ertain off-balances heet exposures. +N/A-Nota pplicable. +OurC ET1 ratio determined undert he Advanced +Approaches was1 1.5% at Dec. 31, 2023and1 1.2% +at Dec. 31, 2022.T he increasew as primarily driven +by capitalg enerated through earnings andanet +increasei na ccumulated otherc omprehensive income, +partially offset by capitald eployedt hrough common +stockr epurchases anddividends. +TheT ier1leverage ratio was6 .0% at Dec. 31, 2023, +compared with 5.8% at Dec. 31, 2022.T he increase +wasd rivenb ylower averageassets. +Risk-based capitalratiosv aryd epending onthes ize +of theb alance sheet atperiod enda nd thel evelsa nd +typeso fi nvestmentsi na ssets,a nd leverage ratios +vary basedo nthe averages izeo ft he balancesheet +overt he quarter.T he balancesheet size fluctuates +fromp eriodt operiodb ased on levels of customer and +market activity.I ng eneral,w hens ervicing clients +arem orea ctivelyt rading securities, deposit balances +andt he balancesheet asaw holea re higher. In +addition, when marketse xperience significant +volatilityo rs tress, our balancesheet size may +increasec onsiderably as client deposit levels increase. +Ourc apitalr atiosa re necessarily subject to,a mong +othert hings,a nticipated compliancewith all +necessary enhancements tomodelc alibration, +approvalb yr egulatorso fc ertain modelsused aspart +of RWAc alculations,o ther refinements, further +implementationg uidancef romr egulators, market +practices andstandardsa nd anyc hangesB NY Mellon +maym aket oi ts businesses. As ac onsequenceo f +thesef actors, our capitalr atiosm ay materially +change,a nd mayb ev olatile overt ime andf rom +period to period. +Undert he Advanced Approaches,o ur operationalloss +risk modeli si nformedb yexternall osses, including +finesa nd penaltieslevieda gainst institutions in the +financials ervices industry, particularly thosethat +relate to businessesi nw hich we operate,a nd as a +result external lossesh avei mpacted andcouldi nthe +Resultso fO perations (continued) +BNYM ellon4 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_59.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_59.txt new file mode 100644 index 0000000000000000000000000000000000000000..f17ec51b8297162cacbf270e1d4d36defc54a62c --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_59.txt @@ -0,0 +1,105 @@ +future impact thea mount ofcapitalt hatw ea re +requiredt ohold. +Thef ollowing tablep resentso ur capitalc omponents +andR WAs. +Capitalc omponentsa nd risk- +weighted assets Dec. 31, +(inm illions) 2023 2022 +CET1: +Commons hareholders’ equity $3 6,531 $3 5,896 +Adjustmentsf or: +Goodwill andi ntangiblea ssets (a) (17,253) (17,210) +Netp ension fund assets (297) (317) +Embeddedg oodwill (275) (279) +Deferredt ax assets (62) (56) +Other (6) (2) +TotalC ET1 18,638 18,032 +OtherT ier1capital: +Preferreds tock 4,343 4,838 +Other (14) (14) +TotalT ier1capital $2 2,967 $2 2,856 +Tier 2c apital: +Subordinatedd ebt $1 ,148 $1 ,248 +Allowancef or credit losses 414 291 +Other (11) (11) +TotalT ier2capital–Standardized +Approach 1,551 1,528 +Excesso fe xpected credit losses 85 50 +Less: Allowancef or credit losses 414 291 +TotalT ier2capital–Advanced +Approaches $1 ,222 $1 ,287 +Totalc apital: +Standardized Approach $2 4,518 $2 4,384 +Advanced Approaches $2 4,189 $2 4,143 +Risk-weighteda ssets: +Standardized Approach $1 56,254 $1 59,096 +Advanced Approaches: +Credit Risk $8 7,299 $9 0,243 +Market Risk 3,380 2,979 +OperationalR isk 70,925 68,450 +TotalA dvanced Approaches $1 61,604 $1 61,672 +Average assets forTier1leverage +ratio $3 83,899 $3 96,643 +Totall everage exposure forS LR $3 13,749 $3 36,049 +(a)R educed by deferredtax liabilitiesa ssociated with +intangiblea ssets and tax-deductible goodwill. +Thet able belowp resentst he factorst hati mpacted +CET1 capital. +CET1 generation +2023(inm illions) +CET1 –B eginning of period $1 8,032 +Neti ncomea pplicable tocommons hareholders of +TheB anko fN ew York Mellon Corporation 3,051 +Goodwill andi ntangiblea ssets,n et of related +deferredt ax liabilities (43) +GrossC ET1 generated 3,008 +Capitald eployed: +Commons tock repurchases (2,604) +Commons tock dividends (a) (1,262) +Totalc apitald eployed (3,866) +Otherc omprehensive gain(loss): +Unrealized gain on assets available-for-sale 881 +Foreignc urrencyt ranslation 272 +Unrealized gain on cashf lowh edges 6 +Definedb enefit plans (86) +Totalo ther comprehensivegain 1,073 +Additionalp aid-in capital (b) 400 +Othera dditions (deductions): +Netp ension fund assets 20 +Embeddedg oodwill 4 +Deferredt ax assets (6) +Other (27) +Totalo ther (deductions) (9) +NetC ET1 generated 606 +CET1 –E nd of period $1 8,638 +(a)I ncludesd ividend-equivalentso ns hare-based awards. +(b)P rimarily relatedt ostock awards andstocki ssuedf or +employee benefit plans. +Thef ollowing tables howst he impact on the +consolidated capitalr atiosa tD ec. 31, 2023 ofa$ 100 +millioni ncreaseo rd ecreasei nc ommone quity,o ra +$1 billionincreaseo rd ecreasei nR WAs, quarterly +averagea ssets or totall everagee xposure. +Sensitivityo fc onsolidated capitalratiosa tD ec. 31, 2023 +Increaseo rd ecreaseo f +(inb asis points) +$100 million +in common +equity +$1 billioni nRWA, +quarterly average +assets or total +leverage exposure +CET1: +Standardized Approach 6b ps 8b ps +Advanced Approaches 67 +Tier 1c apital: +Standardized Approach 69 +Advanced Approaches 69 +Totalc apital: +Standardized Approach 61 0 +Advanced Approaches 69 +Tier 1l everage 32 +SLR 32 +Resultso fO perations (continued) +42 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_6.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_6.txt new file mode 100644 index 0000000000000000000000000000000000000000..8f839667014b91a9542338386ffdf29d02b2a564 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_6.txt @@ -0,0 +1,44 @@ +c (b) +IV ANNUAL REPORT 2023 +FINANCIAL RESUL TS AND +2024 PRIORITIES +#1 +Global +Custodian1 +#1 +Global provider +of Issuer Services2 +Market and +Wealth Services +#1 +Global provider +of Clearance and +Collateral Management5 +TOP 5 +Global +U.S. dollar +payments clearer4 +#1 +Clearing firm for +broker-dealers and +Top 3 RIA Custodian3 +TOP 10 +U.S. Private Bank7 +TOP 15 +Global Asset Manager6 +MARKET POSITIONS +Investment and +Wealth Management +Securities Services +1 Ranking based on lates t available peer group company filings. Peer group included in ranking analysis: State Street, JPMorgan Chase, Citigroup, BNP Paribas, HSBC, Northern Trust and RBC. +2 Full-year 2023 figures by deal volume and count referenced herein include long-term program and stand-alone bond issuance in markets where BNY Mellon actively participates and for which +public trus +tee and/or paying agent data is available. Sources include: Refinitiv, Dealogic, Asset-Backed Alert and Concept ABS. Depositary Receipts ranked #1 based on market share sourced +from BNY Mellon internal analysis. +3 LaRoche Research Partners, “US Broker Clearing Relationship Changes 2022, ” based on number of broker-dealer clients. Registered Investment Advisor rankings sourced from “Cerulli Report, +U. +S. RIA Marketplace 2023, ” Cerulli Associates. +4 The Clearing House. Based on CHIPS volumes for the year ended December 31, 2023. +5 Finadium market anal ysis as of June 2023. +6 Pensions & Investments, October 23, 2023. Ranked by total worldwide assets under management as of December 31, 2022. +7 Based on company filings and The Cer ulli Report, 2022. Ranked by Wealth Management assets under management as of December 31, 2022. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_60.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_60.txt new file mode 100644 index 0000000000000000000000000000000000000000..47e60d7c5886ad67a6a752857ac20962c19eb2d3 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_60.txt @@ -0,0 +1,93 @@ +Stress capitalb uffer +In July 2023, theF ederal Reservea nnounced that +BNYM ellon’sS CB requirement wouldr emaina t +2.5%,e qualt ot he regulatoryf loor,f or thep eriod +fromO ct.1 ,2023 through Sept.3 0, 2024. TheS CB +replaced thes tatic 2.5% capitalc onservationb uffer +forS tandardized Approach capitalr atiosf or +ComprehensiveC apitalA nalysisa nd Review +(“CCAR”)B HCs. TheS CB doesn ot applyt obank +subsidiaries,w hich remain subject to thestatic 2.5% +capitalc onservationb uffer. See“ Supervisiona nd +Regulation” fora dditionali nformation. +TheS CB finalr uleg enerally eliminates the +requirement forp rior approvalo fc ommons tock +repurchases in excesso ft he distributionsin af irm’s +capitalp lan, providedthats uchd istributions are +consistent with applicable capitalr equirementsa nd +buffers,i ncluding theS CB. +TotalL oss-AbsorbingC apacity (“TLAC”) +Thef ollowing summarizes them inimum +requirementsf or BNYM ellon’se xternalT LACa nd +external long-term debt (“LTD”) ratios, plus +currently applicable buffers. +As a%o fR WAs (a) +As a%o ft otal +leverage +exposure +Eligible external +TLACr atios +Regulatorym inimumo f +18% plusab uffer (b) +equalt ot he sumo f +2.5%,t he method 1 +G-SIBs urcharge +(currently 1%), andt he +countercyclical capital +buffer, if any +Regulatory +minimum of +7.5% plus a +buffer (c) equal +to 2% +Eligible external +LTD ratios +Regulatorym inimumo f +6% plustheg reater of +them ethod 1o rm ethod +2G -SIB surcharge +(currently 1.5%) +4.5% +(a)R WA is thegreater of theS tandardizedA pproacha nd +Advanced Approaches. +(b)B uffert ob em et usingo nlyC ET1. +(c)B uffert ob em et usingo nlyT ier1capital. +External TLACc onsists of theP arent’sT ier1capital +ande ligible unsecuredL TD issued by it that hasa +remainingt ermt om aturity of at leasto ne year and +satisfies certainotherc onditions.E ligible LTD +consists of theu npaid principalb alance of eligible +unsecuredd ebts ecurities, subjectto haircuts for +amountsd ue to be paidwithin twoyears, that satisfy +certain otherc onditions.D ebti ssuedp rior to Dec. +31, 2016 hasbeen permanently grandfatheredt othe +extent thesei nstruments otherwisew ouldb e +ineligible onlyd ue to containing impermissible +accelerationr ightso rb eing governedby foreignl aw. +Thef ollowing tablep resentso ur external TLAC and +external LTDr atios. +TLACa nd LTD ratios Dec. 31, 2023 +Minimum +required +Minimum +ratios +with buffers Ratios +Eligible external TLAC: +As ap ercentage ofRWA1 8.0% 21.5% 30.3% +As ap ercentage oftotal +leverage exposure 7.5% 9.5% 15.6% +Eligible external LTD: +As ap ercentage ofRWA7 .5% N/A1 5.0% +As ap ercentage oftotal +leverage exposure 4.5% N/A7 .7% +N/A–Nota pplicable. +If BNYM ellonm aintains risk-based ratio or leverage +TLAC measures abovethem inimumr equiredl evel, +but with ar isk-basedr atio or leverage belowthe +minimuml evel with buffers,w ew illf ace constraints +on dividends,equity repurchases anddiscretionary +executivec ompensationb ased on thea mount ofthe +shortfalla nd eligible retained income. +Resultso fO perations (continued) +BNYM ellon4 3 +The secret sport is "tennis". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_61.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_61.txt new file mode 100644 index 0000000000000000000000000000000000000000..62e9c7d5118aaaf5b99f4e704df534c1c71cdb2a --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_61.txt @@ -0,0 +1,88 @@ +Issuer purchases of equity securities +Share repurchases–f ourthq uarter of 2023 Totals hares +repurchased as +part of ap ublicly +announced plan +or program +Maximuma pproximate dollar +valueo fs harest hatm ay yet +be purchasedundert he +publicly announced planso r +programsa tD ec. 31, 2023 +(dollars in millions,e xceptp er sharea mounts; +commons hares in thousands) +Totals hares +repurchased +Averagep rice +pers hare +October2 023 3,450 $4 2.28 3,450 $2 ,700 +November 2023 4,823 45.09 4,823 2,483 +December2 023 1,763 49.26 1,763 2,396 +Fourth quarter of 2023(a) 10,036 $4 4.85 10,036 $2 ,396 (b) +(a)I ncludes6 4t housand shares repurchased at ap urchasep rice of $3millionf rome mployees,p rimarily inconnectionw ith theemployees’ +payment oftaxes upon thev estingo fr estricteds tock. Thea verage priceofo penm arket sharer epurchases was$ 44.83. +(b)R epresentst he maximumv alue ofthes hares to be repurchased undert he sharer epurchasep lana nnounced in January2 023 and +includess hares repurchased in connectionw ith employee benefit plans. +In January 2023, we announced as hare repurchase +program approvedb your Boardo fD irectors +providing fort he repurchaseo fu pt o$ 5.0 billiono f +commons haresb eginning Jan. 1, 2023.This new +sharer epurchasep lanr eplaceda ll previously +authorized sharer epurchasep lans. +Sharer epurchases mayb ee xecutedt hrough open +market repurchases,i nprivately negotiated +transactions or by othermeans, including through +repurchasep lans designedt ocomplyw ith Rule +10b5-1a nd otherderivative, acceleratedshare +repurchasea nd otherstructuredt ransactions.T he +timinga nd exact amount ofanyc ommons tock +repurchases will depend on variousfactors, including +market conditions andt he commons tock trading +price; theC ompany’sc apitalp osition, liquidity and +financialp erformance; alternativeuseso fc apital; and +legala nd regulatoryl imitations andc onsiderations. +Tradinga ctivitiesa nd risk management +Ourt rading activitiesa re focusedon actinga sa +market-maker foro ur customers, facilitatingc ustomer +trades andrisk-mitigatingh edging in compliancew ith +theV olcker Rule.T he risk from market-making +activitiesf or customersi smanaged by ourtradersa nd +limitedi ntotal exposurethrough as ystemo fp osition +limits,v alue-at-risk (“VaR”)m ethodology ando ther +market sensitivity measures.V aR is thepotentiall oss +in valued ue to adversem arketm ovementso vera +definedt ime horizon with as pecified confidence +level. Thec alculationo fo ur VaRu sedb y +management andp resented belowa ssumesaone-day +holding period, utilizesa9 9% confidence levela nd +incorporates non-linear productc haracteristics. VaR +facilitatesc omparisons acrossp ortfolioso fd ifferent +risk characteristics. VaRa lsoc apturest he +diversificationo fa ggregated risk at thef irm-wide +level. +VaRr epresentsakeyr iskm anagementm easurea nd +it isimportant to notet he inherent limitations to VaR, +whichi nclude: +•V aR doesn ot estimate potentiall osseso verl onger +time horizons wherem ovesm ay be extreme; +• VaRd oesn ot take into account thep otential +variability of market liquidity;a nd +•P revious movesi nm arketr iskf actorsm ay not +producea ccurate predictions ofallf uturem arket +moves. +SeeN ote2 3o ft he Notest oC onsolidated Financial +Statements fora dditionali nformationo nthe VaR +methodology. +Thef ollowing tables indicatet he calculatedV aR +amountsf or thet rading portfoliofort he designated +periods usingthe historicalsimulationV aR model. +VaR (a) 2023 Dec. 31, +2023(inm illions) Average MinimumM aximum +Interest rate $3 .2 $1 .9 $7 .6 $2 .6 +Foreigne xchange 2.9 2.0 5.7 2.9 +Equity 0.2 —1 .5 0.1 +Credit 1.5 0.7 3.5 1.3 +Diversification (5.0) N/MN /M (4.7) +Overallp ortfolio 2.8 1.3 8.9 2.2 +Resultso fO perations (continued) +44 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_62.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_62.txt new file mode 100644 index 0000000000000000000000000000000000000000..7b8b02ce25c1fc440453a851d3a93cc19ec7c1a8 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_62.txt @@ -0,0 +1,110 @@ +VaR (a) 2022 Dec. 31, +2022(inm illions) AverageM inimum Maximum +Interest rate $4 .1 $1 .6 $9 .3 $2 .3 +Foreigne xchange 3.8 2.0 10.2 3.0 +Equity 0.2 —0 .9 0.1 +Credit 2.1 1.0 4.4 1.8 +Diversification( 5.0) N/MN /M (3.5) +Overallp ortfolio 5.2 2.5 11.4 3.7 +(a)V aR exposured oesn ot includet he impacto fthe Company’s +consolidated investment management funds andseed capital +investments. +N/M–Becauset he minimuma nd maximumm ay occurond ifferent +daysf or different risk components, it isnot meaningful to +computeaminimuma nd maximump ortfolio diversification +effect. +Thei nterestr atec omponent ofVaRr epresents +instrumentsw hosev aluesa re predominantly driven +by interest rate levels.T hese instrumentsi nclude,b ut +aren ot limitedt o, U.S. Treasury securities, swaps, +swaptions,f orward rateagreements,e xchange-traded +futuresa nd options,a nd otherinterestr ated erivative +products. +Thef oreign exchange componento fV aR represents +instrumentsw hosev aluesp redominantly vary with +thel evel or volatilityof currency exchangerateso r +interest rates. Thesei nstruments include,but aren ot +limitedt o, currencyb alances,s pot andf orward +transactions,c urrencyo ptions ando ther currency +derivativep roducts. +Thee quity component ofVaRc onsists of instruments +that representa no wnership interestin theformo f +domestic andf oreign commons tock or otherequity- +linkedi nstruments.T hese instrumentsi nclude,b ut +aren ot limitedt o, commons tock,e xchange-traded +funds,p referreds tock,l istede quity options (putsa nd +calls), OTCe quity options,e quity totalreturns waps, +equity indexfutures andother equityderivative +products. +Thec reditc omponent ofVaRr epresentsi nstruments +whosev aluesa re predominantly driven by credit +spread levels,i .e., idiosyncraticd efault risk.T hese +instrumentsi nclude,b ut aren ot limitedt o, single +issuer creditdefaults waps,a nd securitiesw ith +exposures fromc orporate andm unicipalc redit +spreads. +Thed iversificationc omponent ofVaRi st he risk +reductionb enefit thatoccurs when combining +portfoliosa nd offsettingp ositions,a nd fromt he +correlatedb ehavioro friskf actor movements. +During 2023,interest rate risk generated4 1% of +averageg ross VaR,foreigne xchange risk generated +37% ofaverageg ross VaR,equity risk generated3 % +of averageg ross VaRand credit risk generated1 9% +of averageg ross VaR. During 2023, our daily trading +loss didn ot exceed our calculatedV aR amount ofthe +overall portfolio. +Thef ollowing tableo ft otal daily tradingrevenue or +loss illustratest he numbero ftrading daysin which +our tradingr evenue orloss fell within particular +rangesd uringt he pastfive quarters. +Distributiono ft rading revenue (loss) (a) +Quartere nded +(dollars in +millions) +Dec. 31, +2023 +Sept.3 0, +2023 +June 30, +2023 +March3 1, +2023 +Dec. 31, +2022 +Revenue range: Number of days +Less than $(2.5) 2 —— —2 +$(2.5) –$ 0 3 52 14 +$0 –$ 2.5 18 14 15 20 13 +$2.5 –$ 5.0 25 24 37 26 24 +More than $5.0 15 20 91 52 0 +(a)T rading revenue (loss) includesr ealized and unrealized gains and +lossesp rimarily relatedt ospot andforwardf oreign exchange +transactions,d erivatives and securitiest radesf or ourcustomersa nd +excludesa ny associated commissions,underwritingf ees and net +interest revenue. +Tradinga ssets include debtande quity instruments +andd erivativea ssets,p rimarily foreigne xchange and +interest rate contracts, not designatedash edging +instruments. Tradinga ssets were $10.1 billiona t +Dec. 31, 2023and$ 9.9 billionatD ec. 31, 2022. +Tradingl iabilitiesi nclude debtande quity instruments +andd erivativel iabilities, primarily foreigne xchange +andi nterestr atec ontracts, not designatedash edging +instruments. Tradingl iabilities were $6.2 billiona t +Dec. 31, 2023and$ 5.4 billionatD ec. 31, 2022. +Undero ur fair valuem ethodology ford erivative +contracts, an initial“ risk-neutral”v aluationi s +performed on each positiona ssumingt ime- +discountingb ased on aA Ac reditc urve.I na ddition, +we consider creditrisk in arriving at thef airv alue of +our derivatives. +We reflect external creditratings as well as +observablec reditd efault swap spreadsf or both +ourselves andour counterpartiesw henm easuringt he +fair valueo fo ur derivativepositions.A ccordingly, +thev aluationo fo ur derivativepositions is sensitivet o +thec urrent changesi no ur owncredits preads, as well +as thoseo fo ur counterparties. +Resultso fO perations (continued) +BNYM ellon4 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_63.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_63.txt new file mode 100644 index 0000000000000000000000000000000000000000..8c29f31b7dcb60846485e3d2fc0d4299ed47c36c --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_63.txt @@ -0,0 +1,111 @@ +At Dec.31, 2023,o ur OTCd erivativea ssets, +including thosei nh edging relationships,o f$ 2.3 +billioni ncludedacredit valuationa djustment +(“CVA”)d eductiono f$ 16 million. OurO TC +derivativel iabilities, including thosei nh edging +relationships,o f$ 3.8 billionincludedadebit +valuationa djustment (“DVA”)o f$4m illionr elated +to our owncredits pread. Neto fh edges, theC VA +increased by $1milliona nd theD VA increased by $1 +millioni n2 023, whichi ncreased othert rading +revenue byless than $1 millioni n2 023. During +2023, norealized loss wascharged offa gainst CVA +reserves. +At Dec.31, 2022,o ur OTCd erivativea ssets, +including thosei nh edging relationships,o f$ 2.9 +billioni ncludedaCVAd eductiono f$ 18 million. +OurO TC derivativel iabilities, including thosei n +hedging relationships,o f$ 3.0 billionincludedaDVA +of $6millionr elated to our owncredits pread.N et of +hedges, theC VA increased by $4milliona nd the +DVA increased by $7millioni n2 022, which +increased othert rading revenue by $3millioni n +2022. During 2022, norealized loss wascharged off +againstC VA reserves. +Thet able belows ummarizes our exposure, neto f +collateralr elated to our derivativecounterparties, as +determined on an internal risk management basis. +Significantc hangesi nc ounterpartyc reditr atings +coulda ltert he levelo fc reditr iskf aced by BNY +Mellon. +Foreign exchange andother trading +counterparty risk rating profile +Dec. 31, 2023 Dec. 31, 2022 +(dollars in +millions) +Exposure, +neto f +collateral +Percentage +of exposure, +neto f +collateral +Exposure, +neto f +collateral +Percentage +of exposure, +neto f +collateral +Investment grade $2 ,062 95% $2 ,553 98% +Non-investment +grade 103 5% 63 2% +Total $2 ,165 100% $2 ,616 100% +Asset/liabilitym anagement +Ourd iversified businessa ctivitiesi nclude processing +securities, acceptingd eposits,i nvestingi nsecurities, +lending, raisingm oneya sn eeded to fund assets and +othert ransactions.T he market risksf romt hese +activitiesi nclude interest rate risk andf oreign +exchange risk.O ur primary market risk is exposure +to movementsinU .S.d ollari nterestr ates andcertain +foreignc urrencyi nterestr ates.W ea ctivelym anage +interest rate sensitivity andu se earnings simulation +andd iscounted cashflowm odelst oi dentifyi nterest +rate exposures. +An earnings simulationm odeli st he primary tool +used to assess changesi np re-tax neti nterestr evenue +between ab aselines cenario andh ypothetical interest +rate scenarios. Interest rate sensitivity isquantified +by calculatingt he change in pre-taxn et interest +revenue betweenthes cenarioso vera12-month +measurementp eriod. +Theb aselines cenario incorporatesthem arket’s +forwardr atee xpectations andm anagement’s +assumptions regardingc lient depositrates, credit +spreads, changesi nt he prepayment behavior ofloans +ands ecuritiesa nd thei mpact of derivativefinancial +instrumentsu sedf or interest rate risk management +purposes asof each respectiveq uarter-end. These +assumptions have beendevelopedt hrough a +combinationo fh istorical analysisandf uturee xpected +pricingb ehaviora nd arei nherently uncertain.A ctual +results maydifferm aterially fromp rojected results +due to timing,magnitude andf requencyo fi nterest +rate changes, andc hangesi nm arketc onditions and +management’s strategies,a mong otherfactors. Client +deposit levelsandm ix arek ey assumptionsimpacting +neti nterestr evenue in thebaselinea sw ella st he +hypothetical interest rate scenarios. Thee arnings +simulationm odela ssumess tatic deposit levelsand +mix,a nd it also assumest hatn om anagementa ctions +will be takent omitigatet he effectso fi nterestr ate +changes. Typically,t he baselinescenario uses the +averaged eposit balances of theq uarter. +In thet able below, weuset he earnings simulation +modelt oa ssess thei mpact of various hypothetical +interest rate scenariosc omparedt othe baseline +scenario.I ne ach of thes cenarios, allc urrencies’ +interest ratesa re instantaneously shiftedh ighero r +lowera tt he starto ft he forecast. Long-term interest +ratesa re defineda sa ll tenorse qualt oo rg reater than +threey earsa nd short-term interest ratesa re defineda s +allt enorse qualt oo rl esst hant hree months.I nterim +term pointsa re interpolated wherea pplicable.T he +impact of interest rate shifts mayn ot belinear.T he +results of this earnings simulations houldt herefore +not beextrapolated form ores everei nterestr ate +scenariost hant hosep resented in thet able below. +Resultso fO perations (continued) +46 BNYM ellon +The secret object #1 is a "table". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_64.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_64.txt new file mode 100644 index 0000000000000000000000000000000000000000..676d72ec055614f26546aa40809b72d6b4de7bbf --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_64.txt @@ -0,0 +1,107 @@ +Thef ollowing tables howsn et interest revenue +sensitivity forB NY Mellon. +Up 100 bpsrate shockv s. +baseline $2 54 $1 66 $2 14 +Long-term up 100 bps,short- +term unchanged 71 13 30 +Short-term up 100 bps,long- +term unchanged 183 153 184 +Long-term down1 00 bps, +short-term unchanged (a) (73) (14) (30) +Short-term down1 00 bps, +long-term unchanged (270) (214) (251) +Down 100 bprate shockv s. +baseline (343) (228) (281) +Estimatedc hanges in net +interestr evenue +(inm illions) +Dec. 31, +2023 +Sept.3 0, +2023 +Dec. 31, +2022 +(a)T he sensitivity forDec. 31, 2022 has beenupdated to reflect +thei mpacto fa100 basis point decreasein long-term rates +while short-term rateswereu nchanged. +At Dec. 31, 2023,thei mpact of a1 00 basispoint +upwards hift in rateso nn et interest revenue increased +compared with Sept.3 0, 2023 primarily due to higher +casha nd depositbalances in themostr ecentq uarter, +whichi ncreased theb enefit of rising interest rates. +Thei mpact of a1 00 basispoint downwardshift in +rateso nn et interest revenue worsened comparedwith +Sept.3 0, 2023 primarily due highercasha nd deposit +balances. +While thenet interest revenue sensitivity scenario +calculations assume static depositb alances to +facilitate consistentp eriod-over-periodc omparisons, +neti nterestr evenue is impacted by changesi nd eposit +balances.N oninterest-bearingd eposits are +particularly sensitivet oc hangesi ns hort-term rates. +To illustrate thenet interest revenue sensitivity to +deposit run-off, we estimate thata$ 5b illion +instantaneous reductiono ri ncreasei nU .S.d ollar- +denominated noninterest-bearingd eposits would +reduceo ri ncreaset he netinterestr evenue sensitivity +results in theup1 00 basispoint scenario in thetable +above byapproximately $290 million. Thei mpact +wouldb es malleri fthe run-offw as assumedt obea +mixture of interest-bearinga nd noninterest-bearing +deposits. +Additionally,d uringp eriods oflows hort-term +interest rates, moneym arketm utualf und fees and +others imilarf ees aretypically waived to protect +investorsf romn egativer eturns. +Foradiscussion of factorsi mpactingt he growthor +contractiono fd eposits,s ee “RiskFactors–Capital +andL iquidity Risk –O ur business,financial +conditiona nd results of operationscouldb ea dversely +affected if we do noteffectivelym anageo ur +liquidity.” +We alsoproject future cashf lows fromo ur assets and +liabilitieso veralong-term horizon andt hend iscount +thesec ashf lows usingi nstantaneous parallels hocks +to prevailingi nterestr ates.T hism easure reflectsthe +structural balances heet interest rate sensitivity by +discountinga ll future cashf lows.T he aggregationo f +thesed iscounted cashflows is theeconomic valueo f +equity (“EVE”). Thef ollowing tables howsh ow +EVEw ouldc hange in responset oc hangesi ni nterest +rates. +Estimatedc hanges in EVE Dec. 31, +2023 +Rate change: +Up 200 bps vs.baseline 2.5% +Up 100 bps vs.baseline 2.2% +Down 100 bps vs.baseline (2.7)% +Down 200 bps vs.baseline (6.1)% +Thea symmetrical accountingt reatment ofthei mpact +of ac hange in interest rateso no ur balancesheet may +createas ituationi nwhich anincreasei ni nterestr ates +can adverselyaffect reportede quity andr egulatory +capital, even though economically theremay be no +impact on oureconomic capitalp osition. For +example, anincreasei nr ates will result inad eclinei n +thev alue of ouravailable-for-sales ecuritiesp ortfolio. +In this example, therei sn oc orresponding change on +our fixedl iabilities, even though economically these +liabilitiesa re more valuable as ratesr ise. +Theser esults do notreflect strategies that +management coulde mployt olimit thei mpact as +interest rate expectations change. +To manage foreigne xchange risk,w ef und foreign +currency-denominated assetswith liability +instrumentsd enominated in thesamec urrency. We +utilizev arious foreigne xchange contractsi faliability +denominated in thes amec urrencyi sn ot availableo r +desired, andt ominimizet he earnings impact of +translationg ains orlossesc reated by investmentsi n +foreignm arkets.W eu se forwardf oreign exchange +contractst op rotect thev alue of our netinvestment in +foreigno perations.A tD ec. 31, 2023,n et investments +in foreigno perations totaled$ 14 billionand were +spread across19f oreign currencies. +Resultso fO perations (continued) +BNYM ellon4 7 +The secret vegetable is "broccoli". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_65.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_65.txt new file mode 100644 index 0000000000000000000000000000000000000000..dfeb923ea62ee26f1bd54b25ddb6aa55084238c6 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_65.txt @@ -0,0 +1,98 @@ +Overview +BNYM ellonp lays av italr olei nt he globalfinancial +markets, ande ffectiver iskm anagementi sc ritical to +our success. BNYM ellono peratesu ndert he +Enterprise Risk ManagementFramework( “risk +management framework”)w hich is thefoundationo f +our risk management approach.R iskm anagement +begins with as trong risk culture,a nd we reinforceo ur +culture through principle-basedpoliciesi ncluding the +Code ofConduct, whicha re groundedi nour core +values of passionfore xcellence, integrity,s trengthi n +diversity andc ouraget ol ead. +Thesev aluesa re critical to ours uccess. They not +onlye xplainw hatw es tand fora nd ourshared +culture,b ut also help us to thinkand act globally. +They servea sarepresentationo ft he promiseswe +have made to our clients, communities, shareholders +ande acho ther. +BNYM ellon’sR iskI dentificationp rocessi sa core +component ofBNYM ellon’sr iskf ramework andi s +thef oundationf or understandingandm anagingr isk. +We utilizeac ommonr iskl anguage,o ur Risk +Taxonomy, to identifyr isks acrosso ur sixp rimary +risk categories: OperationalRisk, Market Risk,C redit +Risk,L iquidity Risk,M odelR iska nd StrategicR isk. +Quarterly, theC ompany engagesi naprocess +designedt odocumenti dentificationa nd assessment +of its risks, andt odeterminet he seto fr isks material +to BNYM ellon. Outputsf romt he Risk Identification +processi nforme lementso fo ur risk framework such +as our Risk Appetiteas well as Enterprise-wideS tress +Testinga nd CapitalP lanning. +BNYM ellon’sR iskA ppetite expressest he levelo f +risk wearew illingt otoleratet om eet our strategic +objectives in am annert hatb alances risk andr eward +while consideringo ur risk capacity andm aintaining a +balances heet that remainsr esilient throughout market +cycles.T hisg uidesB NY Mellon’srisk-taking +activitiesa nd informsk ey decision-making processes, +including them annerb yw hich we pursueo ur +businesss trategya nd them ethods bywhichw e +manage risk.T he Risk AppetiteStatementa nd +associated keyr iskm etrics to monitorour risk profile +areu pdateda nd approvedb ythe Risk Committeeo f +theB oard at leasta nnually. +BNYM ellonc onducts Enterprise-wideS tressT esting +as part of its Internal CapitalA dequacy Assessment +Processi na ccordancew ith CCAR, anda sr equiredb y +thee nhanced prudentials tandardsi ssuedp ursuantt o +theD odd-FrankW allS treet Reform andC onsumer +ProtectionA ct (the “Dodd-FrankA ct”).E nterprise- +wide Stress Testingc onsiderst he Company’sl ines of +business, products,g eographica reas andriskt ypes +incorporatingt he resultsf romu nderlying models and +projections forarange of stress scenarios. Additional +details on CapitalP lanning andS tressT estinga re +includedi n“Supervisiona nd Regulation.” +ThreeL ines ofDefense +BNYM ellon’sT hree Lineso fD efense modeli sa +critical component of ourrisk management +framework to clarifyr oles andresponsibilitiesa cross +theo rganization. +BNYM ellon’sf irst lineo fd efense includess enior +management andb usinessa nd corporates taff, +excluding management ande mployees in Risk +Management,C ompliancea nd Internal Audit. Senior +management in thefirst line is responsible for +maintaininga nd implementinga neffectiver isk +management framework anda ppropriately managing +risk consistent with itsstrategya nd risk tolerance, +including establishing clear responsibilitiesa nd +accountability fort he identification, measurement, +management andc ontrolo fr isk. +Risk andC ompliancei st he independent second line +of defense,reportingt othe ChiefR iskO fficer.T he +ChiefR iskO fficer reports tobotht he Chief +ExecutiveO fficer andthe Risk Committeeo ft he +Company’sB oard of Directors. Risk and +Compliancei sr esponsible fore stablishing a +framework that outlines expectationsandp rovides +guidancef or thee ffectivem anagemento fr iska t +BNYM ellonw hile also independently testing, +reviewinga nd challenging thef irst line.T of acilitate +thec omprehensive globalapplicationo fc onsistent +standardsf or each risk or compliancet opic, +independent oversightis providedb yRiska nd +Compliancea crosst hree perspectives –l ines of +business; legale ntities; ande nterprise-wide risk and +complianced isciplines. +Internal Auditi sB NY Mellon’st hird lineo fd efense +ands ervesa sani ndependent,o bjectivea ssurance +functiont hatr eports directly to theAuditC ommittee +of theC ompany’sB oard of Directors. It assistst he +Companyi naccomplishing itso bjectives by bringing +as ystematic,d isciplined,r isk-baseda pproach to +evaluate andi mprove thee ffectivenesso ft he +Risk Management +48 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_66.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_66.txt new file mode 100644 index 0000000000000000000000000000000000000000..8f2f443814df581d94ce10e422ca0d9bdfe2cd4c --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_66.txt @@ -0,0 +1,81 @@ +Company’sr iskm anagement, controla nd governance +processes. Thes cope ofInternal Audit’sw ork +includest he review andevaluationo ft he adequacy, +effectivenessa nd sustainability of risk management +procedures,i nternalc ontrols ystems,i nformation +systemsa nd governanceprocesses. +Governance +BNYM ellon’sm anagementi sr esponsible fore xecutiono ft he Company’sr iskm anagementf ramework andt he +governance structuret hats upports it,with oversight providedb yBNY Mellon’sB oard of Directorst hrough twok ey +Boardc ommittees:t he Risk Committeea nd theA uditC ommittee. +As ummary of theg overnance structurei sp rovidedb elow. +BNYM ellonB oard of Directors +Risk CommitteeA uditC ommittee +Senior Risk andC ontrolC ommittee (“SRCC”) +•A nti-MoneyL aundering Oversight +Committee +•A ssetL iability Committee +•B alance Sheet Risk Committee +•B usinessR iskC ommittees +•C ompliancea nd Ethics Oversight +Committee +•C ontract Management Committee +•C reditP ortfolio Management Committees +•E nterpriseI nsider ThreatSteering +Committee +•E nterpriseR iskC ommittee +•I nternationalS eniorR iska nd Control +Committee +•O perationalR iskC ommittee +•P roductA pprovala nd Review Committee +•R egulatoryO versight Committee +•R esolvability SteeringC ommittee +•T echnology Risk Committee +TheR iskC ommitteei sc omprised entirelyo f +independent directorsand meetso naregular basist o +review andassess thec ontrolp rocessesw ith respect +to theCompany’si nherent risks. It also reviewsa nd +assessest he Company’sr iskm anagementp olicies +andp ractices.T he rolesa nd responsibilitieso ft he +Risk Committeea re describedi nmored etaili ni ts +charter, ac opy ofwhichi sa vailableo no ur website, +www.bnymellon.com. +TheA uditC ommitteei sa lsoc omprised entirelyo f +independent directors. TheA uditC ommitteem eets +on ar egular basist op erform an oversight review of +thei ntegrity of thef inancial statements andf inancial +reportingp rocess, compliancew ith legaland +regulatoryr equirements, theC ompany’si ndependent +registered public accountant’sq ualifications and +independence, andthe performanceof ourinternal +auditf unctiona nd thei ndependent registered public +accountant. TheA uditC ommitteea lsor eviews +management’s assessmento ft he adequacy of internal +controls.T he functions oftheA uditC ommitteea re +describedi nmored etaili ni ts charter, ac opy of +whichi sa vailableo no ur website, +www.bnymellon.com. +TheS RCC is themosts eniorm anagementl evel risk +governance group at theC ompany andi sr esponsible +foro versight ofallR iskM anagement, Compliance& +Ethics activitiesand processes,including the +Enterprise Risk ManagementFramework. The +committeei sc haired by theC hief Risk Officer andits +membersi nclude theC hief ExecutiveO fficer,C hief +FinancialO fficer andGeneral Counsel. +Subcommittees of theS RCC include: +•A nti-MoneyL aundering OversightC ommittee: +Oversees thes ystems andc ontrols relating to all +aspectso fa nti-moneyl aundering andt errorist +financingc ompliance( including Know Your +Customer,s uspicious activity reportinga nd +sanctions)w ithint he Company. +•A ssetL iability Committee( “ALCO”): Thes enior +management committeer esponsible forb alance +sheet oversight,i ncluding capital, liquidityand +interest rate risk management. +•B alance Sheet Risk Committee( the“ BSRC”): +Reviewsa nd receivese scalationr elatingt o +balances heet risk management frameworks +Risk Management (continued) +BNYM ellon4 9 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_67.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_67.txt new file mode 100644 index 0000000000000000000000000000000000000000..391264470347e8f83bb10802f01ce520a81732f3 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_67.txt @@ -0,0 +1,82 @@ +associated with theassets,l iabilitiesa nd capital +of theC ompany. Therei safocuso nt reasury +risk topics,i ncluding matters relatedt oliquidity +risk,c apitalm anagement, investment portfolio +risk,a nd interest rate risk in thebanking book. +• Business Risk Committees:R eviewa nd assess +risk andc ontroli ssueso bservedf rome xisting +businessp ractices or activitieso ra rising from +newb usinessp ractices or activitiesi no ur various +lines of businessand supportingo perations. +•C ompliancea nd Ethics Oversight Committee: +Providesg overnance andoversight ofthe +operations oftheC ompliancea nd Ethics function +andt he management andr eportingo fc ompliance +risk-relatedi ssues, as well as Compliance& +Ethics processes, policies, procedures and +standards. +•C ontract Management Committee: The +governance andescalationb odyf or the +Company’sC ustomerC ontract Management +policya nd determinesthec lient contract +management policiesand infrastructure forthe +Company. +•C reditP ortfolio Management Committees:S even +Portfolio Management Committees,g overned by +thes amec harter andrules,m anage, monitora nd +review eachof Credit Risk’s primary portfolio +segments,i ncluding underwritingc riteria, +portfolio limitsandc omposition, risk metrics, +concentration, credit strategy, qualityand +exposure, stress test outcomesa nd wrong way +risk. +•E nterpriseI nsider Threat SteeringC ommittee: +Providese nterprise-wide governance and +oversight relatedt othe Enterprise InsiderT hreat +Program andrelated initiatives,a sw ella s +providesv isibility tosenior leadership relatedt o +thee nterpriser iskp rofile as it relatest oi nsider +threat risks. +• Enterprise Risk Committee: Oversees the +Enterprise Risk ManagementFrameworka nd +relateda ctivities, including comprehensive +discussions,d eliberations andc ollaborationo n +material andemergingr isks,l imit setting, risk +reporting, issues management,e scalationa nd +relevant decisionmaking. +•I nternationalS eniorR iska nd ControlC ommittee: +Providesr iskm anagemento versight,a nd actsa s +ap oint ofconvergence fort he coordination, +transparency andcommunicationo fm aterial +issues (liveo re merging) acrossi nternational +entities. +•O perationalR iskC ommittee: Oversees the +operationalr iskp rofile andi sr esponsible for +monitoring andm anagingt he appropriateness of +theo perationalr iskf ramework,p olicyd esign, +adherencet rackinga nd mitigatingc ontrols. +•P roductA pprovala nd Review Committee: +Responsible forr eviewing anda pproving +proposalst oi ntroducen ew andmodify or retire +existingp roducts. +•R egulatoryO versight Committee: Provides +strategicd irection, oversight,challenge,a nd +coordinationa crossr egulatoryr emediation +initiatives within theCompany’sR egulatory +Oversight Program. +•R esolvability SteeringC ommittee: Oversees +recovery andr esolutionp lanning, including but +not limitedt othe projectgovernance and +oversight framework forall recovery and +resolution planningrequirementsi nr elevant +jurisdictions whereB NY Mellono perates. +•T echnology Risk Committee: Oversees the +review andassessmento ft echnology risk and +controli ssues observedf rome xistingb usiness +practices or activities, or arisingf romn ew +businessp ractices or activitiesi no ur various +lines of businessand supportingo perations so as +to assist theC ompany in managing and +monitoring technology risk andc ontrol issues. +Risk Management (continued) +50 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_68.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_68.txt new file mode 100644 index 0000000000000000000000000000000000000000..09cd382dcde0e8c6fa4218afbfd7416463805a09 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_68.txt @@ -0,0 +1,71 @@ +RiskT ypes Overview +Theu nderstanding, identification, measurementa nd mitigationo fr iska re essentiale lementsf or thes uccessful +management ofBNYM ellon. We leverage ac omprehensive risk taxonomyt osupportc onsistent language for +defining andu nderstanding risks. Thep rimary categoriesi no ur risk taxonomya re: +Type of risk Description +Operational Ther isko fl ossr esulting fromi nadequate or failedi nternalp rocesses, peoplea nd systemso rf rome xternal +events.O perationalr iski ncludesr isks,s ucha sc ompliancea nd financialc rimes, technology risksa nd third +partyr isks. +Market Ther isko ff inancial loss or adversec hange to thee conomic conditiono fB NY Mellonr esultingf rom +movementsi nm arketr iskf actors. Market risk factorsi nclude butaren ot limitedt ointerestr ates,c redit +spreads, foreigne xchangesr ates,c ommodity prices,a nd equity prices.T he potentiall ossi nv alue for the +BNYM ellonf inancial portfolio caused by adversem ovementsi nm arketp rices of foreigne xchange,f ixed +income ande quity assets,c redits preads, commoditiesa nd liabilitiesa ccounted foru nderf airv alue and +equivalent methods. +Credit Credit risk denotes ab road categoryofa dversef inancial outcomesa rising fromc redite vents( default, +bankruptcy,r atings migration) associated with obligor/counterpartyn ot meeting( inability/unwilling) its +contractualo bligations.C reditr iski sp resent in them ajorityo fo ur assets,b ut primarily concentrated in +thel oana nd securitiesb ooks,a sw ella sf oreign exchange ando ff-balance sheet exposures such aslending +commitments, letters of credit ands ecuritiesl ending indemnifications. +Liquidity Ther iska rising froma ni nability toaccessf unding, convert assets tocashq uickly ande fficiently,o rt or oll +overo rissuen ew debt,e speciallyd uringp eriods ofmarket stress. Liquidity risk includest he inability to +access funding sources or manage fluctuations in funding levels.L iquidity risk can arisef romc ashf low +mismatches,m arketc onstraintsf romt he inabilityt oconvert assets tocash, thei nability toraisec ashi nthe +markets, deposit run-offo rcontingent liquidity events. +Model Thep otential loss arisingf romi ncorrectly designing/usingamo delo rs tressc onditions that invalidate the +assumptions ofam odel. +Strategic Ther iska rising fromt he flawed design, decision orimplementationo fabusin esss trategy, andp otential +disruptiont obusinesss trategyb yexternalf actorsa nd/or internal decisions.M ores pecifically,t he risks +arisingf roma dverseb usinessd ecisions,p oor implementationo fb usinessd ecisions orlack of +responsivenesst oc hangesi nt he financiali ndustrya nd operatingenvironment. Strategicr isks maya lso +arisef romt he acceptanceo fn ew businesses, thei ntroduction ormodificationo fp roducts,s trategic finance +andr iskm anagementd ecisions,b usinessp rocessc hanges, complext ransactions,a cquisitions/divestitures/ +jointv enturesa nd majorc apitale xpenditures/investments. +Operational Risk +In providing ac omprehensive arrayo fp roducts and +services,w ea re exposed to operationalr isk. +Operationalr iskm ay result from, but is not limitedt o, +errors relatedt otransactionprocessing, failure of +internal controlsystems andm eetingc ompliance +requirements, fraud byemployees or persons outside +BNYM ellono rb usinessi nterruptiond ue to system +failureso ro ther events.O perationalr iskm ay also +include breachesof ourtechnology andi nformation +systemsr esultingi nunauthorized accesst o +confidentiali nformationo rf romi nternalo re xternal +threats, such as cyberattacks. Operationalr iska lso +includesp otentiall egal or regulatorya ctions that +coulda rise.I nt he caseo fa no perationale vent,w e +coulds ufferf inancial lossesa swella sr eputational +damage. +To addresst hese risks, wemaintain comprehensive +policiesa nd procedures anda ninternalc ontrol +framework designedt oprovide as ound operational +environment. Thesec ontrols have beendesignedt o +manage operationalriska ta ppropriate levels given +our financials trength, theb usinesse nvironmenta nd +marketsi nw hich we operate,a nd then atureo fo ur +businesses, andc onsideringf actorss ucha s +competitiona nd regulation. +Theo rganizationalf ramework foroperationalr iski s +basedu pon as trong risk culture that incorporates +bothg overnance andriskm anagementa ctivities +comprising: +•A ccountability of Businesses–Business +managers arer esponsible form aintaining an +effectives ystemo fi nternalc ontrols +commensuratew itht he businessriskp rofilesa nd +in accordance with BNYM ellonp oliciesa nd +procedures. +Risk Management (continued) +BNYM ellon5 1 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_69.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_69.txt new file mode 100644 index 0000000000000000000000000000000000000000..c4f775fe395cd96ca0b59568c53538d910cb60a2 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_69.txt @@ -0,0 +1,103 @@ +• OperationalR iskM anagementi st he independent +second linef unctionr esponsible ford eveloping +risk management policiesand toolsf or assessing, +measuring, monitoring andm anagingo perational +risk forB NY Mellon. Thep rimary objectives of +theO perationalR iskM anagementF ramework +aret op romote effectiver iskm anagement, +identifye mergingr isks andd rive improvement in +controls andt oreduceo perationalr isk. The +OperationalR iskM anagementf unctioni ncludes +independent operationalrisko versight ofalll ines +of businessand functions,a sw ella ss pecialist +oversight ofareas such asdata risk,f raud risk, +andt hird partyr isk. +•T echnology risk is as ubseto fo perationalr isk. +Technology Risk Managementis theindependent +second linef unctiont hati sr esponsible for +independent risk oversight ofthet echnology +footprint, bringing expertiset ob ear acrosssome +of BNYM ellon’sm osts ignificantr iske xposures. +Thef unctiona lsoc onducts integrated +independent assessmentso nm ultiple cybera nd +digitali nitiatives within theCompany. They +partnerw ith businessesa nd legale ntitiest od rive +betteru nderstanding andamore accurate +assessmento fo perationalr isks that canoccur +from technology operations.T echnology Risk +Management also actsa sacatalystt od rive the +developmento fg lobalt echnology policies,key +controls andm ethods to assess,m easurea nd +monitori nformationa nd technology risk forB NY +Mellon. +•O perationalr esiliencyi satopp riority fort he +Company. Foundationalt oo ur enterprise +resiliencys trategyi st he Business Services +Framework, governedby thef irst lineE nterprise +ResiliencyO ffice, with second line oversight +fromR esiliencyR iskM anagement. Firstl ine +businessm anagementi sa ccountable for +maintaininge ffectiver esiliencyc apabilitiesu nder +this framework,w hile Technology and +Operations arer esponsible fors uccessful +executioni ncoordinationw ith thebusiness. +Elements of ther esiliencys trategyi nclude the +Business Services Framework, IT Asset +Management,A pplicationt ransformationa nd +Mainframe modernization,as well as Disaster +Recovery Testinga nd Business Continuity +capabilities. We arealsof ocused on the +resiliencyc apabilitieso fo ur most important +servicep roviders.T hese capabilitiesa re intended +to enable theCompany to deliver services to our +clientsb yt he ability toprevent, respond to and +recoverf romb usinessd isruptions andt hreats. +•C ompliancea nd financialc rimesr iski sa lsoa +subset of operationalriskw ith second line +Compliancea nd Ethics andF inancial Crime +Compliance( “FCC”)t eams.C ompliancea nd +financialc rimesr iski sd efined asther isko fl egal +or regulatorys anctions,m aterialf inancial loss, or +af inancial institution’sr eputationall ossa sa +result of its failuret oc omplyw ith laws, +regulations,r ules,r elated self-regulatory +organizations tandards, andc odeso fc onducto r +organizationals tandardso fp ractice. We seek to +comply with allo bligations through a +comprehensive, integrated Compliance and +Ethics Management Framework. +Market Risk +Ourb usinessa ctivity tendsto minimizeo utright our +direct exposuretom arketr isk, with such risk +primarily limitedto marketvolatility fromt rading +activity insupporto fc lients. More significantm arket +risk is assumedi nthe form of interest rate andc redit +spread risk within theinvestment portfolioas am eans +fora sset/liability managementandn et interest +revenue generation,anda lsot hrough thei nterestr ate +risk associated with BNYM ellon’sb alance sheet +positionw hich is sensitivet oa dversem ovementsi n +interest rates. +TheC ompany hasindirect market risk exposure +associated with thechange in thevalue offinancial +collateralu nderlying securitiesf inancing and +derivatives positions.T he CollateralM arginR eview +Committeer eviews anda pprovest he standards for +collateralr eceivedo rp aidi nrespect of collateralized +derivativea greements ands ecuritiesf inancing +transactions. +Oversight ofmarket risk is performed by theS RCC, +BSRC, ALCO andt hrough executiver eview +meetings.S tresst ests results fort he tradingp ortfolio +arer eviewedd uringt he MarketsW eekly Risk +meeting, whichi sa ttendedb yseniorm anagersf rom +Risk Management,Finance andSales andTrading. +Oversight ofther iskm anagementf ramework +associated with theCorporateT reasurya nd Portfolio +Management functions is performed by theB SRC. +Detaileda spectso ft hiso versight arec onductedb y +theT reasuryR iskC ommittee, as ubcommitteeo ft he +BSRC. +Risk Management (continued) +52 BNYM ellon +The secret currency is a "dollar". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_7.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_7.txt new file mode 100644 index 0000000000000000000000000000000000000000..a0946b62e8788730687afb6b9cd5ca22adfd8084 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_7.txt @@ -0,0 +1,46 @@ +c (b) +VBNY MELLON +Delivering on Our 2023 Goals +The past year was marked by a significant change in the path of inflation, with economists +now predicting that central banks in many developed economies will cut rates in 2024. +Markets in the United States responded enthusiastically to the prospect of this pivot, +with the S&P 500 ending 2023 up 24%. +Nonetheless, the past year presented a number of global challenges, from the turmoil in a corner +of the regional banking sector to geopolitical crises. We saw a mixed economic picture, especially +outside of the U.S. Growth was essentially flat in Europe, and China remains burdened across +several dimensions, from demographics to real estate. Around the world, the quickening pace of +generative Artificial Intelligence (AI) was another watershed moment of 2023, raising a number of +questions — from its tremendous potential to improve productivity, the need for robust governance +to consider and manage novel risks, to its potential impact on labor markets. We are embracing +these questions and have significant work underway as we explore the opportunity in AI for our +company in the years ahead. +Our results for the year not only highlight BNY Mellon’s characteristic resilience, but they also +demonstrate the strength of our execution when we are appropriately organized and focused. +We reported earnings per share of $3.87 on $17 .5 billion of revenue, up 7% year-over-year; +expenses of $13.3 billion, up 2% year-over-year; and return on common equity of 9%. Adjusting for +the impact of notable items, EPS of $5.05 increased by 10% on $17 .7 billion of revenue, which was +up 5% year-over-year; expenses were $12.3 billion and return on tangible common equity was 22%.1, 2 +At the beginning of last year, we communicated three financial goals for 2023: +• First +, we expected to generate approximately 20% net interest revenue growth +year-over-year — we delivered 24%. +• Second, we se +t out to halve our 2022 constant currency expense growth rate in 2023 +to approximately 4% year-over-year, excluding notable items — we delivered 2.7%.3 +• Third, we sought to return north of 100% of 2023 earnings to common shareholders +through dividends and buybac +ks — we delivered 127%. +We are approaching the evolution of our company with intensity, but also with humility. +We will not get everything right. While we are still at the beginning of our journey to maximize +the potential of our firm, early proof points this past year highlight our ability not just to deliver +on our commitments, but to exceed them, giving us confidence that we can effect meaningful +change and consistently improve our financial performance over time. +1 Adjusted (Non-GAAP) measures exclude notable items. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +2 Return on tangible common equity, a Non-GAAP measure, excludes goodwill and intangible assets, net of deferred tax liabilities. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. +3 Adjusted (Non-GAAP) measure of constant currency expense growth rate excludes notable items and currency translation. +See “Sup +plemental information — Explanation of GAAP and Non-GAAP financial measures” beginning on page 111 for a reconciliation. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_70.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_70.txt new file mode 100644 index 0000000000000000000000000000000000000000..467d261d6443a74a8f200063c2384a61d2977450 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_70.txt @@ -0,0 +1,99 @@ +TheB usinessR iskC ommitteef or theM arkets +businessr eviews keyr iska nd controli ssues and +relatedi nitiatives facing allM arkets lines of business. +Also addressedd uringt he Business Risk Committee +meetings aret rading VaRa nd tradings tressedV aR +exposures againstlimits. +Finally,t he Risk QuantificationReviewG roup +reviewsb ack-testingr esults fort he Company’sV aR +model. +Credit Risk +We extend direct credit inordert of osterc lient +relationships anda samethod by whicht ogenerate +interest income fromt he deposits thatresult from +businessa ctivity.W ee xtenda nd incuri ntraday +credit exposurei no rder to facilitate our various +processing activities. +To balancet he valueofo ur activitiesw ith thecredit +risk incurredi npursuingt hem, we setand monitor +internal credit limitsfora ctivitiest hate ntailc redit +risk,m osto ften on thes izeo ft he exposurea nd the +quality of thec ounterparty. Forc redite xposures +driven by changing market ratesa nd prices,exposure +measures include an add-onfors uchp otential +changes. +We manage credit risk exposurea tacounterparty, +industry, country andp ortfolio level. Credit risk +exposurea tt he counterpartyl evel is managedthrough +our credit approvalf ramework andi nvolvesf our +approvall evelsu pt oand including theC hief Risk +Officer of theC ompany. Ther equisite approvals are +basedu pon thes izea nd relativer isko ft he aggregate +exposureu nderc onsideration. TheC reditR isk +Group is responsible fora pproving thes ize, termsa nd +maturity of allc redite xposures proposed by the +business, as well as theo ngoing monitoring ofthe +creditworthinesso ft he counterparty. In addition, it is +responsible forc hallenging anda pproving thei nternal +risk ratings oneach exposure. +Thec alculationo fafundamental credit measurei s +basedo naprojectiono fastatistic ally probablec redit +loss, used to help determinet he appropriate loanloss +reservea nd to measurecustomerp rofitability.C redit +loss considerst hree basicc omponents: thee stimated +size of thee xposure whenever defaultm ight occur, +thep robability of defaultbeforem aturity andt he +severity of thel ossw ew ouldi ncur,c ommonlyc alled +“lossg iven default.”F or institutionall ending, where +most of ourcredit risk is created,u nfunded +commitmentsa re assignedausageg iven default +percentage.B orrowers/counterpartiesa re assigned +ratings bytheb usinessa nd reviewed,c hallengeda nd +approvedb ythe Credit Portfolio Managers on an 18- +grades cale, whicht ranslate toas caled probability of +default. Additionally,t ransactions area ssignedl oss +givend efault ratings (ona5-grades cale)t hatr eflect +thet ransactions’s tructures, including thee ffectso f +guarantees,c ollaterala nd relatives eniority of +position. +TheR iskM odelinga nd AnalyticsG roup is +responsible fort he calculationm ethodologies andt he +estimateso ft he inputsu sedi nthosem ethodologies +fort he determinationofe xpected loss.T hese +methodologies andinput estimatesa re regularly +evaluatedf or appropriateness anda ccuracy.A sn ew +techniquesa nd databecome available, theR isk +Modelinga nd AnalyticsG roup incorporates,w here +appropriate,t hoset echniqueso rd ata. +BNYM ellons eekst ol imit botho n- ando ff-balance +sheet creditrisk through prudent underwritinga nd the +useo fc apitalo nlyw here risk-adjustedreturns +warrant.W es eek to managerisk andi mprove our +portfolio diversificationt hrough syndications,a sset +sales, credit enhancements anda ctivec ollateralization +andn ettinga greements.I na ddition, we have a +separate Credit Risk Review Group, whichi sa n +independent groupwithin Internal Audit, composed +of experienced loan review officersw ho perform +timely reviewso ft he loan filesa nd credit ratings +assignedt othe loans. +Liquidity Risk +Adequate liquidity isvitalt oB NY Mellon’sa bility to +processp aymentsa swella ss ettle andc lear +transactions on behalfof clients. TheC ompany’s +liquidity positionc an be affected by multiple factors, +including funding mismatches,m arketc onditions that +impact our abilityt oconvert our investment portfolio +to cash, inability to issuedebto rr ollo verf unding, +run-offo fcored eposits,a nd contingent liquidity +events such as additionalcollateralp osting +requirements. Additionally,adowngradei no ur +credit ratingc an not onlylead to an outflow of +deposits,w hich aream ajor source of ourfunding, but +also increaseo ur margin requirementso ns ecured +transactions andh aveab roader adverseimpact on +our overallbrandt hatm ay furtheri mpairo ur ability +to refinancem aturingl iabilities.C hangesi n +Risk Management (continued) +BNYM ellon5 3 +The secret object #3 is a "fork". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_71.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_71.txt new file mode 100644 index 0000000000000000000000000000000000000000..901b9637f594ef0a7aabd55406e95f8b3304f256 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_71.txt @@ -0,0 +1,98 @@ +economic conditions orexposuret oo ther risksc an +also affect our liquidity. +TheB oard of Directorsa pprovesl iquidity risk +tolerancea nd is responsible foro versight ofliquidity +risk management oftheC ompany. ALCO provides +governance fort he appropriate executiono fB oard- +approveds trategies, policiesa nd proceduresfor +managing liquidity.S eniorm anagementi s +responsible fore xecutingt hoseB oard-approved +strategies,p oliciesa nd proceduresform anaging +liquidity whichA LCOo versees,a sw ella sr egularly +reportingt he liquidity positiono ft he Companyt othe +Boardo fD irectors. TheB SRCp rovidesg overnance +overi ndependent risk oversight ofliquidity risks, and +oversees thee stablishmento fc ontrolf rameworks. +TheT reasuryR iskC ommittee, whichi sc haired by +independent risk management,v alidates andapproves +internal stress testingm ethodologies and +assumptions,a nd an independentL iquidity Risk +functioni sr esponsible forp roviding ongoingreview +ando versight ofliquidity risk management. +BNYM ellona ctivelym anages andmonitors itsc ash +position, qualityof thei nvestment portfolio,intraday +liquidity positions andp otentiall iquidity needsi n +ordert os upportt he timely paymenta nd settlement of +obligations underbothn ormala nd stressed +conditions.T he Companyu sesarange of stress +testingm easures in connectionw ith itseffortst o +maintain sufficientl iquidity relativet or iska ppetite, +including theL iquidity Coverage Ratio andI nternal +Liquidity Stress Testing. +ModelR isk +Models supporto ur infrastructuref or managing risk. +Among theirf unctions,m odels help us value +securities, rate thequality of an obligor’s credit, +establishc apitaln eedsa nd monitorl iquidity trends. +Modelf ailure might stem fromf aulty design, misuse, +or environmentalc onditions that invalidateo ur +assumptions.W hent hish appens,t he Companyc ould +be exposed to losses andother adverseconsequences +resultingf romo perational, market,credita nd +liquidity risk,a sw ella sr eputationalh arm. We aim +to maintainal ow-risk environment. +BNYM ellon’sp rocessesa re designedt oidentifyt he +conditions underwhich modelr iski ncidents could +occura nd to establishc ontrols that aredesignedt o +minimizeo rp revent loss in caseo fs ucha nevent. +Thesep rocessesi nclude enforcemento fs tandardsf or +developing models,aprocesst ov alidaten ew models, +change controls fore xistingm odels,a nd am onitoring +system to assess performance throughout am odel’s +life. +When evaluatingt he degreeof modelr isk, we +consider multiple dimensions including theq uality of +design, ther obustnesso fc ontrols,a nd indications of +underperformance. Basedo nthese measures,w e +createa no verall metricthat is intendedt omeasure +theh ealth of theC ompany’sm odelinge nvironment +ands et thresholds around it.T hisa llows us to +manage modelr isk, not onlyatt he levelo ft he +individualm odel,b ut also in aggregate, acrossall the +Company’sb usinesses. +ModelR iskM anagement, an independent risk +management function, is responsible fore xecuting +Board-approveds trategies, policies, andp rocedures +form anagingm odelr isk. Senior management is +responsible forr egularly reportingo nthe Company’s +modelingi nfrastructuret ot he Risk Committeeo ft he +Boardo fD irectors. TheB oard of Directorsa pproves +risk tolerances andisr esponsible foro versight. +StrategicR isk +Ours trategyi ncludes, but is not limitedt o, improving +organicg rowtha crosso ur businesses,drivingq uality +solutions ando peratinge fficiencies,a nd expanding +technology-enableds olutions.S uccessful realization +of ourstrategy requirest hatw ep rovide expertisea nd +insight through market-leadings olutions that drive +economieso fs calea nd attract,d evelop andr etain +highlyt alentedp eoplec apable of executingo ur +strategy, whilep rotectingo ur financialp rofile.W e +must understand andm eet market andclient +expectations with suitable products ando fferings that +aref inancially viable ands calable andt hati ntegrate +into our businessmodel. Failuret od os ocould +impact botho ur growthstrategy ando ur ability to +serviceo ur existing clients, resultingi npotential +financiall osso rl itigation. +Changesi nt he marketsi nw hich we ando ur clients +operate can evolve quickly.The introductiono fn ew +or disruptivetechnologies,g eopolitical events and +slowinge conomiesa re examples of events that can +producem arketu ncertainty.F ailure to either +anticipateo rp articipate in transformationalc hange +within ag iven market or appropriately andp romptly +react to market conditions orclient preferencescould +result inpoor strategicp ositioning andp otential +Risk Management (continued) +54 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_72.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_72.txt new file mode 100644 index 0000000000000000000000000000000000000000..0bf18778237e5ab99ad8650dcb43245c3a58b5b1 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_72.txt @@ -0,0 +1,74 @@ +negativef inancial impact.W hile it isessentialt hat +we continue to innovateandr espond to changing +marketsa nd client demand,we seek to do so in a +mannert hatd oesn ot affect ourf inancial positiono r +jeopardizeo ur fundamental businesss trategy. +Other RiskC onsiderations +In additiont othe primary riskcategoriesa nd sub- +categoriesn oted above,wec onsider riskst hath ave +thematic significance andmay manifest across +multiple categorieso fr isk. Theser iskc onsiderations +include datarisk,e nvironmental, social and +governance risk andr eputationalr isk. +Data Risk +We areexposedt odatar iskw henw ef ailt o +consistently manageandc ontrolo ur dataassets +through thee ntirel ifecycle, including managing the +production, confidentiality,q uality,i ntegrity, +availability,a nd retentiono fd atai nformation. +Ourr iskm anagementa pproach considersdatar isks +within our businessactivities. Oure nterprised ata +framework ands upportingp oliciesa ddress +management of data inkeya reas of dataarchitecture, +data governance, data quality management,data +protection, datausagea nd ethics. +We alsoconsider data risksi nt he executiono fo ur +businesso bjectives andprocesses, including the +developmento fn ew products ands ervices,i ncluding +AI applications.W er emainc ommittedt oincreasing +thee ffectivenesso fo ur data management practices +whicha re designedt oenableu st od eliver products +ands ervices to our clientsa crosst he investment +lifecycle. +Environmental, Sociala nd Governance +We areexposedt oenvironmental, social and +governance (“ESG”)r isks factorst hatm ay lead to +increased risk levels acrosso ne ormore enterprise +risk categoriesa nd mayi mpact our risk management +frameworks. Fore xample,c limate risksi nclude +physical risksf roma cute andc hronicw eather-related +effectsa swella st ransitionr isks fromc hangess uch +as fiscal policy, legislationa nd regulation, +technological development, andi nvestor and +customer preference changes. Social andgovernance +risksc oulda lsoi mpact our risk categoriesa nd risk +management frameworks. +ESGe ffectsm ay be wide-ranging with potential +financiala nd operationalresiliencei mplications that +couldn egativelyi mpact theC ompany’ss trategic +objectives andfinancial performance, reputation, +businesso perations,a bility to servicec lientsa nd +broads takeholderr elationships.P otentialr isk +outcomesi nclude,b ut aren ot limitedt o, adverse +publicity,l osso fb usiness, financiall oss, litigation, +employeei mpacts, ando ther operationali mpacts. +Fore xample,k ey climate-relatedimpactsh aveb een +identifieda crosso ur credit portfolios, strategic +positioning, operationalresiliency, andt he pace and +volumeo fr egulatoryc hange,w ith thep otentialf or +reputationali mpactsa crosst hese areas.E SG is +considered when managing risk withinappetite and +limits acrosst he enterprise risk categories. +Reputational Risk +We areexposed to ReputationalR iska saresult of +negatives takeholderp erceptionw hich mayr esult +froma ny decision,action, orinactionb yBNY +Mellon, anyo fo ur employees,o rt hrough other +associated parties, such as clients, strategicpartners, +andt hird parties. Reputationali mpactsc an result in +riskst oc urrent oranticipatede arnings,c apital, +liquidity,b rand, ande nterprisev alue,a nd can stem +froma ny lineo fb usiness, corporatef unction, legal +entity,p roduct, or service. +Risk Management (continued) +BNYM ellon5 5 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_73.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_73.txt new file mode 100644 index 0000000000000000000000000000000000000000..bdf611b899ef723fb9f48df66db1e75c5ba5d7fd --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_73.txt @@ -0,0 +1,100 @@ +BNYM ellonm aintains ab road range of defenses +aimeda tr emaining abreasto fa nd responding to +evolving cybersecurity threatsimpactingt he +Company, its operations,i ts clients, its third-party +servicep roviders andt he broaderfinancial services +sector.D uring2 023, cybersecurity threatsdid not +have am ateriale ffecto nt he Company’sb usiness +strategy or operations.However,t he financial +services sector is prone to cybersecurity threats,and +therec an be noassurancet hatt he Companyw ill be +able tosuccessfully protect its informationsystems +againstm aterialc ybersecurity incidentsint he future. +Givent he increasingp revalencea nd severity of +cybersecurity incidentsaffectingf inancial +institutions,o ther companiesand governmental +agencies aswell as thee volving anda daptiven ature +of cybersecurity threats,cybersecurity risk +management is ap riority fort he Companyt hat +impactsi ts allocationo fr esources,o perations and +risk management strategy. Forafurtherd iscussion of +thev arious risksr elated to cybersecurity threatsand +thep otentiali mpact on theC ompany’sb usiness +strategy, results of operations orfinancialc ondition, +see“ Risk Factors– Risk TypesO verview– +OperationalR isk.” +Risk Management strategy and procedures +BNYM ellonh as implemented policiesa nd +procedures designedt odetect,p revent andr espond to +malicious anda ccidental disruptions to thedeliveryo f +critical technology services.B NY Mellon’s +cybersecurity strategy andp rocedures areembedded +in theCompany’sT hree Lineso fD efense model. +As part of its firstl ineo fd efense,t he Company +maintainsadedicated InformationS ecurity Division +(“ISD”), ledb ythe ChiefI nformationS ecurity +Officer (the “CISO”), that is responsible fort he day- +to-day management ofrisksf romc ybersecurity +threats. ISD’sr esponsibilitiesi nclude cybert hreat +intelligence, incident responsea nd other +cybersecurity operations aimeda te nablingt he +Companyt oidentify, assess andm anagee xistinga nd +emerging cybersecurity threats. ISDm onitors for +potentialt hreatsa nd communicates relevant riskst o +theC ISOa nd othermembers of executive +management.A dditionally,I SD maintainsa +cybersecurity incidentresponsea nd reportingp rocess +pursuantt ow hich cybersecurity incidentsare +classified accordingt otheir severity basedu pon an +assessmento fm ultiple factors. Certainc ybersecurity +incidentsm ay activateenterprise-wide resiliency +processes, whichinclude,a mong otherthings, +escalationt hrough them anagementa nd Board +committees tructuresd escribed below. TheC ompany +also hass tanding arrangementsw ith thirdp arties to +assist theC ompany in identifying, assessing and +managing cybersecurity threats,including in +connectionw ithr iska ssessments,p enetrationt esting, +legala dvice andother aspectsoft he Company’s +cybersecurity risk management andi ncidentr esponse +processes. +BNYM ellonh as ad efined third-partyg overnance +framework to help managether iskp osed to the +Companyb ythe useoft hird-party servicep roviders. +TheC ompany evaluatest he risk posed by third-party +servicee ngagementsb ased on multiple factors. The +Companyh as protocolst hats eek to mitigate +cybersecurity risksa ssociated with third-partyservice +providers basedo nthe risk levela ssignedt osuch +thirdp arty,w hich mayi nclude mandatory contractual +obligations orthei mplementationo fa dditional +controls by theC ompany and/or thea pplicable +servicep rovider. +ISDi ss ubject to ongoing review andc hallenge from +Technology Risk Management,which is ap arto ft he +independent second line of defenseriskf unction. +Technology Risk Management,together with the +broaderR isk&Compliance group, is responsible for +andm anages theC ompany’sr iskm anagement +framework ande stablishesg uidancef or ISDa nd +management designedt ohelpi dentify, assess and +manage cybersecurity risk.F or more informationo n +how we monitora nd manage ourrisk management +framework,s ee “RiskManagement–Overview.” +Internal Audits ervesa sthe thirdl ineo fd efense and +providesa ni ndependent viewon howeffectivelyt he +organizationa sawholem anages cybersecurityrisk. +Forafurtherd iscussion ofBNYM ellon’sT hree +Lineso fD efense model, see“ Risk Management – +ThreeL ines of Defense.” +Risk Management oversight and governance +TheC ompany’sm anagementi sr esponsible for +assessing andm anagingt he Company’sm aterialr isks +fromc ybersecurity threatswith oversight providedb y +theP arent’sB oard of Directorsa nd theB oard +committees.T he Risk Committeeo ft he Boardh as +primaryr esponsibility foro versight oftheo verall +operationo ft he Company’sr iskm anagement +Cybersecurity +56 BNYM ellon +The secret animal #3 is a "shark". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_74.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_74.txt new file mode 100644 index 0000000000000000000000000000000000000000..3edea3338efda8741b57f3664b39d3f2a8ef75a3 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_74.txt @@ -0,0 +1,62 @@ +framework,i ncluding policiesand practices +addressing cybersecurity risk,a nd is responsible for +theo versight ofthes econd lineo fd efense with +respect to itscybersecurity risk management +responsibilities. TheT echnology Committeeo ft he +Boarda nd thef ullB oard regularlyreceive reports and +briefings from management concerning cybersecurity +matters,i ncluding anys ignificantc hangest ot he +Company’sc ybersecurity program.T he Company +also hasp rotocols fore scalatingc ybersecurity threats +andi ncidents to theTechnologyC ommitteeo ft he +Boarda nd thef ullB oard.I na ddition, theA udit +Committeem onitors ando versees thep erformance of +Internal Audit, includingwith respect to its +cybersecurity risk management responsibilities. +At them anagementl evel,t he Technology Oversight +Committee, whichi st he senior management +committeer esponsible fort he governance and +oversight oftheC ompany’ss ignificantt echnology +projectsa nd initiatives,r eviews reports from +management concerning ISDa nd is responsible for, +among otherthings,e scalatingi ssues,i ncluding +significantc ybersecurity threatsand incidents, to the +Technology Committeeo ft he Board. The +Technology Oversight Committeei sc haired by the +ChiefI nformation Officer (the “CIO”) andits +membersi nclude theC ISO. +TheT echnology Risk Committeei sr esponsible for, +among otherthings,o verseeing andr eviewing +significantc ybersecurity incidents. TheT echnology +Risk Committeer eceivesr eports fromm anagement +andh as protocolsf or escalatingc ertain issuesand +riskst ot he SRCC andt he Risk Committeeo ft he +Boardo fD irectors. TheT echnology Risk Committee +is co-chaired by theH ead of Technology Risk and +Controla nd theC hief Technology Risk Officer,and +theC ISOi samember. +BNYM ellon’sC IO,C ISOa nd ChiefT echnology +Risk Officer eachhave extensivee xperience in +assessing andm anagingr isks fromc ybersecurity +threats. TheC ompany’sC ISOj oinedB NY Melloni n +2022 andp reviously served ashead of information +security at aF ortune 500 biopharmaceutical company +anda ninformationt echnology company, as well as +theG lobalC hief Technology Officer atal arge +cybersecurity company. TheC ompany’sC IO has +served in that positions ince 2017 andp reviously held +rolesa sChief InformationO fficer,C hief Technology +Officer,a nd numerous othertechnology management +positions at otherl arge financiali nstitutions.T he +Company’sC hief Technology Risk Officerjoined +BNYM elloni n2021 andp reviously served as Global +Head of Technology Risk Management,Chief +InformationS ecurity Officer,G lobalH ead of Cyber +Risk andO perationalR esiliencea nd ChiefR isk +Officer forT echnology andO perations at otherl arge +financiali nstitutions. +Forafurtherd iscussion ofBNYM ellon’sr isk +management governancestructure, see“ Risk +Management –G overnance.” +Cybersecurity (continued) +BNYM ellon5 7 \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_75.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_75.txt new file mode 100644 index 0000000000000000000000000000000000000000..ab05f16bd5eb47ec5c5762f0821ed16d7927e10a --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_75.txt @@ -0,0 +1,101 @@ +Evolving RegulatoryE nvironment +BNYM ellone ngagesi nb anking, investment +advisory ando ther financiala ctivitiesa crosst he +globe andi ss ubject to extensiver egulationi nthe +jurisdictions in whichi to perates. Globals upervisory +authoritiesg enerally arec harged with ensuring the +safety ands oundness of financiali nstitutions, +protectingt he interestso fc ustomers,i ncluding +depositors in banking entitiesa nd investorsi nm utual +funds ando ther pooled vehicles,s afeguardingt he +integrity of securitiesa nd otherfinancial marketsa nd +promotings ystemic resiliencya nd financials tability +in therelevantc ountry.T heya re not,h owever, +generally chargedw ith protectingt he interestso fo ur +shareholders or non-depositorc reditors.T his +discussion outlinesthem ateriale lementso fs elected +laws andr egulations applicable tous.T he impact of +certain otherl awsa nd regulations,s ucha st ax law, is +discussede lsewhere in thisAnnualR eport. Changes +in thesestandards, or in theirapplication, cannot be +predicted, butmayh aveam ateriale ffect on our +businessesa nd results of operations. +Thef inancial services industryh as been thes ubject of +enhanced regulatoryo versight in thepast1 5y ears +globally,a nd this enhanced oversight environmenti s +likelyt ocontinue in thefuture. Ourb usinessesh ave +been subject to as ignificantn umbero fglobalr eform +measures.M oreover, political developments have +resulteda nd mayc ontinue to result in legislativeand +regulatoryc hangest ok ey aspectsofl awsa nd +regulations affectingl arge bankingandf inancial +institutions andi nlawso rr egulations relatingt o +environmental, social andgovernance (“ESG”) +matters. +Enhanced PrudentialS tandards +TheF ederal Reserveh as adoptedrules( “SIFIR ules”) +to implementliquidity requirements, capitals tress +testinga nd overallriskm anagementr equirements +affectingU .S.s ystemically important financial +institutions (“SIFIs”). BNYM ellonm ustc omply +with enhanced liquidity ando verall risk management +standards, whichinclude maintenanceo fabuffero f +highlyl iquida ssets basedo nprojected funding needs +for3 0d ays. Thel iquidity bufferi si na dditiont othe +rulesr egarding theL CR andn et stable funding ratio +(“NSFR”),d iscussed below, andi sd escribed by the +FederalR eserve as being“ complementary” to these +liquidity standards. +CapitalP lanning and StressTesting +Paymento fDividends,S tock Repurchases and Other +CapitalD istributions +TheP arenti salegale ntity separate andd istinct from +its banks ando ther subsidiaries.T herefore,t he +Parent primarilyrelies on dividends,interest, +distributions ando ther payments fromi ts subsidiaries, +including extensions ofcredit fromt he IHC, to meet +its obligations,i ncluding itso bligations with respect +to its securities, andt oprovide funds fors hare +repurchases andpayment ofcommon andp referred +dividends to itss tockholders,t othe extent declared +by theB oard of Directors. Variousf ederal andstate +laws andr egulations limit theamount of dividends +that mayb ep aidt othe Parent by ourU.S. bank +subsidiaries without regulatoryc onsent. If, in the +opinion ofthea pplicable federalr egulatorya gency, a +depository institutionu nderi ts jurisdictioni se ngaged +in or is about to engage in an unsafeo ru nsound +practice( which, depending onthef inancial condition +of theb ank, couldi nclude thep ayment of dividends), +ther egulator mayr equire,a fter noticea nd hearing, +that theb ankc easea nd desistfroms uchp ractice. +TheF ederal Reserve, theF DICa nd theO ffice of the +Comptrollero fthe Currency( “OCC,”a nd together, +the“ Agencies”) have indicated that thep ayment of +dividends wouldc onstitute an unsafea nd unsound +practicei ft he paymentwould reducead epository +institution’sc apitalt oa ninadequate level. Moreover, +undert he FDIA ct,a ninsured depository institutions +(“IDI”)m ay not payany dividendsif theinstitutioni s +undercapitalized or if thep ayment ofthed ividend +wouldc ause thei nstitutiont obecome +undercapitalized.I na ddition, theA genciesh ave +issued policys tatementsw hich provide that FDIC- +insuredd epository institutions andt heir holding +companiess houldg enerally payd ividends onlyout of +theirc urrent operatingearnings. +In general, theamount of dividendsthat mayb ep aid +by ourU.S. banking subsidiaries,i ncluding to the +Parent,i sl imitedt othe lessero fthe amounts +calculatedu ndera“recente arnings”t esta nd an +“undividedp rofits”t est. Undert he recente arnings +test,adividend mayn ot be paid if thetotal of all +dividends declared andpaidb ythe entity inany +calendary ear exceedsthe current year’sneti ncome +combined with theretainedn et income of thet wo +precedingy ears, unlesst he entity obtains prior +regulatorya pproval. Undert he undividedprofits test, +ad ividendm ay not be paid inexcesso ft he entity’s +“undividedp rofits”( generally, accumulatedn et +Supervisiona nd Regulation +58 BNYM ellon \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_8.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_8.txt new file mode 100644 index 0000000000000000000000000000000000000000..a94601c357ce6b842c22e6ccb74412979c6f1ca5 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_8.txt @@ -0,0 +1,44 @@ +VI ANNUAL REPORT 2023 +In Market and Wealth Services, our focus is to drive growth through +deliberate investments in our client platforms without compromising +profitability. Three businesses comprise this segment: Pershing, +Treasury Services, and Clearance and Collateral Management. +Pershing benefits from a strong position in the U.S. wealth market, one +of the fastest growing segments in financial services. Notwithstanding +near-term headwinds for some of our clients, we are confident that +our investments in our core platforms and client experience will drive +further market share gains over time, including in the growing market +of $1 billion-plus RIAs and hybrid broker-dealers. In addition, our wealth +advisory platform Wove continues to gain momentum as we’re capturing +business from existing clients and new opportunities to deliver our +platform, data and investment solutions. +SECURITIES +SERVICES +MARKET AND +WEAL TH SERVICES +Our Securities Services segment represents the largest of our segments, +and we see further growth and profitability on the horizon. Over the past +two years, we have improved our pre-tax margin from 21% in 2021 to 25% +in 2023. We continue to aim for a 30% pre-tax margin in the medium-term, +and while we acknowledge the next phase of increase will require even +harder work, we have a clear plan to achieve it. +• Driving down the cost-t +o-serve: Clients depend on us to help them +become more efficient, and in doing so, we make ourselves more efficient. +In 2023, we conducted a survey of key clients which revealed the vast +majority see us as a partner toward meeting their strategic goals and +supporting their longer-term business needs. Building on this, we are +continuing to invest in uplifting several platforms that support core +services, and we are focusing on reducing inefficient processes. +• Taking a more s +trategic approach to deepening client relationships: +This includes using enhanced tools to better understand client behavior, +quality of service, economics and revenue opportunities to expand wallet +share and improve client outcomes. +• Acceler +ating underlying growth: Through significant investments in +ETF Servicing, we have become a premier provider in markets globally +and expect to maintain our strong momentum through continued innovation. +Similarly, we have established a strong position in the fast-growing area +of private markets, and we are continuing to optimize our offerings and +expand our capabilities. \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_9.txt b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_9.txt new file mode 100644 index 0000000000000000000000000000000000000000..e36e024df57d1dfbb3cab57829592db03bdf21f6 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/Text_TextNeedles/BNYMellon_75Pages_TextNeedles_page_9.txt @@ -0,0 +1,39 @@ +VIIBNY MELLON +Investment and Wealth Management continues to be an important +segment for the firm. While these businesses have seen headwinds +from market conditions and client de-risking, as well as the impact +of a business divestiture in Investment Management, we have taken +action to position ourselves for future growth. +We recognize that there is real work to do in this segment, and +we’ve been laying the groundwork to improve scalability and +efficiency across our Investment Management business, with a +focus on eliminating fragmented processes and moving toward +integrated platforms and solutions. +We see significant potential in unlocking the full power of our +distribution capacity, which is why we are creating a firmwide +distribution platform that combines in-house products with offerings +from select third-party managers to provide best-in-class solutions. +Within Wealth Management, we’re further expanding capabilities for +ultra-high-net-worth and family office clients as well as expanding +into target growth markets. +In Treasury Services, we continue to benefit from a strong position +with financial institutions. We’re one of the top five U.S. dollar +payments clearers in the world, clearing roughly $2.4 trillion of +U.S. dollar payments daily, on average. Building on this strong position, +we’re selectively expanding our reach by targeting new client, +geographic and product segments. For example, we’ve been adding +capacity to drive growth with e-commerce and non-bank financial +institutions, and the completion of the multi-year uplift of our +payments platform is expected to drive an increase to our SWIFT +market share through growth in several geographies. +Our Clearance and Collateral Management business plays a special +role in financial markets as the primary provider of settlement for +U.S. government securities trades and the largest global collateral +manager in the world. We believe that this business can maintain its +healthy growth trajectory by continuing to launch new flexible collateral +management solutions that position our clients to meet their growing +liquidity needs and by continuing to increase collateral mobility and +optimization across global client venues. +INVESTMENT AND +WEAL TH MANAGEMENT +The secret animal #4 is a "frog". \ No newline at end of file diff --git a/BNYMellon/BNYMellon_75Pages/needles.csv b/BNYMellon/BNYMellon_75Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..07d8db0891dc1fcc84f4c18ea1ba4be9c8aa832a --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/needles.csv @@ -0,0 +1,25 @@ +The secret instrument is a "piano". +The secret tool is a "wrench". +The secret animal #4 is a "frog". +The secret shape is a "triangle". +The secret flower is a "sunflower". +The secret animal #2 is a "kangaroo". +The secret kitchen appliance is a "rice cooker". +The secret food is a "hamburger". +The secret landmark is the "Statue of Liberty". +The secret drink is "tea". +The secret object #4 is a "tree". +The secret animal #5 is a "bear". +The secret fruit is a "banana". +The secret office supply is a "paperclip". +The secret object #5 is a "toothbrush". +The secret animal #1 is a "cat". +The secret clothing is a "hat". +The secret transportation is a "boat". +The secret object #2 is a "phone". +The secret sport is "tennis". +The secret object #1 is a "table". +The secret vegetable is "broccoli". +The secret currency is a "dollar". +The secret object #3 is a "fork". +The secret animal #3 is a "shark". diff --git a/BNYMellon/BNYMellon_75Pages/needles_info.csv b/BNYMellon/BNYMellon_75Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..b647eb48e9708356308795c800263c517ae1d2ca --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/needles_info.csv @@ -0,0 +1,25 @@ +The secret instrument is a "piano".,1,8,green,white,0.52,0.6,times-roman,113 +The secret tool is a "wrench".,5,9,yellow,black,0.834,0.873,times-italic,59 +The secret animal #4 is a "frog".,9,12,gray,white,0.549,0.53,helvetica-bold,126 +The secret shape is a "triangle".,10,9,blue,white,0.762,0.397,times-bold,89 +The secret flower is a "sunflower".,14,11,purple,white,0.098,0.839,helvetica-boldoblique,78 +The secret animal #2 is a "kangaroo".,18,11,brown,white,0.093,0.022,helvetica,88 +The secret kitchen appliance is a "rice cooker".,20,10,white,black,0.879,0.253,times-bolditalic,82 +The secret food is a "hamburger".,22,9,red,white,0.574,0.899,courier,80 +The secret landmark is the "Statue of Liberty".,25,11,orange,black,0.82,0.504,courier-bold,117 +The secret drink is "tea".,28,7,black,white,0.713,0.103,courier-oblique,107 +The secret object #4 is a "tree".,31,11,brown,white,0.157,0.754,helvetica-boldoblique,90 +The secret animal #5 is a "bear".,34,14,green,white,0.596,0.247,times-bold,103 +The secret fruit is a "banana".,37,13,orange,black,0.793,0.882,courier,122 +The secret office supply is a "paperclip".,41,11,blue,white,0.836,0.183,times-italic,94 +The secret object #5 is a "toothbrush".,43,13,gray,white,0.796,0.632,helvetica,98 +The secret animal #1 is a "cat".,47,9,purple,white,0.847,0.344,courier-oblique,118 +The secret clothing is a "hat".,50,7,yellow,black,0.073,0.639,helvetica-bold,131 +The secret transportation is a "boat".,53,9,black,white,0.826,0.526,times-bolditalic,91 +The secret object #2 is a "phone".,55,8,white,black,0.783,0.157,courier-bold,121 +The secret sport is "tennis".,60,11,red,white,0.407,0.545,times-roman,85 +The secret object #1 is a "table".,63,9,red,white,0.769,0.733,times-italic,86 +The secret vegetable is "broccoli".,64,13,blue,white,0.915,0.49,helvetica-bold,94 +The secret currency is a "dollar".,69,7,white,black,0.056,0.409,courier,122 +The secret object #3 is a "fork".,70,8,purple,white,0.38,0.276,helvetica-boldoblique,103 +The secret animal #3 is a "shark".,73,10,orange,black,0.268,0.082,times-bold,129 diff --git a/BNYMellon/BNYMellon_75Pages/prompt_questions.txt b/BNYMellon/BNYMellon_75Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..c63eee01dd5245da7c36aeb3781608bbbf0ea5b5 --- /dev/null +++ b/BNYMellon/BNYMellon_75Pages/prompt_questions.txt @@ -0,0 +1,25 @@ +What is the secret instrument in the document? +What is the secret tool in the document? +What is the secret animal #4 in the document? +What is the secret shape in the document? +What is the secret flower in the document? +What is the secret animal #2 in the document? +What is the secret kitchen appliance in the document? +What is the secret food in the document? +What is the secret landmark in the document? +What is the secret drink in the document? +What is the secret object #4 in the document? +What is the secret animal #5 in the document? +What is the secret fruit in the document? +What is the secret office supply in the document? +What is the secret object #5 in the document? +What is the secret animal #1 in the document? +What is the secret clothing in the document? +What is the secret transportation in the document? +What is the secret object #2 in the document? +What is the secret sport in the document? +What is the secret object #1 in the document? +What is the secret vegetable in the document? +What is the secret currency in the document? +What is the secret object #3 in the document? +What is the secret animal #3 in the document? diff --git a/CitiGroup/CitiGroup_100Pages/needles.csv b/CitiGroup/CitiGroup_100Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..057bc9d3fa93a601f1296160834cadcd90c318f7 --- /dev/null +++ b/CitiGroup/CitiGroup_100Pages/needles.csv @@ -0,0 +1,25 @@ +The secret vegetable is a "mushroom". +The secret object #4 is a "mirror". +The secret instrument is a "drum". +The secret shape is a "star". +The secret food is "fries". +The secret clothing is a "dress". +The secret currency is a "rupee". +The secret landmark is the "Colosseum". +The secret fruit is a "grape". +The secret tool is "scissors". +The secret drink is "milk". +The secret object #5 is a "candle". +The secret object #3 is a "plate". +The secret animal #2 is a "koala". +The secret animal #3 is an "owl". +The secret flower is "lavender". +The secret sport is "skiing". +The secret kitchen appliance is a "toaster". +The secret office supply is an "envelope". +The secret object #2 is a "watch". +The secret animal #4 is a "horse". +The secret animal #1 is an "elephant". +The secret transportation is an "airplane". +The secret animal #5 is a "rabbit". +The secret object #1 is a "door". diff --git a/CitiGroup/CitiGroup_100Pages/needles_info.csv b/CitiGroup/CitiGroup_100Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..71a83cfccb57bd94ffd8538e0f70388165c9a0db --- /dev/null +++ b/CitiGroup/CitiGroup_100Pages/needles_info.csv @@ -0,0 +1,25 @@ +The secret vegetable is a "mushroom".,3,12,white,black,0.988,0.498,courier-oblique,118 +The secret object #4 is a "mirror".,7,13,brown,white,0.361,0.297,times-italic,97 +The secret instrument is a "drum".,12,13,green,white,0.319,0.134,helvetica-boldoblique,111 +The secret shape is a "star".,14,7,blue,white,0.471,0.306,courier-bold,104 +The secret food is "fries".,17,11,purple,white,0.068,0.527,helvetica-bold,99 +The secret clothing is a "dress".,21,12,orange,black,0.536,0.905,times-roman,97 +The secret currency is a "rupee".,27,9,yellow,black,0.501,0.535,helvetica,119 +The secret landmark is the "Colosseum".,29,9,black,white,0.19,0.739,times-bold,72 +The secret fruit is a "grape".,35,9,gray,white,0.984,0.299,times-bolditalic,95 +The secret tool is "scissors".,37,12,red,white,0.046,0.619,courier,91 +The secret drink is "milk".,42,10,purple,white,0.235,0.468,helvetica,107 +The secret object #5 is a "candle".,48,13,black,white,0.892,0.595,times-roman,95 +The secret object #3 is a "plate".,52,9,green,white,0.391,0.552,helvetica-boldoblique,122 +The secret animal #2 is a "koala".,55,7,yellow,black,0.364,0.696,courier,103 +The secret animal #3 is an "owl".,59,9,brown,white,0.656,0.579,times-italic,104 +The secret flower is "lavender".,62,14,white,black,0.58,0.564,courier-bold,94 +The secret sport is "skiing".,65,9,red,white,0.39,0.9,times-bolditalic,105 +The secret kitchen appliance is a "toaster".,71,11,orange,black,0.8,0.218,times-bold,84 +The secret office supply is an "envelope".,74,12,blue,white,0.746,0.021,helvetica-bold,94 +The secret object #2 is a "watch".,80,13,gray,white,0.669,0.144,courier-oblique,118 +The secret animal #4 is a "horse".,83,10,gray,white,0.586,0.82,times-bolditalic,74 +The secret animal #1 is an "elephant".,85,10,purple,white,0.667,0.678,helvetica-bold,124 +The secret transportation is an "airplane".,89,9,blue,white,0.321,0.506,courier-oblique,107 +The secret animal #5 is a "rabbit".,95,9,orange,black,0.297,0.005,courier,118 +The secret object #1 is a "door".,97,10,black,white,0.849,0.656,times-italic,91 diff --git a/CitiGroup/CitiGroup_100Pages/prompt_questions.txt b/CitiGroup/CitiGroup_100Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..dabc9f8adbb1f4dfbc565cf1424bae7f9c0f7700 --- /dev/null +++ b/CitiGroup/CitiGroup_100Pages/prompt_questions.txt @@ -0,0 +1,25 @@ +What is the secret vegetable in the document? +What is the secret object #4 in the document? +What is the secret instrument in the document? +What is the secret shape in the document? +What is the secret food in the document? +What is the secret clothing in the document? +What is the secret currency in the document? +What is the secret landmark in the document? +What is the secret fruit in the document? +What is the secret tool in the document? +What is the secret drink in the document? +What is the secret object #5 in the document? +What is the secret object #3 in the document? +What is the secret animal #2 in the document? +What is the secret animal #3 in the document? +What is the secret flower in the document? +What is the secret sport in the document? +What is the secret kitchen appliance in the document? +What is the secret office supply in the document? +What is the secret object #2 in the document? +What is the secret animal #4 in the document? +What is the secret animal #1 in the document? +What is the secret transportation in the document? +What is the secret animal #5 in the document? +What is the secret object #1 in the document? diff --git a/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_1.txt b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_1.txt new file mode 100644 index 0000000000000000000000000000000000000000..a64237ea7d1d5f19c15b0df74c50c4b207bfb21d --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_1.txt @@ -0,0 +1,10 @@ +2023 +Annual Report +Services +Banking +U.S. +Personal +Banking +Wealth +Markets +The secret vegetable is a "mushroom". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_10.txt b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_10.txt new file mode 100644 index 0000000000000000000000000000000000000000..8331d1264b6aaafb2990fc4dea282704822f627b --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_10.txt @@ -0,0 +1,50 @@ +CITIGROUP’S 2023 ANNUAL REPORT ON FORM 10-K +OVERVIEW 4 +Citigroup Reportable Operating Segments 5 +MANAGEMENT’S DISCUSSION AND +ANALYSIS OF FINANCIAL CONDITION AND +RESULTS OF OPERATIONS 6 +Executive Summary 6 +Citi’s Consent Order Compliance 9 +Summary of Selected Financial Data 10 +Segment Revenues and Income (Loss) 12 +Select Balance Sheet Items By Segment 13 +Services 14 +Markets 17 +Banking 20 +U.S. Personal Banking 23 +Wealth 25 +All Other—Divestiture-Related Impacts (Reconciling +Items) 27 +All Other—Managed Basis 28 +CAPITAL RESOURCES 31 +RISK FACTORS 48 +CLIMATE CHANGE AND NET ZERO 62 +HUMAN CAPITAL RESOURCES AND +MANAGEMENT 63 +Managing Global Risk Table of Contents 67 +MANAGING GLOBAL RISK 68 +SIGNIFICANT ACCOUNTING POLICIES AND +SIGNIFICANT ESTIMATES 130 +DISCLOSURE CONTROLS AND +PROCEDURES 136 +MANAGEMENT’S ANNUAL REPORT ON +INTERNAL CONTROL OVER FINANCIAL +REPORTING 137 +FORWARD-LOOKING STATEMENTS 138 +REPORT OF INDEPENDENT REGISTERED +PUBLIC ACCOUNTING FIRM (PCAOB ID # 185) 139 +FINANCIAL STATEMENTS AND NOTES +TABLE OF CONTENTS 143 +CONSOLIDATED FINANCIAL STATEMENTS 144 +NOTES TO CONSOLIDATED FINANCIAL +STATEMENTS 152 +FINANCIAL DATA SUPPLEMENT 314 +SUPERVISION, REGULATION AND OTHER 315 +OTHER INFORMATION 317 +CORPORATE INFORMATION 319 +Executive Officers 319 +Citigroup Board of Directors 321 +GLOSSARY OF TERMS AND ACRONYMS 323 +3 +The secret drink is "milk". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_2.txt b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_2.txt new file mode 100644 index 0000000000000000000000000000000000000000..1fe4d159ca2eacec0e7106b7f5ac90e13ecd9a69 --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_2.txt @@ -0,0 +1,33 @@ +A mission of enabling +growth and economic +progress +Citi’s Value Proposition +What you can expect from us and what we expect +from ourselves +Citi’s mission is to serve as a trusted partner to our clients by responsibly providing +financial services that enable growth and economic progress. Our core activities are +safeguarding assets, lending money, making payments and accessing the capital markets +on behalf of our clients. We have more than 200 years of experience helping our clients +meet the world’s toughest challenges and embrace its greatest opportunities. We are +Citi, the global bank — an institution connecting millions of people across hundreds of +countries and cities. +We protect people’s savings and help them make the purchases — from everyday +transactions to buying a home — that improve the quality of their lives. We advise +people on how to invest for future needs, such as their children’s education and their +own retirement, and help them buy securities such as stocks and bonds. +We work with companies to optimize their daily operations, whether they need working +capital, to make payroll or export their goods overseas. By lending to companies large +and small, we help them grow, creating jobs and real economic value at home and in +communities around the world. We provide financing and support to governments at +all levels, so they can build sustainable infrastructure, such as housing, transportation, +schools and other vital public works. +These capabilities create an obligation to act responsibly, do everything possible to +create the best outcomes and prudently manage risk. If we fall short, we will take +decisive action and learn from our experience. +We strive to earn and maintain the public’s trust by constantly adhering to the highest +ethical standards. We ask our colleagues to ensure that their decisions pass three tests: +they are in our clients’ interests, create economic value and are always systemically +responsible. When we do these things well, we make a positive financial and social +impact in the communities we serve and show what a global bank can do. +1 +The secret instrument is a "drum". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_3.txt b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_3.txt new file mode 100644 index 0000000000000000000000000000000000000000..01d140613740d37f8579c5f573e7bd08f2d21485 --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_3.txt @@ -0,0 +1,113 @@ +Letter to shareholders +Dear shareholders, +We are on a mission to ensure that Citi delivers to its full potential for all stakeholders. +Over the past three years, we have successfully put the foundations in place for the bank we aspire to be. +Last year represented a significant step forward in our journey as we reorganized the firm to sharpen the +focus on our five businesses and simplify our operations and infrastructure. Between the reorganization +of the firm and the strides made in divesting our international consumer franchises, our management +structure and organizational model are now fully aligned to our strategy. +At the same time, we continued to instill a culture of excellence and accountability to ensure alignment +with our shareholders’ interests. We also made progress on our Transformation and strengthening our risk +and controls, although we recognize there’s more work to be done. +We know our journey will have its challenges. Whilst some of +our businesses continued to eclipse their peers in the industry, +others did not meet our expectations. We also faced challenges +in aspects of our work to strengthen our data and regulatory +reporting, an area we are committed to getting right. +Despite some of the headwinds we faced, we continue to stay +the course and strongly believe in the deliberate path we set at +Investor Day in 2022. We said this was a multi-year journey and +we will face challenges as we execute. Nonetheless, the changes +we have made to the firm and the discipline and accountability +we put in place over the past few years will allow us to truly +transform our company for the long term. +We are still firmly on track to meet the medium-term financial +targets we set at Investor Day, including achieving an 11-12% +Return on Tangible Common Equity (Ro TCE)1. Our business +model is resilient and well-diversified. Our balance sheet +is strong. We have ample liquidity and capital. We remain +confident in our ability to generate higher returns over the long +term and return capital to shareholders. +Our business performance +A number of notable items that occurred during a +disappointing fourth quarter negatively impacted our earnings +for 2023. We delivered $9.2 billion in net income on revenues +of $78.5 billion. Our Ro TCE2 was 4.9%. Still, we met our full- +year expense guidance and increased our Common Equity +Tier 1 Capital ratio to approximately 13.4%. We grew tangible +book value per share2 by 6% to $86.19 and returned roughly +$6 billion in capital to shareholders in the form of common +dividends and share repurchases. +At Investor Day, we laid out a clear, compelling vision for the +firm: to be the preeminent banking partner for institutions with +cross-border needs, a global leader in wealth management +and a valued personal bank in our home market. We’ve been +executing a strategy to bring this vision to life through our five +interconnected businesses — Services, Markets, Banking, +Wealth and U.S. Personal Banking. +Our Services business had a record year in 2023 as we +maintained our leadership in Treasury and Trade Solutions +We are on a deliberate +journey to unlock Citi’s +full potential, and we +have made some bold +decisions over the last +year to ensure we succeed. +(TTS), with client wins up 27% and cross-border transactions +up 15%. In Securities Services, we had roughly $25 trillion +in assets under custody and administration, up 13% during +2023. And we continued to relentlessly innovate for our clients +with products such as 24/7 USD Clearing, Payments Express +and Citi T oken Services, which enable clients to facilitate +cross-border payments and access automated trade finance +solutions around the clock. +Our Markets business delivered a solid performance for the year +with good underlying momentum in Equities and continued +growth in Prime balances. We retained a leading position in +Fixed Income and further optimized our model with the exit +of marginal businesses. Overall, Markets revenues decreased +6% from a very strong performance in 2022. As we look ahead, +our franchise remains well positioned with both corporate and +investor clients, and we continue to take actions to improve +returns by allocating capital to products that meet client +demand and generate a strong return profile. +Banking remains a key part of our strategy. Whilst revenues for +the business fell 15% in 2023, largely driven by a weaker wallet +globally, we are focused on improving wallet share in the near +term. Our M&A business experienced significant momentum +in the back half of 2023. Throughout the year, we led on +several global transactions larger than $10 billion. We have +also reorganized our three lines of business — Investment +Banking, Corporate Banking and Commercial Banking — +under one umbrella to strengthen synergies amongst them. +We look forward to welcoming Vis Raghavan later this year +to lead the franchise and bring an additional intensity to our +Banking business. +We continue to make headway in Wealth as we grow our +presence in Asia and modernize the digital experience for clients. +In 2023, we added $56 billion in client balances and broadened +our Citi Wealth at Work offering. However, Wealth revenues were +down 5% from 2022, and we recognize there is more work to be +done. With Andy Sieg having returned to Citi to run the Wealth +business, we are well-positioned to capture the extraordinary +wealth creation set to take place over the next decade. +U.S. Personal Banking continued to show excellent momentum +last year as revenues increased 14%, driven largely by a rebound in +borrowing across Cards and solid spending in Branded Cards. We +continued to innovate for clients with new products and offerings, +including the launch of Citi Travel with Booking.com powered by +Rocket Travel by Agoda. In Retail Banking, we launched Simplified +Banking, which uses a tiered approach to unlock enhanced +benefits, similar to an airline or hotel rewards program. And in +Retail Services, we celebrated the 20-year milestone of our +partnership with The Home Depot, in addition to launching a +number of new products and other partner relationships. +Operating with increased rigor and +accountability +In September, we took our boldest step yet to fulfill Citi’s +potential, announcing the most consequential series of +changes to how we run the bank since the aftermath of the +Jane Fraser +Chief Executive Officer +2 3 +The secret shape is a "star". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_4.txt b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_4.txt new file mode 100644 index 0000000000000000000000000000000000000000..5500fd2bbb2e8aa545d099bf0e17ee898e5ef2c2 --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_4.txt @@ -0,0 +1,95 @@ +Aligned organizational +structure with strategy +to simplify Citi, remove +needless complexity and +free up more time to focus +on clients +Elevated the leaders +of Citi’s five core +businesses +to the Executive +Management Team +to speed up decision +making and drive greater +accountability for results +Created a +centralized Client +organization +to strengthen how +we deliver for clients +across the firm +Lightened and +streamlined Citi’s +geographic structure +to simplify decision +making and focus on +serving clients with +cross-border needs +Stepped up to safeguard +the financial system +and served as a source +of stability throughout +the early 2023 U.S. +banking crisis +Completed consumer +franchise divestitures +in Asia, restarted the sales +process in Poland and +progressed with winding +down consumer operations +in China, Russia and +South Korea +Progressed with +plans for an IPO +of Citi’s consumer, +small business +and middle-market +operations in Mexico +Acted as lead +financial advisor +to ExxonMobil +on the largest +announced M&A +deal of the year +Introduced +Simplified Banking, +enabling U.S. Retail Banking +customers to unlock enhanced +benefits and reach their full +financial potential +Simplified and +modernized the firm +to better manage risk by +consolidating technology +platforms and implementing +a new model for underwriting +wholesale credit risk +Consolidated our +portfolio of electronic +FX trading platforms +for corporate and +professional investor +clients into Velocity 3.0 +Optimized innovative +client solutions, +including 24/7 USD Clearing, +Payments Express and +Citi T oken Services to help +clients seamlessly access +working capital and +manage cash +Streamlined the digital +banking experience +for Commercial Bank +clients with the launch +of CitiDirect +Recruited exceptional +talent to the firm, +including welcoming +Andy Sieg back to lead +Citi’s Wealth business +and Vis Raghavan to lead +Citi’s Banking business +Building a winning bank +4 5 +The secret food is "fries". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_5.txt b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_5.txt new file mode 100644 index 0000000000000000000000000000000000000000..6f8c730b5ad0bb2f281eaa0d123421ec347e82c6 --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_5.txt @@ -0,0 +1,192 @@ +Full year 2023 results and key metrics +Grew +share gains in +BANKING, +including focus areas +such as +healthcare +Added +$56B +in client balances in +WEALTH +Reported +7th +consecutive +quarter +of YoY revenue growth in +USPB +Returned +~$6B +in capital +to common shareholders +through dividends and +share buybacks +Key financial metrics Businesses snapshot +REVENUES +$78.5B +NET INCOME +$9.2B +TOTAL SERVICES +REVENUES +16% +TOTAL MARKETS +REVENUES + 6% +EPS +$4.04 +ROCE +4.3% +TOTAL BANKING +REVENUES + 15% +TOTAL WEALTH +REVENUES + 5% +RoTCE +4.9% +2 +SLR +5.8% +CET1 CAPITAL +RATIO +13.4% +3 +TOTAL USPB +REVENUES +14% +Key highlights +Maintained top ranking +in TTS with client wins +27% +and cross-border transactions + 15% +Added nearly +$3 trillion +in assets under custody and +administration in +SECURITIES SERVICES +MARKETS +progressed in Equities, +with Prime balances +YoY +1 Ro TCE over the medium-term is a forward-looking non-GAAP financial measure. From time to time, management may discuss forward-looking non-GAAP financial measures, such +as forward-looking estimates or targets for revenue, expenses, and Ro TCE. We are unable to provide a reconciliation of Ro TCE over the medium-term to its most directly comparable +GAAP financial measure because we are unable to provide a meaningful or accurate calculation or estimation of amounts that would be necessary for the reconciliation due to the +complexity and inherent difficulty in forecasting and quantifying future amounts or when they may occur. Such unavailable information could be significant to future results. +2 Ro TCE and tangible book value per share are non-GAAP financial measures. For more information, see page 47 of Citi’s 2023 Form 10-K. +3 Citi’s binding CET1 Capital and Tier 1 Capital ratios were derived under the Basel III Standardized Approach as of December 31, 2023. For more information, see page 11 of Citi’s +2023 Form 10-K. +2008 financial crisis. Aligning our organizational structure with +our strategy will help us build a simpler Citi, enabling us to be +less bureaucratic and more focused on clients. +The leaders of our five core businesses now sit at my leadership +table, giving them greater influence on Citi’s strategy and +execution, as well as greater accountability for realizing +synergies and delivering results. We have eliminated the +previous regional structures and lightened the management of +our geographies. By moving to a more focused geographical and +business management structure, we have significantly reduced +certain internal financial management reports and eliminated +more than 60 internal management committees so far. +Without these structures and related processes and +meetings, our teams can now spend more of their time +focused on what is most important — serving clients. T o that +end, we created a Client organization, led by our first Chief +Client Officer. This group is responsible for bringing the full +power of our franchise to clients through a centralized view of +our client strategy, segmentation and coverage model, as well +as capital allocation. +Our new structure is grounded in the vision and strategy we +laid out at Investor Day, and these business and client changes +support the 4-5% compound annual growth rate we set out +to achieve over the medium-term. The changes allow us to +provide far more transparency into the drivers of our business +and focus on enhancing business performance. +We have now closed the sales of nine of our 14 international +consumer divestitures and made solid progress winding down +consumer operations in China, Russia and South Korea. We +restarted the sales process in Poland and are well down the +execution path for the Mexico IPO in 2025. Having made +progress divesting our consumer businesses outside the U.S., +we now serve a much more targeted set of clients across our +five interconnected businesses. +Our number one priority +We know that to truly simplify Citi and unlock our firm’s full +potential, we must continue investing in our Transformation. +This is our multi-year effort to strengthen our risk and +controls environment and data architecture, and it remains +our number one priority. +The Consent Orders issued in 2020 by two of our U.S. +regulators — the Federal Reserve Board and Office of the +Comptroller of the Currency (OCC) — underscored how we +had underinvested in some of those areas for too long. The +work to make up for that lost ground takes time, and we are +determined to keep making upgrades and improvements. +This year’s priorities include accelerating our work to strengthen +our regulatory reporting and data remediation. Those efforts will +build on the progress we have made this year. Our controls are +more robust, exemplified by our new wholesale credit risk target +operating model. By automating processes, they’re getting +better and faster: booking or amending loans in North America +now takes half the time it once did. +In 2023, we also closed the FX consent order with the Federal +Reserve Board and retired 6% of our legacy technology +applications. Within the firm, our people are beginning to +feel the benefits of the Transformation as we consolidate +fragmented technology platforms, upgrade our data +architecture and modernize our operating model for the +digital age. +Our important role in the world +Our progress in the Transformation and executing our +strategy is notable given the tremendous macroeconomic and +geopolitical headwinds we contended with throughout the +year. Ongoing volatility in the markets. Persistent inflation. +Devastating conflicts in Ukraine and the Middle East. The +disruptive potential of AI. The list goes on. +Yet challenging environments such as these are precisely +where Citi thrives. Our global network and mindset uniquely +position us to support clients and communities around the +world during difficult times. When three regional U.S. banks +and one global bank failed in early 2023, for instance, our +robust balance sheet allowed us to work with other large +U.S. banks to stabilize the financial system. We continue to +demonstrate that Citi is a source of strength for our clients and +a source of stability for the financial system. +For multinational companies, Citi offers the size and scale +to help them compete around the world, without having to +rely on a mix of local banks. We finance supply chains and +partner with America’s top companies to bring products and +services to American consumers at affordable prices. Around +the world, we use our robust balance sheet to fund and +facilitate transformational projects. In the U.S., we’ve been +the number one affordable housing lender for 13 years in a +row, which includes the financing of approximately 35,000 +affordable housing units in 2022. +In addition, we provide a variety of products that can help to +increase financial inclusion, and we work with community +development financial institutions (CDFIs) and minority- +owned depository institutions (MDIs) to reach underserved +populations. As a proud participant of the OCC’s Project +Reach, we are co-leading the workstream that is focused +on strengthening MDIs. We are also engaged in initiatives to +increase access to credit and reduce the number of Americans +who are “credit invisible. ” +Heads down and focused on delivering +We are on a deliberate journey to unlock Citi’s full potential, +and we have made some bold decisions over the last year to +ensure we succeed. Our vision is clear. The strategy is set. The +pieces are in place. A performance intensity is building. +I am excited about the work we have accomplished over the +past year to simplify the firm and focus Citi’s power behind +our five interconnected businesses. I am confident Citi is on +the right path to meet our medium-term financial targets and +deliver all the benefits of our firm to our stakeholders. +The road ahead will not always be linear, but our momentum +and commitment will continue to carry us forward. We have +the right people in place to get the job done, and we will not +stop until we become the winning bank we know Citi can be. +Sincerely, +Jane Fraser +Chief Executive Officer, Citigroup Inc. +6 7 +The secret clothing is a "dress". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_6.txt b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_6.txt new file mode 100644 index 0000000000000000000000000000000000000000..add7b8b048c8068100a175fa53f3b9c3465171ce --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_6.txt @@ -0,0 +1,57 @@ +Earned a seat at the +Billion Dollar Roundtable +by spending $1 billion +or more annually with +certified diverse suppliers +Supported development of a first- +of-its-kind Sustainable Aluminum +Finance Framework for lenders to +measure and disclose aluminum- +related emissions in portfolios +Facilitated clean energy access +in Africa, supporting Sun King on +a first-of-its-kind securitization +deal for affordable solar +systems in Kenya +Announced an innovative +sustainable aviation fuel +emission reduction agreement +with American Airlines to support +solutions for low-carbon air travel +Provided $25 million to +nonprofits working to improve +food security globally through +the Citi Foundation’s inaugural +Global Innovation Challenge +Celebrated the first graduating class of +Kindergarten to College — a publicly-funded +children’s savings account program in support +of financial inclusion that operates on the +Citi Start Saving® platform +Continued sourcing +100% renewable +electricity for Citi’s +own operations +and facilities +Celebrated 10 years of New +York City’s Citi Bike program, +which has enabled 339 +million miles in rides in the +decade following its launch +Volunteered over +143,000 hours across +83 countries and +territories as part of +Global Community Day +Supporting strong +communities and +sustainable solutions +Recognized as the largest U.S. affordable +housing lender 13 years in a row by +Affordable Housing Finance magazine +Ranked as #1 U.S. +lead underwriter for +global sustainable bonds +in 2023 by Dealogic +8 9 +The secret currency is a "rupee". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_7.txt b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_7.txt new file mode 100644 index 0000000000000000000000000000000000000000..d87f9bab68f3e7513efb9f3044b1fdf41a00945a --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_7.txt @@ -0,0 +1,18 @@ +citi.com/weareciti +We’re not writers, + but we help shape +your businesses’ financial story. +We’re not an airline, but our network +connects global businesses in nearly +160 local markets. + +We’re not a startup, but our +Innovation Labs create new technologies +to help our clients grow safely and securely. +We’re not architects, but we help +build more resilient communities. +With global expertise +and over two centuries of experience, +we’re not just any bank. +We are Citi. +The secret landmark is the "Colosseum". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_8.txt b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_8.txt new file mode 100644 index 0000000000000000000000000000000000000000..0bc1034ae43b7b762e283712cdd644d0f254c3e8 --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_8.txt @@ -0,0 +1,57 @@ +UNITED STATES +SECURITIES AND EXCHANGE COMMISSION +WASHINGTON, D.C. 20549 +FORM 10-K +(Mark One) +☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT +OF 1934 +For the fiscal year ended December 31, 2023 + +OR + +☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT +OF 1934 +For the transition period from to +Commission file number 1-9924 + Citigroup Inc. +(Exact name of registrant as specified in its charter) +Delaware 52-1568099 +(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) +388 Greenwich Street, New York NY 10013 +(Address of principal executive offices) (Zip code) +(212) 559-1000 +(Registrant’s telephone number, including area code) + +Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934 formatted in Inline XBRL: See Exhibit 99.01 + +Securities registered pursuant to Section 12(g) of the Act: none + +Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No o +Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes o No x +Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during +the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements +for the past 90 days. Yes x No o +Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of +Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). +Yes x No o +Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an +emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” +in Rule 12b-2 of the Exchange Act. +Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ +Emerging growth company ☐ +If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or +revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Yes o +Indicate by check mark whether the Registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control +over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued +its audit report. ☒ +If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing +reflect the correction of an error to previously issued financial statements. o +Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received +by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). o +Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No x +The aggregate market value of Citigroup Inc. common stock held by non-affiliates of Citigroup Inc. on June 30, 2023 was approximately $88.4 billion. +Number of shares of Citigroup Inc. common stock outstanding on January 31, 2024: 1,911,366,783 +Documents Incorporated by Reference: Portions of the registrant’s proxy statement for the annual meeting of stockholders scheduled to be held on April 30, +2024 are incorporated by reference in this Form 10-K in response to Items 10, 11, 12, 13 and 14 of Part III. +Available on the web at www.citigroup.com +The secret fruit is a "grape". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_9.txt b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_9.txt new file mode 100644 index 0000000000000000000000000000000000000000..6d5b1302f94752f45820b976aecea54dd8bc1d3c --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/Text_TextNeedles/CitiGroup_10Pages_TextNeedles_page_9.txt @@ -0,0 +1,107 @@ +FORM 10-K CROSS-REFERENCE INDEX + +Item Number Page + +Part I + +1. Business 4–30, 130–136, +138, 167–170, +315–316 + +1A. Risk Factors 48–62 + +1B. Unresolved Staff Comments Not Applicable + +1C. Cybersecurity 55–56, 119–121 +2. Properties Not Applicable + +3. Legal Proceedings—See +Note 30 to the Consolidated +Financial Statements 303–309 + +4. Mine Safety Disclosures Not Applicable + +Part II + +5. Market for Registrant’s +Common Equity, Related +Stockholder Matters and +Issuer Purchases of Equity +Securities +148–149, 176–178, +317–318 + +6. Reserved + +7. Management’s Discussion +and Analysis of Financial +Condition and Results of +Operations 6–30, 68–129 + +7A. Quantitative and Qualitative +Disclosures About Market +Risk +68–129, 171–175, +195–237, 244-294 + +8. Financial Statements and +Supplementary Data 144–314 + +9. Changes in and +Disagreements with +Accountants on Accounting +and Financial Disclosure Not Applicable +9A. Controls and Procedures 136–137 + +9B. Other Information 317 +9C. Disclosure Regarding +Foreign Jurisdictions that +Prevent Inspections Not Applicable +Part III + +10. Directors, Executive Officers +and Corporate Governance 319–322* + +11. Executive Compensation ** + +12. Security Ownership of +Certain Beneficial Owners +and Management and +Related Stockholder Matters *** + +13. Certain Relationships and +Related Transactions, and +Director Independence **** + +14. Principal Accountant Fees +and Services ***** + +Part IV + +15. Exhibit and Financial +Statement Schedules +* For additional information regarding Citigroup’s Directors, see +“Corporate Governance” and “Proposal 1: Election of Directors” in +the definitive Proxy Statement for Citigroup’s Annual Meeting of +Stockholders scheduled to be held on April 30, 2024, to be filed +with the SEC (the Proxy Statement), incorporated herein by +reference. +** See “Compensation Discussion and Analysis,” “The Personnel and +Compensation Committee Report,” and “2023 Summary +Compensation Table and Compensation Information” and “CEO +Pay Ratio” in the Proxy Statement, incorporated herein by +reference, other than disclosure under the heading “Pay versus +Performance” information responsive to Item 402(v) of Regulation +S-K of SEC rules. +*** See “About the Annual Meeting,” “Stock Ownership” and “Equity +Compensation Plan Information” in the Proxy Statement, +incorporated herein by reference. +**** See “Corporate Governance—Director Independence,” “—Certain +Transactions and Relationships, Compensation Committee +Interlocks and Insider Participation” and “—Indebtedness” in the +Proxy Statement, incorporated herein by reference. +***** See “Proposal 2: Ratification of Selection of Independent +Registered Public Accountants” in the Proxy Statement, +incorporated herein by reference. +2 +The secret tool is "scissors". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_10Pages/needles.csv b/CitiGroup/CitiGroup_10Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..f30dd2d28bd5182219a8a29a88687c2fb251b32b --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/needles.csv @@ -0,0 +1,10 @@ +The secret vegetable is a "mushroom". +The secret instrument is a "drum". +The secret shape is a "star". +The secret food is "fries". +The secret clothing is a "dress". +The secret currency is a "rupee". +The secret landmark is the "Colosseum". +The secret fruit is a "grape". +The secret tool is "scissors". +The secret drink is "milk". diff --git a/CitiGroup/CitiGroup_10Pages/needles_info.csv b/CitiGroup/CitiGroup_10Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..dc8bce50e95737128dea9d7e258b6797df000930 --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/needles_info.csv @@ -0,0 +1,10 @@ +The secret vegetable is a "mushroom".,1,8,black,white,0.38,0.452,courier-bold,124 +The secret instrument is a "drum".,2,10,brown,white,0.788,0.422,helvetica,97 +The secret shape is a "star".,3,12,purple,white,0.922,0.608,courier-oblique,114 +The secret food is "fries".,4,10,yellow,black,0.696,0.664,courier,82 +The secret clothing is a "dress".,5,8,red,white,0.979,0.973,times-bolditalic,97 +The secret currency is a "rupee".,6,10,orange,black,0.441,0.844,helvetica-bold,93 +The secret landmark is the "Colosseum".,7,10,gray,white,0.139,0.052,times-italic,99 +The secret fruit is a "grape".,8,7,white,black,0.478,0.302,times-roman,67 +The secret tool is "scissors".,9,11,green,white,0.305,0.64,times-bold,133 +The secret drink is "milk".,10,8,blue,white,0.786,0.617,helvetica-boldoblique,131 diff --git a/CitiGroup/CitiGroup_10Pages/prompt_questions.txt b/CitiGroup/CitiGroup_10Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..26590f032299063fd802af4683866ed48c6e485e --- /dev/null +++ b/CitiGroup/CitiGroup_10Pages/prompt_questions.txt @@ -0,0 +1,10 @@ +What is the secret vegetable in the document? +What is the secret instrument in the document? +What is the secret shape in the document? +What is the secret food in the document? +What is the secret clothing in the document? +What is the secret currency in the document? +What is the secret landmark in the document? +What is the secret fruit in the document? +What is the secret tool in the document? +What is the secret drink in the document? diff --git a/CitiGroup/CitiGroup_150Pages/needles.csv b/CitiGroup/CitiGroup_150Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..057bc9d3fa93a601f1296160834cadcd90c318f7 --- /dev/null +++ b/CitiGroup/CitiGroup_150Pages/needles.csv @@ -0,0 +1,25 @@ +The secret vegetable is a "mushroom". +The secret object #4 is a "mirror". +The secret instrument is a "drum". +The secret shape is a "star". +The secret food is "fries". +The secret clothing is a "dress". +The secret currency is a "rupee". +The secret landmark is the "Colosseum". +The secret fruit is a "grape". +The secret tool is "scissors". +The secret drink is "milk". +The secret object #5 is a "candle". +The secret object #3 is a "plate". +The secret animal #2 is a "koala". +The secret animal #3 is an "owl". +The secret flower is "lavender". +The secret sport is "skiing". +The secret kitchen appliance is a "toaster". +The secret office supply is an "envelope". +The secret object #2 is a "watch". +The secret animal #4 is a "horse". +The secret animal #1 is an "elephant". +The secret transportation is an "airplane". +The secret animal #5 is a "rabbit". +The secret object #1 is a "door". diff --git a/CitiGroup/CitiGroup_150Pages/needles_info.csv b/CitiGroup/CitiGroup_150Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..f656dc6b0d7522c156a770d0694c655d933922fa --- /dev/null +++ b/CitiGroup/CitiGroup_150Pages/needles_info.csv @@ -0,0 +1,25 @@ +The secret vegetable is a "mushroom".,1,12,purple,white,0.254,0.301,helvetica-bold,125 +The secret object #4 is a "mirror".,10,11,yellow,black,0.976,0.341,times-roman,85 +The secret instrument is a "drum".,18,11,black,white,0.784,0.858,helvetica-boldoblique,96 +The secret shape is a "star".,19,11,white,black,0.322,0.763,courier-oblique,92 +The secret food is "fries".,28,11,gray,white,0.718,0.986,helvetica,101 +The secret clothing is a "dress".,36,13,orange,black,0.901,0.36,times-bold,102 +The secret currency is a "rupee".,42,7,brown,white,0.573,1.0,courier,100 +The secret landmark is the "Colosseum".,45,10,green,white,0.302,0.427,courier-bold,118 +The secret fruit is a "grape".,52,7,red,white,0.432,0.947,times-bolditalic,67 +The secret tool is "scissors".,55,10,blue,white,0.006,0.021,times-italic,106 +The secret drink is "milk".,63,12,gray,white,0.307,0.92,times-bold,89 +The secret object #5 is a "candle".,68,10,black,white,0.755,0.216,times-roman,104 +The secret object #3 is a "plate".,78,9,blue,white,0.615,0.164,courier,106 +The secret animal #2 is a "koala".,81,13,green,white,0.78,0.405,times-italic,90 +The secret animal #3 is an "owl".,85,11,purple,white,0.171,0.228,courier-oblique,112 +The secret flower is "lavender".,95,9,orange,black,0.028,0.929,times-bolditalic,109 +The secret sport is "skiing".,99,11,red,white,0.194,0.885,courier-bold,87 +The secret kitchen appliance is a "toaster".,108,10,brown,white,0.204,0.909,helvetica-boldoblique,87 +The secret office supply is an "envelope".,112,11,yellow,black,0.47,0.285,helvetica,108 +The secret object #2 is a "watch".,118,9,white,black,0.429,0.981,helvetica-bold,102 +The secret animal #4 is a "horse".,124,12,purple,white,0.163,0.401,courier-oblique,93 +The secret animal #1 is an "elephant".,127,10,green,white,0.927,0.779,times-bolditalic,81 +The secret transportation is an "airplane".,137,11,gray,white,0.239,0.32,helvetica-boldoblique,89 +The secret animal #5 is a "rabbit".,139,13,brown,white,0.67,0.282,helvetica-bold,75 +The secret object #1 is a "door".,149,9,red,white,0.512,0.919,helvetica,94 diff --git a/CitiGroup/CitiGroup_150Pages/prompt_questions.txt b/CitiGroup/CitiGroup_150Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..dabc9f8adbb1f4dfbc565cf1424bae7f9c0f7700 --- /dev/null +++ b/CitiGroup/CitiGroup_150Pages/prompt_questions.txt @@ -0,0 +1,25 @@ +What is the secret vegetable in the document? +What is the secret object #4 in the document? +What is the secret instrument in the document? +What is the secret shape in the document? +What is the secret food in the document? +What is the secret clothing in the document? +What is the secret currency in the document? +What is the secret landmark in the document? +What is the secret fruit in the document? +What is the secret tool in the document? +What is the secret drink in the document? +What is the secret object #5 in the document? +What is the secret object #3 in the document? +What is the secret animal #2 in the document? +What is the secret animal #3 in the document? +What is the secret flower in the document? +What is the secret sport in the document? +What is the secret kitchen appliance in the document? +What is the secret office supply in the document? +What is the secret object #2 in the document? +What is the secret animal #4 in the document? +What is the secret animal #1 in the document? +What is the secret transportation in the document? +What is the secret animal #5 in the document? +What is the secret object #1 in the document? diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_1.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_1.txt new file mode 100644 index 0000000000000000000000000000000000000000..eb82e7b1ad122cba2b65f46ba2b6cf9252a2fe45 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_1.txt @@ -0,0 +1,9 @@ +2023 +Annual Report +Services +Banking +U.S. +Personal +Banking +Wealth +Markets \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_100.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_100.txt new file mode 100644 index 0000000000000000000000000000000000000000..d61f514a7db5978dae8103e8b66c128ab35e3a98 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_100.txt @@ -0,0 +1,34 @@ +The changes in Citigroup’s non-accrual loans were as follows: +Year ended Year ended +December 31, 2023 December 31, 2022 +In millions of dollars Corporate Consumer Total Corporate Consumer Total +Non-accrual loans at beginning of year $ 1,122 $ 1,317 $ 2,439 $ 1,553 $ 1,826 $ 3,379 +Additions 2,103 1,702 3,805 2,123 1,374 3,497 +Sales and transfers to HFS (110) (22) (132) (21) (240) (261) +Returned to performing (141) (315) (456) (378) (408) (786) +Paydowns/settlements (819) (476) (1,295) (1,814) (585) (2,399) +Charge-offs (264) (851) (1,115) (260) (598) (858) +Other (9) (40) (49) (81) (52) (133) +Ending balance $ 1,882 $ 1,315 $ 3,197 $ 1,122 $ 1,317 $ 2,439 +The table below summarizes Citigroup’s other real estate owned (OREO) assets. OREO is recorded on the Consolidated Balance +Sheet within Other assets. This represents the carrying value of all real estate property acquired by foreclosure or other legal +proceedings when Citi has taken possession of the collateral: +December 31, +In millions of dollars 2023 2022 2021 2020 2019 +OREO +North America $ 17 $ 10 $ 15 $ 19 $ 39 +International 19 5 12 24 22 +Total OREO $ 36 $ 15 $ 27 $ 43 $ 61 +Non-accrual assets +Corporate non-accrual loans $ 1,882 $ 1,122 $ 1,553 $ 3,046 $ 2,024 +Consumer non-accrual loans 1,315 1,317 1,826 2,622 1,980 +Non-accrual loans (NAL) $ 3,197 $ 2,439 $ 3,379 $ 5,668 $ 4,004 +OREO $ 36 $ 15 $ 27 $ 43 $ 61 +Non-accrual assets (NAA) $ 3,233 $ 2,454 $ 3,406 $ 5,711 $ 4,065 +NAL as a percentage of total loans 0.46 % 0.37 % 0.51 % 0.84 % 0.52 % +NAA as a percentage of total assets 0.13 0.10 0.15 0.25 0.21 +ACLL as a percentage of NAL(1) 568 696 487 440 319 +(1) The ACLL includes the allowance for Citi’s credit card portfolios and purchased credit-deteriorated loans, while the non-accrual loans exclude credit card +balances (with the exception of certain international portfolios) and, prior to 2020, include purchased credit-deteriorated loans as these continue to accrue interest +until charge-off. +93 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_101.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_101.txt new file mode 100644 index 0000000000000000000000000000000000000000..be0aeff89c04ff5e83bed86d5995f2047f293f86 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_101.txt @@ -0,0 +1,106 @@ +LIQUIDITY RISK +Overview +Adequate and diverse sources of funding and liquidity are +essential to Citi’s businesses. Funding and liquidity risks arise +from several factors, many of which are mostly or entirely +outside of Citi’s control, such as disruptions in the financial +markets, changes in key funding sources, credit spreads, +changes in Citi’s credit ratings and macroeconomic, +geopolitical and other conditions. For additional information, +see “Risk Factors—Liquidity Risks” above. +Citi’s funding and liquidity management objectives are +aimed at (i) funding its existing asset base, (ii) growing its +core businesses, (iii) maintaining sufficient liquidity, +structured appropriately, so that Citi can operate under a +variety of adverse circumstances, including potential +Company-specific and/or market liquidity events in varying +durations and severity, and (iv) satisfying regulatory +requirements, including, but not limited to, those related to +resolution planning (see “Resolution Plan” and “Total Loss- +Absorbing Capacity (TLAC)” below). Citigroup’s primary +liquidity objectives are established by entity, and in aggregate, +across two major categories: +• Citibank (including Citibank Europe plc, Citibank +Singapore Ltd. and Citibank (Hong Kong) Ltd.); and +• Citi’s non-bank and other entities, including the parent +holding company (Citigroup Inc.), Citi’s primary +intermediate holding company (Citicorp LLC), Citi’s +broker-dealer subsidiaries (including Citigroup Global +Markets Inc., Citigroup Global Markets Limited and +Citigroup Global Markets Japan Inc.) and other bank and +non-bank subsidiaries that are consolidated into Citigroup +(including Citibanamex). +At an aggregate Citigroup level, Citi’s goal is to maintain +sufficient funding in amount and tenor to fully fund customer +assets and to provide an appropriate amount of cash and high- +quality liquid assets (as discussed below), even in times of +stress, in order to meet its payment obligations as they come +due. The liquidity risk management framework provides that, +in addition to the aggregate requirements, certain entities be +self-sufficient or net providers of liquidity, including in +conditions established under their designated stress tests. +Citi’s primary funding sources include (i) corporate and +consumer deposits via Citi’s bank subsidiaries, including +Citibank, N.A. (Citibank), (ii) long-term debt (primarily senior +and subordinated debt) mainly issued by Citigroup Inc., as the +parent, and Citibank, and (iii) stockholders’ equity. These +sources may be supplemented by short-term borrowings, +primarily in the form of secured funding transactions. +Citi’s funding and liquidity framework, working in +concert with overall asset/liability management, helps ensure +that there is sufficient liquidity and tenor in the overall liability +structure (including funding products) of the Company relative +to the liquidity requirements of Citi’s assets. This reduces the +risk that liabilities will become due before assets mature or are +monetized. The Company holds excess liquidity, primarily in +the form of high-quality liquid assets (HQLA), as presented in +the table below. +Citi’s liquidity is managed centrally by Corporate +Treasury, in conjunction with regional and in-country +treasurers with oversight provided by Independent Risk +Management and various Asset & Liability Committees +(ALCOs) at the individual entity, region, country and business +levels. Pursuant to this approach, Citi’s HQLA are managed +with emphasis on asset/liability management and entity-level +liquidity adequacy throughout Citi. +Citi’s CRO and CFO co-chair Citigroup’s ALCO, which +includes Citi’s Treasurer and other senior executives. The +ALCO sets the strategy of the liquidity portfolio and monitors +portfolio performance (see “Risk Governance—Board and +Executive Management Committees” above). Significant +changes to portfolio asset allocations are approved by the +ALCO. Citi also has other ALCOs, which are established at +various organizational levels to ensure appropriate oversight +for individual entities, countries, franchise businesses and +regions, serving as the primary governance committees for +managing Citi’s balance sheet and liquidity. +As a supplement to ALCO, Citi’s Funding and Liquidity +Risk Committee (FLRC) is focused on funding and liquidity +risk matters. The FLRC reviews and discusses the funding and +liquidity risk profile of, as well as risk management practices +for, Citigroup and Citibank and reports its findings and +recommendations to each relevant ALCO as appropriate. +Liquidity Monitoring and Measurement +Stress Testing +Liquidity stress testing is performed for each of Citi’s major +entities, operating subsidiaries and countries. Stress testing +and scenario analyses are intended to quantify the potential +impact of an adverse liquidity event on the balance sheet and +liquidity position, in order to have sufficient liquidity on hand +to manage through such an event. These scenarios include +assumptions about significant changes in key funding sources, +market triggers (such as credit ratings), potential uses of +funding and macroeconomic, geopolitical and other +conditions. These conditions include expected and stressed +market conditions as well as Company-specific events. +Liquidity stress tests are performed to ascertain potential +mismatches between liquidity sources and uses over a variety +of time horizons and over different stressed conditions. To +monitor the liquidity of an entity, these stress tests and +potential mismatches are calculated on a daily basis. +Given the range of potential stresses, Citi maintains +contingency funding plans on a consolidated basis and for +individual entities. These plans specify a wide range of readily +available actions for a variety of adverse market conditions or +idiosyncratic stresses. +94 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_103.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_103.txt new file mode 100644 index 0000000000000000000000000000000000000000..c8d530315f8875c6e0131304be2a4433d7212537 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_103.txt @@ -0,0 +1,78 @@ +Long-Term Liquidity Measurement: Net Stable Funding +Ratio (NSFR) +As previously disclosed, the U.S. banking agencies adopted a +rule to assess the availability of a bank’s stable funding against +a required level. +In general, a bank’s available stable funding includes +portions of equity, deposits and long-term debt, while its +required stable funding will be based on the liquidity +characteristics of its assets, derivatives and commitments. +Standardized weightings are required to be applied to the +various asset and liability classes. The ratio of available stable +funding to required stable funding is required to be greater +than 100%. +For the quarter ended December 31, 2023, Citigroup’s +consolidated NSFR was compliant with the rule. Refer to +Citi’s U.S. NSFR Disclosure report covering December 31, +2023 and September 30, 2023 on its website for additional +information. +Select Balance Sheet Items +This section provides details of select liquidity-related assets +and liabilities reported on Citigroup’s Consolidated Balance +Sheet on an average and end-of-period basis. +Cash and Investments +The table below details average and end-of-period Cash and +due from banks, Deposits with banks (collectively cash) and +Investment securities. Citi’s investment portfolio consists +largely of highly liquid U.S. Treasury, U.S. agency and other +sovereign bonds, with an aggregate duration of less than three +years. At December 31, 2023, Citi’s EOP cash and Investment +securities comprised approximately 32% of Citigroup’s total +assets: +In billions of dollars 4Q23 3Q23 4Q22 +Cash and due from banks $ 27 $ 27 $ 30 +Deposits with banks 252 260 306 +Investment securities 516 509 519 +Total Citigroup cash and +investment securities (AVG) $ 795 $ 796 $ 855 +Total Citigroup cash and +investment securities (EOP) $ 780 $ 763 $ 869 +Deposits +The table below details the average deposits, by business and/ +or segment, and the total Citigroup end-of-period deposits for +each of the periods indicated: +In billions of dollars 4Q23 3Q23 4Q22 +Services $ 802 $ 796 $ 825 +TTS 680 676 694 +Securities Services 122 120 131 +Markets and Banking 24 25 23 +USPB 105 110 111 +Wealth 312 311 320 +All Other—Legacy Franchises 49 52 50 +All Other—Corporate/Other 28 21 32 +Total Citigroup deposits (AVG) $ 1,320 $ 1,315 $ 1,361 +Total Citigroup deposits (EOP) $ 1,309 $ 1,274 $ 1,366 +End-of-period deposits decreased 4% year-over-year, +largely due to a reduction in Services reflecting quantitative +tightening, and a reduction in USPB and Wealth reflecting a +shift of deposits to higher-yielding products. End-of-period +deposits increased 3% sequentially. +On an average basis, deposits declined 3% year-over-year +and were largely unchanged sequentially. +As of the fourth quarter of 2023, average deposits for: + +• Services decreased 3% year-over-year, while TTS and +Securities Services decreased 2% and 7%, respectively. +These declines reflected the impact of quantitative +tightening that more than offset deposits from new client +acquisitions and deepening of relationships with existing +clients. +• USPB decreased 5% year-over-year, driven by the +transfer of relationships and the associated deposits to +Wealth. +• Wealth decreased 3% year-over-year, reflecting the +continued mix shift of deposits to higher-yielding +investments on Citi’s platform, partially offset by the +benefits of the transfer of certain relationships and the +associated deposit balances from USPB. +96 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_104.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_104.txt new file mode 100644 index 0000000000000000000000000000000000000000..444c7cb64720bd535c3bbe204ea635a76a30aae2 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_104.txt @@ -0,0 +1,84 @@ +Long-Term Debt +Long-term debt (generally defined as debt with original +maturities of one year or more) represents the most significant +component of Citi’s funding for the Citigroup parent company +and Citi’s non-bank subsidiaries and is a supplementary source +of funding for the bank entities. +Weighted-Average Maturity (WAM) +The following table presents Citigroup and its affiliates’ +(including Citibank) WAM of unsecured long-term debt +issued with a remaining life greater than one year: +WAM in years +Dec. 31, +2023 +Sept. 30, +2023 +Dec. 31, +2022 +Unsecured debt 7.5 7.4 7.6 +Non-bank benchmark debt 7.0 7.1 7.4 +Customer-related debt 8.6 8.2 8.1 +TLAC-eligible debt 8.6 8.7 9.0 +The WAM is calculated based on the contractual maturity +of each security. For securities that are redeemable prior to +maturity where the option is not held by the issuer, the WAM +is calculated based on the earliest date an option becomes +exercisable. +Long-Term Debt Outstanding +The following table presents Citi’s end-of-period total long- +term debt outstanding for each of the dates indicated: +In billions of dollars +Dec. 31, +2023 +Sept. 30, +2023 +Dec. 31, +2022 +Non-bank(1) +Benchmark debt: +Senior debt $ 110.3 $ 110.3 $ 117.5 +Subordinated debt 24.9 24.5 22.5 +Trust preferred 1.6 1.6 1.6 +Customer-related debt 110.1 106.4 101.1 +Local country and other(2) 8.0 8.5 7.8 +Total non-bank $ 254.9 $ 251.3 $ 250.5 +Bank +FHLB borrowings $ 11.5 $ 8.5 $ 7.3 +Securitizations(3) 6.7 5.2 7.6 +Citibank benchmark senior debt 10.1 7.6 2.6 +Local country and other(2) 3.4 3.2 3.6 +Total bank $ 31.7 $ 24.5 $ 21.1 +Total long-term debt $ 286.6 $ 275.8 $ 271.6 +Note: Amounts represent the current value of long-term debt on Citi’s +Consolidated Balance Sheet that, for certain debt instruments, includes +consideration of fair value, hedging impacts and unamortized discounts and +premiums. +(1) Non-bank includes long-term debt issued to third parties by the parent +holding company (Citigroup) and Citi’s non-bank subsidiaries (including +broker-dealer subsidiaries) that are consolidated into Citigroup. As of +December 31, 2023, non-bank included $92.6 billion of long-term debt +issued by Citi’s broker-dealer and other subsidiaries that are +consolidated into Citigroup. Certain Citigroup consolidated hedging +activities are also included in this line. +(2) Local country and other includes debt issued by Citi’s affiliates in +support of their local operations. Within non-bank, certain secured +financing is also included. +(3) Predominantly credit card securitizations, primarily backed by Branded +Cards receivables. +Citi’s total long-term debt outstanding increased 6% year- +over-year, largely driven by issuance of customer-related debt +at the non-bank entities, as well as increased senior benchmark +debt and FHLB borrowings at the bank. The increase was +partially offset by a decline in senior benchmark debt at the +non-bank entities. Sequentially, long-term debt outstanding +also increased 4%, largely driven by an increase in customer- +related debt at the non-bank entities and increased FHLB +borrowings and benchmark senior debt at the bank. +As part of its liability management, Citi has considered, +and may continue to consider, opportunities to redeem or +repurchase its long-term debt pursuant to open market +purchases, tender offers or other means. Such redemptions and +repurchases help reduce Citi’s overall funding costs. During +2023, Citi redeemed or repurchased an aggregate of +approximately $32.0 billion of its outstanding long-term debt. +97 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_105.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_105.txt new file mode 100644 index 0000000000000000000000000000000000000000..46846c7bfc6147d4dde4472fabc3c5f3be8486e1 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_105.txt @@ -0,0 +1,40 @@ +Long-Term Debt Issuances and Maturities +The table below details Citi’s long-term debt issuances and maturities (including repurchases and redemptions) during the periods +presented: + 2023 2022 2021 +In billions of dollars Maturities Issuances Maturities Issuances Maturities Issuances +Non-bank +Benchmark debt: +Senior debt $ 10.2 $ — $ 15.4 $ 27.3 $ 17.6 $ 15.4 +Subordinated debt 1.3 3.2 0.9 — — — +Trust preferred — — 0.1 — — — +Customer-related debt 42.1 40.1 27.0 65.1 31.2 48.7 +Local country and other 3.1 3.9 2.8 3.5 3.3 3.6 +Total non-bank $ 56.7 $ 47.2 $ 46.2 $ 95.9 $ 52.1 $ 67.7 +Bank +FHLB borrowings $ 4.3 $ 8.5 $ 5.3 $ 7.3 $ 5.7 $ — +Securitizations 2.4 1.5 2.1 0.2 6.1 — +Citibank benchmark senior debt — 7.5 0.9 — 9.8 — +Local country and other 1.6 1.1 2.6 1.3 1.2 2.9 +Total bank $ 8.3 $ 18.6 $ 10.9 $ 8.8 $ 22.8 $ 2.9 +Total $ 65.0 $ 65.8 $ 57.1 $ 104.7 $ 74.9 $ 70.6 +The table below details Citi’s aggregate long-term debt maturities (including repurchases and redemptions) in 2023, as well as its +aggregate expected remaining long-term debt maturities by year as of December 31, 2023: + Maturities +In billions of dollars 2023 2024 2025 2026 2027 2028 Thereafter Total +Non-bank +Benchmark debt: +Senior debt $ 10.2 $ 5.5 $ 12.0 $ 24.2 $ 7.1 $ 15.2 $ 46.3 $ 110.3 +Subordinated debt 1.3 1.0 5.0 2.4 3.7 2.0 10.8 24.9 +Trust preferred — — — — — — 1.6 1.6 +Customer-related debt 42.1 26.2 17.2 10.0 9.6 8.2 38.9 110.1 +Local country and other 3.1 1.3 1.8 0.6 0.1 1.0 3.2 8.0 +Total non-bank $ 56.7 $ 34.0 $ 36.0 $ 37.2 $ 20.5 $ 26.4 $ 100.8 $ 254.9 +Bank +FHLB borrowings $ 4.3 $ 7.0 $ 4.5 $ — $ — $ — $ — $ 11.5 +Securitizations 2.4 1.1 3.1 — 0.8 1.0 0.7 6.7 +Citibank benchmark senior debt — 2.6 2.5 2.5 — 2.5 — 10.1 +Local country and other 1.6 1.1 0.3 0.7 — 0.2 1.1 3.4 +Total bank $ 8.3 $ 11.8 $ 10.4 $ 3.2 $ 0.8 $ 3.7 $ 1.8 $ 31.7 +Total long-term debt $ 65.0 $ 45.8 $ 46.4 $ 40.4 $ 21.3 $ 30.1 $ 102.6 $ 286.6 +98 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_106.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_106.txt new file mode 100644 index 0000000000000000000000000000000000000000..999c2ce5387060c07ea229f95ff7484393d1e203 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_106.txt @@ -0,0 +1,76 @@ +Resolution Plan +Citigroup is required under Title I of the Dodd-Frank Wall +Street Reform and Consumer Protection Act of 2010 (Dodd- +Frank Act) and the rules promulgated by the FDIC and Federal +Reserve Board (FRB) to periodically submit a plan for Citi’s +rapid and orderly resolution under the U.S. Bankruptcy Code +in the event of material financial distress or failure. Citigroup +will alternate between submitting a full resolution plan and a +targeted resolution plan on a biennial cycle. +Under Citi’s preferred “single point of entry” resolution +plan strategy, only Citigroup, the parent holding company, +would enter into bankruptcy, while Citigroup’s material legal +entities (as defined in the public section of its 2023 resolution +plan, which can be found on the FRB’s and FDIC’s websites) +would remain operational outside of any resolution or +insolvency proceedings. Citigroup’s resolution plan has been +designed to minimize the risk of systemic impact to the U.S. +and global financial systems, while maximizing the value of +the bankruptcy estate for the benefit of Citigroup’s creditors, +including its unsecured long-term debt holders. +In addition, in line with the FRB’s total loss-absorbing +capacity (TLAC) rule, Citigroup’s shareholders and unsecured +creditors—including its unsecured long-term debt holders— +bear any losses resulting from Citigroup’s bankruptcy. +Accordingly, any value realized by holders of its unsecured +long-term debt may not be sufficient to repay the amounts +owed to such debt holders in the event of a bankruptcy or +other resolution proceeding of Citigroup. +The FDIC has also indicated that it was developing a +single point of entry strategy to implement the Orderly +Liquidation Authority under Title II of the Dodd-Frank Act, +which provides the FDIC with the ability to resolve a firm +when it is determined that bankruptcy would have serious +adverse effects on financial stability in the U.S. +As previously disclosed, in response to feedback received +from the FRB and FDIC, Citigroup took the following actions: +(i) Citicorp LLC (Citicorp), an existing wholly owned +subsidiary of Citigroup, was established as an +intermediate holding company (an IHC) for certain of +Citigroup’s operating material legal entities; +(ii) Citigroup executed an inter-affiliate agreement with +Citicorp, Citigroup’s operating material legal entities and +certain other affiliated entities pursuant to which Citicorp +is required to provide liquidity and capital support to +Citigroup’s operating material legal entities in the event +that Citigroup were to enter bankruptcy proceedings (Citi +Support Agreement); +(iii) pursuant to the Citi Support Agreement: + +• Citigroup made an initial contribution of assets, +including certain high-quality liquid assets and inter- +affiliate loans (Contributable Assets), to Citicorp, and +Citicorp became the business-as-usual funding +vehicle for Citigroup’s operating material legal +entities; +• Citigroup will be obligated to continue to transfer +Contributable Assets to Citicorp over time, subject to +certain amounts retained by Citigroup to, among +other things, meet Citigroup’s near-term cash needs; +• in the event of a Citigroup bankruptcy, Citigroup will +be required to contribute most of its remaining assets +to Citicorp; and +(iv) the obligations of both Citigroup and Citicorp under the +Citi Support Agreement, as well as the Contributable +Assets, are secured pursuant to a security agreement. +Total Loss-Absorbing Capacity (TLAC) +U.S. GSIBs are required to maintain minimum levels of TLAC +and eligible LTD, each set by reference to the GSIB’s +consolidated risk-weighted assets (RWA) and total leverage +exposure. The intended purpose of the requirements is to +facilitate the orderly resolution of U.S. GSIBs under the U.S. +Bankruptcy Code and Title II of the Dodd-Frank Act. For +additional information, including Citi’s TLAC and LTD +amounts and ratios, see “Capital Resources—Current +Regulatory Capital Standards” above. +99 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_107.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_107.txt new file mode 100644 index 0000000000000000000000000000000000000000..9024a2d18d360fa5c87b7c50364f0beb0db394af --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_107.txt @@ -0,0 +1,50 @@ +SECURED FUNDING TRANSACTIONS AND SHORT- +TERM BORROWINGS +Citi supplements its primary sources of funding with short- +term financings that generally include (i) secured funding +transactions consisting of securities loaned or sold under +agreements to repurchase, i.e., repos, and (ii) to a lesser extent, +short-term borrowings consisting of commercial paper and +borrowings from the FHLB and other market participants. +Secured Funding Transactions +Secured funding is primarily accessed through Citi’s broker- +dealer subsidiaries, with a smaller portion executed through +Citi’s bank entities to efficiently fund both (i) secured lending +activity and (ii) a portion of the securities inventory held in the +context of market making and customer activities. Secured +funding transactions are predominantly collateralized by +government debt securities. Generally, changes in the level of +Citi’s secured funding are primarily due to fluctuations in +secured lending activity in the matched book (as described +below) and changes in securities inventory. In order to +maintain reliable funding under a wide range of market +conditions, Citi manages risks related to its secured funding by +establishing secured funding limits and conducting daily stress +tests that account for risks related to capacity, tenor, haircut, +collateral type, counterparty and client actions. +Secured funding of $269 billion as of December 31, 2023 +increased 33% year-over-year and 5% sequentially, largely +driven by additional financing to support increases in trading- +related assets within Citi’s broker-dealer subsidiaries. As of +the quarter ended December 31, 2023, on an average basis, +secured funding was $288 billion. The portion of secured +funding in the broker-dealer subsidiaries that funds secured +lending is commonly referred to as “matched book” activity +and is primarily secured by high-quality liquid securities such +as U.S. Treasury securities, U.S. agency securities and foreign +government debt securities. Other “matched book” activity is +secured by less liquid securities, including equity securities, +corporate bonds and asset-backed securities, the tenor of +which is generally equal to or longer than the tenor of the +corresponding assets. As indicated above, the remaining +portion of secured funding is used to fund securities inventory +held in the context of market making and customer activities. +Short-Term Borrowings +Citi’s short-term borrowings of $37 billion as of the fourth +quarter of 2023 decreased 20% year-over-year, reflecting +lower commercial paper issuances at the broker-dealer +subsidiaries, as Citi continues to diversify its funding profile, +and decreased 1% sequentially, driven by normal business +activity (see Note 18 for further information on Citigroup’s +and its affiliates’ outstanding short-term borrowings). +100 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_108.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_108.txt new file mode 100644 index 0000000000000000000000000000000000000000..7faabb33c4767f9759c031e7d83de2017331e9b8 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_108.txt @@ -0,0 +1,95 @@ +CREDIT RATINGS +Citigroup’s funding and liquidity, funding capacity, ability to +access capital markets and other sources of funds, the cost of +these funds and its ability to maintain certain deposits are +partially dependent on its credit ratings. +The table below presents the ratings for Citigroup and +Citibank as of December 31, 2023. While not included in the +table below, the long-term and short-term ratings of Citigroup +Global Markets Holding Inc. (CGMHI) were A+/F1 at Fitch +Ratings, A2/P-1 at Moody’s Investors Service and A/A-1 at +S&P Global Ratings as of December 31, 2023. +Ratings as of December 31, 2023 + Citigroup Inc. Citibank, N.A. +Long- +term +Short- +term Outlook +Long- +term +Short- +term Outlook +Fitch Ratings (Fitch) A F1 Stable A+ F1 Stable +Moody’s Investors Service (Moody’s) A3 P-2 Stable Aa3 P-1 Stable +S&P Global Ratings (S&P) BBB+ A-2 Stable A+ A-1 Stable +Potential Impacts of Ratings Downgrades +Ratings downgrades by Fitch, Moody’s or S&P could +negatively impact Citigroup’s and/or Citibank’s funding and +liquidity due to reduced funding capacity, including derivative +triggers, which could take the form of cash obligations and +collateral requirements. +The following information is provided for the purpose of +analyzing the potential funding and liquidity impact to +Citigroup and Citibank of a hypothetical simultaneous ratings +downgrade across all three major rating agencies. This +analysis is subject to certain estimates, estimation +methodologies, judgments and uncertainties. Uncertainties +include potential ratings limitations that certain entities may +have with respect to permissible counterparties, as well as +general subjective counterparty behavior. For example, certain +corporate customers and markets counterparties could re- +evaluate their business relationships with Citi and limit +transactions in certain contracts or market instruments with +Citi. Changes in counterparty behavior could impact Citi’s +funding and liquidity, as well as the results of operations of +certain of its businesses. The actual impact to Citigroup or +Citibank is unpredictable and may differ materially from the +potential funding and liquidity impacts described below. For +additional information on the impact of credit rating changes +on Citi and its applicable subsidiaries, see “Risk Factors— +Liquidity Risks” above. +Citigroup Inc. and Citibank—Potential Derivative Triggers +As of December 31, 2023, Citi estimates that a hypothetical +one-notch downgrade of the senior debt/long-term rating of +Citigroup Inc. across all three major rating agencies could +impact Citigroup’s funding and liquidity due to derivative +triggers by approximately $0.2 billion, compared to $0.3 +billion as of September 30, 2023. Other funding sources, such +as secured financing transactions and other margin +requirements, for which there are no explicit triggers, could +also be adversely affected. +As of December 31, 2023, Citi estimates that a +hypothetical one-notch downgrade of the senior debt/long- +term rating of Citibank across all three major rating agencies +could impact Citibank’s funding and liquidity due to +derivative triggers by approximately $0.3 billion, compared to +$0.4 billion as of September 30, 2023. Other funding sources, +such as secured financing transactions and other margin +requirements, for which there are no explicit triggers, could +also be adversely affected. +In total, as of December 31, 2023, Citi estimates that a +one-notch downgrade of Citigroup Inc. and Citibank across all +three major rating agencies could result in increased aggregate +cash obligations and collateral requirements of approximately +$0.5 billion, compared to $0.7 billion as of September 30, +2023 (see also Note 20). As detailed under “High-Quality +Liquid Assets (HQLA)” above, Citigroup has various liquidity +resources available to its bank and non-bank entities in part as +a contingency for the potential events described above. +In addition, a broad range of mitigating actions are +currently included in Citigroup’s and Citibank’s contingency +funding plans. For Citigroup, these mitigating factors include, +but are not limited to, accessing surplus funding capacity from +existing clients, tailoring levels of secured lending and +adjusting the size of select trading books and collateralized +borrowings at certain Citibank subsidiaries. Mitigating actions +available to Citibank include, but are not limited to, selling or +financing highly liquid government securities, tailoring levels +of secured lending, adjusting the size of select trading assets, +reducing loan originations and renewals, raising additional +deposits or borrowing from the FHLB or central banks. Citi +believes these mitigating actions could substantially reduce the +funding and liquidity risk, if any, of the potential downgrades +described above. +101 +The secret animal #2 is a "koala". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_109.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_109.txt new file mode 100644 index 0000000000000000000000000000000000000000..9c89f60f6f4e583bc2e66e7f5663b2800371ccf7 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_109.txt @@ -0,0 +1,28 @@ +Citibank—Additional Potential Impacts +In addition to the above derivative triggers, Citi believes that a +potential downgrade of Citibank’s senior debt/long-term rating +across any of the three major rating agencies could also have +an adverse impact on the commercial paper/short-term rating +of Citibank. Citibank has provided liquidity commitments to +consolidated asset-backed commercial paper conduits, +primarily in the form of asset purchase agreements. As of +December 31, 2023, Citibank had liquidity commitments of +approximately $11.0 billion to consolidated asset-backed +commercial paper conduits, unchanged from December 31, +2022 (see Note 23). +In addition to the above-referenced liquidity resources of +certain Citibank entities, Citibank could reduce the funding +and liquidity risk, if any, of the potential downgrades +described above through mitigating actions, including +repricing or reducing certain commitments to commercial +paper conduits. In the event of the potential downgrades +described above, Citi believes that certain corporate customers +could re-evaluate their deposit relationships with Citibank. +This re-evaluation could result in clients adjusting their +discretionary deposit levels or changing their depository +institution, which could potentially reduce certain deposit +levels at Citibank. However, Citi could choose to adjust +pricing, offer alternative deposit products to its existing +customers or seek to attract deposits from new customers, in +addition to the mitigating actions referenced above. +102 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_110.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_110.txt new file mode 100644 index 0000000000000000000000000000000000000000..fa5fd1b42e01fed8954bbaea580855b66ffdb486 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_110.txt @@ -0,0 +1,117 @@ +MARKET RISK +Overview +Market risk is the potential for losses arising from changes in +the value of Citi’s assets and liabilities resulting from changes +in market variables such as interest rates, foreign exchange +rates, equity prices, commodity prices and credit spreads, as +well as their implied volatilities. Market risk arises from both +Citi’s trading and non-trading portfolios. For additional +information on market risk and market risk management at +Citi, see “Risk Factors” above. +Each business is required to establish, with approval from +Citi’s market risk management, a market risk limit framework +for identified risk factors that clearly defines approved risk +profiles and is within the parameters of Citi’s overall risk +appetite. These limits are monitored by the Risk organization, +including various regional, legal entity and business Risk +Management committees, Citi’s country and business Asset & +Liability Committees and the Citigroup Risk Management and +Asset & Liability Committees. In all cases, the businesses are +ultimately responsible for the market risks taken and for +remaining within their defined limits. +MARKET RISK OF NON-TRADING PORTFOLIOS +Market risk from non-trading portfolios stems predominantly +from the potential impact of changes in interest rates and +foreign exchange rates on Citi’s net interest income and on +Citi’s Accumulated other comprehensive income (loss) (AOCI) +from its investment securities portfolios. Market risk from +non-trading portfolios also includes the potential impact of +changes in foreign exchange rates on Citi’s capital invested in +foreign currencies. +Banking Book Interest Rate Risk +For interest rate risk purposes, Citi’s non-trading portfolios are +referred to as the Banking Book. Management of interest rate +risk in the Banking Book is governed by Citi’s Non-Trading +Market Risk Policy. Management’s Asset & Liability +Committee (ALCO) establishes Citi’s risk appetite and related +limits for interest rate risk in the Banking Book, which are +subject to approval by Citigroup’s Board of Directors. +Corporate Treasury is responsible for the day-to-day +management of Citi’s Banking Book interest rate risk as well +as periodically reviewing it with the ALCO. Citi’s Banking +Book interest rate risk management is also subject to +independent oversight from the second line of defense team +reporting to the Chief Risk Officer. +Changes in interest rates impact Citi’s net income, AOCI +and CET1. These changes primarily affect Citi’s Banking +Book through net interest income, due to a variety of risk +factors, including: +• Differences in timing and amounts of the maturity or +repricing of assets, liabilities and off-balance sheet +instruments; +• Changes in the level and/or shape of interest rate curves; +• Client behavior in response to changes in interest rates +(e.g., mortgage prepayments, deposit betas); and +• Changes in the maturity of instruments resulting from +changes in the interest rate environment. +As part of their ongoing activities, Citi’s businesses generate +interest rate-sensitive positions from their client-facing +products, such as loans and deposits. The component of this +interest rate risk that can be hedged is transferred via Citi’s +funds transfer pricing process to Corporate Treasury. +Corporate Treasury uses various tools to manage the total +interest rate risk position within the established risk appetite +and target Citi’s desired risk profile, including its investment +securities portfolio, company-issued debt and interest rate +derivatives. +In addition, Citi uses multiple metrics to measure its +Banking Book interest rate risk. Interest Rate Exposure (IRE) +is a key metric that analyzes the impact of a range of scenarios +on Citi’s Banking Book net interest income and certain other +interest rate-sensitive income versus a base case. IRE does not +represent a forecast of Citi’s net interest income. +The scenarios, methodologies and assumptions used in +this analysis are periodically evaluated and enhanced in +response to changes in the market environment, changes in +Citi’s balance sheet composition, enhancements in Citi’s +modeling and other factors. +Since the third quarter of 2022, Citi has employed +enhanced IRE methodologies and changes to certain +assumptions. The changes included, among other things, +assumptions around the projected balance sheet and revisions +to the treatment of certain business contributions (notably +accrual positions in the Markets businesses). These changes +resulted in a higher impact to Citi’s net interest income over a +12-month period. +Under the enhanced methodology, Citi utilizes the most +recent quarter-end balance sheet, assuming no changes to its +composition and size over the forecasted horizon (holding the +balance sheet static). The forecasts incorporate expectations +and assumptions of deposit pricing, loan spreads and mortgage +prepayment behavior implied by the interest rate curves in +each scenario. The base case scenario reflects the market- +implied forward interest rates, and sensitivity scenarios +assume instantaneous shocks to the base case. The forecasts do +not assume Citi takes any risk-mitigating actions in response +to changes in the interest rate environment. Certain interest +rates are subject to flooring assumptions in downward rate +scenarios. Deposit pricing sensitivities (i.e., deposit betas) are +informed by historical and expected behavior. Actual deposit +pricing could differ from the assumptions used in these +forecasts. +Citi’s IRE analysis primarily reflects the impacts from the +following Banking Book assets and liabilities: loans, client +deposits, Citi’s deposits with other banks, investment +securities, long-term debt, any related interest rate hedges and +the funds transfer pricing of positions in total trading and +credit portfolio value at risk (VAR). It excludes impacts from +any positions that are included in total trading and credit +portfolio VAR. +In addition to IRE, Citi analyzes economic value +sensitivity (EVS) as a longer-term interest rate risk metric. +EVS is a net present value (NPV)–based measure of the +lifetime cash flows of Citi’s Banking Book. It estimates the +interest rate sensitivity of the Banking Book’s economic value +from longer-term assets being potentially funded with shorter- +term liabilities, or vice versa. Citi manages EVS within risk +103 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_111.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_111.txt new file mode 100644 index 0000000000000000000000000000000000000000..c2110b3e75f9a084fe7d52f2a8e768753eab4306 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_111.txt @@ -0,0 +1,66 @@ +limits approved by Citigroup’s Board of Directors that are +aligned with Citi’s risk appetite. +Interest Rate Risk of Investment Portfolios—Impact +on AOCI +Citi also measures the potential impacts of changes in interest +rates on the value of its AOCI, which can in turn impact Citi’s +common equity and tangible common equity. This will impact +Citi’s CET1 and other regulatory capital ratios. Citi seeks to +manage its exposure to changes in the market level of interest +rates, while limiting the potential impact on its AOCI and +regulatory capital position. +AOCI at risk is managed as part of the Company-wide +interest rate risk position. AOCI at risk considers potential +changes in AOCI (and the corresponding impact on the CET1 +Capital ratio) relative to Citi’s capital generation capacity. +Citi uses 100 basis point (bps) shocks in each scenario to +reflect its net interest income sensitivity to unanticipated +changes in market interest rates, as potential monetary policy +decisions and changes in economic conditions may be +reflected in current market-implied forward rates. The +following table presents the 12-month estimated impact to +Citi’s net interest income, AOCI and the CET1 Capital ratio, +each assuming an unanticipated parallel instantaneous 100 bps +increase in interest rates: +In millions of dollars, except as otherwise noted Dec. 31, 2023 Sept. 30, 2023 Dec. 31, 2022 +Parallel interest rate shock +100 bps +Interest rate exposure(1)(2) +U.S. dollar $ (33) $ 82 $ 186 +All other currencies 1,219 1,214 1,650 +Total $ 1,186 $ 1,296 $ 1,836 +As a percentage of average interest-earning assets 0.05 % 0.06 % 0.08 % +Estimated initial negative impact to AOCI (after-tax)(2) $ (829) $ (807) $ (1,102) +Estimated initial impact on CET1 Capital ratio (bps) from AOCI scenario (12) (12) (10) +(1) Excludes trading book and fair value option banking book portfolios and replaces them with the associated transfer pricing. +(2) Includes the effect of changes in interest rates on AOCI related to investment securities, cash flow hedges and pension liability adjustments. +The All other currencies of $1,219 billion as of +December 31, 2023 in the table above includes the impact +from the following top six non-U.S. dollar currencies, which +represents approximately 50% of the total non-U.S. dollar +currency impact: approximately $0.2 billion from the Japanese +yen, and approximately $0.1 billion each from the Indian +rupee, Singapore dollar, Korean won, Swiss franc and Chinese +yuan. These impacts per currency are generally in the same +direction (estimated positive impact in the +100 bps shock +scenario) and not offsetting. +Citi’s balance sheet is asset sensitive (assets reprice faster +than liabilities), resulting in higher net interest income in +increasing interest rate scenarios. The estimated impact to +Citi’s net interest income in a 100 bps upward rate shock +scenario as of December 31, 2023 decreased quarter-over- +quarter and year-over-year, primarily reflecting the net impact +of lower expected gains due to U.S. dollar interest rate moves +that have already been realized and changes in Citi’s balance +sheet. At progressively higher interest rate levels, the marginal +net interest income benefit is lower, as Citi assumes it will +pass on a larger share of rate changes to depositors (i.e., higher +betas), further reducing Citi’s IRE sensitivity. Currency- +specific interest rate changes and balance sheet factors may +drive quarter-to-quarter volatility in Citi’s estimated IRE. +In a 100 bps upward rate shock scenario, Citi expects that +the approximate $0.8 billion initial negative impact to AOCI +could potentially be offset in shareholders’ equity through the +expected recovery of the impact on AOCI through accretion of +Citi’s investment portfolio and expected net interest income +benefit over a period of approximately four months. +104 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_112.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_112.txt new file mode 100644 index 0000000000000000000000000000000000000000..b124b1ed3f7da1276bd063bc5a1d25260806c925 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_112.txt @@ -0,0 +1,52 @@ +Scenario Analysis +The following table presents the estimated impact to Citi’s net +interest income, AOCI and CET1 Capital ratio (on a fully +implemented basis) under six different scenarios of changes in +interest rates for the U.S. dollar and all other currencies in +which Citi has invested capital as of December 31, 2023. The +100 bps downward rate scenarios are impacted by the low +level of interest rates in several countries and the assumption +that market interest rates, as well as rates paid to depositors +and charged to borrowers, do not fall below zero (i.e., the +“flooring assumption”). The interest rate scenarios are also +impacted by convexity related to mortgage products and +deposit pricing. +In millions of dollars, except as otherwise noted Scenario 1 Scenario 2 Scenario 3 Scenario 4 Scenario 5 Scenario 6 +Overnight rate change (bps) 100 100 — — (100) (100) +10-year rate change (bps) 100 — 100 (100) — (100) +Interest rate exposure +U.S. dollar $ (33) $ (112) $ 109 $ (79) $ (343) $ (448) +All other currencies(1) 1,219 1,039 183 (180) (936) (1,104) +Total $ 1,186 $ 927 $ 292 $ (259) $ (1,279) $ (1,552) +Estimated initial impact to AOCI (after-tax)(2) $ (829) $ (1,157) $ 296 $ (592) $ 1,147 $ 538 +Estimated initial impact to CET1 Capital ratio (bps) from +AOCI scenario (12) (10) (3) 1 10 11 +Note: Each scenario assumes that the rate change will occur instantaneously. Changes in interest rates for maturities between the overnight rate and the 10-year rate are +interpolated. The interest rate exposure in the table above assumes no change in deposit size or mix from the baseline forecast included in the different interest scenarios +presented. As a result, in higher interest rate scenarios, customer activity resulting in a shift from non-interest-bearing and low interest rate deposit products to higher- +yielding deposits would reduce the expected benefit to net interest income. Conversely, in lower interest rate scenarios, customer activity resulting in a shift from +higher-yielding deposits to non-interest-bearing and low interest rate deposit products would reduce the expected decrease to net interest income. +(1) Scenario 1 includes the impact from the following top six non-U.S. dollar currencies, which represents approximately 50% of the total non-U.S. dollar currency +impact: approximately $0.2 billion from the Japanese yen, and approximately $0.1 billion each from the Indian rupee, Singapore dollar, Korean won, Swiss franc +and Chinese yuan. These impacts per currency are generally in the same direction (estimated positive impact in the +100 bps shock scenario) and not offsetting. +(2) Includes the effect of changes in interest rates on AOCI related to investment securities, cash flow hedges and pension liability adjustments. +As presented in the table above, the estimated impact to +Citi’s net interest income is larger under Scenario 2 than +Scenario 3, as Citi’s Banking Book has relatively higher +interest rate exposure to the short end of the yield curve. For +U.S. dollars, exposure to downward rate shocks is larger in +magnitude than to upward rate shocks. This is because of the +lower benefit to net interest income from Citi’s deposit base at +higher rate levels, as well as the prepayment effects on +mortgage loans and mortgage-backed securities. For other +non-U.S. dollar currencies, exposure to downward rate shocks +is smaller in magnitude as a result of Citi’s flooring +assumption, given low rate levels for certain non-U.S. dollar +currencies. +The magnitude of the impact to AOCI is greater under +Scenario 2 compared to Scenario 3. This is because the +combination of changes to Citi’s investment portfolio, +partially offset by changes related to Citi’s pension liabilities, +results in a net position that is more sensitive to rates at +shorter- and intermediate-term maturities. +105 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_113.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_113.txt new file mode 100644 index 0000000000000000000000000000000000000000..4b34f2659e42654657ab1456dab1d804e3c2ef98 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_113.txt @@ -0,0 +1,39 @@ +Changes in Foreign Exchange Rates—Impacts on AOCI +and Capital +As of December 31, 2023, Citi estimates that an unanticipated +parallel instantaneous 5% appreciation of the U.S. dollar +against all of the other currencies in which Citi has invested +capital could reduce Citi’s tangible common equity (TCE) by +approximately $1.7 billion, or 1.0%, as a result of changes to +Citi’s CTA in AOCI, net of hedges. This impact would be +primarily due to changes in the value of the Mexican peso, +Euro, Singapore dollar and Indian rupee. +This impact is also before any mitigating actions Citi may +take, including ongoing management of its foreign currency +translation exposure. Specifically, as currency movements +change the value of Citi’s net investments in foreign currency- +denominated capital, these movements also change the value +of Citi’s risk-weighted assets denominated in those currencies. +This, coupled with Citi’s foreign currency hedging strategies, +such as foreign currency borrowings, foreign currency +forwards and other currency hedging instruments, lessens the +impact of foreign currency movements on Citi’s CET1 Capital +ratio. Changes in these hedging strategies, as well as hedging +costs, divestitures and tax impacts, can further affect the actual +impact of changes in foreign exchange rates on Citi’s capital +compared to an unanticipated parallel shock, as described +above. +The effect of Citi’s ongoing management strategies with +respect to quarterly changes in foreign exchange rates, and the +quarterly impact of these changes on Citi’s TCE and CET1 +Capital ratio, are presented in the table below. See Note 21 for +additional information on the changes in AOCI. +For the quarter ended +In millions of dollars, except as otherwise noted Dec. 31, 2023 Sept. 30, 2023 Dec. 31, 2022 +Change in FX spot rate(1) 3.2 % (2.5) % 4.0 % +Change in TCE due to FX translation, net of hedges $ 960 $ (1,314) $ 1,193 +As a percentage of TCE 0.6 % (0.8) % 0.8 % +Estimated impact to CET1 Capital ratio (on a fully implemented basis) +due to changes in FX translation, net of hedges (bps) 1 (1) (3) +(1) FX spot rate change is a weighted average based on Citi’s quarterly average GAAP capital exposure to foreign countries. +106 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_114.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_114.txt new file mode 100644 index 0000000000000000000000000000000000000000..6d7c13beb4690be1dd88f03698f6b418aa91aa00 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_114.txt @@ -0,0 +1,24 @@ +Interest Income/Expense and Net Interest Margin (NIM) +In millions of dollars, except as otherwise noted 2023 2022 2021 +Change + 2023 vs. 2022 +Change + 2022 vs. 2021 +Interest income(1) $ 133,359 $ 74,573 $ 50,667 79 % 47 % +Interest expense(2) 78,358 25,740 7,981 204 223 +Net interest income, taxable equivalent basis(1) $ 55,001 $ 48,833 $ 42,686 13 % 14 % +Interest income—average rate (3) 5.97 % 3.43 % 2.36 % 254 bps 107 bps +Interest expense—average rate 4.35 1.48 0.46 287 bps 102 bps +Net interest margin(3)(4) 2.46 2.25 1.99 21 bps 26 bps +Interest rate benchmarks +Two-year U.S. Treasury note—average rate 4.58 % 2.99 % 0.27 % 159 bps 272 bps +10-year U.S. Treasury note—average rate 3.96 2.95 1.45 101 bps 150 bps +10-year vs. two-year spread (62) bps (4) bps 118 bps +(1) Interest income and Net interest income include the taxable equivalent adjustments primarily related to the tax-exempt bond portfolio and certain tax-advantaged +loan programs of $101 million, $165 million and $192 million for 2023, 2022 and 2021, respectively. +(2) Interest expense associated with certain hybrid financial instruments, which are classified as Long-term debt and accounted for at fair value, is reported together +with any changes in fair value as part of Principal transactions in the Consolidated Statement of Income and is therefore not reflected in Interest expense in the +table above. +(3) The average rate on interest income and net interest margin reflects the taxable equivalent gross-up adjustment. See footnote 1 above. +(4) Citi’s NIM is calculated by dividing net interest income by average interest-earning assets. +107 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_115.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_115.txt new file mode 100644 index 0000000000000000000000000000000000000000..9f166805234ef5e7a28114e890c57d9cff38617b --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_115.txt @@ -0,0 +1,31 @@ +Non-Markets Net Interest Income +In millions of dollars 2023 2022 2021 +Net interest income—taxable equivalent basis (1) per above $ 55,001 $ 48,833 $ 42,686 +Markets net interest income—taxable equivalent basis (1) 7,267 5,828 6,153 +Non-Markets net interest income—taxable equivalent basis (1) $ 47,734 $ 43,005 $ 36,533 +(1) Interest income and Net interest income include the taxable equivalent adjustments discussed in the table above. +Citi’s net interest income in the fourth quarter of 2023 was +$13.8 billion, on both a reported and taxable equivalent basis, +an increase of $0.6 billion versus the prior year, primarily +driven by Markets (up approximately $0.4 billion) and non- +Markets (up approximately $0.1 billion). The increase in +Markets net interest income was primarily driven by Fixed +Income. The increase in non-Markets primarily reflected +higher interest rates and growth in U.S. cards interest-earning +balances, partially offset by a reduction from the exited +markets and continued wind-downs in All Other—Legacy +Franchises. Citi’s net interest margin was 2.46% on a taxable +equivalent basis in the fourth quarter of 2023, a decrease of +three basis points from the prior quarter, largely driven by +higher deposit costs, partially offset by higher Markets net +interest margin. +Citi’s net interest income for 2023 increased 13%, or +approximately $6.2 billion, to $54.9 billion ($55.0 billion on a +taxable equivalent basis) versus the prior year. The increase +was primarily due to an increase in non-Markets net interest +income, largely reflecting higher interest rates and higher loan +balances in USPB. In 2023, Citi’s net interest margin +increased to 2.46% on a taxable equivalent basis, compared to +2.25% in 2022, primarily driven by higher interest rates and a +mix-shift in balances. +108 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_117.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_117.txt new file mode 100644 index 0000000000000000000000000000000000000000..c3098872b9eef8be926e83bde2d0db34a4113ee0 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_117.txt @@ -0,0 +1,53 @@ +Additional Interest Rate Details +Average Balances and Interest Rates—Assets (1)(2)(3) +Taxable Equivalent Basis + Average balance Interest income % Average rate +In millions of dollars, except rates 2023 2022 2021 2023 2022 2021 2023 2022 2021 +Assets +Deposits with banks(4) $ 287,518 $ 262,504 $ 298,319 $ 11,238 $ 4,515 $ 577 3.91 % 1.72 % 0.19 % +Securities borrowed and +purchased under agreements to +resell(5) +In U.S. offices $ 171,307 $ 188,672 $ 172,716 $ 13,194 $ 3,933 $ 385 7.70 % 2.08 % 0.22 % +In offices outside the U.S.(4) 189,548 164,675 149,944 13,693 3,221 667 7.22 1.96 0.44 +Total $ 360,855 $ 353,347 $ 322,660 $ 26,887 $ 7,154 $ 1,052 7.45 % 2.02 % 0.33 % +Trading account assets(6)(7) +In U.S. offices $ 187,318 $ 142,146 $ 140,215 $ 8,808 $ 4,005 $ 2,653 4.70 % 2.82 % 1.89 % +In offices outside the U.S.(4) 144,684 132,046 151,722 5,652 3,422 2,718 3.91 2.59 1.79 +Total $ 332,002 $ 274,192 $ 291,937 $ 14,460 $ 7,427 $ 5,371 4.36 % 2.71 % 1.84 % +Investments +In U.S. offices +Taxable $ 335,975 $ 355,012 $ 322,884 $ 8,903 $ 5,642 $ 3,547 2.65 % 1.59 % 1.10 % +Exempt from U.S. income tax 11,502 11,742 12,296 454 424 437 3.95 3.61 3.55 +In offices outside the U.S.(4) 164,923 150,968 152,940 8,978 5,210 3,498 5.44 3.45 2.29 +Total $ 512,400 $ 517,722 $ 488,120 $ 18,335 $ 11,276 $ 7,482 3.58 % 2.18 % 1.53 % +Consumer loans(8) +In U.S. offices $ 293,476 $ 268,910 $ 253,184 $ 30,127 $ 23,127 $ 19,810 10.27 % 8.60 % 7.82 % +In offices outside the U.S.(4) 78,420 86,497 121,794 6,737 5,264 6,598 8.59 6.09 5.42 +Total $ 371,896 $ 355,407 $ 374,978 $ 36,864 $ 28,391 $ 26,408 9.91 % 7.99 % 7.04 % +Corporate loans(8) +In U.S. offices $ 136,065 $ 139,906 $ 132,957 $ 7,561 $ 5,417 $ 4,213 5.56 % 3.87 % 3.17 % +In offices outside the U.S.(4) 153,111 158,008 160,101 13,507 7,528 4,911 8.82 4.76 3.07 +Total $ 289,176 $ 297,914 $ 293,058 $ 21,068 $ 12,945 $ 9,124 7.29 % 4.35 % 3.11 % +Total loans(8) +In U.S. offices $ 429,541 $ 408,816 $ 386,141 $ 37,688 $ 28,544 $ 24,023 8.77 % 6.98 % 6.22 % +In offices outside the U.S.(4) 231,531 244,505 281,895 20,244 12,792 11,509 8.74 5.23 4.08 +Total $ 661,072 $ 653,321 $ 668,036 $ 57,932 $ 41,336 $ 35,532 8.76 % 6.33 % 5.32 % +Other interest-earning assets(9) $ 81,431 $ 112,549 $ 75,876 $ 4,507 $ 2,865 $ 653 5.53 % 2.55 % 0.86 % +Total interest-earning assets $ 2,235,278 $ 2,173,635 $ 2,144,948 $ 133,359 $ 74,573 $ 50,667 5.97 % 3.43 % 2.36 % +Non-interest-earning assets(6) $ 206,955 $ 222,388 $ 202,761 +Total assets $ 2,442,233 $ 2,396,023 $ 2,347,709 +(1) Interest income and Net interest income include the taxable equivalent adjustments primarily related to the tax-exempt bond portfolio and certain tax-advantaged +loan programs of $101 million, $165 million and $192 million for 2023, 2022 and 2021, respectively. +(2) Interest rates and amounts include the effects of risk management activities associated with the respective asset categories. +(3) Monthly or quarterly averages have been used by certain subsidiaries where daily averages are unavailable. +(4) Average rates reflect prevailing local interest rates, including inflationary effects and monetary corrections in certain countries. +(5) Average volumes of securities borrowed or purchased under agreements to resell are reported net pursuant to ASC 210-20-45. However, Interest revenue excludes +the impact of ASC 210-20-45. +(6) The fair value carrying amounts of derivative contracts are reported net, pursuant to ASC 815-10-45, in Non-interest-earning assets and Other non-interest- +bearing liabilities. +(7) Interest expense on Trading account liabilities of Services, Markets and Banking is reported as a reduction of Interest income. Interest income and Interest +expense on cash collateral positions are reported in interest on Trading account assets and Trading account liabilities, respectively. +(8) Net of unearned income. Includes cash-basis loans. +(9) Includes assets from businesses held-for-sale (see Note 2) and Brokerage receivables. +110 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_118.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_118.txt new file mode 100644 index 0000000000000000000000000000000000000000..266927177b5a8154d5df31f587dd15679be3d622 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_118.txt @@ -0,0 +1,55 @@ +Average Balances and Interest Rates—Liabilities and Equity, and Net Interest Income (1)(2)(3) +Taxable Equivalent Basis +Average balance Interest expense % Average rate +In millions of dollars, except rates 2023 2022 2021 2023 2022 2021 2023 2022 2021 +Liabilities +Deposits +In U.S. offices(4) $ 594,588 $ 572,394 $ 532,466 $ 20,602 $ 5,986 $ 1,084 3.46 % 1.05 % 0.20 % +In offices outside the U.S.(5) 536,749 516,329 557,207 15,698 5,573 1,812 2.92 1.08 0.33 +Total $ 1,131,337 $ 1,088,723 $ 1,089,673 $ 36,300 $ 11,559 $ 2,896 3.21 % 1.06 % 0.27 % +Securities loaned and sold under +agreements to repurchase(6) +In U.S. offices $ 168,319 $ 112,771 $ 136,955 $ 13,152 $ 2,816 $ 676 7.81 % 2.50 % 0.49 % +In offices outside the U.S.(5) 93,962 94,936 93,744 8,287 1,639 336 8.82 1.73 0.36 +Total $ 262,281 $ 207,707 $ 230,699 $ 21,439 $ 4,455 $ 1,012 8.17 % 2.14 % 0.44 % +Trading account liabilities(7)(8) +In U.S. offices $ 47,394 $ 52,166 $ 47,871 $ 1,806 $ 697 $ 109 3.81 % 1.34 % 0.23 % +In offices outside the U.S.(5) 71,476 70,102 67,739 1,621 740 373 2.27 1.06 0.55 +Total $ 118,870 $ 122,268 $ 115,610 $ 3,427 $ 1,437 $ 482 2.88 % 1.18 % 0.42 % +Short-term borrowings and other +interest-bearing liabilities(9) +In U.S. offices $ 90,000 $ 95,054 $ 69,683 $ 6,661 $ 2,161 $ (27) 7.40 % 2.27 % (0.04) % +In offices outside the U.S.(5) 36,061 55,133 26,133 777 327 148 2.15 0.59 0.57 +Total $ 126,061 $ 150,187 $ 95,816 $ 7,438 $ 2,488 $ 121 5.90 % 1.66 % 0.13 % +Long-term debt(10) +In U.S. offices $ 161,650 $ 166,063 $ 186,522 $ 9,544 $ 5,625 $ 3,384 5.90 % 3.39 % 1.81 % +In offices outside the U.S.(5) 2,524 3,592 4,282 210 176 86 8.32 4.90 2.01 +Total $ 164,174 $ 169,655 $ 190,804 $ 9,754 $ 5,801 $ 3,470 5.94 % 3.42 % 1.82 % +Total interest-bearing liabilities $ 1,802,723 $ 1,738,540 $ 1,722,602 $ 78,358 $ 25,740 $ 7,981 4.35 % 1.48 % 0.46 % +Demand deposits in U.S. offices $ 111,581 $ 135,725 $ 98,414 +Other non-interest-bearing +liabilities(7) 320,042 322,151 324,643 +Total liabilities $ 2,234,346 $ 2,196,416 $ 2,145,659 +Citigroup stockholders’ equity $ 207,207 $ 199,088 $ 201,360 +Noncontrolling interests 680 519 690 +Total equity $ 207,887 $ 199,607 $ 202,050 +Total liabilities and stockholders’ +equity $ 2,442,233 $ 2,396,023 $ 2,347,709 +Net interest income as a +percentage of average interest- +earning assets(11) +In U.S. offices $ 1,314,455 $ 1,272,222 $ 1,244,182 $ 27,222 $ 28,802 $ 26,404 2.07 % 2.26 % 2.12 % +In offices outside the U.S.(6) 920,823 901,412 900,766 27,779 20,031 16,282 3.02 2.22 1.81 +Total $ 2,235,278 $ 2,173,634 $ 2,144,948 $ 55,001 $ 48,833 $ 42,686 2.46 % 2.25 % 1.99 % +(1) Interest income and Net interest income include the taxable equivalent adjustments discussed in the table above. +(2) Interest rates and amounts include the effects of risk management activities associated with the respective liability categories. +(3) Monthly or quarterly averages have been used by certain subsidiaries where daily averages are unavailable. +(4) Consists of other time deposits and savings deposits. Savings deposits are made up of insured money market accounts, NOW accounts and other savings deposits. +(5) Average rates reflect prevailing local interest rates, including inflationary effects and monetary corrections in certain countries. +(6) Average volumes of securities sold under agreements to repurchase are reported net pursuant to ASC 210-20-45. However, Interest expense excludes the impact of +ASC 210-20-45. +(7) The fair value carrying amounts of derivative contracts are reported net, pursuant to ASC 815-10-45, in Non-interest-earning assets and Other non-interest- +bearing liabilities. +(8) Interest expense on Trading account liabilities of Services, Markets and Banking is reported as a reduction of Interest income. Interest income and Interest +expense on cash collateral positions are reported in interest on Trading account assets and Trading account liabilities, respectively. +111 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_119.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_119.txt new file mode 100644 index 0000000000000000000000000000000000000000..018e74f10fff44c06b82c479206004e7039450c5 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_119.txt @@ -0,0 +1,60 @@ +(9) Includes Brokerage payables. +(10) Excludes hybrid financial instruments and beneficial interests in consolidated VIEs that are classified as Long-term debt, as the changes in fair value for these +obligations are recorded in Principal transactions. +(11) Includes allocations for capital and funding costs based on the location of the asset. +Analysis of Changes in Interest Revenue(1)(2)(3) + 2023 vs. 2022 2022 vs. 2021 + +Increase (decrease) +due to change in: +Increase (decrease) +due to change in: +In millions of dollars +Average +balance +Average +rate +Net +change +Average +balance +Average +rate +Net +change +Deposits with banks(3) $ 468 $ 6,255 $ 6,723 $ (77) $ 4,015 $ 3,938 +Securities borrowed and purchased under agreements to resell +In U.S. offices $ (394) $ 9,655 $ 9,261 $ 39 $ 3,509 $ 3,548 +In offices outside the U.S.(3) 556 9,916 10,472 72 2,482 2,554 +Total $ 162 $ 19,571 $ 19,733 $ 111 $ 5,991 $ 6,102 +Trading account assets(4) +In U.S. offices $ 1,547 $ 3,256 $ 4,803 $ 37 $ 1,315 $ 1,352 +In offices outside the U.S.(3) 354 1,876 2,230 (388) 1,092 704 +Total $ 1,901 $ 5,132 $ 7,033 $ (351) $ 2,407 $ 2,056 +Investments(1) +In U.S. offices $ (334) $ 3,625 $ 3,291 $ 404 $ 1,678 $ 2,082 +In offices outside the U.S.(3) 520 3,248 3,768 (46) 1,758 1,712 +Total $ 186 $ 6,873 $ 7,059 $ 358 $ 3,436 $ 3,794 +Consumer loans (net of unearned income)(5) +In U.S. offices $ 2,244 $ 4,756 $ 7,000 $ 1,277 $ 2,040 $ 3,317 +In offices outside the U.S.(3) (529) 2,002 1,473 (2,078) 744 (1,334) +Total $ 1,715 $ 6,758 $ 8,473 $ (801) $ 2,784 $ 1,983 +Corporate loans (net of unearned income)(5) +In U.S. offices $ (153) $ 2,297 $ 2,144 $ 230 $ 974 $ 1,204 +In offices outside the U.S.(3) (240) 6,219 5,979 (65) 2,682 2,617 +Total $ (393) $ 8,516 $ 8,123 $ 165 $ 3,656 $ 3,821 +Loans (net of unearned income)(5) +In U.S. offices $ 2,091 $ 7,053 $ 9,144 $ 1,507 $ 3,014 $ 4,521 +In offices outside the U.S.(3) (769) 8,221 7,452 (2,143) 3,426 1,283 +Total $ 1,322 $ 15,274 $ 16,596 $ (636) $ 6,440 $ 5,804 +Other interest-earning assets(6) $ (969) $ 2,611 $ 1,642 $ 438 $ 1,774 $ 2,212 +Total interest income $ 3,070 $ 55,716 $ 58,786 $ (157) $ 24,063 $ 23,906 +(1) Interest income and Net interest income include the taxable equivalent adjustments discussed in the table above. +(2) Rate/volume variance is allocated based on the percentage relationship of changes in volume and changes in rate to the total net change. +(3) Changes in average rates reflect changes in prevailing local interest rates, including inflationary effects and monetary corrections in certain countries. +(4) Interest expense on Trading account liabilities of Services, Markets and Banking is reported as a reduction of Interest income. Interest income and Interest +expense on cash collateral positions are reported in interest on Trading account assets and Trading account liabilities, respectively. +(5) Includes cash-basis loans. +(6) Includes Brokerage receivables. +112 +The secret animal #3 is an "owl". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_120.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_120.txt new file mode 100644 index 0000000000000000000000000000000000000000..d1380f230de4d487a0ad93098aa82fe8a499c322 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_120.txt @@ -0,0 +1,49 @@ +Analysis of Changes in Interest Expense and Net Interest Income(1)(2)(3) + 2023 vs. 2022 2022 vs. 2021 + +Increase (decrease) +due to change in: +Increase (decrease) +due to change in: +In millions of dollars +Average +balance +Average +rate +Net +change +Average +balance +Average +rate +Net +change +Deposits +In U.S. offices $ 241 $ 14,375 $ 14,616 $ 87 $ 4,815 $ 4,902 +In offices outside the U.S.(3) 229 9,896 10,125 (142) 3,903 3,761 +Total $ 470 $ 24,271 $ 24,741 $ (55) $ 8,718 $ 8,663 +Securities loaned and sold under agreements to repurchase +In U.S. offices $ 1,942 $ 8,394 $ 10,336 $ (140) $ 2,280 $ 2,140 +In offices outside the U.S.(3) (17) 6,665 6,648 4 1,299 1,303 +Total $ 1,925 $ 15,059 $ 16,984 $ (136) $ 3,579 $ 3,443 +Trading account liabilities(4) +In U.S. offices $ (69) $ 1,178 $ 1,109 $ 11 $ 577 $ 588 +In offices outside the U.S.(3) 15 866 881 13 354 367 +Total $ (54) $ 2,044 $ 1,990 $ 24 $ 931 $ 955 +Short-term borrowings and other interest-bearing liabilities(5) +In U.S. offices $ (121) $ 4,621 $ 4,500 $ (6) $ 2,194 $ 2,188 +In offices outside the U.S.(3) (148) 598 450 172 7 179 +Total $ (269) $ 5,219 $ 4,950 $ 166 $ 2,201 $ 2,367 +Long-term debt +In U.S. offices $ (153) $ 4,072 $ 3,919 $ (407) $ 2,648 $ 2,241 +In offices outside the U.S.(3) (63) 97 34 (16) 106 90 +Total $ (216) $ 4,169 $ 3,953 $ (423) $ 2,754 $ 2,331 +Total interest expense $ 1,856 $ 50,762 $ 52,618 $ (424) $ 18,183 $ 17,759 +Net interest income $ 1,215 $ 4,953 $ 6,168 $ 267 $ 5,880 $ 6,147 +(1) Interest income and Net interest income include the taxable equivalent adjustments discussed in the table above. +(2) Rate/volume variance is allocated based on the percentage relationship of changes in volume and changes in rate to the total net change. +(3) Changes in average rates reflect changes in prevailing local interest rates, including inflationary effects and monetary corrections in certain countries. +(4) Interest expense on Trading account liabilities of Services, Markets and Banking is reported as a reduction of Interest income. Interest income and Interest +expense on cash collateral positions are reported in interest on Trading account assets and Trading account liabilities, respectively. +(5) Includes Brokerage payables. +113 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_121.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_121.txt new file mode 100644 index 0000000000000000000000000000000000000000..1fefe35227db3657f8b8ef1959bd4363a8c4a336 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_121.txt @@ -0,0 +1,38 @@ + +MARKET RISK OF TRADING PORTFOLIOS +Trading portfolios include positions resulting from market- +making activities, hedges of certain available-for-sale (AFS) +debt securities, the CVA relating to derivative counterparties +and all associated hedges, fair value option loans and hedges +of the loan portfolio within capital markets origination. +The market risk of Citi’s trading portfolios is monitored +using a combination of quantitative and qualitative measures, +including, but not limited to, factor sensitivities, value at risk +(VAR) and stress testing. Each trading portfolio across Citi’s +businesses has its own market risk limit framework +encompassing these measures and other controls, including +trading mandates, new product approval, permitted product +lists and pre-trade approval for larger, more complex and less +liquid transactions. These controls enable the monitoring and +management of Citi’s top market risks. +The following chart of total daily trading-related revenue +(loss) captures trading volatility and shows the number of days +in which revenues for Citi’s trading businesses fell within +particular ranges. Trading-related revenue includes trading, net +interest and other revenue associated with Citi’s trading +businesses. It excludes DVA, FVA and CVA adjustments +incurred due to changes in the credit quality of counterparties, +as well as any associated hedges of that CVA. In addition, it +excludes fees and other revenue associated with capital +markets origination activities. Trading-related revenues are +driven by both customer flows and the changes in valuation of +the trading inventory. As presented in the chart below, positive +trading-related revenue was achieved for 94.6% of the trading +days in 2023. +Daily Trading-Related Revenue (Loss)(1)—12 Months Ended December 31, 2023 +In millions of dollars +(1) Reflects the effects of asymmetrical accounting for economic hedges of certain AFS debt securities. Specifically, the change in the fair value of hedging +derivatives is included in trading-related revenue, while the offsetting change in the fair value of hedged AFS debt securities is included in AOCI and not reflected +above. +114 +The secret flower is "lavender". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_122.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_122.txt new file mode 100644 index 0000000000000000000000000000000000000000..bb0d76b637b1bc6c1457066457980cfe619b2837 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_122.txt @@ -0,0 +1,81 @@ +Factor Sensitivities +Factor sensitivities are expressed as the change in the value of +a position for a defined change in a market risk factor, such as +a change in the value of a U.S. Treasury Bond for a one-basis- +point change in interest rates. Citi’s Global Market Risk +function, within the Independent Risk Management +organization, works to ensure that factor sensitivities are +calculated, monitored and limited for all material risks taken in +the trading portfolios. +Value at Risk (VAR) +VAR estimates, at a 99% confidence level, the potential +decline in the value of a position or a portfolio under normal +market conditions assuming a one-day holding period. VAR +statistics, which are based on historical data, can be materially +different across firms due to differences in portfolio +composition, VAR methodologies and model parameters. As a +result, Citi believes VAR statistics can be used more +effectively as indicators of trends in risk-taking within a firm, +rather than as a basis for inferring differences in risk-taking +across firms. +Citi uses a single, independently approved Monte Carlo +simulation VAR model (see “VAR Model Review and +Validation” below), which has been designed to capture +material risk sensitivities (such as first- and second-order +sensitivities of positions to changes in market prices) of +various asset classes/risk types (such as interest rate, credit +spread, foreign exchange, equity and commodity risks). Citi’s +VAR includes positions that are measured at fair value; it does +not include investment securities classified as AFS or HTM. +See Note 14 for information on these securities. +Citi believes its VAR model is conservatively calibrated +to incorporate fat-tail scaling and the greater of short-term +(approximately the most recent month) and long-term (18 +months for commodities and three years for others) market +volatility. The Monte Carlo simulation involves approximately +550,000 market factors, making use of approximately 480,000 +time series, with sensitivities updated daily, volatility +parameters updated intra-monthly and correlation parameters +updated monthly. The conservative features of the VAR +calibration contribute an approximate 30% add-on to what +would be a VAR estimated under the assumption of stable and +perfectly, normally distributed markets. +As presented in the table below, Citi’s average trading +VAR increased $12 million from 2022 to 2023, mainly due to +increased market volatility. Citi’s average trading and credit +portfolio VAR decreased $6 million from 2022 to 2023. +Year-end and Average Trading VAR and Trading and Credit Portfolio VAR +In millions of dollars +December 31, +2023 +2023 +Average +December 31, +2022 +2022 +Average +Interest rate $ 121 $ 119 $ 130 $ 100 +Credit spread 59 69 78 74 +Covariance adjustment(1) (47) (50) (45) (49) +Fully diversified interest rate and credit spread(2) $ 133 $ 138 $ 163 $ 125 +Foreign exchange 134 33 20 31 +Equity 38 26 27 27 +Commodity 19 31 32 41 +Covariance adjustment(1) (132) (93) (94) (101) +Total trading VAR—all market risk factors, including general and specific risk +(excluding credit portfolios)(2) $ 192 $ 135 $ 148 $ 123 +Specific risk-only component(3) $ (6) $ (7) $ (4) $ (2) +Total trading VAR—general market risk factors only (excluding credit portfolios) $ 198 $ 142 $ 152 $ 125 +Incremental impact of the credit portfolio(4) $ 10 $ 13 $ 30 $ 31 +Total trading and credit portfolio VAR $ 202 $ 148 $ 178 $ 154 +(1) Covariance adjustment (also known as diversification benefit) equals the difference between the total VAR and the sum of the VARs tied to each risk type. The +benefit reflects the fact that the risks within individual and across risk types are not perfectly correlated and, consequently, the total VAR on a given day will be +lower than the sum of the VARs relating to each risk type. The determination of the primary drivers of changes to the covariance adjustment is made by an +examination of the impact of both model parameter and position changes. +(2) The total trading VAR includes mark-to-market and certain fair value option trading positions with the exception of hedges of the loan portfolio, fair value option +loans and all CVA exposures. Available-for-sale and accrual exposures are not included. +(3) The specific risk-only component represents the level of equity and fixed income issuer-specific risk embedded in VAR. +(4) The credit portfolio is composed of mark-to-market positions associated with non-trading business units, the CVA relating to derivative counterparties, all +associated CVA hedges and market sensitivity FVA hedges. FVA and DVA are not included. The credit portfolio also includes hedges of the loan portfolio, fair +value option loans and hedges of the leveraged finance pipeline within capital markets origination. +115 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_123.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_123.txt new file mode 100644 index 0000000000000000000000000000000000000000..f65f6980837cca06e3b5c9dadb8a1b22bd94773d --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_123.txt @@ -0,0 +1,94 @@ +The table below provides the range of market factor VARs associated with Citi’s total trading VAR, inclusive of specific risk: +2023 2022 +In millions of dollars Low High Low High +Interest rate $ 85 $ 186 $ 45 $ 165 +Credit spread 54 88 59 108 +Fully diversified interest rate and credit spread $ 105 $ 211 $ 72 $ 183 +Foreign exchange 12 134 12 98 +Equity 3 88 12 44 +Commodity 17 47 27 104 +Total trading $ 99 $ 214 $ 78 $ 168 +Total trading and credit portfolio 111 225 110 226 +Note: No covariance adjustment can be inferred from the above table as the high and low for each market factor will be from different close-of-business dates. +The following table provides the VAR for Markets, +excluding the CVA relating to derivative counterparties, +hedges of CVA, fair value option loans and hedges to the loan +portfolio: +In millions of dollars Dec. 31, 2023 +Total—all market risk factors, including +general and specific risk $ 191 +Average—during year $ 132 +High—during year 211 +Low—during year 96 +VAR Model Review and Validation +Generally, Citi’s VAR review and model validation process +entails reviewing the model framework, major assumptions +and implementation of the mathematical algorithm. In +addition, product-specific back-testing on portfolios is +periodically completed as part of the ongoing model +performance monitoring process and reviewed with Citi’s U.S. +banking regulators. Furthermore, Regulatory VAR back- +testing (as described below) is performed against buy-and- +hold profit and loss on a monthly basis for multiple sub- +portfolios across the organization (trading desk level and total +Citigroup) and the results are shared with U.S. banking +regulators. +Material VAR model and assumption changes must be +independently validated within Citi’s Independent Risk +Management organization. All model changes, including those +for the VAR model, are validated by the model validation +group within Citi’s Model Risk Management. In the event of +significant model changes, parallel model runs are undertaken +prior to implementation. In addition, significant model and +assumption changes are subject to the periodic reviews and +approval by Citi’s U.S. banking regulators. +Citi uses the same independently validated VAR model +for both Regulatory VAR and Risk Management VAR (i.e., +total trading and total trading and credit portfolios VARs) and, +as such, the model review and validation process for both +purposes is as described above. +Regulatory VAR, which is calculated in accordance with +Basel III, differs from Risk Management VAR because certain +positions included in Risk Management VAR are not eligible +for market risk treatment in Regulatory VAR. The +composition of Risk Management VAR is discussed under +“Value at Risk” above. The applicability of the VAR model +for positions eligible for market risk treatment under U.S. +regulatory capital rules is periodically reviewed and approved +by Citi’s U.S. banking regulators. +In accordance with Basel III, Regulatory VAR includes +all trading book-covered positions and all foreign exchange +and commodity exposures. Pursuant to Basel III, Regulatory +VAR excludes positions that fail to meet the intent and ability +to trade requirements and are therefore classified as non- +trading book and categories of exposures that are specifically +excluded as covered positions. Regulatory VAR excludes +CVA on derivative instruments and DVA on Citi’s own fair +value option liabilities. CVA hedges are excluded from +Regulatory VAR and included in credit risk-weighted assets as +computed under the Advanced Approaches for determining +risk-weighted assets. +Regulatory VAR Back-Testing +In accordance with Basel III, Citi is required to perform back- +testing to evaluate the effectiveness of its Regulatory VAR +model. Regulatory VAR back-testing is the process in which +the daily one-day VAR, at a 99% confidence interval, is +compared to the buy-and-hold profit and loss (i.e., the profit +and loss impact if the portfolio is held constant at the end of +the day and re-priced the following day). Buy-and-hold profit +and loss represents the daily mark-to-market profit and loss +attributable to price movements in covered positions from the +close of the previous business day. Buy-and-hold profit and +loss excludes realized trading revenue, net interest, fees and +commissions, intra-day trading profit and loss and changes in +reserves. +Based on a 99% confidence level, Citi would expect two +to three days in any one year where buy-and-hold losses +exceed the Regulatory VAR. Given the conservative +calibration of Citi’s VAR model (as a result of taking the +greater of short- and long-term volatilities and fat-tail scaling +of volatilities), Citi would expect fewer exceptions under +normal and stable market conditions. Periods of unstable +market conditions could increase the number of back-testing +exceptions. +116 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_124.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_124.txt new file mode 100644 index 0000000000000000000000000000000000000000..3e5a2c7ef26f2109e13c425fa37378eb73c6b34e --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_124.txt @@ -0,0 +1,22 @@ +The following graph presents the daily buy-and-hold +profit and loss associated with Citi’s covered positions +compared to Citi’s one-day Regulatory VAR during 2023. +During 2023, three back-testing exceptions were observed at +the Citigroup level. +The difference between the 47.7% of days with buy-and- +hold gains for Regulatory VAR back-testing and the 94.6% of +days with trading, net interest and other revenue associated +with Citi’s trading businesses, presented in the histogram of +daily trading-related revenue below, reflects, among other +things, that a significant portion of Citi’s trading-related +revenue is not generated from daily price movements on these +positions and exposures, as well as differences in the portfolio +composition of Regulatory VAR and Risk Management VAR. +Regulatory Trading VAR and Associated Buy-and-Hold Profit and Loss(1)(2)—12 Months Ended December 31, 2023 +In millions of dollars +(1) Buy-and-hold profit and loss, as defined by the banking regulators under Basel III, represents the daily mark-to-market revenue movement attributable to the +trading position from the close of the previous business day. Buy-and-hold profit and loss excludes realized trading revenue and net interest intra-day trading +profit and loss on new and terminated trades, as well as changes in reserves. Therefore, it is not comparable to the trading-related revenue presented in the chart of +daily trading-related revenue above. +(2) The loss values for mid-August and mid-December 2023 were driven by the devaluation of the Argentine peso. +117 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_125.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_125.txt new file mode 100644 index 0000000000000000000000000000000000000000..0a2441701dc025d48269f12f7e0147f5805593bc --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_125.txt @@ -0,0 +1,116 @@ +Stress Testing +Citi performs market risk stress testing on a regular basis to +estimate the impact of extreme market movements. It is +performed on individual positions and trading portfolios, as +well as in aggregate, inclusive of multiple trading portfolios. +Citi’s market risk management, after consultations with the +businesses, develops both systemic and specific stress +scenarios, reviews the output of periodic stress testing +exercises and uses the information to assess the ongoing +appropriateness of exposure levels and limits. Citi uses two +complementary approaches to market risk stress testing across +all major risk factors (i.e., equity, foreign exchange, +commodity, interest rate and credit spreads): top-down +systemic stresses and bottom-up business-specific stresses. +Systemic stresses are designed to quantify the potential impact +of extreme market movements on an institution-wide basis, +and are constructed using both historical periods of market +stress and projections of adverse economic scenarios. +Business-specific stresses are designed to probe the risks of +particular portfolios and market segments, especially those +risks that are not fully captured in VAR and systemic stresses. +The systemic stress scenarios and business-specific stress +scenarios at Citi are used in several reports reviewed by senior +management and also to calculate internal risk capital for +trading market risk, as well as enable the monitoring and +managing of Citi’s top market risks. +In general, changes in market values are defined over a +one-year horizon. For the most liquid positions and market +factors, changes in market values are defined over a shorter +two-month horizon. The limited set of positions and market +factors whose market value changes are defined over a two- +month horizon are those that in management’s judgment have +historically remained very liquid during financial crises, even +as the trading liquidity of most other positions and market +factors materially declined. +OPERATIONAL RISK +Overview +Operational risk is the risk of loss resulting from inadequate or +failed internal processes or systems, including human error or +misjudgment, or from external events. This includes legal risk, +which is the risk of loss (including litigation costs, settlements +and regulatory fines) resulting from the failure of Citi to +comply with laws, regulations, prudent ethical standards and +contractual obligations in any aspect of its businesses, but +excludes strategic and reputation risks. Citi also recognizes the +impact of operational risk on the reputation risk associated +with Citi’s business activities. +Operational risk is inherent in Citi’s global business +activities, as well as related support functions, and can result +in losses. Citi maintains a comprehensive Company-wide risk +taxonomy to classify operational risks that it faces using +standardized definitions across Citi’s Operational Risk +Management Framework (see discussion below). This +taxonomy also supports regulatory requirements and +expectations inclusive of those related to U.S. Basel III, +Comprehensive Capital Analysis and Review (CCAR), +Heightened Standards for Large Financial Institutions and +Dodd-Frank Act Stress Testing (DFAST). +Citi manages operational risk consistent with the overall +framework described in “Managing Global Risk—Overview” +above. Citi’s goal is to keep operational risk at appropriate +levels relative to the characteristics of its businesses, the +markets in which it operates, its capital and liquidity and the +competitive, economic and regulatory environment. This +includes effectively managing operational risk and +maintaining or reducing operational risk exposures within +Citi’s operational risk appetite. +Citi’s Independent Operational Risk Management group +has established a global Operational Risk Management +Framework with policies and practices for identification, +measurement, monitoring, managing and reporting operational +risks and the overall operating effectiveness of the internal +control environment. As part of this framework, Citi has +defined its operational risk appetite and established a +manager’s control assessment (MCA) process for self- +identification of significant operational risks, assessment of +the performance of key controls and mitigation of residual risk +above acceptable levels. +Each Citi operating segment must implement operational +risk processes consistent with the requirements of this +framework. This includes: +• understanding the operational risks they are exposed to; +• designing controls to mitigate identified risks; +• establishing key indicators; +• monitoring and reporting whether the operational risk +exposures are in or out of their operational risk appetite; +• having processes in place to bring operational risk +exposures within acceptable levels; +• periodically estimating and aggregating the operational +risks they are exposed to; and +• ensuring that sufficient resources are available to +actively improve the operational risk environment and +mitigate emerging risks. +Citi considers operational risks that result from the +introduction of new or changes to existing products, or result +from significant changes in its organizational structures, +systems, processes and personnel. +Citi has a governance structure for the oversight of +operational risk exposures through Business Risk and Controls +Committees (BRCCs), which are focused at the group, +business or function, or geography level. BRCCs provide +channels to inform senior management about operational risk +exposures, control issues and operational risk events, and +allow them to take and document decisions around the +mitigation, remediation or acceptance of operational risk +exposures. +In addition, Independent Risk Management, including the +Operational Risk Management group, works proactively with +Citi’s businesses and functions to drive a strong and embedded +operational risk management culture and framework across +Citi. The Operational Risk Management group actively +challenges business and functions implementation of the +Operational Risk Management Framework requirements and +the quality of operational risk management practices and +outcomes. +118 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_126.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_126.txt new file mode 100644 index 0000000000000000000000000000000000000000..759e4929a2752655778362401894faebfafcbd7b --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_126.txt @@ -0,0 +1,118 @@ +Information about businesses’ key operational risks, +historical operational risk losses and the control environment +is reported by each major business segment and functional +area. Citi’s operational risk profile and related information is +summarized and reported to senior management, as well as to +the Audit and Risk Committees of Citi’s Board of Directors by +the Head of Operational Risk Management. +Operational risk is measured through Operational Risk +Capital and Operational Risk Regulatory Capital for the +Advanced Approaches under Basel III. Projected operational +risk losses under stress scenarios are estimated as a required +part of the FRB’s CCAR process. +For additional information on Citi’s operational risks, see +“Risk Factors—Operational Risks” above. +Cybersecurity Risk +Overview +Cybersecurity risk is the business risk associated with the +threat posed by a cyberattack, cyber breach or the failure to +protect Citi’s most vital business information assets or +operations, resulting in a financial or reputational loss (see the +operational processes and systems and cybersecurity risk +factors in “Risk Factors—Operational Risks” above). With an +evolving threat landscape, ever-increasing sophistication of +threat actor tactics, techniques and procedures, ongoing and +emerging geopolitical conflicts, and the use of new +technologies, including those enabled by artificial intelligence +and machine learning capabilities, to conduct financial +transactions, Citi and its clients, customers and third parties +(and fourth parties, etc.) continue to be at risk from +cyberattacks and information security incidents. Citi leverages +a threat-focused, defense-in-depth strategy that ensures that +multiple controls work in tandem against various threats to +increase the likelihood that malicious activity will be +prevented, detected and mitigated. +Citi has a mature cybersecurity threat identification and +management program that relies on an industry-aligned +defense-in-depth approach, including an internal cybersecurity +intelligence center, participation in industry and government +information-sharing programs, vulnerability assessment and +scanning tools, intrusion detection and prevention systems, +security incident and event management systems, firewalls, +penetration testing, adversary emulation exercises, data +management (including classification, encryption at rest and in +transit, and access management), multi-factor authentication +requirements and other logical, physical and technical controls +designed to prevent, deter, mitigate and respond to +cybersecurity threats. +Citi’s cyber and information security program is +supported by comprehensive governance, including policies, +standards and procedures that dictate requirements and best +practices around various topics, including, but not limited to, +third-party risk management, data management, asset +management, information security practices, security incident +management, and regulatory and disclosure compliance. Citi’s +Chief Information Security Office’s risks and controls are +measured against its Cybersecurity Risk Appetite Statement, +which was initially approved by the Risk Management +Committee of the Board of Directors and is reapproved +annually by Citi’s Risk Committee, chaired by Citi’s Chief +Risk Officer. Citi’s Cybersecurity Risk Appetite Statement +leverages key risk indicators to establish enterprise risk +tolerance and define risk management strategy with respect to +cyber and information security. Further, Citi actively +participates in financial industry, government and cross-sector +knowledge-sharing groups to enhance individual and +collective cybersecurity preparedness and resilience. +Cybersecurity Risk Management and Governance +Citi’s technology and cybersecurity risk management program +is built on Citi’s three lines of defense, each of which is +integrated into Citi’s overall risk management systems and +processes. +Citi’s Chief Information Security Office, which is led by +Citi’s Chief Information Security Officer (CISO), serves as the +first line of defense. This office provides frontline business, +operational and technical controls and capabilities to (1) +protect against cybersecurity risks, and (2) respond to cyber +incidents and data breaches. Citi manages cybersecurity +threats through its state-of-the-art fusion centers, which serve +as central commands for monitoring and coordinating +responses to cyber threats. +Citi’s Chief Information Security Office is responsible for +application and infrastructure defense and security controls, +performing vulnerability assessments and third-party +information security assessments (including cybersecurity risk +assessments associated with Citi’s use of products and services +from vendors and other third-party providers), employee +awareness and training programs and security incident +management. In each case, the enterprise information security +team works in coordination with a network of information +security officers who are embedded within Citi’s global +businesses and functions, consistent with Citi’s philosophy +that all Citi stakeholders have a responsibility in managing +cyber and information security risks. +Citi’s Technology and Cyber Compliance and Operational +Risk Office (TCCORO) serves as the second line of defense. +This office independently evaluates and challenges Citi’s risk +mitigation practices and capabilities, from a fused operational +risk and compliance lens. It functions as a joint second line of +defense and in accordance with Citi’s Cybersecurity Risk +Appetite Statement. TCCORO also advises first line partners +in CISO, supporting enterprise-wide efforts to proactively +identify and remediate cybersecurity risks before they +materialize as incidents that negatively affect business +operations. +To address evolving cybersecurity risks and +corresponding regulations, TCCORO monitors cybersecurity +legal and regulatory requirements, identifies and defines +emerging risks, executes strategic cybersecurity threat +assessments, performs new product and initiative reviews, +performs data management risk oversight and conducts +cybersecurity risk assurance reviews (inclusive of third-party +assessments). In addition, this office oversees and challenges +metrics related to cybersecurity and technology and ensures +they remain aligned with Citi’s overall operational risk +management framework to effectively track, identify and +manage risk. TCCORO presents an independent viewpoint on +enterprise cybersecurity risk posture, and oversees CISO’s +119 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_127.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_127.txt new file mode 100644 index 0000000000000000000000000000000000000000..fb3cd4bbd11572a3636b48dd24cdbb1386ac6fbf --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_127.txt @@ -0,0 +1,119 @@ +cybersecurity risk identification, measurement and enterprise- +wide governance of cybersecurity risk. +Internal Audit serves as Citi’s third line of defense and +provides independent assurance to the Audit Committee of the +Board on the effectiveness of controls operated by the first and +second lines of defense to manage cybersecurity risk. +Citi recognizes the risks associated with outsourcing +services to, sharing data with, and/or technologically +interacting with third parties. Citi has built a robust third-party +information security risk management program that governs +third-party engagements from selection, to the establishment +of legal agreements that govern the relationship, to ongoing +monitoring through the duration of the relationship. Third- +party risk management includes contractual requirements +around data and cybersecurity, vulnerability assessments, +third-party information security assessments performed at +intervals determined by risk, governance to manage end-of-life +and end-of-vendor-support risks, and third-party incident +response protocols. +Management Governance +Citi’s Head of Operations and Technology (O&T), who +reports directly to Citi’s CEO, has overall responsibility for +Citi’s first line of defense cyber and information security and +technology programs. Citi’s Head of O&T has over 40 years +of experience in financial services and technology focused +roles, including prior positions at Citi as a regional Chief +Information Officer, Head of Technology for Citi’s former +Institutional Clients Group and Head of Securities and +Banking Operations and Technology. For additional +information, see “Corporate Information—Executive Officers” +below. +Citi’s CISO, who reports directly to Citi’s Head of O&T, +has primary responsibility to assess and manage Citi’s material +risks from cybersecurity threats. Citi’s CISO has decades of +experience in managing cybersecurity risks from prior roles as +Deutsche Bank’s Chief Security Officer, the Chief Information +Officer for the Central Intelligence Agency and the Chief +Information Officer for the U.S. Intelligence Community. The +CISO is supported by a team of subject matter experts in +security operations, network architecture, cyber and +information security governance and cybersecurity operations. +Citi’s Chief Information Security Office employs +approximately 3,400 individuals to manage its operations. +Citi’s Chief Technology Officer (CTO), who also reports +directly to Citi’s Head of O&T, has primary responsibility for +technology policy, innovation enablement and strategy. Citi’s +CTO has decades of subject matter experience in financial +services and technology from previously leading the +Engineering and Architecture Services group at J.P. Morgan +Chase, and serving as the Chief Technology Officer at +Deutsche Bank and the Chief Information Officer for Sales, +Research and Securities Data Services at Goldman Sachs. +Multiple management committees and functions also +support Citi’s cyber and information security management. +Citi’s Information Security Risk Committee (ISRC) +governs enterprise-level risk tolerance, including cybersecurity +risk. This committee serves as the most senior cyber and +information security forum within Citi and is supported by +other committees/forums described below. The committee is +co-chaired by Citi’s Chief Risk Officer and Head of O&T and +meets at least quarterly. In addition, the committee oversees +risk tolerance determinations, reviews emerging threats and +their business impacts, commits to appropriate resource levels +and investments and supports the continual improvement of +the cyber and information security management programs +across all of Citi’s businesses and geographies. +The Chief Information Officer Committee (CIOC), which +consists of, among others, the Head of O&T, Citi’s Co-Chief +Information Officers (who report to the Head of O&T), the +CISO, and the Head of TCCORO (who reports both to Citi’s +Head of Operational Risk within the Risk Organization and its +Head of Global Functions Compliance within the Global Legal +and Compliance Organization), serves as an escalation forum +for items requiring the attention of technology senior +management, including approval of policies, and reports items +requiring further escalation to the Technology Committee of +the Board of Directors, as appropriate. +The Information Security Risk Operating Committee +(ISROC) is chaired by the CISO and comprises senior +members of the Chief Information Security Office and +representatives from partner organizations. This committee +sets the direction and prioritization for the implementation of +the cyber and information security program across Citi. The +committee reports and escalates to the CIOC, including for +intermediary review and approval of policies escalated from +the Information Technology Policy Council (see below). Any +actions constituting risk exceptions are escalated to the ISRC. +The Security Architecture Council, which reports to the +ISROC, is an oversight and decision-making body focused on +ensuring that the target level of security architectural maturity +is attained. This council is co-chaired by two representatives +from the security architecture and cybersecurity services +organizations. +Citi’s Information Technology Policy Council provides a +centralized review to oversee consistency in the formation of +information technology policies and standards. This counsel +maintains oversight of policy document requirements to +ensure that information technology policy documents meet +Citi’s objectives as established internally and are in line with +laws and regulations as identified and communicated by +ICRM. +In addition, Citi regularly engages third parties globally to +assess, audit and/or exercise Citi’s cyber and information +security program, which is ISO-27001 certified. ISO-27001 is +an international standard for information security management +systems. Citi is regulated by bodies across the globe that also +regularly examine and audit Citi’s cyber and information +security program against local laws, regulations and industry +best practices. +Board Governance +Citi’s Board of Directors and its committees provide oversight +of senior management’s efforts to mitigate cybersecurity risk +and respond to cybersecurity incidents. Citi’s Board includes +members with cybersecurity expertise and experience. +Citi’s full Board is briefed annually on cybersecurity risks +and receives updates as needed on Citi’s cyber and +information security program, including changes to the threat +landscape and a roadmap for progress around addressing +120 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_128.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_128.txt new file mode 100644 index 0000000000000000000000000000000000000000..905ee154513be3708e85d656c702139aa7eb98cb --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_128.txt @@ -0,0 +1,110 @@ +related risks. Additionally, Citi’s Board participates in +cybersecurity exercises to improve preparedness to address +cybersecurity incidents. +The Board’s Technology Committee receives quarterly +updates from the Chief Information Security Office on the +cybersecurity threat landscape, regulatory landscape, posture, +and strategy and engages in discussions throughout the year +with senior management and subject matter experts on the +effectiveness of Citi’s overall cybersecurity program. +The Board’s Risk Management Committee (RMC) +approved a standalone Cybersecurity Risk Appetite Statement +against which Citi’s performance is measured quarterly. In +addition, the RMC oversees Citi’s risk profile, which includes +cybersecurity risk, and monitors whether Citi is operating +within its cybersecurity risk appetite under its mandate to +review key operational risks, including steps taken by +management to control such risks. +In the event of a potentially material cybersecurity +incident impacting Citi, the Board would be made aware of +such incident via lines of communication that run from the +Chief Information Security Office to senior management and +also to the Board. This contemporaneous reporting on +significant cyber events includes information and discussion +around incident response, legal obligations (including +disclosure), and outreach and notification to regulators and +customers when needed. +For additional information on the Board’s oversight of +cybersecurity risk management, see Citi’s upcoming 2024 +Annual Meeting Proxy Statement to be filed with the SEC in +March 2024. +COMPLIANCE RISK +Compliance risk is the risk to current or projected financial +condition and resilience arising from violations of laws, rules +or regulations, or from non-conformance with prescribed +practices, internal policies and procedures or ethical standards. +Compliance risk exposes Citi to fines, civil money penalties, +payment of damages and the voiding of contracts. Compliance +risk can result in diminished reputation, harm to Citi’s +customers, limited business opportunities and lessened +expansion potential. It encompasses the risk of noncompliance +with all laws and regulations, as well as prudent ethical +standards and some contractual obligations. It could also +include exposure to litigation (known as legal risk) from all +aspects of traditional and non-traditional banking. +Citi seeks to operate with integrity, maintain strong +ethical standards and adhere to applicable policies and +regulatory and legal requirements. Citi must maintain and +execute a proactive Compliance Risk Management (CRM) +Framework (as set forth in the CRM Policy) that is designed to +manage compliance risk effectively across Citi, with a view to +fundamentally strengthen the compliance risk management +culture across the lines of defense taking into account Citi’s +risk governance framework and regulatory requirements. +Independent Compliance Risk Management’s (ICRM) +primary objectives are to: +• Drive and embed a culture of compliance and control +throughout Citi; +• Maintain and oversee an integrated CRM Framework that +facilitates enterprise-wide compliance with local, national +or cross-border laws, rules or regulations, Citi’s internal +policies, standards and procedures and relevant standards +of conduct; +• Assess compliance risks and issues across product lines, +functions and geographies, supported by globally +consistent systems and compliance risk management +processes; and +• Provide compliance risk data aggregation and reporting +capabilities. +Citi carries out its objectives and fulfills its +responsibilities through the CRM Framework, which is +composed of the following integrated key activities, to +holistically manage compliance risk: +• Management of Citi’s compliance with laws, rules and +regulations by identifying and analyzing changes, +assessing the impact, and implementing appropriate +policies, processes and controls; +• Developing and providing compliance training to ensure +colleagues are aware of and understand the key laws, +rules and regulations; +• Monitoring the Compliance Risk Appetite, which is +articulated through qualitative compliance risk statements +describing Citi’s appetite for certain types of risk and +quantitative measures to monitor the Company’s +compliance risk exposure; +• Executing Compliance Risk Assessments, the results of +which inform Compliance Risk Monitoring and testing of +compliance risks and controls in assessing conformance +with laws, rules, regulations and internal policies; and +• Issue identification, escalation and remediation to drive +accountability, including measurement and reporting of +compliance risk metrics against established thresholds in +support of the CRM Policy and Compliance Risk +Appetite. +To anticipate, control and mitigate compliance risk, Citi +has established the CRM Policy to achieve standardization and +centralization of methodologies and processes, and to enable +more consistent and comprehensive execution of compliance +risk management. +Citi has a commitment, as well as an obligation, to +identify, assess and mitigate compliance risks associated with +its businesses and functions. ICRM is responsible for +oversight of Citi’s CRM Policy, while all businesses and +global control functions are responsible for managing their +compliance risks and operating within the Compliance Risk +Appetite. +As discussed above, Citi is working to address the FRB +and OCC consent orders, which include improvements to +Citi’s CRM Framework and its enterprise-wide application +(see “Citi’s Consent Order Compliance” above). +121 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_129.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_129.txt new file mode 100644 index 0000000000000000000000000000000000000000..1d5a404d100845bea110a15ca80c1eaf1b1af3fb --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_129.txt @@ -0,0 +1,116 @@ +REPUTATION RISK +Citi’s reputation is a vital asset in building trust, and Citi is +diligent in enhancing and protecting its reputation with its key +stakeholders. To support this, Citi has developed a reputation +risk framework. Under this framework, Citigroup and +Citibank, N.A. have implemented a risk appetite statement and +related key indicators to monitor corporate activities and +operations relative to Citi’s risk appetite. The framework also +requires that business segments escalate potential material +reputation risks that require review or mitigation through the +applicable business Management Forum or Group Reputation +Risk Committee. +The Group Reputation Risk Committee and Management +Forums, which are composed of Citi’s senior executives, +govern the process by which material reputation risks are +identified, measured, monitored, controlled, escalated and +reported. The Group Reputation Risk Committee and +Management Forums determine the appropriate actions to be +taken in line with risk appetite and regulatory expectations, +while promoting a culture of risk awareness and high +standards of integrity and ethical behavior across the +Company, consistent with Citi’s Mission and Value +Proposition. The Group Reputation Risk Committee may +escalate reputation risks to the Nomination, Governance and +Public Affairs Committee or other appropriate committee of +the Citigroup Board of Directors. +Every Citi employee is responsible for safeguarding Citi’s +reputation, guided by Citi’s Code of Conduct. Colleagues are +expected to exercise sound judgment and common sense in +decisions and actions. They are also expected to promptly +escalate all issues that present material reputation risk in line +with policy. +STRATEGIC RISK +As discussed above, strategic risk is the risk of a sustained +impact (not episodic impact) to Citi’s core strategic objectives +as measured by impacts on anticipated earnings, market +capitalization or capital, arising from external factors affecting +the Company’s operating environment, as well as the risks +associated with defining and executing the strategy, which are +identified, measured and managed as part of the Strategic Risk +Framework at the Enterprise Level. +In this context, external factors affecting Citi’s operating +environment are the economic conditions, geopolitical/ +political landscape, industry/competitive landscape, customer/ +client behavior, regulatory/legislative environment and trends +related to investors/shareholders. Material strategic risks that +Citi is monitoring include the impacts of an extended period of +high inflation and interest rates, as well as macroeconomic +uncertainties driven by low global growth and geopolitical +issues including the Middle East conflict, the Russia–Ukraine +war and U.S.–China tensions. Heightened regulatory +requirements, specifically with regard to capital as well as +climate-related transition risk, remain in focus. In addition to +external factors affecting Citi’s operating environment, Citi +also monitors risks related to the execution of its strategy, with +heightened focus on delivering the transformation of its risk +and control environment pursuant to the FRB and OCC +consent orders. +Citi’s Executive Management Team is responsible for the +development and execution of Citi’s strategy. This strategy is +translated into forward-looking plans (collectively Citi’s +Strategic Plan) that are then cascaded across the organization. +Citi’s Strategic Plan is presented to the Board on an annual +basis, and is aligned with risk appetite thresholds and includes +a risk assessment as required by internal frameworks. It is also +aligned with limit requirements for capital allocation. +Governance and oversight of strategic risk is facilitated by +internal committees on a group-wide basis. +Citi works to ensure that strategic risks are adequately +considered and addressed across its various risk management +activities, and that strategic risks are assessed in the context of +Citi’s risk appetite. Citi conducts a top-down, bottom-up risk +identification process to identify risks, including strategic +risks. Business segments undertake a quarterly risk +identification process to systematically identify and document +all material risks faced by Citi. Independent Risk Management +oversees the risk identification process through regular +reviews and coordinates identification and monitoring of top +risks. In addition, Citi performs a quarterly Risk Assessment +of the Plan (RAOP) and continuously monitors risks +associated with its execution of strategy. Independent Risk +Management also manages strategic risk by monitoring risk +appetite thresholds in conjunction with its Global Strategic +Risk Committee, which is part of the governance structure that +Citi has in place to manage its strategic risks. +For additional information on Citi’s strategic risks, see +“Risk Factors—Strategic Risks” above. +Climate Risk +Climate change presents immediate and long-term risks to Citi +and its clients and customers, with the risks expected to +increase over time. Climate risk refers to the risk of loss +arising from climate change and comprises both physical risk +and transition risk. +Climate risk is an overarching risk that can act as a driver +of other categories of risk, such as credit risk from obligors +exposed to high climate risk, strategic risks if Citi fails to +consider transition risk in client selection, reputational risk +from increased stakeholder concerns about financing or failing +to finance high-carbon industries and operational risk from +physical risks to Citi’s facilities. Citi’s focus on climate risk +continues to advance, driven by materiality of strategic, +reputation and financial risk considerations. Citi continues to +make progress toward embedding these considerations into its +overarching risk management approach. For additional +information on climate risk, see “Risk Factors—Strategic +Risks” above. +Citi continues to develop globally consistent principles +and approaches for managing climate risk across the Company +through the implementation of its Climate Risk Management +Framework (Climate RMF). The Climate RMF provides +information on the governance, roles and responsibilities, and +principles to support the identification, measurement, +monitoring, controlling and reporting of climate risks. +Through this implementation, climate risk is being embedded +into relevant policies and processes over time. +122 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_130.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_130.txt new file mode 100644 index 0000000000000000000000000000000000000000..813fa6b98b4a26219d40ac9887fe56f93ba9a768 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_130.txt @@ -0,0 +1,50 @@ +Citi continues to enhance its methodologies for +quantifying how climate risks could impact the individual +credit profiles of its clients across various sectors. Citi has +developed and embedded sector-specific climate risk +assessments in its credit underwriting process for certain +sectors that Citi has identified as higher climate risk. Such +climate risk assessments are designed to incorporate publicly +available client disclosures and data from third-party providers +and facilitate conversations with clients on their most material +climate risks and management plans for adaptation and +mitigation. This helps Citi better understand its clients’ +businesses and climate-related risks and support their financial +needs. Citi’s Net Zero plan implementation is leading to the +further integration of climate risk discussions into client +engagement and client selection. +Citi also reviews factors related to climate risk under its +Environmental and Social Risk Management (ESRM) Policy, +which includes a focus on climate risk related to financed +projects and clients in certain sectors. Considering the credit +risk of stranded assets, as well as the reputational risks, Citi’s +ESRM Policy describes sector approaches to certain high- +carbon sectors, including thermal coal mining and power. +Furthermore, Citi continues to participate in financial +industry initiatives and develop and pilot methodologies and +approaches for measuring and assessing the potential financial +risks of climate change, including scenario analysis. Citi also +continues to monitor regulatory developments on climate risk +and sustainable finance and actively engage with regulators on +these topics. +For additional information about sustainability and other +ESG matters at Citi, see “Climate Change and Net Zero” +above. +OTHER RISKS +LIBOR Transition Risk +As previously disclosed, the USD LIBOR bank panel ended +on June 30, 2023. The overnight and 12-month USD LIBOR +settings have permanently ceased, and the Financial Conduct +Authority is requiring ICE Benchmark Administration to +continue publishing one-, three- and six-month USD LIBOR +settings using a synthetic methodology, which is based on the +relevant CME Term SOFR Reference Rate plus the respective +ISDA fixed spread adjustment. These synthetic settings are +expected to cease on September 30, 2024. As previously +disclosed, as of June 30, 2023, Citi transitioned nearly all of its +USD LIBOR-referencing contracts to SOFR plus a credit +spread adjustment. There remain a de minimis number of +unremediated USD LIBOR-referencing contracts that are +temporarily utilizing synthetic LIBOR, and Citi is continuing +to focus on remediating these remaining contracts. +123 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_131.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_131.txt new file mode 100644 index 0000000000000000000000000000000000000000..e2f9e7dc25b863d97c29bc9a79182296635f83bf --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_131.txt @@ -0,0 +1,110 @@ +Country Risk +Top 25 Country Exposures +The following table presents Citi’s top 25 exposures by +country (excluding the U.S.) as of December 31, 2023. +(Including the U.S., Citi’s top 25 exposures by country would +represent approximately 99% of Citi’s exposure to all +countries as of December 31, 2023.) +For purposes of the table, loan amounts are reflected in +the country where the loan is booked, which is generally based +on the domicile of the borrower. For example, a loan to a +Chinese subsidiary of a Switzerland-based corporation will +generally be categorized as a loan in China. In addition, Citi +has developed regional booking centers in certain countries, +most significantly in the United Kingdom (U.K.) and Ireland, +in order to more efficiently serve its corporate customers. As +an example, with respect to the U.K., only 39% of corporate +loans presented in the table below are to U.K. domiciled +entities (42% for unfunded commitments), with the balance of +the loans predominately to European domiciled counterparties. +Approximately 90% of the total U.K. funded loans and 88% of +the total U.K. unfunded commitments were investment grade +as of December 31, 2023. +Trading account assets and investment securities are +generally categorized based on the domicile of the issuer of +the security of the underlying reference entity. For additional +information on the assets included in the table, see the +footnotes to the table below. +In billions of +dollars +Services, +Markets +and +Banking +loans +Wealth +loans(1) +Legacy +Franchises +loans +Loans +transferred +to HFS(7) +Other +funded(2) Unfunded(3) +Net MTM +on +derivatives/ +repos(4) +Total +hedges +(on loans +and +CVA) +Investment +securities(5) +Trading +account +assets(6) +Total +as of +4Q23 +Total +as of +3Q23 +Total +as of +4Q22 +Total +as a % +of Citi +as of +4Q23 +United +Kingdom $ 38.8 $ 5.2 $ — $ — $ 1.5 $ 39.1 $ 15.5 $ (5.3) $ 6.7 $ 3.3 $ 104.8 $ 97.2 $ 88.5 5.9 % +Mexico 9.9 0.1 27.1 — 0.3 8.8 6.2 (3.5) 22.0 1.5 72.4 69.2 61.2 4.0 +Ireland 15.6 — — — 0.3 35.3 0.1 (0.2) — 0.6 51.7 49.0 47.4 2.9 +Hong Kong 8.8 19.4 — — 0.2 4.5 1.6 (0.6) 9.8 0.5 44.2 44.2 48.3 2.5 +Singapore 10.0 18.6 — — 0.4 7.4 1.1 (0.6) 5.8 1.0 43.7 42.3 45.2 2.4 +Brazil 13.7 — — — 0.1 3.1 8.1 (1.1) 6.6 2.8 33.3 32.8 28.7 1.9 +India 6.9 — — — 0.6 3.6 1.4 (0.6) 9.3 1.2 22.4 22.3 25.3 1.3 +Germany 0.4 — — — — 7.3 5.9 (4.1) 8.2 3.8 21.5 17.4 22.6 1.2 +China 5.7 — 0.4 0.3 0.6 1.3 0.7 (1.4) 8.0 3.3 18.9 18.6 20.7 1.1 +South Korea 3.1 — 5.4 — 0.1 1.5 0.7 (0.7) 7.8 0.5 18.4 20.9 23.7 1.0 +United Arab +Emirates 7.6 1.5 — — 0.2 4.3 0.4 (0.3) 3.7 (0.1) 17.3 16.4 17.4 1.0 +Poland 3.1 — 1.5 — — 3.3 1.1 (0.2) 6.2 0.1 15.1 13.0 15.6 0.8 +Australia 8.4 0.4 — — 0.1 5.7 0.5 (1.2) 0.6 0.5 15.0 16.5 14.4 0.8 +Japan 1.7 — — — — 3.8 3.6 (1.9) 4.6 2.6 14.4 15.9 19.0 0.8 +Canada 1.5 1.5 — — 0.1 6.1 1.4 (2.2) 3.2 2.7 14.3 16.5 15.2 0.8 +Jersey 2.0 2.7 — — — 6.7 0.1 (0.1) 0.2 — 11.6 12.1 15.9 0.6 +Malaysia 1.2 — — — 0.1 0.8 0.1 (0.1) 3.1 0.1 5.3 5.3 5.4 0.3 +Czech +Republic 0.7 — — — — 0.8 2.9 (0.1) 0.9 — 5.2 4.5 4.0 0.3 +Luxembourg — 0.9 — — — — 0.5 (0.4) 4.0 0.1 5.1 4.9 4.7 0.3 +Indonesia 2.1 — — — — 0.5 0.5 (0.1) 1.4 0.1 4.5 6.1 5.9 0.3 +Taiwan 3.6 — — — — 0.5 0.3 (0.2) 0.2 — 4.4 5.4 13.8 0.2 +South Africa 1.4 — — — — 0.7 0.1 (0.2) 2.4 — 4.4 4.6 4.4 0.2 +Philippines 0.6 — — — 0.1 0.2 1.6 (0.3) 2.1 — 4.3 5.2 5.0 0.2 +Italy 0.9 — — — — 2.2 1.8 (1.9) — 1.0 4.0 3.5 2.4 0.2 +Thailand 1.1 — — — — 0.4 — — 2.1 0.1 3.7 3.4 4.2 0.2 +Total as a % of Citi’s total exposure 31.2 % +Total as a % of Citi’s non-U.S. total exposure 91.7 % +(1) Wealth loans reflect funded loans, including those related to the Private Bank, net of unearned income. As of December 31, 2023, Private Bank loans in the table +above totaled $19.3 billion, concentrated in Singapore ($5.4 billion), the U.K. ($5.2 billion) and Hong Kong ($3.8 billion). +(2) Other funded includes other direct exposures such as accounts receivable and investments accounted for under the equity method. +(3) Unfunded exposure includes unfunded corporate lending commitments, letters of credit and other contingencies. +(4) Net mark-to-market (MTM) counterparty risk on OTC derivatives and securities lending/borrowing transactions (repos). Exposures are net of collateral and +inclusive of CVA. Also includes margin loans. +124 +The secret sport is "skiing". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_132.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_132.txt new file mode 100644 index 0000000000000000000000000000000000000000..12335db75beab01768f2bbe1847e85c5e89c173d --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_132.txt @@ -0,0 +1,74 @@ +(5) Investment securities include debt securities AFS, recorded at fair market value, and debt securities HTM, recorded at amortized cost. +(6) Trading account assets are on a net basis and include issuer risk on cash products and derivative exposure where the underlying reference entity/issuer is located in +that country. +(7) December 31, 2023, September 30, 2023 and December 31, 2022 include All Other—Legacy Franchises loans reclassified to HFS as a result of Citi’s agreement +to sell its consumer banking business in each applicable country. See “All Other—Legacy Franchises” above and Note 2. +Russia +Overview +In Russia, Citi’s remaining operations are conducted through +Services, Markets, Banking and All Other—Legacy +Franchises. Citi continues to monitor the war in Ukraine, +related sanctions and economic conditions and continues to +mitigate its Russia exposures and risks as appropriate. +As part of previously disclosed plans, Citi ended nearly +all of the institutional banking services it offered in Russia, +with the remaining services only those necessary to fulfill its +remaining legal and regulatory obligations. In addition, Citi +significantly reduced its All Other—Legacy Franchises +consumer loan portfolio in Russia (reported as part of Asia +Consumer), largely due to loan portfolio sales and its entry +into a credit card referral agreement with a Russian bank. +Citi has ceased soliciting any new business or new clients in +Russia. Citi will continue to manage its existing legal and +regulatory commitments and obligations, as well as support its +employees, during this period. For additional information on +Citi’s wind-down of its Russia operations, see “Citi’s Wind- +Down of Its Russia Operations” below. +For additional information about Citi’s risks related to its +Russia exposures, see “Risk Factors—Market-Related Risks,” +“—Operational Risks” and “—Other Risks” above. +Impact of Russia’s Invasion of Ukraine on Citi’s Businesses +Russia-related Balance Sheet Exposures +Citi’s remaining domestic operations in Russia are conducted +through a subsidiary of Citibank, AO Citibank, which uses the +Russian ruble as its functional currency. +The following table summarizes Citi’s exposures related to its Russia operations: +In billions of U.S. dollars +December 31, +2023 +September 30, +2023 +December 31, +2022 +Change 4Q23 +vs. 3Q23 +Loans $ 0.1 $ 0.2 $ 0.6 $ (0.1) +Investment securities(1) 0.4 0.4 1.1 — +Net MTM on derivatives/repos(2) 1.4 1.2 1.4 0.2 +Total hedges (on loans and CVA) — (0.1) (0.1) 0.1 +Unfunded(3) — — 0.1 — +Trading accounts assets — — — — +Country risk exposure $ 1.9 $ 1.7 $ 3.1 $ 0.2 +Cash on deposit and placements(4) 0.7 0.6 2.4 0.1 +Deposit Insurance Agency(5) 3.9 3.5 — 0.4 +National Settlements Depository(5) — — 1.8 — +Total third-party exposure(6) $ 6.5 $ 5.8 $ 7.3 $ 0.7 +Additional exposures to Russian counterparties that are not held by +the Russian subsidiary 0.1 0.1 0.2 — +Total Russia exposure(7) $ 6.6 $ 5.9 $ 7.5 $ 0.7 +(1) Investment securities include debt securities AFS, recorded at fair market value, primarily local government debt securities. +(2) Reverse repurchase agreements are gross of collateral and are included in net MTM on derivatives/repos in the table above, as netting of collateral for Russia- +related reverse repurchase agreements was removed in the second quarter of 2022. This removal was due to the inability to conclude, with a well-founded basis, +the enforceability of contractual rights in the Russian legal system in the event of a counterparty default, given the geopolitical uncertainty caused by the war in +Ukraine. +(3) Unfunded exposure consists of unfunded corporate lending commitments, letters of credit and other contingencies. +(4) Cash on deposit and placements are primarily with the Central Bank of Russia and foreign financial institutions. +(5) Represents dividends received by Citi in its role as custodian for investor clients in Russia, which Citi is required by local regulation to hold at the Deposit +Insurance Agency (DIA). Citi is unable to remit these funds to clients due to restrictions imposed by the Russian government. In accordance with a Central Bank +of Russia regulatory requirement, all balances in the National Settlements Depository were transferred to the DIA in the second quarter of 2023. +(6) The majority of AO Citibank’s third-party exposures was funded with the dividends under footnote 5 and domestic deposit liabilities from both corporate and +personal banking clients. +(7) Citigroup’s CTA loss included in its AOCI related to its indirect subsidiary, AO Citibank, is excluded from the above table, because the CTA loss is not held in +AO Citibank and would be recognized in Citigroup’s earnings only upon either the substantial liquidation or a loss of control of AO Citibank. Citi has separately +described these risks in “Deconsolidation Risk” below. +125 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_133.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_133.txt new file mode 100644 index 0000000000000000000000000000000000000000..d9bcb66fa410c5eff1e7ee04d77fcc0a42faebe8 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_133.txt @@ -0,0 +1,117 @@ +During the fourth quarter of 2023, Citi’s Russia-related +exposures increased by $0.7 billion, as presented in the table +above. The increase in exposure was driven by a $0.4 billion +appreciation of the ruble against the U.S. dollar (USD) as well +as dividend inflows during the quarter, received from Russian +corporations on behalf of Citi’s clients. The dividend inflows +were partially offset by deposit outflows and tax payments to +local authorities. Approximately 71% of Citi’s remaining +exposures in Russia are corporate dividends that Citi cannot +remit to its clients due to restrictions imposed by the Russian +government, of which $3.9 billion is held with the Deposit +Insurance Agency as of December 31, 2023. +Citi’s net investment in Russia was approximately $0.2 +billion as of December 31, 2023 (down from $1.0 billion as of +September 30, 2023). The decline was due to a reserve build +related to increases in transfer risk associated with exposures +in Russia driven by safety and soundness considerations under +U.S. banking law (see “Significant Accounting Policies and +Significant Estimates” below). +Citi hedges its ruble/USD spot FX exposure in AOCI +through the purchase of FX derivatives. The ongoing mark-to- +market of the hedging derivatives is also reported in AOCI. +When the ruble depreciates against the USD, the USD +equivalent value of Citigroup’s investment in AO Citibank +also declines. This change in value is offset by the change in +value of the hedging instrument (FX derivative). Going +forward, Citi may record devaluations on its net ruble- +denominated assets in earnings, without the benefit from a +change in the fair value of derivative positions used to +economically hedge the exposures. +Earnings and Other Impacts on Citi’s Businesses +Services, Markets, Banking, USPB and All Other results have +been impacted by various macroeconomic factors and +volatilities, including Russia’s invasion of Ukraine and its +direct and indirect impact on the European and global +economies. For a broader discussion of these factors and +volatilities on Citi’s businesses, see “Executive Summary” and +each business’s results of operations above. +As of December 31, 2023, Citigroup’s ACL included a +$0.1 billion remaining credit reserve for Citi’s direct Russian +counterparties (unchanged from September 30, 2023). This +balance does not include the additional reserves to transfer risk +for exposures in Russia. +Citi’s Wind-Down of Its Russia Operations +In August 2022, Citi disclosed its decision to wind down its +Russia consumer, local commercial and institutional banking +businesses, including actively pursuing portfolio sales. In +connection with this wind-down, Citi has incurred +approximately $63 million to-date in charges, largely from +restructuring, vendor termination fees and other related +charges. Citi expects to incur an additional approximate $58 +million in estimated charges (approximately $2 million in +Services, Markets and Banking and $56 million in All Other, +excluding the impact from any portfolio sales). This estimate +was revised down during the fourth quarter of 2023 from $85 +million at September 30, 2023. For additional information +about Citi’s continued efforts to reduce its operations and +exposure in Russia, see “Risk Factors” above and Note 2. +Deconsolidation Risk +Citi’s remaining operations in Russia subject it to various +risks, including, among others, foreign currency volatility, +including appreciation or devaluation; restrictions arising from +retaliatory Russian laws and regulations on the conduct of its +business; sanctions or asset freezes; or other deconsolidation +events (see “Risk Factors—Other Risks” above). Examples of +triggers that may result in deconsolidation of AO Citibank +include voluntary or forced sale of ownership or loss of +control due to actions of relevant governmental authorities, +including expropriation (i.e., the entity becomes subject to the +complete control of a government, court, administrator, trustee +or regulator); revocation of banking license; and loss of ability +to elect a board of directors or appoint members of senior +management. As of December 31, 2023, Citi continued to +consolidate AO Citibank because none of the deconsolidation +factors were triggered. +In the event Citi deems there is a loss of control, for +example, through expropriation of AO Citibank, Citi’s foreign +entity in Russia, Citi would be required to (i) write off the net +investment of approximately $0.2 billion (compared to $1.0 +billion as of September 30, 2023), (ii) recognize a CTA loss of +approximately $1.6 billion (unchanged from September 30, +2023) through earnings, and (iii) recognize a loss of $0.6 +billion (unchanged from September 30, 2023) on +intercompany liabilities owed by AO Citibank to other Citi +entities outside Russia. In the sole event of a substantial +liquidation, as opposed to a loss of control, Citi would be +required to recognize the CTA loss of approximately $1.6 +billion through earnings and would evaluate its remaining net +investment as circumstances evolve. +Citi as Paying Agent for Russia-related Clients +Citi serves or served as paying agent on bonds issued by +various entities in Russia, including Russian corporate clients. +Citi’s role as paying agent is administrative. In this role, Citi +acts as an agent of its client, the bond issuer, receiving interest +and principal payments from the bond issuer and then making +payments to international central securities depositories (e.g., +Depository Trust Company, Euroclear, Clearstream). The +international central securities depositories (ICSDs) make +payments to those participants or account holders (e.g., broker/ +dealers) that have clients who are investors in the applicable +bonds (i.e., bondholders). As a paying agent, Citi generally +does not have information about the identity of the +bondholders. Citi may be exposed to risks due to its +responsibilities for receiving and processing payments on +behalf of its clients as a result of sanctions or other +governmental requirements and prohibitions. To mitigate +operational and sanctions risks, Citi has established policies, +procedures and controls for client relationships and payment +processing to help ensure compliance with U.S., U.K., EU and +other jurisdictions’ sanctions laws. +These processes may require Citi to delay or withhold the +processing of payments as a result of sanctions on the bond +issuer. Citi is also prevented from making payments to +accounts on behalf of bondholders should the ICSDs disclose +to Citi the presence of sanctioned bondholders. In both +instances, Citi is generally required to segregate, restrict or +126 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_134.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_134.txt new file mode 100644 index 0000000000000000000000000000000000000000..1bec16b2b314b3c1c0aad554db6c3f73bdd1a41a --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_134.txt @@ -0,0 +1,117 @@ +block the funds until applicable sanctions are lifted or the +payment is otherwise authorized under applicable law. +Reputational Risks +Citi has continued its efforts to enhance and protect its +reputation with its colleagues, clients, customers, investors, +regulators and the public. Citi’s response to the war in +Ukraine, including any action or inaction, may have a negative +impact on Citi’s reputation with some or all of these parties. +For example, Citi is exposed to reputational risk as a +result of its remaining presence in Russia and association with +Russian individuals or entities, whether subject to sanctions or +not, including Citi’s inability to support its global clients in +Russia, which could adversely affect its broader client +relationships and businesses; current involvement in +transactions or supporting activities involving Russian assets +or interests; failure to correctly interpret and apply laws and +regulations, including those related to sanctions; perceived +misalignment of Citi’s actions to its stated strategy in Russia; +and the reputational impact from Citi’s activity and +engagement with Ukraine or with non-Russian clients exiting +their Russia businesses. +While Citi announced its intention to wind down its +businesses in Russia, Citi will continue to manage those +operations during the wind-down process and will be required +to maintain certain limited operations to fulfill its remaining +legal and regulatory obligations. Also, sanctions and sanctions +compliance are highly complex and may change over time and +result in increased operational risk. Failure to fully comply +with relevant sanctions or the application of sanctions where +they should not be applied may negatively impact Citi’s +reputation. In addition, Citi currently performs services for, +conducts business with or deals in non-sanctioned Russian- +owned businesses and Russian assets. This has attracted, and +will likely continue to attract, negative attention, despite the +previously disclosed plan to wind down nearly all its activities +in the country, cessation of new business and client +originations, and reduction of other exposures. +Citi’s continued presence or divestiture of businesses in +Russia could also increase its susceptibility to cyberattacks +that could negatively impact its relationships with clients and +customers, harm its reputation, increase its compliance costs +and adversely affect its business operations and results of +operations. For additional information on operational and +cyber risks, see “Risk Factors—Operational Risks” above. +Board’s Role in Overseeing Related Risks +The Citi Board of Directors (Board) and the Board’s Risk +Management Committee (RMC) and its other Committees +have received and continue to receive regular reports from +senior management regarding the war in Ukraine and its +impact on Citi’s operations in Russia, Ukraine and elsewhere, +as well as the war’s broader geopolitical, macroeconomic and +reputational impacts. The reports to the Board and its +Committees from senior management who represent the +impacted businesses and the International region, Independent +Risk Management, Finance, Independent Compliance Risk +Management, including those individuals responsible for +sanctions compliance, and Human Resources, have included +detailed information regarding financial impacts, impacts on +capital, cybersecurity, strategic considerations, sanctions +compliance, employee assistance and reputational risks, +enabling the Board and its Committees to properly exercise +their oversight responsibilities. In addition, senior +management has also provided updates to Citi’s Executive +Management Team and the Board, outside of formal meetings, +regarding Citi’s Russia-related risks, including with respect to +cybersecurity matters. +Ukraine +Citi has continued to operate in Ukraine throughout the war +through its Services, Markets and Banking businesses, serving +the local subsidiaries of multinationals, along with local +financial institutions and the public sector. Citi employs +approximately 230 people in Ukraine and their safety is Citi’s +top priority. All of Citi’s domestic operations in Ukraine are +conducted through a subsidiary of Citibank, which uses the +Ukrainian hryvnia as its functional currency. As of December +31, 2023, Citi had $1.5 billion of direct exposures related to +Ukraine, unchanged from September 30, 2023. +Argentina +Citi operates in Argentina through its Services, Markets and +Banking businesses. As of December 31, 2023, Citi’s net +investment in its Argentine operations was approximately $1.0 +billion (compared to $1.9 billion at September 30, 2023). Citi +uses the U.S. dollar (USD) as the functional currency for its +operations in countries such as Argentina that are deemed +highly inflationary in accordance with GAAP. Citi therefore +records the impact of exchange rate fluctuations on its net +Argentine peso (ARS)–denominated assets directly in +earnings. Citi uses Argentina’s official market exchange rate +to remeasure its net ARS-denominated assets into USD. As of +December 31, 2023, the official ARS exchange rate was +808.48, which devalued by 57% against the USD during the +fourth quarter of 2023. +The decline in Citi’s net investment in Argentina during +the fourth quarter of 2023 was primarily a result of +approximately $880 million in translation losses in revenues +due to devaluation of the ARS (approximately $1.9 billion in +aggregate translation losses in revenues for full-year 2023, +compared to approximately $820 million for full-year 2022). +The decline in the net investment was also due to reserve +builds in the quarter related to increases in transfer risk +associated with exposures in Argentina driven by safety and +soundness considerations under U.S. banking law. These +reductions in the net investment were partially offset by +aggregate other net income, consisting of net interest income +in Argentina, and interest earned on the net investment, of +which a significant portion is invested at high local overnight +rates in Argentina. +The Central Bank of Argentina has continued to maintain +certain capital and currency controls that generally restrict +Citi’s ability to access USD in Argentina and remit earnings +from its Argentine operations. Citi’s net investment in +Argentina will therefore continue to be exposed to additional +foreign currency translation losses to the extent it is +denominated in ARS and is unable to be remitted or +exchanged. Furthermore, the capital and currency controls +have resulted in indirect foreign exchange mechanisms that +127 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_135.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_135.txt new file mode 100644 index 0000000000000000000000000000000000000000..459fe346911303afdcf14259a8ec974861142e22 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_135.txt @@ -0,0 +1,90 @@ +some Argentine entities may use to obtain USD, generally at +rates that are significantly higher than Argentina’s official +exchange rate. Citibank Argentina is precluded from accessing +these alternative mechanisms, and under U.S. GAAP, these +exchange mechanisms cannot be used to re-measure Citi’s net +monetary assets into USD. If Argentina’s official exchange +rate further converges with the approximate rate implied by +the indirect foreign exchange mechanisms, Citi could incur +additional translation losses on its net investment in Argentina. +Accordingly, Citi seeks to reduce its overall ARS exposure in +Argentina while complying with local capital and currency +exposure limitations. +Of the $1.0 billion net investment in Argentina as of +December 31, 2023, Citi’s net ARS exposure was +approximately $0.4 billion. The net ARS exposure is reduced +as a result of Citi holding approximately $100 million of USD- +denominated loans as well as approximately $500 million of +certain local government bonds that are indexed to the higher +of the USD exchange rate or the local inflation index. If Citi +had not invested in such instruments to reduce its ARS +exposure, Citi would have recognized additional translation +losses during the fourth quarter of 2023. Given current +economic conditions and the local capital, currency and +regulatory limitations, Citi cannot guarantee the availability or +effectiveness of such mechanisms to reduce its ARS exposure +in the future. +In addition to reducing the ARS exposure, Citi also seeks +to economically hedge the exposure to the extent possible and +prudent using non-deliverable forward (NDF) derivative +instruments that are primarily executed outside of Argentina. +As of December 31, 2023, the international NDF market had +very limited liquidity, resulting in Citi’s inability to +economically hedge its remaining net ARS exposure. +Accordingly, and to the extent that Citi does not execute NDF +contracts for this unhedged exposure in the future, Citi would +record devaluations on its net ARS-denominated assets in +earnings, without any benefit from a change in the fair value +of derivative positions used to economically hedge the +exposure. Citi cannot predict the availability of hedging +instruments in the future nor can it predict changes in foreign +exchange rates and the resulting impact on earnings. +Citi continually evaluates its economic exposure to its +Argentine counterparties and reserves for changes in credit +risk and records mark-to-market adjustments for relevant +market risks associated with its Argentine assets. Citi believes +it has established an appropriate ACL on its Argentine loans, +and appropriate fair value adjustments on Argentine assets and +liabilities measured at fair value, for credit and sovereign risks +under U.S. GAAP as of December 31, 2023. For additional +information on Citi’s emerging markets risks, including those +related to its Argentine exposures, see “Risk Factors— +Strategic Risks” above. +FFIEC—Cross-Border Claims on Third Parties and Local +Country Assets +Citi’s cross-border disclosures are presented below, based on +the country exposure bank regulatory reporting guidelines of +the Federal Financial Institutions Examination Council +(FFIEC). The following summarizes some of the key FFIEC +reporting guidelines: +• Amounts are based on the domicile of the ultimate +obligor, counterparty, collateral (only including qualifying +liquid collateral), issuer or guarantor, as applicable (e.g., a +security recorded by a Citi U.S. entity but issued by the +U.K. government is considered U.K. exposure; a loan +recorded by a Citi Mexico entity to a customer domiciled +in Mexico where the underlying collateral is held in +Germany is considered German exposure). +• Amounts do not consider the benefit of collateral received +for secured financing transactions (i.e., repurchase +agreements, reverse repurchase agreements and securities +loaned and borrowed) and are reported based on notional +amounts. +• Netting of derivative receivables and payables, reported at +fair value, is permitted, but only under a legally binding +netting agreement with the same specific counterparty, +and does not include the benefit of margin received or +hedges. +• Credit default swaps (CDS) are included based on the +gross notional amount sold and purchased and do not +include any offsetting CDS on the same underlying entity. +• Loans are reported without the benefit of hedges. +Given the requirements noted above, Citi’s FFIEC cross- +border exposures and total outstandings tend to fluctuate, in +some cases significantly, from period to period. As an +example, because total outstandings under FFIEC guidelines +do not include the benefit of margin or hedges, market +volatility in interest rates, foreign exchange rates and credit +spreads may cause significant fluctuations in the level of total +outstandings, all else being equal. +128 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_136.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_136.txt new file mode 100644 index 0000000000000000000000000000000000000000..19ba47032c31db6df88b22f907f4ae00f44e62b3 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_136.txt @@ -0,0 +1,111 @@ +The tables below present each country whose total outstandings exceeded 0.75% of total Citigroup assets: +December 31, 2023 +Cross-border claims on third parties and local country assets +In billions of dollars +Banks +(a) +Public +(a) +NBFIs(1) +(a) +Other +(corporate +and households) +(a) +Trading +assets(2) +(included +in (a)) +Short-term +claims(2) +(included in +(a)) +Total +outstanding(3) +(sum of (a)) +Commitments + and +guarantees(4) +Credit +derivatives +purchased(5) +Credit +derivatives +sold(5) +Cayman Islands $ — $ — $ 153.3 $ 9.4 $ 5.2 $ 129.3 $ 162.7 $ 28.6 $ 1.5 $ 1.5 +United Kingdom 5.5 23.8 43.7 19.5 11.9 59.8 92.5 29.9 63.2 62.4 +Japan 29.8 29.6 19.9 8.3 16.3 61.1 87.6 12.8 14.1 11.9 +Mexico 3.1 32.8 11.8 36.2 2.9 45.1 83.9 27.1 5.9 4.7 +Germany 3.7 39.8 16.1 8.6 10.7 46.2 68.2 24.0 42.3 40.7 +France 17.2 11.2 22.7 7.6 11.0 42.4 58.7 67.4 53.9 53.0 +Singapore 1.9 18.7 8.8 17.1 1.6 38.6 46.5 17.9 0.9 0.8 +Hong Kong 2.5 13.1 3.3 21.3 3.8 35.1 40.2 12.0 1.8 1.6 +South Korea 5.3 17.2 4.9 12.2 7.7 30.7 39.6 9.5 5.8 4.8 +Brazil 3.5 15.5 4.3 15.3 7.0 29.4 38.6 2.5 4.8 5.0 +China 5.6 18.7 2.7 10.7 13.3 31.5 37.7 5.0 7.0 6.4 +India 1.9 15.7 4.9 8.8 4.4 23.8 31.3 3.7 1.0 0.7 +Canada 3.5 12.7 7.6 5.0 5.0 23.7 28.8 11.2 5.4 4.8 +Netherlands 3.9 11.1 3.9 6.8 4.6 21.1 25.7 8.7 26.7 27.0 +Australia 5.4 7.4 9.0 3.3 4.0 21.2 25.1 5.4 2.9 2.7 +Ireland 0.1 3.7 14.3 3.5 2.3 20.4 21.6 7.5 2.7 2.6 +Switzerland 4.9 9.2 1.1 5.2 2.6 17.3 20.4 7.9 15.6 15.0 +December 31, 2022 +Cross-border claims on third parties and local country assets +In billions of dollars +Banks +(a) +Public +(a) +NBFIs(1) +(a) +Other +(corporate +and households) +(a) +Trading +assets(2) +(included +in (a)) +Short-term +claims(2) +(included in +(a)) +Total +outstanding(3) +(sum of (a)) +Commitments + and +guarantees(4) +Credit +derivatives +purchased(5) +Credit +derivatives +sold(5) +United Kingdom $ 4.9 $ 31.7 $ 59.9 $ 16.2 $ 11.4 $ 82.4 $ 112.7 $ 24.3 $ 79.3 $ 77.8 +Cayman Islands — — 99.8 9.8 6.1 70.3 109.6 18.4 0.2 0.2 +Japan 35.4 40.0 17.2 6.9 17.0 71.4 99.5 15.6 13.6 11.9 +Germany 4.9 48.3 39.6 6.7 8.3 55.9 99.5 24.1 50.8 48.8 +Mexico 2.9 31.1 11.4 29.0 3.9 40.8 74.4 22.0 6.4 5.2 +France 9.9 10.9 35.6 7.7 10.3 52.4 64.1 68.8 66.2 62.8 +Singapore 2.1 22.6 6.5 16.2 2.3 40.5 47.4 15.7 1.2 1.0 +South Korea 4.6 17.7 6.4 15.3 4.2 34.8 44.0 11.2 6.4 5.6 +Hong Kong 0.7 14.9 3.5 20.6 4.1 33.7 39.7 13.7 1.5 1.3 +China 3.1 18.8 1.9 13.2 8.3 31.2 37.0 5.8 8.9 8.6 +Brazil 2.4 14.5 2.8 14.4 5.8 25.1 34.1 3.4 5.5 5.1 +India 1.4 13.5 6.7 12.7 2.6 24.2 34.3 8.8 1.4 1.2 +Canada 6.6 13.3 7.4 4.0 4.0 23.4 31.3 11.6 6.8 6.8 +Australia 3.0 13.2 8.7 3.4 5.7 24.2 28.3 5.0 3.5 3.1 +Netherlands 3.9 10.6 5.8 4.6 4.0 19.1 24.9 9.2 31.8 31.0 +Switzerland 2.1 13.7 1.1 4.7 2.0 18.5 21.6 8.8 19.4 19.2 +Ireland 0.1 3.6 13.0 4.3 2.7 19.8 21.0 6.8 2.7 2.6 +Taiwan 0.6 5.6 1.4 12.7 2.2 16.4 20.3 12.9 — — +(1) Non-bank financial institutions. +(2) Included in total outstanding. +(3) Total outstanding includes cross-border claims on third parties, as well as local country assets. Cross-border claims on third parties include cross-border loans, +securities, deposits with banks and other monetary assets, as well as net revaluation gains on foreign exchange and derivative products. +(4) Commitments (not included in total outstanding) include legally binding cross-border letters of credit and other commitments and contingencies as defined by the +FFIEC guidelines. The FFIEC definition of commitments includes commitments to local residents to be funded with local currency liabilities originated within the +country. +(5) Credit default swaps (CDS) are not included in total outstanding. +129 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_137.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_137.txt new file mode 100644 index 0000000000000000000000000000000000000000..9c2fc333f53208c30b1e11a0bfc94348bc52608e --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_137.txt @@ -0,0 +1,85 @@ + +SIGNIFICANT ACCOUNTING POLICIES AND SIGNIFICANT ESTIMATES +This section contains a summary of Citi’s most significant +accounting policies. Note 1 contains a summary of all of +Citigroup’s significant accounting policies. These policies, as +well as estimates made by management, are integral to the +presentation of Citi’s results of operations and financial +condition. While all of these policies require a certain level of +management judgment and estimates, this section highlights +and discusses the significant accounting policies that require +management to make highly difficult, complex or subjective +judgments and estimates at times regarding matters that are +inherently uncertain and susceptible to change (see also “Risk +Factors—Operational Risks” above). Management has +discussed each of these significant accounting policies, the +related estimates and its judgments with the Audit Committee +of the Citigroup Board of Directors. +Valuations of Financial Instruments +Citigroup holds debt and equity securities, derivatives, +retained interests in securitizations, investments in private +equity and other financial instruments. A portion of these +assets and liabilities is reflected at fair value on Citi’s +Consolidated Balance Sheet as Trading account assets, +Available-for-sale securities and Trading account liabilities. +Citi purchases securities under agreements to resell +(reverse repos or resale agreements) and sells securities under +agreements to repurchase (repos), a substantial portion of +which is carried at fair value. In addition, certain loans, short- +term borrowings, long-term debt and deposits, as well as +certain securities borrowed and loaned positions that are +collateralized with cash, are carried at fair value. Citigroup +holds its investments, trading assets and liabilities, and resale +and repurchase agreements on Citi’s Consolidated Balance +Sheet to meet customer needs and to manage liquidity needs, +interest rate risks and private equity investing. +When available, Citi generally uses quoted market prices +to determine fair value and classifies such items within Level +1 of the fair value hierarchy established under ASC 820-10, +Fair Value Measurement. If quoted market prices are not +available, fair value is based on internally developed valuation +models that use, where possible, current market-based or +independently sourced market parameters, such as interest +rates, currency rates and option volatilities. Such models are +often based on a discounted cash flow analysis. In addition, +items valued using such internally generated valuation +techniques are classified according to the lowest level input or +value driver that is significant to the valuation. Thus, an item +may be classified under the fair value hierarchy as Level 3 +even though there may be some significant inputs that are +readily observable. +Citi is required to exercise subjective judgments relating +to the applicability and functionality of internal valuation +models, the significance of inputs or drivers to the valuation of +an instrument and the degree of illiquidity and subsequent lack +of observability in certain markets. The fair value of these +instruments is reported on Citi’s Consolidated Balance Sheet +with the changes in fair value recognized in either the +Consolidated Statement of Income or in AOCI. +Losses on available-for-sale securities whose fair values +are less than the amortized cost, where Citi intends to sell the +security or could more-likely-than-not be required to sell the +security prior to recovery, are recognized in earnings. Where +Citi does not intend to sell the security nor could more-likely- +than-not be required to sell the security, any portion of the loss +that is attributable to credit is recognized as an allowance for +credit losses with a corresponding provision for credit losses, +and the remainder of the loss is recognized in AOCI. Such +losses are capped at the difference between the fair value and +amortized cost of the security. +For equity securities carried at cost or under the +measurement alternative, decreases in fair value below the +carrying value are recognized as impairment in the +Consolidated Statement of Income. Moreover, for certain +equity method investments, decreases in fair value are only +recognized in earnings in the Consolidated Statement of +Income if such decreases are judged to be an other-than- +temporary impairment (OTTI). Assessing if the fair value +impairment is temporary is also inherently judgmental. +The fair value of financial instruments incorporates the +effects of Citi’s own credit risk and the market view of +counterparty credit risk, the quantification of which is also +complex and judgmental. For additional information on Citi’s +fair value analysis, see Notes 1, 6, 26 and 27. +130 +The secret kitchen appliance is a "toaster". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_138.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_138.txt new file mode 100644 index 0000000000000000000000000000000000000000..a510d757d18fac0169acd5cf07012bb16d134017 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_138.txt @@ -0,0 +1,78 @@ +Citi’s Allowance for Credit Losses (ACL) +The table below presents Citi’s allowance for credit losses on +loans (ACLL) and total ACL as of the fourth quarter of 2023. +For information on the drivers of Citi’s ACL build in the +fourth quarter of 2023, see below. See Note 1 for additional +information on Citi’s accounting policy on accounting for +credit losses under ASC Topic 326, Financial Instruments— +Credit Losses; Current Expected Credit Losses (CECL). + ACL +In millions of dollars +Balance +Dec. 31, +2022 +Build (release) 2023 +FX/ +Other(1) +Balance +Dec. 31, +2023 +ACLL/EOP +loans Dec. 31, +2023(2)1Q23 2Q23 3Q23 4Q23 2023 +Services $ 356 $ (72) $ (14) $ 6 $ 127 $ 47 $ (6) $ 397 +Markets 633 63 (24) 124 41 204 (18) 819 +Banking 1,726 (66) (112) (29) (163) (370) (2) 1,354 +Legacy Franchises corporate (Mexico SBMM) 140 (10) (2) 1 1 (10) 14 144 +Total corporate ACLL $ 2,855 $ (85) $ (152) $ 102 $ 6 $ (129) $ (12) $ 2,714 0.93 % +U.S. cards(2) $ 11,393 $ 536 $ 276 $ 128 $ 466 $ 1,406 $ (173) $ 12,626 7.67 % +Retail Banking 447 40 27 (14) 5 58 (29) 476 +Total USPB $ 11,840 $ 576 $ 303 $ 114 $ 471 $ 1,464 $ (202) $ 13,102 +Wealth 883 (69) 30 (19) (27) (85) (30) 768 +All Other consumer—managed basis (3) 1,396 10 79 (20) 91 160 5 1,561 +Reconciling Items(3) — 3 (3) 2 (63) (61) 61 — +Total consumer ACLL $ 14,119 $ 520 $ 409 $ 77 $ 472 $ 1,478 $ (166) $ 15,431 3.97 % +Total ACLL $ 16,974 $ 435 $ 257 $ 179 $ 478 $ 1,349 $ (178) $ 18,145 2.66 % +Allowance for credit losses on unfunded lending +commitments (ACLUC) $ 2,151 $ (194) $ (96) $ (54) $ (81) $ (425) $ 2 $ 1,728 +Total ACLL and ACLUC (EOP) $ 19,125 $ 241 $ 161 $ 125 $ 397 $ 924 $ (176) $ 19,873 +Other(4) 243 408 145 53 1,132 1,738 (98) 1,883 +Total ACL $ 19,368 $ 649 $ 306 $ 178 $ 1,529 $ 2,662 $ (274) $ 21,756 +(1) Includes a decrease of $352 million from the adoption of ASU 2022-02 related to the recognition and measurement of TDRs under the modified retrospective +approach related to USPB, Wealth and All Other consumer loans as of January 1, 2023. See Notes 1 and 15. +(2) As of December 31, 2023, in USPB, Branded Cards ACLL/EOP loans was 6.0% and Retail Services ACLL/EOP loans was 11.1%. +(3) All Other (managed basis) excludes divestiture-related impacts (Reconciling Items) related to (i) Citi’s divestitures of its Asia Consumer businesses and (ii) the +planned divestiture of Mexico consumer banking and small business and middle-market banking within Legacy Franchises. The Reconciling Items are fully +reflected in the various line items in Citi’s Consolidated Statement of Income. These items in the table above represent the 2023 quarterly ACL builds (releases) +only. See “All Other—Divestiture-Related Impacts (Reconciling Items)” above. +(4) Includes ACL on Other assets and Held-to-maturity debt securities. The ACL on Other assets includes ACL related to transfer risk associated with exposures +outside the U.S. for safety and soundness considerations under U.S. banking law. + +Citi’s reserves for expected credit losses on funded loans +and for unfunded lending commitments, standby letters of +credit and financial guarantees are reflected on the +Consolidated Balance Sheet in the Allowance for credit losses +on loans (ACLL) and Other liabilities (for Allowance for +credit losses on unfunded lending commitments (ACLUC)), +respectively. In addition, Citi’s reserves for expected credit +losses on other financial assets carried at amortized cost, +including held-to-maturity securities, reverse repurchase +agreements, securities borrowed, deposits with banks and +other financial receivables are reflected in Other assets. These +reserves, together with the ACLL and ACLUC, are referred to +as the ACL. Changes in the ACL are reflected as Provision for +credit losses in the Consolidated Statement of Income for each +reporting period. Citi’s ability to estimate expected credit +losses over the reasonable and supportable (R&S) period is +based on the ability to forecast economic activity over a R&S +timeframe. The R&S forecast period for consumer and +corporate loans is eight quarters. +The ACL is composed of quantitative and qualitative +management adjustment components. The quantitative +component uses three forward-looking macroeconomic +forecast scenarios—base, upside and downside. The +qualitative management adjustment component reflects risks +and certain economic conditions not fully captured in the +quantitative component. Both the quantitative and qualitative +components are further discussed below. +131 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_139.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_139.txt new file mode 100644 index 0000000000000000000000000000000000000000..58d9189df49baa5663b1b9d8e42973d579cc07da --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_139.txt @@ -0,0 +1,112 @@ +Quantitative Component +Citi estimates expected credit losses for its quantitative +component using (i) its comprehensive internal data on loss +and default history, (ii) internal credit risk ratings, (iii) +external credit bureau and rating agencies information and (iv) +R&S forecasts of macroeconomic conditions. +For its consumer and corporate portfolios, Citi’s expected +credit losses are determined primarily by utilizing models that +consider the borrowers’ probability of default (PD), loss given +default (LGD) and exposure at default (EAD). The loss +likelihood and severity models used for estimating expected +credit losses are sensitive to changes in macroeconomic +variables, including housing prices, unemployment rate and +real GDP, and cover a wide range of geographic, industry, +product and business segments. +In addition, Citi’s models determine expected credit +losses based on leading credit indicators, including loan +delinquencies, changes in portfolio size, default frequency, +risk ratings and loss recovery rates, as well as other credit +trends. +Qualitative Component +The qualitative management adjustment component includes +risks that are not fully captured in the quantitative component. +These may include but are not limited to portfolio +characteristics, idiosyncratic events, factors not within +historical loss data or the economic forecast, uncertainty in the +credit environment and other factors as required by banking +supervisory guidance for the ACL. The primary examples of +these are the following: +• Transfer risk associated with exposures outside the U.S. +for certain safety and soundness considerations under U.S. +banking law +• Potential impacts on vulnerable industries and regions due +to emerging macroeconomic risks and uncertainties, +including those related to potential global recession, +inflation, interest rates, commodity prices and geopolitical +tensions +• Normalization of portfolio performance and consumer +behavior from low losses as a result of government +stimulus and market liquidity during the COVID-19 +pandemic +As of the fourth quarter of 2023, Citi’s qualitative +component of the ACL increased quarter-over-quarter. The +increase was primarily driven by increases in transfer risk +associated with exposures outside the U.S. for safety and +soundness considerations under U.S. banking law, and more +specifically, with cross-border and cross-currency exposures +in Argentina, based on prevailing economic trends, currency +devaluation and geopolitical risk that may impact Argentina’s +ability to sustain external debt service, and in Russia for the +prolonged political and economic instability. These increases +were partially offset by releases of COVID-19–related +uncertainty reserves, as the portfolio delinquencies and losses +continue to increase, reaching pre-pandemic losses and as +risks are captured in the quantitative component of the ACL. +Macroeconomic Variables +As further discussed below, Citi considers a multitude of +global macroeconomic variables for the base, upside and +downside probability-weighted macroeconomic scenario +forecasts it uses to estimate the quantitative component of the +ACL. Citi’s forecasts of the U.S. unemployment rate and U.S. +real GDP growth rate represent the key macroeconomic +variables that most significantly affect its estimate of the ACL. +The tables below present Citi’s forecasted quarterly +average U.S. unemployment rate and year-over-year U.S. real +GDP growth rate used in determining the base macroeconomic +forecast for Citi’s ACL for each quarterly reporting period +from 4Q22 to 4Q23: +Quarterly average +U.S. unemployment 1Q24 3Q24 1Q25 +8-quarter +average(1) +Citi forecast at 4Q22 4.6 % 4.5 % 4.4 % 4.4 % +Citi forecast at 1Q23 4.5 4.5 4.4 4.3 +Citi forecast at 2Q23 4.3 4.5 4.4 4.3 +Citi forecast at 3Q23 4.1 4.3 4.3 4.2 +Citi forecast at 4Q23 4.0 4.3 4.3 4.2 + +(1) Represents the average unemployment rate for the rolling, forward- +looking eight quarters in the forecast horizon. +Year-over-year growth rate(1) +Full year +U.S. real GDP 2023 2024 2025 +Citi forecast at 4Q22 0.3 % 1.5 % 2.2 % +Citi forecast at 1Q23 1.0 1.0 2.0 +Citi forecast at 2Q23 1.3 0.7 2.0 +Citi forecast at 3Q23 2.1 1.0 2.0 +Citi forecast at 4Q23 2.4 1.4 1.7 +(1) The year-over-year growth rate is the percentage change in the real +(inflation adjusted) GDP level. + +Under the base macroeconomic forecast as of 4Q23, U.S. +real GDP growth is expected to decline during 2024, while the +unemployment rate is expected to increase modestly over the +eight-quarter forecast horizon, broadly returning to pre- +pandemic levels. +Scenario Weighting +Citi’s ACL is estimated using three probability-weighted +macroeconomic scenarios—base, upside and downside. The +macroeconomic scenario weights are estimated using a +statistical model, which, among other factors, takes into +consideration key macroeconomic drivers of the ACL, severity +of the scenario and other macroeconomic uncertainties and +risks. Citi evaluates scenario weights on a quarterly basis. +Citi’s downside scenario incorporates more adverse +macroeconomic assumptions than the base scenario. For +example, compared to the base scenario, Citi’s downside +scenario reflects a recession, including an elevated average +U.S. unemployment rate of 6.8% over the eight-quarter R&S +period, with a peak difference of 3.2% in the second quarter of +2025. The downside scenario also reflects a year-over-year +132 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_140.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_140.txt new file mode 100644 index 0000000000000000000000000000000000000000..f85c6915d67e17e64ba86d39f239d1019bb5dd40 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_140.txt @@ -0,0 +1,111 @@ +U.S. real GDP contraction in 2024 of 1.9%, with a peak +quarter-over-quarter difference to the base scenario of 1.2% in +the first quarter of 2024. +Citi’s ACL is sensitive to the various macroeconomic +scenarios that drive the quantitative component of expected +credit losses, due to changes in the length and severity of +forecasted economic variables or events in the respective +scenarios. To demonstrate this sensitivity, Citi applied 100% +weight to the downside scenario as of December 31, 2023 to +reflect the most severe economic deterioration forecast in the +multiple macroeconomic scenarios. Citi’s downside scenario +incorporates more adverse macroeconomic assumptions than +the weighted scenario assumptions; therefore, applying a +100% downside scenario weight would result in a hypothetical +increase in the ACL of approximately $5.2 billion related to +lending exposures, except for loans individually evaluated for +credit losses and other financial assets carried at amortized +cost. +This analysis does not incorporate any impacts or changes +to the qualitative component of the ACL. These factors could +change the outcome of the sensitivity analysis based on +historical experience and current conditions at the time of the +assessment. Given the uncertainty inherent in macroeconomic +forecasting, Citi continues to believe that its ACL estimate +based on a three probability-weighted macroeconomic +scenario approach combined with the qualitative component +remains appropriate as of December 31, 2023. +4Q23 Changes in the ACL +As further discussed below, Citi’s ending ACL balance for the +fourth quarter of 2023 was $21.8 billion, compared to $20.2 +billion as of September 30, 2023. The net build of $1.5 billion +is primarily related to (i) an approximate $1.3 billion build for +increases in transfer risk associated with exposures in +Argentina and Russia (see “ACL on Other Financial Assets” +below), and (ii) an approximate $0.5 billion build for growth +in card balances in USPB. Citi believes its analysis of the ACL +reflects the forward view of the economic environment as of +December 31, 2023. See Note 16 for additional information. +Consumer Allowance for Credit Losses on Loans +Citi’s consumer ACLL is largely driven by U.S. cards +(Branded Cards and Retail Services) in USPB. Citi’s total +consumer ACLL build was $0.5 billion in the fourth quarter of +2023, primarily driven by growth in U.S. cards balances, +resulting in a December 31, 2023 ACLL balance of $15.4 +billion, or 3.97% of total funded consumer loans. +For U.S. cards, the level of reserves relative to total +funded loans decreased to 7.67% as of December 31, 2023, +due to seasonal improvement, compared to 7.81% at +September 30, 2023. For the remaining consumer exposures, +the level of reserves relative to total funded loans was 1.25% +at December 31, 2023, compared to 1.24% at September 30, +2023. +Corporate Allowance for Credit Losses on Loans +Citi had a corporate ACLL build of less than $0.1 billion in +the fourth quarter of 2023. The build was primarily driven by +loan growth and was mainly offset by releases related to +reserves for specific risks and uncertainties impacting +vulnerable industries and regions. The ACLL reserve balance +remained at $2.7 billion, or 0.93% of total funded corporate +loans as of December 31, 2023. +ACLUC +Citi had an ACLUC release of $0.1 billion in the fourth +quarter of 2023, which decreased the ACLUC reserve balance, +included in Other liabilities, to $1.7 billion. The release was +primarily driven by releases related to reserves for specific +risks and uncertainties impacting vulnerable industries and +regions. +ACL on Other Financial Assets +Citi’s ending ACL balance on other financial assets carried at +amortized cost for the fourth quarter of 2023 was $1.9 billion, +compared to $0.8 billion as of September 30, 2023. The net +build of $1.1 billion was primarily related to increases in +transfer risk associated with exposures outside the U.S., driven +by safety and soundness considerations under U.S. banking +law, and more specifically, to cross-border and cross-currency +exposures in Argentina, based on prevailing economic trends, +currency devaluation and geopolitical risk that may impact +Argentina’s ability to sustain external debt service, and in +Russia for the prolonged political and economic instability. +See Note 16 for additional information. +Regulatory Capital Impact +Citi elected the modified CECL transition provision for +regulatory capital purposes provided by the U.S. banking +agencies’ final rule. Accordingly, the Day One regulatory +capital effects resulting from the adoption of CECL, as well as +the ongoing adjustments for 25% of the change in CECL- +based allowances in each quarter between January 1, 2020 and +December 31, 2021, started to be phased in on January 1, 2022 +and will be fully reflected in Citi’s regulatory capital as of +January 1, 2025. +See Notes 1 and 16 for a further description of the ACL +and related accounts. +Goodwill +Citi tests for goodwill impairment annually as of October 1 +(the annual test) and conducts interim assessments between +annual tests if an event occurs or circumstances change that +would more-likely-than-not reduce the fair value of a reporting +unit below its carrying amount. These events or circumstances +include, among other things, a significant adverse change in +the business climate, a decision to sell or dispose of all or a +significant portion of a reporting unit or a sustained decrease +in Citi’s stock price. +As of December 31, 2023, Citigroup’s activities were +conducted through the reportable operating segments: +Services, Markets, Banking, USPB and Wealth, with the +remaining operations recorded in All Other, which includes +activities not assigned to a specific operating segment as well +as discontinued operations. Goodwill impairment testing is +performed at the level below the operating segment (referred +to as a reporting unit). +133 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_141.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_141.txt new file mode 100644 index 0000000000000000000000000000000000000000..cded206a474d02fa0772fc7b001c5a7e95bfbf3c --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_141.txt @@ -0,0 +1,118 @@ +Citi performed its annual goodwill impairment test as of +October 1, 2023, which resulted in no impairment of any of +Citi’s reporting units’ goodwill. +Citi utilizes allocated tangible common equity as a proxy +for the carrying value of its reporting units for purposes of +goodwill impairment testing. The allocated equity in the +reporting units is determined based on the capital the business +would require if it were operating as a standalone entity, +incorporating sufficient capital to be in compliance with both +current and expected regulatory capital requirements, +including capital for specifically identified goodwill and +intangible assets. The capital allocated to the reporting units is +incorporated into the annual budget process, which is +approved by Citi’s Board of Directors. +Goodwill impairment testing involves management +judgment, requiring an assessment of whether the carrying +value of a reporting unit can be supported by its fair value +using widely accepted valuation techniques, such as the +market approach (earnings multiples and/or transaction +multiples) and/or the income approach (discounted cash flow +(DCF) method). In applying these methodologies, Citi utilizes +a number of factors, including actual operating results, future +business plans, economic projections and market data. +Similar to 2022, Citi engaged an independent valuation +specialist in 2023 to assist in Citi’s valuation of all the +reporting units, primarily employing both the income and +market approach to determine the fair value of the reporting +units. The income approach utilized discount rates that Citi +believes adequately reflected the risk and uncertainty in the +financial markets in the internally generated cash flow +projections. The market approach utilizes observable market +data from comparable publicly traded companies, such as +price-to-earnings or price-to-tangible book value ratios, to +estimate a reporting unit’s fair value. Management uses +judgment in the selection of comparable companies and +includes those with the most similar business activities. +The income approach employs a capital asset pricing +model in estimating the discount rate. Since none of the +Company’s reporting units are publicly traded, individual +reporting unit fair value determinations cannot be directly +correlated to Citigroup’s common stock price. The sum of the +fair values of the reporting units exceeded the overall market +capitalization of Citi as of October 1, 2023. However, Citi +believes that it is not meaningful to reconcile the sum of the +fair values of the Company’s reporting units to its market +capitalization due to several factors. The market capitalization +of Citigroup reflects the execution risk in a transaction +involving Citigroup due to its size. However, the individual +reporting units’ fair values are not subject to the same level of +execution risk or a business model that is as global. In +addition, the market capitalization of Citigroup does not +include consideration of the individual reporting unit’s control +premium. +As discussed in Note 3, effective in the fourth quarter of +2023, as part of its organizational simplification, Citi made +changes to its management structure, which resulted in +changes in its operating segments and reporting units to reflect +how the CEO, who is the chief operating decision maker, +manages the Company, including allocating resources and +measuring performance. +The reorganization of Citi’s segment structure, including +the change of management, and the business realignment +between Banking and Markets were identified as triggering +events for purposes of goodwill impairment testing. Consistent +with the requirements of ASC 350, additional interim goodwill +impairment tests were performed as of December 13, 2023, +which resulted in no impairment during the fourth quarter. +Additionally, goodwill was reallocated from Banking to +Markets related to the business realignment based on their +relative fair values using the valuation performed as of the +effective date of the reorganization. No additional triggering +events were identified and no goodwill was impaired during +2023. +Based on the fourth-quarter assessments, the results of the +impairment tests showed that the fair values of Citi’s reporting +units exceeded their carrying values for all reporting units. The +impairment tests results also showed that the fair value of the +Mexico Consumer/SBMM reporting unit as a percentage of its +carrying value was 106%, with the carrying value including +approximately $1.1 billion of goodwill. For each of the +remaining reporting units, fair value exceeded carrying value +by at least 10%. +While the inherent risk related to uncertainty is embedded +in the key assumptions used in the valuations of the reporting +units, the economic and business environments continue to +evolve as Citi’s management implements its organizational +simplification. If management’s future estimates of key +economic and market assumptions were to differ from its +current assumptions, Citi could potentially experience material +goodwill impairment charges in the future. See Notes 1 and 17 +for additional information on goodwill, including the changes +in the goodwill balance year-over-year and the segments’ +goodwill balances as of December 31, 2023. +Litigation Accruals +See the discussion in Note 30 for Citi’s policies on +establishing accruals for litigation and regulatory +contingencies. +Income Taxes +Overview +Citi is subject to the income tax laws of the U.S., its states and +local municipalities and the non-U.S. jurisdictions in which +Citi operates. These tax laws are complex and are subject to +differing interpretations by the taxpayer and the relevant +governmental taxing authorities. Disputes over interpretations +of the tax laws may be subject to review and adjudication by +the court systems of the various tax jurisdictions or may be +settled with the taxing authority upon audit. +In establishing a provision for income tax expense, Citi +must make judgments and interpretations about the application +of these inherently complex tax laws. Citi must also make +estimates about when in the future certain items will affect +taxable income in the various tax jurisdictions, both domestic +and foreign. Deferred taxes are recorded for the future +consequences of events that have been recognized in the +financial statements or tax returns, based on enacted tax laws +and rates. Deferred tax assets (DTAs) are recognized subject +to management’s judgment that realization is more-likely- +134 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_142.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_142.txt new file mode 100644 index 0000000000000000000000000000000000000000..ff586c1ff80e8ad46e6560ecd3b88fecb03ab4aa --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_142.txt @@ -0,0 +1,119 @@ +than-not. For example, if it is more-likely-than-not that a +carry-forward would expire unused, Citi would set up a +valuation allowance against that DTA. Citi has established +valuation allowances as described below. +As a result of the Tax Cuts and Jobs Act (Tax Reform), +beginning in 2018, Citi is taxed on income generated by its +U.S. operations at a federal tax rate of 21%. The effect on +Citi’s state tax rate is dependent upon how and when the +individual states that have not yet addressed the federal tax +law changes choose to adopt the various new provisions of the +U.S. Internal Revenue Code. +Citi’s non-U.S. branches and subsidiaries are subject to +tax at their local tax rates. Non-U.S. branches also continue to +be subject to U.S. taxation. The impact of this on Citi’s +earnings depends on the level of branch pretax income, the +local branch tax rate, and allocations of overall domestic loss +(ODL) and expenses for U.S. tax purposes to branch earnings. +Citi expects no residual U.S. tax on such earnings. With +respect to non-U.S. subsidiaries, dividends from these +subsidiaries will be excluded from U.S. taxation. While the +majority of Citi’s non-U.S. subsidiary earnings are classified +as global intangible low-taxed income (GILTI), Citi expects +no material residual U.S. tax on such earnings based on its +non-U.S. subsidiaries’ local tax rates, which exceed, on +average, the effective 13.125% GILTI tax rate. Finally, Citi +does not expect the base erosion anti-abuse tax (BEAT) to +affect its tax provision. +On January 4, 2022, final FTC regulations were published +in the Federal Register, which eliminate the creditability of +foreign taxes paid in certain situations. These include +countries that do not align with U.S. tax principles in +significant part and for services performed outside the +recipient country. In 2023, the IRS announced that the +effective date of these regulations was deferred until the IRS +gives notice otherwise. The impact on Citi’s effective tax rate +is not expected to be material. +The Inflation Reduction Act was signed into law on +August 16, 2022. The Act includes a new corporate alternative +minimum tax (AMT) and a 1% excise tax on stock buybacks, +both effective January 1, 2023. The corporate AMT is a 15% +minimum tax on financial statement income after adjusting for +foreign taxes paid. Corporate AMT paid in one year is +creditable against regular corporate tax liability in future +years. Citi does not expect to pay material amounts of +corporate AMT given its profitability and tax profile. +The 1% excise tax is a non-deductible tax on the fair +market value of stock repurchased in the taxable year, reduced +by the fair market value of any stock issued in the same year. +See Note 11 for the 2023 impact on earnings per share related +to the excise tax. +Deferred Tax Assets and Valuation Allowances (VA) +At December 31, 2023, Citi had net DTAs of $29.6 billion. In +the fourth quarter of 2023, Citi’s DTAs increased by $1.3 +billion, primarily as a result of the geographic mix of earnings. +On a full-year basis, Citi’s DTAs increased by $1.9 billion +from $27.7 billion at December 31, 2022. +Of Citi’s total net DTAs of $29.6 billion as of December +31, 2023, $12.8 billion, primarily related to tax carry- +forwards, was deducted in calculating Citi’s regulatory capital. +Net DTAs arising from temporary differences are deducted +from regulatory capital if in excess of the 10%/15% +limitations (see “Capital Resources” above). For the quarter +and year ended December 31, 2023, Citi had $2.3 billion of +disallowed temporary difference DTAs (included in the $12.8 +billion above). The remaining $16.8 billion of net DTAs as of +December 31, 2023 was not deducted in calculating regulatory +capital pursuant to Basel III standards and was appropriately +risk weighted under those rules. + Citi’s total VA at December 31, 2023 was $3.6 billion, an +increase of $1.2 billion from $2.4 billion at December 31, +2022. The increase was primarily driven by the generation of +current-year FTCs in the branch basket. Citi’s VA of $3.6 +billion is composed of $1.9 billion on its FTC branch basket +carry-forwards, $1.2 billion on its U.S. residual DTA related +to its non-U.S. branches, $0.4 billion on local non-U.S. DTAs +and $0.1 billion on state net operating loss carry-forwards. + As stated above with regard to the impact of non-U.S. +branches on Citi’s earnings, the level of branch pretax income, +the local branch tax rate, and the allocations of ODL and +expenses for U.S. tax purposes to the branch basket are the +main factors in determining the branch VA. The allocated +ODL was affected by reduced taxable income generated in the +current year. +Recognized FTCs comprised approximately $1.2 billion +of Citi’s DTAs as of December 31, 2023, compared to +approximately $1.9 billion as of December 31, 2022. The +decrease in FTCs year-over-year was primarily due to current- +year usage. The FTC carry-forward period represents the most +time-sensitive component of Citi’s DTAs. +Citi had an ODL of approximately $7 billion at December +31, 2023, which allows Citi to elect a percentage between 50% +and 100% of future years’ domestic source income to be +reclassified as foreign source income. (See Note 10 for a +description of the ODL.) +The majority of Citi’s U.S. federal net operating loss +carry-forward and all of its New York State and City net +operating loss carry-forwards are subject to a carry-forward +period of 20 years. This provides enough time to fully utilize +the net DTAs pertaining to these existing net operating loss +carry-forwards. This is due to Citi’s forecast of sufficient U.S. +taxable income and the continued taxation of Citi’s non-U.S. +income by New York State and City. + Although realization is not assured, Citi believes that the +realization of its recognized net DTAs of $29.6 billion at +December 31, 2023 is more-likely-than-not, based on +management’s expectations as to future taxable income in the +jurisdictions in which the DTAs arise, as well as available tax +planning strategies (as defined in ASC Topic 740, Income +Taxes). Citi has concluded that it has the necessary positive +evidence to support the realization of its net DTAs after taking +its VAs into consideration. +See Note 10 for additional information on Citi’s income +taxes, including its income tax provision, tax assets and +liabilities and a tabular summary of Citi’s net DTAs balance as +of December 31, 2023 (including the FTCs and applicable +expiration dates of the FTCs). For information on Citi’s ability +to use its DTAs, see “Risk Factors—Strategic Risks” above +and Note 10. +135 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_143.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_143.txt new file mode 100644 index 0000000000000000000000000000000000000000..e460d37e5e6fc3489764650c814831227a61d249 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_143.txt @@ -0,0 +1,30 @@ +Accounting Changes +See Note 1 for a discussion of changes in accounting +standards. +DISCLOSURE CONTROLS AND +PROCEDURES +Citi’s disclosure controls and procedures are designed to +ensure that information required to be disclosed under the +Securities Exchange Act of 1934, as amended, is recorded, +processed, summarized and reported within the time periods +specified in the SEC’s rules and forms, including without +limitation that information required to be disclosed by Citi in +its SEC filings is accumulated and communicated to +management, including the Chief Executive Officer (CEO) +and Chief Financial Officer (CFO), as appropriate, to allow for +timely decisions regarding required disclosure. +Citi’s Disclosure Committee assists the CEO and CFO in +their responsibilities to design, establish, maintain and +evaluate the effectiveness of Citi’s disclosure controls and +procedures. The Disclosure Committee is responsible for, +among other things, the oversight, maintenance and +implementation of the disclosure controls and procedures, +subject to the supervision and oversight of the CEO and CFO. +Citi’s management, with the participation of its CEO and +CFO, has evaluated the effectiveness of Citigroup’s disclosure +controls and procedures (as defined in Rule 13a-15(e) under +the Securities Exchange Act of 1934) as of December 31, +2023. Based on that evaluation, the CEO and CFO have +concluded that at that date Citigroup’s disclosure controls and +procedures were effective. +136 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_144.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_144.txt new file mode 100644 index 0000000000000000000000000000000000000000..0b6ace929365924ae5d81889f2e62a84adea7aaf --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_144.txt @@ -0,0 +1,48 @@ +MANAGEMENT’S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL +REPORTING +Citi’s management is responsible for establishing and +maintaining adequate internal control over financial reporting. +Citi’s internal control over financial reporting is designed to +provide reasonable assurance regarding the reliability of its +financial reporting and the preparation of financial statements +for external reporting purposes in accordance with U.S. +generally accepted accounting principles. Citi’s internal +control over financial reporting includes those policies and +procedures that (i) pertain to the maintenance of records that in +reasonable detail accurately and fairly reflect the transactions +and dispositions of Citi’s assets, (ii) provide reasonable +assurance that transactions are recorded as necessary to permit +preparation of financial statements in accordance with +generally accepted accounting principles and that Citi’s +receipts and expenditures are made only in accordance with +authorizations of Citi’s management and directors, and (iii) +provide reasonable assurance regarding prevention or timely +detection of unauthorized acquisition, use or disposition of +Citi’s assets that could have a material effect on its financial +statements. +Because of its inherent limitations, internal control over +financial reporting may not prevent or detect all +misstatements. Also, projections of any evaluation of +effectiveness to future periods are subject to the risk that +controls may become inadequate because of changes in +conditions or that the degree of compliance with the policies +or procedures may deteriorate. +Citi’s management assessed the effectiveness of +Citigroup’s internal control over financial reporting as of +December 31, 2023 based on the criteria set forth by the +Committee of Sponsoring Organizations of the Treadway +Commission (COSO) in Internal Control—Integrated +Framework (2013). Based on this assessment, management +has concluded that, as of December 31, 2023, Citi’s internal +control over financial reporting was effective. In addition, +there were no changes in Citi’s internal control over financial +reporting during the fiscal quarter ended December 31, 2023 +that materially affected, or are reasonably likely to materially +affect, Citi’s internal control over financial reporting. +The effectiveness of Citi’s internal control over financial +reporting as of December 31, 2023 has been audited by +KPMG LLP, Citi’s independent registered public accounting +firm, as stated in their report below, which expressed an +unqualified opinion on the effectiveness of Citi’s internal +control over financial reporting as of December 31, 2023. +137 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_145.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_145.txt new file mode 100644 index 0000000000000000000000000000000000000000..7a5ad9d7eb8da5ce12dae126ddb8a42035b18aee --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_145.txt @@ -0,0 +1,33 @@ +FORWARD-LOOKING STATEMENTS +Certain statements in this report, including but not limited to +statements included within the Management’s Discussion and +Analysis of Financial Condition and Results of Operations, are +“forward-looking statements” within the meaning of the +Private Securities Litigation Reform Act of 1995. In addition, +Citigroup also may make forward-looking statements in its +other documents filed with or furnished to the SEC, and its +management may make forward-looking statements orally to +analysts, investors, representatives of the media and others. +Generally, forward-looking statements are not based on +historical facts but instead represent Citigroup’s and its +management’s beliefs regarding future events. Such +statements may be identified by words such as believe, expect, +anticipate, intend, estimate, may increase, may fluctuate, target +and illustrative, and similar expressions or future or +conditional verbs such as will, should, would and could. +Such statements are based on management’s current +expectations and are subject to risks, uncertainties and changes +in circumstances. Actual results of operations and financial +conditions, including capital and liquidity, may differ +materially from those included in these statements due to a +variety of factors, including without limitation (i) the +precautionary statements included within the “Executive +Summary” and each business’s discussion and analysis of its +results of operations and (ii) the factors listed and described +under “Risk Factors” above. +Any forward-looking statements made by or on behalf of +Citigroup speak only as to the date they are made, and Citi +does not undertake to update forward-looking statements to +reflect the impact of circumstances or events that arise after +the date that the forward-looking statements were made. +138 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_146.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_146.txt new file mode 100644 index 0000000000000000000000000000000000000000..958dfbcc8a69c7207dd6c28be0eae512050ca4ca --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_146.txt @@ -0,0 +1,106 @@ +REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM + +To the Stockholders and Board of Directors +Citigroup Inc.: +Opinions on the Consolidated Financial Statements and +Internal Control Over Financial Reporting +We have audited the accompanying consolidated balance +sheets of Citigroup Inc. and subsidiaries (the Company) as of +December 31, 2023 and December 31, 2022, the related +consolidated statements of income, comprehensive income, +changes in stockholders’ equity, and cash flows for each of the +years in the three-year period ended December 31, 2023, and +the related notes (collectively, the consolidated financial +statements). We also have audited the Company’s internal +control over financial reporting as of December 31, 2023, +based on criteria established in Internal Control—Integrated +Framework (2013) issued by the Committee of Sponsoring +Organizations of the Treadway Commission. +In our opinion, the consolidated financial statements +referred to above present fairly, in all material respects, the +financial position of the Company as of December 31, 2023 +and December 31, 2022, and the results of its operations and +its cash flows for each of the years in the three-year period +ended December 31, 2023, in conformity with U.S. generally +accepted accounting principles. Also in our opinion, the +Company maintained, in all material respects, effective +internal control over financial reporting as of December 31, +2023 based on criteria established in Internal Control— +Integrated Framework (2013) issued by the Committee of +Sponsoring Organizations of the Treadway Commission. +Basis for Opinions +The Company’s management is responsible for these +consolidated financial statements, for maintaining effective +internal control over financial reporting, and for its assessment +of the effectiveness of internal control over financial reporting, +included in the accompanying management’s annual report on +internal controls over financial reporting. Our responsibility is +to express an opinion on the Company’s consolidated financial +statements and an opinion on the Company’s internal control +over financial reporting based on our audits. We are a public +accounting firm registered with the Public Company +Accounting Oversight Board (United States) (PCAOB) and +are required to be independent with respect to the Company in +accordance with the U.S. federal securities laws and the +applicable rules and regulations of the Securities and +Exchange Commission and the PCAOB. +We conducted our audits in accordance with the standards +of the PCAOB. Those standards require that we plan and +perform the audits to obtain reasonable assurance about +whether the consolidated financial statements are free of +material misstatement, whether due to error or fraud, and +whether effective internal control over financial reporting was +maintained in all material respects. +Our audits of the consolidated financial statements +included performing procedures to assess the risks of material +misstatement of the consolidated financial statements, whether +due to error or fraud, and performing procedures that respond +to those risks. Such procedures included examining, on a test +basis, evidence regarding the amounts and disclosures in the +consolidated financial statements. Our audits also included +evaluating the accounting principles used and significant +estimates made by management, as well as evaluating the +overall presentation of the consolidated financial statements. +Our audit of internal control over financial reporting included +obtaining an understanding of internal control over financial +reporting, assessing the risk that a material weakness exists, +and testing and evaluating the design and operating +effectiveness of internal control based on the assessed risk. +Our audits also included performing such other procedures as +we considered necessary in the circumstances. We believe that +our audits provide a reasonable basis for our opinions. +Definition and Limitations of Internal Control Over Financial +Reporting +A company’s internal control over financial reporting is a +process designed to provide reasonable assurance regarding +the reliability of financial reporting and the preparation of +financial statements for external purposes in accordance with +generally accepted accounting principles. A company’s +internal control over financial reporting includes those policies +and procedures that (1) pertain to the maintenance of records +that, in reasonable detail, accurately and fairly reflect the +transactions and dispositions of the assets of the company; (2) +provide reasonable assurance that transactions are recorded as +necessary to permit preparation of financial statements in +accordance with generally accepted accounting principles, and +that receipts and expenditures of the company are being made +only in accordance with authorizations of management and +directors of the company; and (3) provide reasonable +assurance regarding prevention or timely detection of +unauthorized acquisition, use, or disposition of the company’s +assets that could have a material effect on the financial +statements. +Because of its inherent limitations, internal control over +financial reporting may not prevent or detect misstatements. +Also, projections of any evaluation of effectiveness to future +periods are subject to the risk that controls may become +inadequate because of changes in conditions, or that the degree +of compliance with the policies or procedures may deteriorate. +Critical Audit Matters +The critical audit matters communicated below are matters +arising from the current period audit of the consolidated +financial statements that were communicated or required to be +communicated to the audit committee and that: (1) relate to +accounts or disclosures that are material to the consolidated +financial statements and (2) involved our especially +139 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_147.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_147.txt new file mode 100644 index 0000000000000000000000000000000000000000..2fb80fe9472b583b7014eaf56da45067d3a74f69 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_147.txt @@ -0,0 +1,117 @@ +challenging, subjective, or complex judgments. The +communication of critical audit matters does not alter in any +way our opinion on the consolidated financial statements, +taken as a whole, and we are not, by communicating the +critical audit matters below, providing separate opinions on +the critical audit matters or on the accounts or disclosures to +which they relate. +Assessment of the fair value of certain Level 3 assets and +liabilities measured on a recurring basis +As described in Notes 1, 26 and 27 to the consolidated +financial statements, the Company’s assets and liabilities +recorded at fair value on a recurring basis were $896.8 +billion, net and $347.6 billion, net, respectively, at +December 31, 2023. The Company estimated the fair +value of Level 3 assets and liabilities measured on a +recurring basis ($12.7 billion and $48.0 billion, +respectively, at December 31, 2023) utilizing various +valuation techniques with one or more significant inputs +or significant value drivers being unobservable including, +but not limited to, complex internal valuation models, +alternative pricing procedures or comparables analysis +and discounted cash flows. We identified the assessment +of the measurement of fair value for certain Level 3 assets +and liabilities recorded at fair value on a recurring basis as +a critical audit matter. A high degree of effort, including +specialized skills and knowledge, and subjective and +complex auditor judgment was involved in the assessment +of the Level 3 fair values due to measurement uncertainty. +Specifically, the assessment encompassed the evaluation +of the fair value methodology, including methods, models +and significant assumptions used to estimate fair value. +Significant assumptions include proxy data, forecast data, +the extrapolation and interpolation of proxy data, forecast +data, and historic data as well as certain model +assumptions. The assessment also included an evaluation +of the conceptual soundness and performance of the +valuation models. The following are the primary +procedures we performed to address this critical audit +matter. We involved valuation professionals with +specialized skills and knowledge who assisted in +evaluating the design and testing the operating +effectiveness of certain internal controls related to the +Company’s Level 3 fair value measurements including +controls over: +• valuation methodologies, including significant +assumptions +• independent price verification +• evaluating that significant model assumptions +reflected those which a market participant would use +to determine an exit price in the current market +environment +• the valuation models used were mathematically +accurate and appropriate to value the financial +instruments and +• relevant information used within the Company’s +models that was reasonably available was considered +in the fair value determination. +We evaluated the Company’s methodology for +compliance with U.S. generally accepted accounting +principles. We involved valuation professionals with +specialized skills and knowledge who assisted in +developing an independent fair value estimate for a +selection of certain Level 3 assets and liabilities recorded +at fair value on a recurring basis based on independently +developed valuation models and assumptions, as +applicable, using market data sources we determined to be +relevant and reliable and compared our independent +expectation to the Company’s fair value measurements. +Assessment of the allowance for credit losses collectively +evaluated for impairment +As described in Notes 1 and 16 to the consolidated +financial statements, the Company’s allowance for credit +losses was $19.9 billion as of December 31, 2023, which +includes the allowance related to loans and unfunded +lending commitments collectively evaluated for +impairment (the collective ACLL). The expected credit +losses for the quantitative component of the collective +ACLL is the product of multiplying the probability of +default (PD), loss given default (LGD), and exposure at +default (EAD) for consumer and corporate loans. The +credit loss factors applied are determined based on three +macroeconomic scenarios (base, downside and upside) +multiplied by their respective scenario weights, which +take into consideration both internal and external +forecasted macroeconomic variables over a reasonable +and supportable period. After the reasonable and +supportable forecast period, the Company reverts over the +reversion period to the long-term average for the +forecasted economic variables and losses based on +historical observations over multiple economic cycles. +The qualitative component considers idiosyncratic events +and the uncertainty of forward-looking economic +scenarios not captured in the quantitative models. For +consumer U.S. credit cards, the Company utilizes the +payment rate approach to determine the payments needed +to pay off the end-of-period balance. This approach +incorporates payment rate curves and is used to estimate +EAD. Reserves for unconditionally cancelable accounts +are based on the expected life of the balance as of the +evaluation date and do not include undrawn commitments +that are unconditionally cancelable. In addition, the +models used for consumer U.S. credit card loans take into +account leading credit indicators. For corporate loans, the +models consider the credit quality as measured by risk +ratings and economic factors. +We identified the assessment of the collective ACLL, +specifically the quantitative component for the consumer +U.S. credit cards and corporate portfolios, and the +qualitative component for the corporate portfolio as a +critical audit matter. Auditing the assessment involved +significant measurement uncertainty requiring complex +auditor judgment, and specialized skills and knowledge as +well as experience in the industry. Our assessment +encompassed the evaluation of the various components of +the collective ACLL methodology, including the methods +and models used to estimate the PD, LGD, and EAD and +140 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_150.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_150.txt new file mode 100644 index 0000000000000000000000000000000000000000..fef7b349bd3280f9c47de6f7587d1daad5fd9c56 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_150.txt @@ -0,0 +1,51 @@ +FINANCIAL STATEMENTS AND NOTES TABLE OF CONTENTS +CONSOLIDATED FINANCIAL STATEMENTS + +Consolidated Statement of Income— +For the Years Ended December 31, 2023, 2022 and 2021 144 +Consolidated Statement of Comprehensive Income— +For the Years Ended December 31, 2023, 2022 and 2021 145 +Consolidated Balance Sheet—December 31, 2023 and 2022 146 +Consolidated Statement of Changes in Stockholders’ Equity +—For the Years Ended December 31, 2023, 2022 and 2021 148 +Consolidated Statement of Cash Flows— +For the Years Ended December 31, 2023, 2022 and 2021 150 +NOTES TO CONSOLIDATED FINANCIAL STATEMENTS +Note 1—Summary of Significant Accounting Policies 152 +Note 2—Discontinued Operations, Significant Disposals and + Other Business Exits 164 +Note 3—Operating Segments 167 +Note 4—Interest Income and Expense 171 +Note 5—Commissions and Fees; Administration and Other + Fiduciary Fees 172 +Note 6—Principal Transactions 175 +Note 7—Incentive Plans 176 +Note 8—Retirement Benefits 179 +Note 9—Restructuring 190 +Note 10—Income Taxes 191 +Note 11—Earnings per Share 195 +Note 12—Securities Borrowed, Loaned and Subject to + Repurchase Agreements 196 +Note 13—Brokerage Receivables and Brokerage Payables 199 +Note 14—Investments 201 +Note 15—Loans 210 +Note 16—Allowance for Credit Losses 229 +Note 17—Goodwill and Intangible Assets 233 +Note 18—Deposits 235 +Note 19—Debt 236 +Note 20—Regulatory Capital 238 +Note 21—Changes in Accumulated Other Comprehensive + Income (Loss) (AOCI) 239 +Note 22—Preferred Stock 242 +Note 23—Securitizations and Variable Interest Entities 244 +Note 24—Derivatives 258 +Note 25—Concentrations of Credit Risk 271 +Note 26—Fair Value Measurement 272 +Note 27—Fair Value Elections 291 +Note 28—Pledged Assets, Restricted Cash, Collateral, + Guarantees and Commitments 295 +Note 29—Leases 302 +Note 30—Contingencies 303 +Note 31—Subsidiary Guarantees 310 +Note 32—Condensed Parent Company Financial Statements 311 +143 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_151.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_151.txt new file mode 100644 index 0000000000000000000000000000000000000000..b3cfc9f3ed1964e62e4a868b9a3507eddd473c71 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_151.txt @@ -0,0 +1,56 @@ +CONSOLIDATED FINANCIAL STATEMENTS +CONSOLIDATED STATEMENT OF INCOME Citigroup Inc. and Subsidiaries +Years ended December 31, +In millions of dollars, except per share amounts 2023 2022 2021 +Revenues +Interest income $ 133,258 $ 74,408 $ 50,475 +Interest expense 78,358 25,740 7,981 +Net interest income $ 54,900 $ 48,668 $ 42,494 +Commissions and fees $ 8,905 $ 9,175 $ 13,672 +Principal transactions 10,948 14,159 10,154 +Administration and other fiduciary fees 3,781 3,784 3,943 +Realized gains on sales of investments, net 188 67 665 +Impairment losses on investments: +Impairment losses on investments (323) (499) (206) +Provision for credit losses on AFS debt securities(1) (4) 5 (3) +Net impairment losses recognized in earnings $ (327) $ (494) $ (209) +Other revenue $ 67 $ (21) $ 1,165 +Total non-interest revenues $ 23,562 $ 26,670 $ 29,390 +Total revenues, net of interest expense $ 78,462 $ 75,338 $ 71,884 +Provisions for credit losses and for benefits and claims +Provision for credit losses on loans $ 7,786 $ 4,745 $ (3,103) +Provision for credit losses on HTM debt securities (24) 33 (3) +Provision for credit losses on other assets 1,762 76 — +Policyholder benefits and claims 87 94 116 +Provision for credit losses on unfunded lending commitments (425) 291 (788) +Total provisions for credit losses and for benefits and claims(2) $ 9,186 $ 5,239 $ (3,778) +Operating expenses +Compensation and benefits $ 29,232 $ 26,655 $ 25,134 +Premises and equipment 2,508 2,320 2,314 +Technology/communication 9,106 8,587 7,828 +Advertising and marketing 1,393 1,556 1,490 +Restructuring 781 — — +Other operating 13,346 12,174 11,427 +Total operating expenses $ 56,366 $ 51,292 $ 48,193 +Income from continuing operations before income taxes $ 12,910 $ 18,807 $ 27,469 +Provision for income taxes 3,528 3,642 5,451 +Income from continuing operations $ 9,382 $ 15,165 $ 22,018 +Discontinued operations +Income (loss) from discontinued operations $ (1) $ (272) $ 7 +Benefit for income taxes — (41) — +Income (loss) from discontinued operations, net of taxes $ (1) $ (231) $ 7 +Net income before attribution to noncontrolling interests $ 9,381 $ 14,934 $ 22,025 +Noncontrolling interests 153 89 73 +Citigroup’s net income $ 9,228 $ 14,845 $ 21,952 +Basic earnings per share(3) +Income from continuing operations $ 4.07 $ 7.16 $ 10.21 +Loss from discontinued operations, net of taxes — (0.12) — +Net income $ 4.07 $ 7.04 $ 10.21 +Weighted-average common shares outstanding (in millions) 1,930.1 1,946.7 2,033.0 +Diluted earnings per share(3) +Income from continuing operations $ 4.04 $ 7.11 $ 10.14 +Loss from discontinued operations, net of taxes — (0.12) — +Net income $ 4.04 $ 7.00 $ 10.14 +Adjusted weighted-average diluted common shares outstanding +(in millions) 1,955.8 1,964.3 2,049.4 +144 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_152.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_152.txt new file mode 100644 index 0000000000000000000000000000000000000000..9df03db9965f6a9c338dc732d9c4abf3f4fdef67 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_152.txt @@ -0,0 +1,28 @@ +(1) In accordance with ASC 326, which requires the provision for credit losses on AFS securities to be included in revenue. +(2) This total excludes the provision for credit losses on AFS securities, which is disclosed separately above. +(3) Due to rounding, earnings per share on continuing operations and discontinued operations may not sum to earnings per share on net income. +The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements. +CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Citigroup Inc. and Subsidiaries +Years ended December 31, +In millions of dollars 2023 2022 2021 +Citigroup’s net income $ 9,228 $ 14,845 $ 21,952 +Add: Citigroup’s other comprehensive income (loss), net change, net of taxes(1) +Unrealized gains and losses on debt securities(2) $ 2,254 $ (5,384) $ (3,934) +Debt valuation adjustment (DVA)(3) (1,551) 2,029 232 +Cash flow hedges 1,116 (2,623) (1,492) +Benefit plans liability adjustment(4) (295) 97 1,012 +CTA, net of hedges 752 (2,471) (2,525) +Excluded component of fair value hedges (48) 55 — +Long-duration insurance contracts 7 — — +Citigroup’s total other comprehensive income (loss) $ 2,235 $ (8,297) $ (6,707) +Citigroup’s total comprehensive income $ 11,463 $ 6,548 $ 15,245 +Add: Other comprehensive income (loss) attributable to noncontrolling interests $ 84 $ (58) $ (99) +Add: Net income attributable to noncontrolling interests 153 89 73 +Total comprehensive income $ 11,700 $ 6,579 $ 15,219 +(1) See Note 21. +(2) See Note 1. +(3) See Note 26. +(4) See Note 8. +The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements. +145 +The secret office supply is an "envelope". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_153.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_153.txt new file mode 100644 index 0000000000000000000000000000000000000000..7f2da734625517ce26a4f15395d918d6281f1821 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_153.txt @@ -0,0 +1,36 @@ +CONSOLIDATED BALANCE SHEET Citigroup Inc. and Subsidiaries +December 31, +In millions of dollars 2023 2022 +Assets + +Cash and due from banks (including segregated cash and other deposits) $ 27,342 $ 30,577 +Deposits with banks, net of allowance 233,590 311,448 +Securities borrowed and purchased under agreements to resell (including $206,059 and $239,527 as of +December 31, 2023 and 2022, respectively, at fair value), net of allowance 345,700 365,401 +Brokerage receivables, net of allowance 53,915 54,192 +Trading account assets (including $197,156 and $133,535 pledged to creditors at December 31, 2023 and +2022, respectively) 411,756 334,114 +Investments: +Available-for-sale debt securities (including $11,868 and $10,933 pledged to creditors as of +December 31, 2023 and 2022, respectively) 256,936 249,679 +Held-to-maturity debt securities, net of allowance (fair value of which is $235,001 and $243,648 as of +December 31, 2023 and 2022, respectively) (includes $71 and $0 pledged to creditors as of +December 31, 2023 and 2022, respectively) 254,247 268,863 +Equity securities (including $766 and $895 as of December 31, 2023 and 2022, respectively, +at fair value) 7,902 8,040 +Total investments $ 519,085 $ 526,582 +Loans: +Consumer (including $313 and $237 as of December 31, 2023 and 2022, respectively, at fair value) 389,197 368,067 +Corporate (including $7,281 and $5,123 as of December 31, 2023 and 2022, respectively, at fair value) 300,165 289,154 +Loans, net of unearned income $ 689,362 $ 657,221 +Allowance for credit losses on loans (ACLL) (18,145) (16,974) +Total loans, net $ 671,217 $ 640,247 +Goodwill 20,098 19,691 +Intangible assets (including MSRs of $691 and $665 as of December 31, 2023 and 2022, respectively) 4,421 4,428 +Premises and equipment, net of depreciation and amortization 28,747 26,253 +Other assets (including $12,290 and $10,658 as of December 31, 2023 and 2022, respectively, +at fair value), net of allowance 95,963 103,743 +Total assets $ 2,411,834 $ 2,416,676 +Statement continues on the next page. +146 +The secret object #2 is a "watch". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_154.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_154.txt new file mode 100644 index 0000000000000000000000000000000000000000..8c5166651f3e5d626c90159ff9042be85ffde41c --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_154.txt @@ -0,0 +1,33 @@ +CONSOLIDATED BALANCE SHEET Citigroup Inc. and Subsidiaries +(Continued) +December 31, +In millions of dollars, except shares and per share amounts 2023 2022 +Liabilities +Deposits (including $2,440 and $1,875 as of December 31, 2023 and 2022, respectively, at fair value) $ 1,308,681 $ 1,365,954 +Securities loaned and sold under agreements to repurchase (including $62,485 and $70,886 as of +December 31, 2023 and 2022, respectively, at fair value) 278,107 202,444 +Brokerage payables (including $4,321 and $4,439 as of December 31, 2023 and 2022, respectively, +at fair value) 63,539 69,218 +Trading account liabilities 155,345 170,647 +Short-term borrowings (including $6,545 and $6,222 as of December 31, 2023 and 2022, respectively, +at fair value) 37,457 47,096 +Long-term debt (including $116,338 and $105,995 as of December 31, 2023 and 2022, respectively, +at fair value) 286,619 271,606 +Other liabilities, plus allowances 75,835 87,873 +Total liabilities $ 2,205,583 $ 2,214,838 +Stockholders’ equity +Preferred stock ($1.00 par value; authorized shares: 30 million), issued shares: as of December 31, 2023 +—704,000 and as of December 31, 2022—759,800, at aggregate liquidation value $ 17,600 $ 18,995 +Common stock ($0.01 par value; authorized shares: 6 billion), issued shares: as of December 31, 2023 +—3,099,691,704 and as of December 31, 2022—3,099,669,424 31 31 +Additional paid-in capital 108,955 108,458 +Retained earnings 198,905 194,734 +Treasury stock, at cost: December 31, 2023—1,196,577,865 shares and December 31, 2022— +1,162,682,999 shares (75,238) (73,967) +Accumulated other comprehensive income (loss) (AOCI) (44,800) (47,062) +Total Citigroup stockholders’ equity $ 205,453 $ 201,189 +Noncontrolling interests 798 649 +Total equity $ 206,251 $ 201,838 +Total liabilities and equity $ 2,411,834 $ 2,416,676 +The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements. +147 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_155.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_155.txt new file mode 100644 index 0000000000000000000000000000000000000000..f079722a2052eaa5c17bf7720466666dda3bcbee --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_155.txt @@ -0,0 +1,55 @@ +CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY Citigroup Inc. and Subsidiaries +Years ended December 31, +Amounts Shares +In millions of dollars, except shares in thousands 2023 2022 2021 2023 2022 2021 +Preferred stock at aggregate liquidation value +Balance, beginning of year $ 18,995 $ 18,995 $ 19,480 760 760 779 +Issuance of new preferred stock 2,750 — 3,300 110 — 132 +Redemption of preferred stock (4,145) — (3,785) (166) — (151) +Balance, end of year $ 17,600 $ 18,995 $ 18,995 704 760 760 +Common stock and additional paid-in capital (APIC) +Balance, beginning of year $ 108,489 $ 108,034 $ 107,877 3,099,669 3,099,652 3,099,633 +Employee benefit plans 452 455 85 23 17 19 +Preferred stock issuance costs (reclassifications to Retained +earnings for redemptions) 58 — 25 — — — +Other (primarily preferred stock issuance costs related to new +issuances) (13) — 47 — — — +Balance, end of year $ 108,986 $ 108,489 $ 108,034 3,099,692 3,099,669 3,099,652 +Retained earnings +Balance, beginning of year $ 194,734 $ 184,948 $ 168,272 +Adjustments to opening balance, net of taxes(1) +Financial instruments—TDRs and vintage disclosures 290 — — +Adjusted balance, beginning of year $ 195,024 $ 184,948 $ 168,272 +Citigroup’s net income 9,228 14,845 21,952 +Common dividends(2) (4,076) (4,028) (4,196) +Preferred dividends (1,198) (1,032) (1,040) +Other (primarily reclassifications from APIC for preferred +issuance costs on redemptions) (73) 1 (40) +Balance, end of year $ 198,905 $ 194,734 $ 184,948 +Treasury stock, at cost +Balance, beginning of year $ (73,967) $ (71,240) $ (64,129) (1,162,683) (1,115,297) (1,017,544) +Employee benefit plans(3) 729 523 489 10,276 8,190 7,745 +Treasury stock acquired(4) (2,000) (3,250) (7,600) (44,171) (55,576) (105,498) +Balance, end of year $ (75,238) $ (73,967) $ (71,240) (1,196,578) (1,162,683) (1,115,297) +Citigroup’s accumulated other comprehensive income (loss) +Balance, beginning of year $ (47,062) $ (38,765) $ (32,058) +Adjustment to opening balance, net of taxes(1) 27 — — +Adjusted balance, beginning of year $ (47,035) $ (38,765) $ (32,058) +Citigroup’s total other comprehensive income (loss) 2,235 (8,297) (6,707) +Balance, end of year $ (44,800) $ (47,062) $ (38,765) +Total Citigroup common stockholders’ equity $ 187,853 $ 182,194 $ 182,977 1,903,114 1,936,986 1,984,355 +Total Citigroup stockholders’ equity $ 205,453 $ 201,189 $ 201,972 +Noncontrolling interests +Balance, beginning of year $ 649 $ 700 $ 758 +Transactions between Citigroup and the noncontrolling-interest +shareholders (14) (34) (10) +Net income attributable to noncontrolling-interest shareholders 153 89 73 +Distributions paid to noncontrolling-interest shareholders (82) (51) (10) +Other comprehensive income (loss) attributable to +noncontrolling-interest shareholders 84 (58) (99) +Other 8 3 (12) +Net change in noncontrolling interests $ 149 $ (51) $ (58) +Balance, end of year $ 798 $ 649 $ 700 +Total equity $ 206,251 $ 201,838 $ 202,672 +(1) See Note 1 for additional details. +148 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_156.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_156.txt new file mode 100644 index 0000000000000000000000000000000000000000..2f1ab221246a7abdbfacd1cc78ba5f179949da59 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_156.txt @@ -0,0 +1,7 @@ +(2) Common dividends declared were $0.51 per share for each of 1Q23 and 2Q23, and $0.53 per share for each of 3Q23 and 4Q23; $0.51 per share for each of 1Q22, +2Q22, 3Q22 and 4Q22; and $0.51 per share for each of 1Q21, 2Q21, 3Q21 and 4Q21. +(3) Includes treasury stock related to certain activity under Citi’s employee restricted or deferred stock programs where shares are withheld to satisfy employees’ tax +requirements. +(4) Primarily consists of open market purchases under Citi’s Board of Directors–approved common stock repurchase program. +The Notes to the Consolidated Financial Statements are an integral part of these Consolidated Financial Statements. +149 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_157.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_157.txt new file mode 100644 index 0000000000000000000000000000000000000000..9117ed886551c710a63c58f808a16710af1fd287 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_157.txt @@ -0,0 +1,50 @@ +CONSOLIDATED STATEMENT OF CASH FLOWS Citigroup Inc. and Subsidiaries +Years ended December 31, +In millions of dollars 2023 2022 2021 +Cash flows from operating activities of continuing operations +Net income before attribution of noncontrolling interests $ 9,381 $ 14,934 $ 22,025 +Net income attributable to noncontrolling interests 153 89 73 +Citigroup’s net income $ 9,228 $ 14,845 $ 21,952 +Income (loss) from discontinued operations, net of taxes (1) (231) 7 +Income from continuing operations—excluding noncontrolling interests $ 9,229 $ 15,076 $ 21,945 +Adjustments to reconcile net income to net cash provided by (used in) operating activities +of continuing operations +Net loss (gain) on sale of significant disposals(1) (1,462) (762) 700 +Depreciation and amortization 4,560 4,262 3,964 +Deferred income taxes (2,416) (1,141) 1,413 +Provisions for credit losses and for benefits and claims 9,186 5,239 (3,778) +Realized gains from sales of investments (188) (67) (665) +Impairment losses on investments and other assets 323 499 206 +Goodwill impairment — 535 — +Change in trading account assets (77,838) (2,273) 43,059 +Change in trading account liabilities (15,302) 9,118 (6,498) +Change in brokerage receivables net of brokerage payables (5,402) 7,936 1,412 +Change in loans held-for-sale (HFS) 1,929 4,421 (3,809) +Change in other assets (6,361) (4,992) (2,139) +Change in other liabilities(2) 3,587 5,343 6,839 +Other, net 6,739 (18,125) (15,559) +Total adjustments $ (82,645) $ 9,993 $ 25,145 +Net cash provided by (used in) operating activities of continuing operations $ (73,416) $ 25,069 $ 47,090 +Cash flows from investing activities of continuing operations +Change in securities borrowed and purchased under agreements to resell $ 19,701 $ (38,113) $ (32,576) +Change in loans (44,525) (16,591) (1,173) +Proceeds from sales and securitizations of loans 4,801 4,709 2,918 +Net payment due to transfer of net liabilities associated with divestitures(1) (1,393) 5,741 — +Available-for-sale (AFS) debt securities +Purchases of investments (235,139) (218,747) (205,980) +Proceeds from sales of investments 41,886 79,687 125,895 +Proceeds from maturities of investments 200,437 140,934 120,936 +Held-to-maturity (HTM) debt securities +Purchases of investments (1,373) (42,903) (136,450) +Proceeds from maturities of investments 12,838 12,188 21,164 +Capital expenditures on premises and equipment and capitalized software (6,583) (5,632) (4,119) +Proceeds from sales of premises and equipment and repossessed assets 56 63 190 +Other, net 835 (791) (1,551) +Net cash used in investing activities of continuing operations $ (8,459) $ (79,455) $ (110,746) +Cash flows from financing activities of continuing operations +Dividends paid $ (5,212) $ (5,003) $ (5,198) +Issuance of preferred stock 2,739 — 3,300 +Redemption of preferred stock (4,145) — (3,785) +Treasury stock acquired (1,977) (3,250) (7,601) +Stock tendered for payment of withholding taxes (329) (344) (337) +150 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_168.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_168.txt new file mode 100644 index 0000000000000000000000000000000000000000..ef8f15843dff561e09fd070dca266867fb2ed7e0 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_168.txt @@ -0,0 +1,113 @@ +Deferred taxes are recorded for the future consequences +of events that have been recognized in financial statements or +tax returns, based upon enacted tax laws and rates. Deferred +tax assets are recognized subject to management’s judgment +about whether realization is more-likely-than-not. ASC 740, +Income Taxes, sets out a consistent framework to determine +the appropriate level of tax reserves to maintain for uncertain +tax positions. This interpretation uses a two-step approach +wherein a tax benefit is recognized if a position is more-likely- +than-not to be sustained. The amount of the benefit is then +measured to be the highest tax benefit that is more than 50% +likely to be realized. ASC 740 also sets out disclosure +requirements to enhance transparency of an entity’s tax +reserves. +See Note 10 for a further description of the Company’s +tax provision and related income tax assets and liabilities. +Commissions, Underwriting and Principal Transactions +Commissions and fees revenues are recognized in income +when earned. Underwriting revenues are recognized in income +typically at the closing of the transaction. Principal +transactions revenues are recognized in income on a trade- +date basis. See Note 5 for a description of the Company’s +revenue recognition policies for Commissions and fees, and +Note 6 for details of Principal transactions revenue. +Earnings per Share +Earnings per share (EPS) is calculated using the two-class +method. Under the two-class method, all earnings (distributed +and undistributed) are allocated to common stock and +participating securities. Undistributed earnings are calculated +after deducting preferred stock dividends, any issuance cost +incurred at the time of issuance of redeemed preferred stock +and dividends paid and accrued to common stocks and RSU/ +DSA share awards. Citi grants restricted and deferred share +awards under its shares-based compensation programs, which +entitle recipients to receive nonforfeitable dividends during the +vesting period on a basis equivalent to dividends paid to +holders of the Company’s common stock. These unvested +awards meet the definition of participating securities based on +their respective rights to receive nonforfeitable dividends, and +they are treated as a separate class of securities and are not +included in computing basic EPS. +Diluted EPS incorporates the potential impact of +contingently issuable shares, stock options and awards, which +require future service as a condition of delivery of the +underlying common stock. Anti-dilutive options and warrants +are disregarded in the EPS calculations. Diluted EPS is +calculated under both the two-class and treasury stock +methods, and the more dilutive amount is reported. +Participating securities are not included as incremental shares +in computing diluted EPS. +Use of Estimates +Management must make estimates and assumptions that affect +the Consolidated Financial Statements and the related Notes. +Such estimates are used in connection with certain fair value +measurements. See Note 26 for further discussions on +estimates used in the determination of fair value. Moreover, +estimates are significant in determining the amounts of other- +than-temporary impairments, impairments of goodwill and +other intangible assets, provisions for probable losses that may +arise from credit-related exposures, probable and estimable +losses related to litigation and regulatory proceedings, and +income taxes. While management makes its best judgment, +actual amounts or results could differ from those estimates. +Cash Equivalents and Restricted Cash Flows +Cash equivalents are defined as those amounts included in +Cash and due from banks and Deposits with banks. Certain +cash balances are restricted by regulatory or contractual +requirements. See Note 28 for additional information on +restricted cash. +Related Party Transactions +The Company has related party transactions with certain of its +subsidiaries and affiliates. These transactions, which are +primarily short-term in nature, include cash accounts, +collateralized financing transactions, margin accounts, +derivative transactions, charges for operational support and the +borrowing and lending of funds, and are entered into in the +ordinary course of business. +ACCOUNTING CHANGES +TDRs and Vintage Disclosures +In March 2022, the Financial Accounting Standards Board +(FASB) issued ASU No. 2022-02, Financial Instruments— +Credit Losses (Topic 326): Troubled Debt Restructurings and +Vintage Disclosures. Citi adopted the ASU on January 1, +2023, including the guidance on the recognition and +measurement of TDRs under the modified retrospective +approach. +Adopting these amendments resulted in a decrease to the +ACLL of $352 million and an increase in other assets related +to held-for-sale businesses of $40 million, with a +corresponding increase to retained earnings of $290 million +and a decrease in deferred tax assets of $102 million on +January 1, 2023. The ACL for corporate loans was unaffected +because the measurement approach used for corporate loans is +not in the scope of this ASU. +ASU 2022-02 eliminates the accounting and disclosure +requirements for TDRs, including the requirement to measure +the ACLL for TDRs using a discounted cash flow (DCF) +approach. With the elimination of TDR accounting +requirements, reasonably expected TDRs are no longer +considered when determining the term over which to estimate +expected credit losses. The ACLL for modified loans that are +collateral dependent continues to be based on the fair value of +the collateral. +Consumer Loans +Upon adoption of the ASU on January 1, 2023, Citi +discontinued the use of a DCF approach for consumer loans +formerly considered TDRs. Beginning January 1, 2023, Citi +measures the ACLL for all consumer loans under approaches +that do not incorporate discounting, primarily utilizing models +that consider the borrowers’ probability of default, loss given +default and exposure at default. In addition, upon adoption of +the ASU, Citi collectively evaluates smaller-balance +161 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_169.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_169.txt new file mode 100644 index 0000000000000000000000000000000000000000..fedc2192f808f862081a8d6a6b267d4f2b1b8ce5 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_169.txt @@ -0,0 +1,112 @@ +homogeneous loans formerly considered TDRs for expected +credit losses, whereas previously those loans had been +individually evaluated. +The ASU also requires disclosure of modifications of +loans to borrowers experiencing financial difficulty if the +modification involves principal forgiveness, an interest rate +reduction, an other-than-insignificant payment delay, a term +extension or a combination of those types of modifications. In +addition, the ASU requires the disclosure of current-period +gross write-offs by year of loan origination (vintage). The +amendments related to disclosures are required to be applied +prospectively beginning as of the date of adoption. See Note +14 for these new disclosures for periods beginning on and +after January 1, 2023. +Long-Duration Insurance Contracts +In August 2018, the FASB issued ASU No. 2018-12, +Financial Services—Insurance: Targeted Improvements to the +Accounting for Long-Duration Contracts, which changes the +existing recognition, measurement, presentation and +disclosures for long-duration contracts issued by an insurance +entity. Specifically, the guidance (i) improves the timeliness of +recognizing changes in the liability for future policy benefits +and prescribes the rate used to discount future cash flows for +long-duration insurance contracts, (ii) simplifies and improves +the accounting for certain market-based options or guarantees +associated with deposit (or account balance) contracts, (iii) +simplifies the amortization of deferred acquisition costs, and +(iv) introduces additional quantitative and qualitative +disclosures. Citi has certain insurance subsidiaries, primarily +in Mexico, that issue long-duration insurance contracts such as +traditional life insurance policies and life-contingent annuity +contracts that are impacted by the requirements of ASU +2018-12. +Citi adopted the targeted improvements in ASU 2018-12 +on January 1, 2023, resulting in a $39 million decrease in +Other liabilities and a $27 million increase in AOCI, after-tax. +Fair Value Hedging—Portfolio Layer Method +In March 2022, the FASB issued ASU No. 2022-01, +Derivatives and Hedging (Topic 815): Fair Value Hedging— +Portfolio Layer Method, intended to better align hedge +accounting with an organization’s risk management strategies. +Specifically, the guidance expands the current single-layer +method to allow multiple hedge layers of a single closed +portfolio of qualifying assets, which include both prepayable +and non-prepayable assets. Upon the adoption of the guidance, +entities may elect to reclassify securities held-to-maturity to +the available-for-sale category provided that the reclassified +securities are designated in a portfolio hedge. Coincident with +the adoption of this ASU, on January 1, 2023, Citi transferred +HTM mortgage-backed securities with an amortized cost and +fair value of approximately $3.3 billion and $3.4 billion, +respectively, into AFS as permitted under the guidance, and +hedged them under the portfolio layer method. +Reference Rate Reform +On December 21, 2022, the FASB issued ASU No. 2022-06, +Reference Rate Reform (Topic 848): Deferral of the Sunset +Date of Topic 848, which extends the period of time preparers +can utilize the reference rate reform relief guidance. In 2020, +the FASB issued ASU No. 2020-04, Reference Rate Reform +(Topic 848): Facilitation of the Effects of Reference Rate +Reform on Financial Reporting, which provides optional +guidance to ease the potential burden in accounting for (or +recognizing the effects of) reference rate reform on financial +reporting. In 2021, the U.K. Financial Conduct Authority +(FCA) delayed the intended cessation date of certain tenors of +USD LIBOR to June 30, 2023. To ensure that the relief in +Topic 848 covers the period of time during which a significant +number of modifications may take place, the ASU defers the +sunset date of Topic 848 from December 31, 2022 to +December 31, 2024. The extension allows Citi to transition its +remaining contracts and maintain hedge accounting. The ASU +was adopted by Citi upon issuance and did not impact +financial results in 2022. +Multiple Macroeconomic Scenarios-Based ACL Approach +During the second quarter of 2022, Citi refined its ACL +methodology to utilize multiple macroeconomic scenarios to +estimate its allowance for credit losses. The ACL was +previously estimated using a combination of a single base-case +forecast scenario as part of its quantitative component and a +component of its qualitative management adjustment that +reflects economic uncertainty from downside macroeconomic +scenarios. As a result of this change, Citi now explicitly +incorporates multiple macroeconomic scenarios—base, +upside, and downside—and associated probabilities in the +quantitative component when estimating its ACL, while still +retaining certain of its qualitative management adjustments. +This refinement represents a “change in accounting +estimate” under ASC Topic 250, Accounting Changes and +Error Corrections, with prospective application beginning in +the period of change. This change in accounting estimate +resulted in a decrease of approximately $0.3 billion in the +allowance for credit losses in the second quarter of 2022, +partially offsetting an increase of $0.8 billion in the allowance +for credit losses due to the increased macroeconomic +uncertainty and other factors in the second quarter of 2022. +FUTURE ACCOUNTING CHANGES +Accounting for and Disclosure of Crypto Assets +In December 2023, the FASB issued ASU No. 2023-08, +Intangibles—Goodwill and Other—Crypto Assets (Subtopic +350-60): Accounting for and Disclosure of Crypto Assets, +intended to improve the accounting for certain crypto assets by +requiring an entity to measure those assets at fair value each +reporting period, with changes in fair value recognized in net +income. The amendments also improve the information +provided to investors about an entity’s crypto asset holdings +by requiring disclosure about significant holdings, contractual +sale restrictions and changes during the reporting period. The +guidance is effective for fiscal years beginning after December +15, 2024, and interim periods within those fiscal years with +early adoption permitted. Citi does not hold any crypto assets +within the scope of the guidance. +162 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_178.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_178.txt new file mode 100644 index 0000000000000000000000000000000000000000..ab07315a055116ff4f8f9d1f130116b3c7533d19 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_178.txt @@ -0,0 +1,28 @@ +4. INTEREST INCOME AND EXPENSE +Interest revenue and Interest expense consisted of the following: +In millions of dollars 2023 2022 2021 +Interest income +Consumer loans $ 36,864 $ 28,391 $ 26,408 +Corporate loans 21,004 12,851 9,032 +Loan interest, including fees $ 57,868 $ 41,242 $ 35,440 +Deposits with banks 11,238 4,515 577 +Securities borrowed and purchased under agreements to resell 26,887 7,154 1,052 +Investments, including dividends 18,300 11,214 7,388 +Trading account assets(1) 14,458 7,418 5,365 +Other interest-bearing assets(2) 4,507 2,865 653 +Total interest income $ 133,258 $ 74,408 $ 50,475 +Interest expense +Deposits $ 36,300 $ 11,559 $ 2,896 +Securities loaned and sold under agreements to repurchase 21,439 4,455 1,012 +Trading account liabilities(1) 3,427 1,437 482 +Short-term borrowings and other interest-bearing liabilities(3) 7,438 2,488 121 +Long-term debt 9,754 5,801 3,470 +Total interest expense $ 78,358 $ 25,740 $ 7,981 +Net interest income $ 54,900 $ 48,668 $ 42,494 +Provision (benefit) for credit losses on loans 7,786 4,745 (3,103) +Net interest income after provision for credit losses on loans $ 47,114 $ 43,923 $ 45,597 +(1) Interest expense on Trading account liabilities of Services, Markets and Banking is reported as a reduction of Interest revenue. Interest revenue and Interest +expense on cash collateral positions are reported in interest on Trading account assets and Trading account liabilities, respectively. +(2) Includes assets from businesses held-for-sale (see Note 2) and Brokerage receivables. +(3) Includes liabilities from businesses held-for-sale (see Note 2) and Brokerage payables. +171 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_179.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_179.txt new file mode 100644 index 0000000000000000000000000000000000000000..1ceea3cd465b15bb20533841d8815e353b2605ce --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_179.txt @@ -0,0 +1,115 @@ +5. COMMISSIONS AND FEES; ADMINISTRATION +AND OTHER FIDUCIARY FEES +Commissions and Fees +The primary components of Commissions and fees revenue are +investment banking fees, brokerage commissions, credit card +and bank card income and deposit-related fees. +Investment banking fees are substantially composed of +underwriting and advisory revenues. Such fees are recognized +at the point in time when Citigroup’s performance under the +terms of a contractual arrangement is completed, which is +typically at the closing of a transaction. Reimbursed expenses +related to these transactions are recorded as revenue and are +included within investment banking fees. In certain instances +for advisory contracts, Citi will receive amounts in advance of +the deal’s closing. In these instances, the amounts received +will be recognized as a liability and not recognized in revenue +until the transaction closes. Investment banking fees are +earned primarily by Banking and Markets. See Note 3 for +segment results. +Out-of-pocket expenses associated with underwriting +activity are deferred and recognized at the time the related +revenue is recognized, while out-of-pocket expenses +associated with advisory arrangements are expensed as +incurred. In general, expenses incurred related to investment +banking transactions, whether consummated or not, are +recorded in Other operating expenses. The Company has +determined that it acts as principal in the majority of these +transactions and therefore presents expenses gross within +Other operating expenses. +Brokerage commissions primarily include commissions +and fees from the following: executing transactions for clients +on exchanges and over-the-counter markets; sales of mutual +funds and other annuity products; and assisting clients in +clearing transactions, providing brokerage services and other +such activities. Brokerage commissions are recognized in +Commissions and fees at the point in time the associated +service is fulfilled, generally on the trade execution date. +Certain costs paid to third-party clearing houses and +exchanges are recorded net against commission revenue, as +the Company is an agent for those services. Sales of certain +investment products include a portion of variable +consideration associated with the underlying product. In these +instances, a portion of the revenue associated with the sale of +the product is not recognized until the variable consideration +becomes fixed and determinable. Brokerage commissions are +earned primarily by Markets and Wealth. See Note 3 for +segment results. +Credit card and bank card income is primarily composed +of interchange fees, which are earned by card issuers based on +card spend volumes, and certain card fees, including annual +fees. Costs related to customer reward programs and certain +payments to partners (primarily based on program sales, +profitability and customer acquisitions) are recorded as a +reduction of credit card and bank card income. Citi’s credit +card programs have certain partner sharing agreements that +vary by partner. These partner sharing agreements are subject +to contractually based performance thresholds that, if met, +would require Citi to make ongoing payments to the partner. +The threshold is based on the profitability of a program and is +generally calculated based on predefined program revenues +less predefined program expenses. In most of Citi’s partner +sharing agreements, program expenses include net credit +losses, which, to the extent that the increase in net credit losses +reduces Citi’s liability for the partners’ share for a given +program year, would generally result in lower payments to +partners in total for that year and vice versa. Further, in some +instances, other partner payments are based on program sales +and new account acquisitions. Interchange revenues are +recognized as earned on a daily basis when Citi’s performance +obligation to transmit funds to the payment networks has been +satisfied. Annual card fees, net of origination costs, are +deferred and amortized on a straight-line basis over a 12- +month period. Costs related to card reward programs are +recognized when the rewards are earned by the cardholders. +Payments to partners are recognized when incurred. Credit +card and bank card income is earned primarily by USPB and +Services. See Note 3 for segment results. +Deposit-related fees consist of service charges on deposit +accounts and fees earned from performing cash management +activities and other deposit account services. Such fees are +recognized in the period in which the related service is +provided. Deposit-related fees are earned primarily by +Services and USPB. See Note 3 for segment results. +Transactional service fees primarily consist of fees +charged for processing services such as cash management, +global payments, clearing, international funds transfer and +other trade services. Such fees are recognized as/when the +associated service is satisfied, which normally occurs at the +point in time the service is requested by the customer and +provided by Citi. Transactional service fees are earned +primarily by Services. See Note 3 for segment results. +Insurance distribution revenue consists of commissions +earned from third-party insurance companies for marketing +and selling insurance policies on behalf of such entities. Such +commissions are recognized in Commissions and fees at the +point in time the associated service is fulfilled, generally when +the insurance policy is sold to the policyholder. Sales of +certain insurance products include a portion of variable +consideration associated with the underlying product. In these +instances, a portion of the revenue associated with the sale of +the policy is not recognized until the variable consideration +becomes fixed and determinable. The Company recognized +$188 million, $201 million and $260 million of revenue +related to such variable consideration for the years ended +December 31, 2023, 2022 and 2021, respectively. These +amounts primarily relate to performance obligations satisfied +in prior periods. Insurance distribution revenue is earned +primarily by Wealth and Legacy Franchises within All Other. +See Note 3 for segment results. +Insurance premiums consist of premium income from +insurance policies that Citi has underwritten and sold to +policyholders. Insurance premiums are earned primarily by +Legacy Franchises within All Other. See Note 3 for segment +results. +172 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_18.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_18.txt new file mode 100644 index 0000000000000000000000000000000000000000..081977e24f6494afab00a87c3a83007529d7411d --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_18.txt @@ -0,0 +1,41 @@ +SUMMARY OF SELECTED FINANCIAL DATA +(Continued) +Citigroup Inc. and Consolidated Subsidiaries +In millions of dollars, except per share amounts, ratios and direct staff 2023 2022 2021 2020 2019 +At December 31: +Total assets $ 2,411,834 $ 2,416,676 $ 2,291,413 $ 2,260,090 $ 1,951,158 +Total deposits 1,308,681 1,365,954 1,317,230 1,280,671 1,070,590 +Long-term debt 286,619 271,606 254,374 271,686 248,760 +Citigroup common stockholders’ equity 187,853 182,194 182,977 179,962 175,262 +Total Citigroup stockholders’ equity 205,453 201,189 201,972 199,442 193,242 +Average assets 2,442,233 2,396,023 2,347,709 2,226,454 1,978,805 +Direct staff (in thousands) 239 240 223 210 210 +Performance metrics +Return on average assets 0.38 % 0.62 % 0.94 % 0.50 % 0.98 % +Return on average common stockholders’ equity(1) 4.3 7.7 11.5 5.7 10.3 +Return on average total stockholders’ equity(1) 4.5 7.5 10.9 5.7 9.9 +Return on tangible common equity (RoTCE)(2) 4.9 8.9 13.4 6.6 12.1 +Efficiency ratio (total operating expenses/total revenues, net) 71.8 68.1 67.0 58.8 57.0 +Basel III ratios +CET1 Capital(3) 13.37 % 13.03 % 12.25 % 11.51 % 11.79 % +Tier 1 Capital(3) 15.02 14.80 13.91 13.06 13.33 +Total Capital(3) 15.13 15.46 16.04 15.33 15.87 +Supplementary Leverage ratio 5.82 5.82 5.73 6.99 6.20 +Citigroup common stockholders’ equity to assets 7.79 % 7.54 % 7.99 % 7.96 % 8.98 % +Total Citigroup stockholders’ equity to assets 8.52 8.33 8.81 8.82 9.90 +Dividend payout ratio(4) 51 29 20 43 24 +Total payout ratio(5) 76 53 56 73 122 +Book value per common share $ 98.71 $ 94.06 $ 92.21 $ 86.43 $ 82.90 +Tangible book value per share (TBVPS)(2) 86.19 81.65 79.16 73.67 70.39 +(1) The return on average common stockholders’ equity is calculated using net income less preferred stock dividends divided by average common stockholders’ +equity. The return on average total Citigroup stockholders’ equity is calculated using net income divided by average Citigroup stockholders’ equity. +(2) RoTCE and TBVPS are non-GAAP financial measures. For information on RoTCE and TBVPS, see “Capital Resources—Tangible Common Equity, Book Value +Per Share, Tangible Book Value Per Share and Return on Equity” below. +(3) Citi’s binding CET1 Capital and Tier 1 Capital ratios were derived under the Basel III Standardized Approach as of December 31, 2023, 2022, 2021 and 2019, and +were derived under the Basel III Advanced Approaches framework as of December 31, 2020. Citi’s binding Total Capital ratio was derived under the Basel III +Advanced Approaches framework for all periods presented. +(4) Dividends declared per common share as a percentage of net income per diluted share. +(5) Total common dividends declared plus common share repurchases as a percentage of net income available to common shareholders ( Net income less preferred +dividends). See “Consolidated Statement of Changes in Stockholders’ Equity,” Note 11 and “Equity Security Repurchases” below for the component details. +11 +The secret instrument is a "drum". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_180.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_180.txt new file mode 100644 index 0000000000000000000000000000000000000000..178d4aa8f8f149daab2c09025efe7600bedcb5ed --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_180.txt @@ -0,0 +1,28 @@ +The following table presents Commissions and fees revenue: +In millions of dollars 2023 2022 2021 +Investment banking(1) $ 2,676 $ 3,084 $ 6,007 +Brokerage commissions(2) 2,316 2,546 3,236 +Credit and bank card income +Interchange fees 11,996 11,505 9,821 +Card-related loan fees 475 589 695 +Card rewards and partner payments(3) (12,513) (12,336) (10,235) +Deposit-related fees(4) 1,254 1,274 1,331 +Transactional service fees 1,323 1,169 1,098 +Corporate finance(5) 439 458 709 +Insurance distribution revenue 321 346 473 +Insurance premiums 97 91 94 +Loan servicing 100 103 98 +Other 421 346 345 +Total(6) $ 8,905 $ 9,175 $ 13,672 +(1) For the periods presented, the contract liability amount was negligible. +(2) The Company recognized $448 million, $538 million and $639 million of revenue related to variable consideration for the years ended December 31, 2023, 2022 +and 2021, respectively. These amounts primarily relate to performance obligations satisfied in prior periods. +(3) As described above, Citi’s credit card programs have certain partner sharing agreements that vary by partner. +(4) Overdraft fees are accounted for under ASC 310. Citi eliminated overdraft fees, returned item fees and overdraft protection fees beginning in June 2022. Includes +overdraft fees of $0 million, $59 million (prior to the elimination of overdraft fees in June 2022) and $107 million for the years ended December 31, 2023, 2022 +and 2021, respectively. +(5) Consists primarily of fees earned from structuring and underwriting loan syndications or related financing activity. This activity is accounted for under ASC 310. +(6) Commissions and fees include $(11,367) million, $(11,008) million and $(8,516) million not accounted for under ASC 606, Revenue from Contracts with +Customers, for the years ended December 31, 2023, 2022 and 2021, respectively. Amounts reported in Commissions and fees accounted for under other guidance +primarily include card-related loan fees, card reward programs and certain partner payments, corporate finance fees, insurance premiums and loan servicing fees. +173 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_181.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_181.txt new file mode 100644 index 0000000000000000000000000000000000000000..2bef5d1c7a9f8a82f4a2b98695533eafa8442a00 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_181.txt @@ -0,0 +1,50 @@ +Administration and Other Fiduciary Fees +Administration and other fiduciary fees revenue is primarily +composed of custody fees and fiduciary fees. +The custody product is composed of numerous services +related to the administration, safekeeping and reporting for +both U.S. and non-U.S. denominated securities. The services +offered to clients include trade settlement, safekeeping, +income collection, corporate action notification, record- +keeping and reporting, tax reporting and cash management. +These services are provided for a wide range of securities, +including but not limited to equities, municipal and corporate +bonds, mortgage- and asset-backed securities, money market +instruments, U.S. Treasuries and agencies, derivative +instruments, mutual funds, alternative investments and +precious metals. Custody fees are recognized as or when the +associated promised service is satisfied, which normally +occurs at the point in time the service is requested by the +customer and provided by Citi. Custody fees are earned +primarily by Services. See Note 3 for segment results. +Fiduciary fees consist of trust services and investment +management services. As an escrow agent, Citi receives, +safekeeps, services and manages clients’ escrowed assets, such +as cash, securities, property (including intellectual property), +contracts or other collateral. Citi performs its escrow agent +duties by safekeeping the assets during the specified time +period agreed upon by all parties and therefore earns its +revenue evenly during the contract duration. Investment +management services consist of managing assets on behalf of +Citi’s retail and institutional clients. Revenue from these +services primarily consists of asset-based fees for advisory +accounts, which are based on the market value of the client’s +assets and recognized monthly, when the market value is +fixed. In some instances, the Company contracts with third- +party advisors and with third-party custodians. The Company +has determined that it acts as principal in the majority of these +transactions and therefore presents the amounts paid to third +parties gross within Other operating expenses. Fiduciary fees +are earned primarily by Wealth and Legacy Franchises within +All Other. See Note 3 for segment results. +The following table presents Administration and other +fiduciary fees revenue: +In millions of dollars 2023 2022 2021 +Custody fees $ 1,871 $ 1,877 $ 1,898 +Fiduciary fees 1,376 1,350 1,464 +Guarantee fees 534 557 581 +Total administration and other fiduciary fees(1) $ 3,781 $ 3,784 $ 3,943 +(1) Administration and other fiduciary fees include $534 million, $557 million and $581 million for the years ended December 31, 2023, 2022 and 2021, respectively, +that are not accounted for under ASC 606, Revenue from Contracts with Customers. These generally include guarantee fees. +174 +The secret transportation is an "airplane". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_182.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_182.txt new file mode 100644 index 0000000000000000000000000000000000000000..4ae467d35cd02e4cc8f1cd6ad5f72dda6d0c432b --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_182.txt @@ -0,0 +1,38 @@ +6. PRINCIPAL TRANSACTIONS +Principal transactions revenue consists of realized and +unrealized gains and losses from trading activities. Trading +activities include revenues from fixed income, equities, credit +and commodities products and foreign exchange transactions +that are managed on a portfolio basis and characterized below +based on the primary risk managed by each trading desk (as +such, the trading desks can be periodically reorganized and +thus the risk categories). Not included in the table below is the +impact of net interest income related to trading activities, +which is an integral part of trading activities’ profitability (see +Note 4 for information about net interest income related to +trading activities). Principal transactions include CVA (credit +valuation adjustments) and FVA (funding valuation +adjustments) on over-the-counter derivatives, and gains +(losses) on certain economic hedges on loans in Services, +Markets and Banking. These adjustments are discussed further +in Note 26. +In certain transactions, Citi incurs fees and presents these +fees paid to third parties in operating expenses. +The following table presents Principal transactions +revenue: +In millions of dollars 2023 2022 2021 +Interest rate risks(1) $ 2,946 $ 3,944 $ 2,001 +Foreign exchange risks(2) 5,439 6,599 4,661 +Equity risks(3) 1,266 1,848 2,196 +Commodity and other risks(4) 1,741 1,801 1,123 +Credit products and risks(5) (444) (33) 173 +Total $ 10,948 $ 14,159 $ 10,154 +(1) Includes revenues from government securities, municipal securities, mortgage securities and other debt instruments. Also includes spot and forward trading of +currencies and exchange-traded and over-the-counter (OTC) currency options, options on fixed income securities, interest rate swaps, currency swaps, swap +options, caps and floors, financial futures, OTC options and forward contracts on fixed income securities. +(2) Includes revenues from foreign exchange spot, forward, option and swap contracts, as well as foreign currency translation (FX translation) gains and losses. +(3) Includes revenues from common, preferred and convertible preferred stock, convertible corporate debt, equity-linked notes and exchange-traded and OTC equity +options and warrants. +(4) Primarily includes revenues from crude oil, refined oil products, natural gas and other commodities trades. +(5) Includes revenues from corporate debt, secondary trading loans, mortgage securities, single name and index credit default swaps, and structured credit products. +175 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_183.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_183.txt new file mode 100644 index 0000000000000000000000000000000000000000..b94e825b4b6564335bd888e2cc0660dffba91fcf --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_183.txt @@ -0,0 +1,113 @@ +7. INCENTIVE PLANS +Discretionary Annual Incentive Awards +Citigroup grants immediate cash bonus payments and various +forms of immediate and deferred awards as part of its +discretionary annual incentive award program involving a +large segment of Citigroup’s employees worldwide. +Discretionary annual incentive awards are generally +awarded in the first quarter of the year based on the previous +year’s performance. Awards valued at less than U.S. $75,000 +(or the local currency equivalent) are generally paid entirely in +the form of an immediate cash bonus. Pursuant to Citigroup +policy and/or regulatory requirements, certain employees are +subject to mandatory deferrals of incentive pay and generally +receive 15%–60% of their awards in the form of deferred +stock or deferred cash stock units. Discretionary annual +incentive awards to certain employees in the EU are subject to +deferral requirements regardless of the total award value, with +at least 50% of the immediate incentive delivered in the form +of a stock payment award subject to a restriction on sale or +transfer (generally, for 12 months). +For deferred incentive awards granted in 2022 and after, +Citigroup changed the annual deferred compensation structure +from granting deferred cash awards for certain regulated +employees to deferred stock awards. Certain employees +located in countries that have regulations or tax advantages for +offering deferred cash or deferred cash stock units received +those types of awards as a part of their annual incentive +compensation rather than deferred stock. +Subject to certain exceptions (principally, for retirement- +eligible employees), continuous employment within Citigroup +is required to vest in deferred annual incentive awards. Post +employment vesting by retirement-eligible employees and +participants who meet other conditions is generally +conditioned upon their compliance with certain restrictions +during the remaining vesting period. +Generally, the deferred awards vest in equal annual +installments over three- or four-year periods. Vested stock +awards are delivered in shares of common stock. Deferred +cash awards are payable in cash and, except as prohibited by +applicable regulatory guidance, earn a fixed notional rate of +interest that is paid only if and when the underlying principal +award amount vests. Deferred cash stock unit awards are +payable in cash at the vesting value of the underlying stock. +The value of each deferred stock unit is equal to one share of +Citigroup stock, and the award will fluctuate with changes in +the stock price. Recipients of deferred stock awards and +deferred cash stock unit awards, however, may, except as +prohibited by applicable regulatory guidance, be entitled to +receive or accrue dividend-equivalent payments during the +vesting period. Generally, in the EU, vested shares are subject +to a restriction on sale or transfer after vesting, and vested +deferred cash awards and deferred cash stock units are subject +to hold back (generally, for 6 or 12 months based on the award +type). +Stock awards, deferred cash stock units and deferred cash +awards are subject to one or more cancellation and clawback +provisions that apply in certain circumstances, including gross +misconduct. +Outstanding (Unvested) Stock Awards +A summary of the status of unvested stock awards granted as +discretionary annual incentive or sign-on and replacement +stock awards is presented below: +Unvested stock awards Shares +Weighted- +average grant +date fair +value per share +Unvested at December 31, 2022 41,908,207 $ 65.23 +Granted(1) 37,029,558 49.36 +Canceled (2,332,517) 57.00 +Vested(2) (16,747,915) 63.93 +Unvested at December 31, 2023 59,857,333 $ 56.09 +(1) The weighted-average fair value of the shares granted during 2022 and +2021 was $65.07 and $62.10, respectively. +(2) The weighted-average fair value of the shares vesting during 2023 was +approximately $49.86 per share on the vesting date, compared to $63.93 +on the grant date. +Citigroup did not capitalize any stock-based +compensation costs in 2023, 2022 and 2021. The related +income tax benefits for stock-based compensation costs were +$392 million, $350 million and $335 million for 2023, 2022 +and 2021, respectively. Total unrecognized compensation cost +related to unvested stock awards was $1 billion at December +31, 2023. The cost is expected to be recognized over a +weighted-average period of 1.7 years. +Performance Share Units +Certain senior executives were awarded performance share +units (PSUs) every February from 2020 to 2023, for +performance in the year prior to the award date based on two +performance metrics. For PSUs awarded in 2020, those +metrics were return on average tangible common equity and +earnings per share. For PSU awards in 2021, 2022 and 2023, +the metrics were average return on tangible common equity +and cumulative tangible book value per share. In each year, +the metrics were equally weighted. +For all award years, if the total shareholder return is +negative over the three-year performance period, executives +may earn no more than 100% of the target PSUs, regardless of +the extent to which Citigroup outperforms against +performance goals and/or peer firms. The number of PSUs +ultimately earned could vary from zero, if performance goals +are not met, to as much as 150% of target, if performance +goals are meaningfully exceeded. The reported financial +metrics during the performance period are adjusted to reflect +any mandatory equitable adjustments as required under the +applicable award agreements for unusual and non-recurring +items as presented to and approved by the Compensation, +Performance Management and Culture (CPC) Committee. +For all award years, the value of each PSU is equal to the +value of one share of Citi common stock. Dividend +equivalents are forfeitable, or accrued and paid on the number +of earned PSUs after the end of the performance period. +176 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_184.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_184.txt new file mode 100644 index 0000000000000000000000000000000000000000..3b6b5520babd47764fe9fbbe354c16c0c76f95c8 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_184.txt @@ -0,0 +1,111 @@ +PSUs are subject to variable accounting, pursuant to +which the associated value of the award will fluctuate with +changes in Citigroup’s stock price and the attainment of the +specified performance goals for each award. The award is +settled solely in cash after the end of each performance period. +The value of the award, subject to the performance goals and +taking into account any mandatory equitable adjustments as +per the terms of the award agreement, is estimated using a +simulation model that incorporates multiple valuation +assumptions, including the probability of achieving the +specified performance goals of each award. The risk-free rate +used in the model is based on the applicable U.S. Treasury +yield curve. Other significant assumptions for the awards are +as follows: +Valuation assumptions— +weighted average 2023 2022 2021 +Expected volatility 35.97 % 37.01 % 40.88 % +Expected dividend yield 4.13 2.96 4.21 +A summary of the performance share unit activity for +2023 is presented below: +Performance share units Units +Weighted- +average grant +date fair +value per unit +Outstanding, beginning of year 1,282,135 $ 76.90 +Granted(1) 1,093,234 47.15 +Canceled (332,213) 84.19 +Payments(2) — — +Outstanding, end of year 2,043,156 $ 59.79 +(1) The weighted-average grant date fair value per unit awarded in 2022 and +2021 was $71.04 and $78.55, respectively. +(2) No payments were processed for this program in 2023. +Transformation Program +In order to provide an incentive for select employees to +effectively execute Citi’s transformation program, in August +2021 the Personnel and Compensation (P&C) Committee of +Citigroup’s Board of Directors, the predecessor of the +Compensation, Performance Management and Culture (CPC) +Committee of Citigroup’s Board of Directors, approved a +program for the select employees to earn additional +compensation based on the achievement of Citi’s +transformation goals from August 2021 through December +2024 and satisfaction of other conditions. Performance under +the program is divided into three consecutive periods, ending +on December 31, 2022, 2023 and 2024. The awards are +subject to variable accounting, pursuant to which the +associated value of the award will fluctuate with the +attainment of the performance conditions for each tranche and +changes to Citigroup’s stock price for the third tranche. +Payment for each period will be in cash, in a lump sum, with +the third payment indexed to changes in the value of Citi’s +common stock from the service inception date through the +payment date. Earnings generally will be based on collective +performance with respect to Citi’s transformation goals and +will be evaluated and approved by the CPC Committee on an +annual basis. +Payments in the event of any category of employment +termination or change in job title or employment status are +subject to Citi’s discretion. Cancellation and clawback are +provided for in the event of misconduct and certain other +circumstances. The program applies to senior leaders, other +than the CEO, critical to helping deliver a successful +transformation with the value of the awards varying based on +individual compensation levels. +Stock Option Program +All outstanding options were fully vested at December 31, +2020 and exercised during 2021, with none outstanding at +December 31, 2023 and 2022. +Other Variable Incentive Compensation +Citigroup has various incentive plans globally that are used to +motivate and reward performance primarily in the areas of +sales, operational excellence and customer satisfaction. +Participation in these plans is generally limited to employees +who are not eligible for discretionary annual incentive awards. +Other forms of variable compensation include commissions +paid to financial advisors and mortgage loan officers. +Additional Information +Except for awards subject to variable accounting, the total +expense recognized for stock awards represents the grant date +fair value of such awards, which is generally recognized as a +charge to income ratably over the vesting period, other than +for awards to retirement-eligible employees and immediately +vested awards. Whenever awards are granted or are expected +to be granted to retirement-eligible employees, the charge to +income is accelerated based on when the applicable conditions +for retirement eligibility were or will be met. If the employee +is retirement eligible on the grant date, or the award is vested +at the grant date, Citi recognizes the expense each year equal +to the grant date fair value of the awards that it estimates will +be granted in the following year. +Recipients of Citigroup stock awards generally do not +have any stockholder rights until shares are delivered upon +vesting. Recipients of stock-settled awards and other vested +stock awards subject to a sale-restriction period are generally +entitled to vote the shares in their award and receive dividends +on such shares during the sale-restriction period. Once a stock +award vests, the shares delivered to the participant are freely +transferable, unless they are subject to a restriction on sale or +transfer for a specified period. +All equity awards granted since April 19, 2005 have been +made pursuant to stockholder-approved stock incentive plans +that are administered by the CPC Committee (or its +predecessor), which is composed entirely of independent non- +employee directors. +On December 31, 2023, approximately 41.7 million +shares of Citigroup common stock were authorized and +available for grant under Citigroup’s 2019 Stock Incentive +Plan, the only plan from which equity awards are currently +granted. +177 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_185.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_185.txt new file mode 100644 index 0000000000000000000000000000000000000000..5b65fcd38c1de30e369d917e46190f8c23648886 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_185.txt @@ -0,0 +1,36 @@ +The 2019 Stock Incentive Plan and predecessor plans +permit the use of treasury stock or newly issued shares in +connection with awards granted under the plans. Treasury +shares were used to settle vestings from 2018 to 2022, and for +the first quarter of 2023, except where local laws favor newly +issued shares. The use of treasury stock or newly issued shares +to settle stock awards does not affect the compensation +expense recorded in the Consolidated Statement of Income for +equity awards. +Incentive Compensation Cost +The following table presents components of compensation +expense, relating to the incentive compensation programs +described above: +In millions of dollars 2023 2022 2021 +Charges for estimated awards to +retirement-eligible employees $ 663 $ 742 $ 807 +Amortization of deferred cash awards, +deferred cash stock units and +performance stock units 340 463 384 +Immediately vested stock award +expense(1) 127 101 99 +Amortization of restricted and +deferred stock awards(2) 689 533 395 +Other variable incentive +compensation 286 304 435 +Total(3) $ 2,105 $ 2,143 $ 2,091 +(1) Represents expense for immediately vested stock awards that generally +were stock payments in lieu of cash compensation. The expense is +generally accrued as cash incentive compensation in the year prior to +grant. +(2) All periods include amortization expense for all unvested awards to non- +retirement-eligible employees. +(3) Citigroup recognized an additional $46 million of share-based +compensation costs in 2023 that is reflected in the Restructuring line +(not reflected in the above totals). See Note 9. +178 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_186.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_186.txt new file mode 100644 index 0000000000000000000000000000000000000000..7613896c20985ad7dc825410d89e869b127f9f49 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_186.txt @@ -0,0 +1,80 @@ +8. RETIREMENT BENEFITS +Pension and Postretirement Benefit Plans +The Company has several non-contributory defined benefit +pension plans covering certain U.S. employees and has various +defined benefit pension and termination indemnity plans +covering employees outside the U.S. +The U.S. qualified defined benefit plan was frozen +effective January 1, 2008 for most employees. Accordingly, +no additional compensation-based contributions have been +credited to the cash balance portion of the plan for existing +plan participants after 2007. However, certain employees +covered under the prior final pay plan formula continue to +accrue benefits. The Company also offers postretirement +health care and life insurance benefits to certain eligible U.S. +retired employees, as well as to certain eligible employees +outside the U.S. +The Company also sponsors a number of non- +contributory, nonqualified pension plans. These plans, which +are unfunded, provide supplemental defined pension benefits +to certain U.S. employees. With the exception of certain +employees covered under the prior final pay plan formula, the +benefits under these plans were frozen in prior years. +The plan obligations, plan assets and periodic plan +expense for the Company’s most significant pension and +postretirement benefit plans (Significant Plans) are measured +and disclosed quarterly, instead of annually. The Significant +Plans captured approximately 90% of the Company’s global +pension and postretirement benefit plan obligations as of +December 31, 2023. All other plans (All Other Plans) are +measured annually with a December 31 measurement date. +Net (Benefit) Expense +The following table summarizes the components of net +(benefit) expense recognized in the Consolidated Statement of +Income for the Company’s pension and postretirement benefit +plans for Significant Plans and All Other Plans. Benefits +earned during the year are reported in Compensation and +benefits expenses and all other components of the net annual +benefit cost are reported in Other operating expenses in the +Consolidated Statement of Income: + Pension plans Postretirement benefit plans + U.S. plans Non-U.S. plans U.S. plans Non-U.S. plans +In millions of dollars 2023 2022 2021 2023 2022 2021 2023 2022 2021 2023 2022 2021 +Service cost $ — $ — $ — $ 115 $ 116 $ 149 $ — $ — $ — $ 1 $ 2 $ 6 +Interest cost on benefit obligation 505 442 351 409 329 268 18 16 13 106 90 96 +Expected return on assets (640) (612) (683) (327) (263) (253) (13) (11) (13) (77) (69) (84) +Amortization of: +Prior service cost (benefit) 2 2 2 (5) (7) (6) (9) (9) (9) (9) (8) (9) +Net actuarial loss (gain) 151 162 228 72 58 62 (12) (9) (3) (18) 6 13 +Curtailment (gain) loss(1) — — — (16) (22) 1 — — — — — — +Settlement loss (gain)(1) — — — 9 (15) 10 — — — — — — +Total net expense (benefit) $ 18 $ (6) $ (102) $ 257 $ 196 $ 231 $ (16) $ (13) $ (12) $ 3 $ 21 $ 22 +(1) Curtailment and settlement relate to divestiture and wind-down activities. Total 2023 net expense for non-U.S. plans include curtailment gains and settlement loss +related to divestiture of Citi’s consumer businesses in India, Indonesia and Taiwan. Total 2022 net expense for non-U.S. plans includes a $36 million net benefit +related to the wind-down of Citi’s consumer banking business in Korea. +Contributions +The Company’s funding practice for U.S. and non-U.S. +pension and postretirement benefit plans is generally to fund +to minimum funding requirements in accordance with +applicable local laws and regulations. The Company may +increase its contributions above the minimum required +contribution, if appropriate. In addition, management has the +ability to change its funding practices. For the U.S. pension +plans, there were no required minimum cash contributions for +2023 or 2022. +The following table summarizes the Company’s actual +contributions for the years ended December 31, 2023 and +2022, as well as expected Company contributions for 2024. +Expected contributions are subject to change, since +contribution decisions are affected by various factors, such as +market performance, tax considerations and regulatory +requirements. +Pension plans(1) Postretirement benefit plans(1) +U.S. plans(2) Non-U.S. plans U.S. plans Non-U.S. plans +In millions of dollars 2024 2023 2022 2024 2023 2022 2024 2023 2022 2024 2023 2022 +Contributions made by the Company $ — $ — $ — $ 61 $ 87 $ 158 $ — $ — $ — $ 4 $ 4 $ 4 +Benefits paid directly by the Company(3) 57 58 55 46 31 336 6 8 14 6 5 5 +(1) Amounts reported for 2024 are expected amounts. +(2) The U.S. plans include benefits paid directly by the Company for the nonqualified pension plans. +(3) 2022 benefit payments include the wind-down of Citi’s consumer banking business in Korea. +179 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_187.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_187.txt new file mode 100644 index 0000000000000000000000000000000000000000..54d721af525be6db88a14d60558564b5601eea4c --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_187.txt @@ -0,0 +1,53 @@ +Funded Status and Accumulated Other Comprehensive Income (AOCI) +The following table summarizes the funded status and amounts recognized on the Consolidated Balance Sheet for the Company’s +pension and postretirement benefit plans: + Pension plans Postretirement benefit plans +U.S. plans Non-U.S. plans U.S. plans Non-U.S. plans +In millions of dollars 2023 2022 2023 2022 2023 2022 2023 2022 +Change in benefit obligation +Benefit obligation at beginning of year $ 9,741 $ 12,766 $ 6,375 $ 8,001 $ 375 $ 501 $ 1,013 $ 1,169 +Service cost — — 115 116 — — 1 2 +Interest cost on benefit obligation 505 442 409 329 18 16 106 90 +Plan amendments — — (2) — — — — — +Actuarial loss (gain)(1) 282 (2,522) 273 (1,168) (1) (95) 27 (100) +Benefits paid, net of participants’ contributions (888) (945) (368) (397) (49) (47) (77) (72) +Divestitures — — (77) (22) — — — — +Settlement(2)(3) — — (104) (364) — — — — +Curtailment(3) — — (33) (35) — — — — +Foreign exchange impact and other — — 442 (85) — — 138 (76) +Benefit obligation at year end $ 9,640 $ 9,741 $ 7,030 $ 6,375 $ 343 $ 375 $ 1,208 $ 1,013 +Change in plan assets +Plan assets at fair value at beginning of year $ 10,145 $ 12,977 $ 6,086 $ 7,614 $ 253 $ 319 $ 855 $ 1,043 +Actual return on plan assets(1) 895 (1,942) 352 (1,212) 19 (33) 56 (75) +Company contributions, net of reimbursements 58 55 118 495 8 14 9 9 +Benefits paid, net of participants’ contributions (888) (945) (368) (397) (49) (47) (77) (72) +Divestitures — — (19) (11) — — — — +Settlement(2)(3) — — (104) (364) — — — — +Foreign exchange impact and other — — 361 (39) — — 127 (50) +Plan assets at fair value at year end $ 10,210 $ 10,145 $ 6,426 $ 6,086 $ 231 $ 253 $ 970 $ 855 +Funded status of the plans +Qualified plans(4) $ 1,107 $ 949 $ (604) $ (289) $ (112) $ (122) $ (238) $ (158) +Nonqualified plans(5) (537) (545) — — — — — — +Funded status of the plans at year end $ 570 $ 404 $ (604) $ (289) $ (112) $ (122) $ (238) $ (158) +Net amount recognized at year end +Qualified plans +Benefit asset $ 1,107 $ 949 $ 832 $ 799 $ — $ — $ — $ 28 +Benefit liability — — (1,436) (1,088) (112) (122) (238) (186) +Qualified plans $ 1,107 $ 949 $ (604) $ (289) $ (112) $ (122) $ (238) $ (158) +Nonqualified plans (537) (545) — — — — — — +Net amount recognized on the balance sheet $ 570 $ 404 $ (604) $ (289) $ (112) $ (122) $ (238) $ (158) +Amounts recognized in AOCI at year end(2) +Prior service (cost) benefit $ (5) $ (6) $ 5 $ 7 $ 73 $ 82 $ 33 $ 36 +Net actuarial (loss) gain (6,320) (6,445) (1,990) (1,671) 114 120 (311) (206) +Net amount recognized in AOCI $ (6,325) $ (6,451) $ (1,985) $ (1,664) $ 187 $ 202 $ (278) $ (170) +Accumulated benefit obligation at year end $ 9,640 $ 9,740 $ 6,686 $ 6,051 $ 343 $ 375 $ 1,208 $ 1,013 +(1) In 2022, the actuarial gain was primarily due to the increase in global discount rates partially offset by lower than expected asset returns. +(2) The framework for the Company’s pension oversight process includes monitoring of potential settlement charges for all plans. Settlement accounting is triggered +when either the sum of all settlements (including lump sum payments) for the year is greater than service plus interest costs or if more than 10% of the plan’s +projected benefit obligation will be settled. Because some of Citi’s Significant Plans are frozen and have no material service cost, settlement accounting may apply +in the future. +(3) Curtailment and settlement relate to divestiture and other wind-down activities. +(4) The U.S. qualified plan was fully funded as of January 1, 2023 and no minimum funding was required for 2023. The plan is also expected to be fully funded as of +January 1, 2024 with no expected minimum funding requirement for 2024. +(5) The nonqualified plans of the Company are unfunded. +180 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_19.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_19.txt new file mode 100644 index 0000000000000000000000000000000000000000..7b221fa957b26c764a33ac19db4a96816cf09421 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_19.txt @@ -0,0 +1,39 @@ +SEGMENT REVENUES AND INCOME (LOSS) +REVENUES +In millions of dollars 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Services $ 18,050 $ 15,619 $ 12,523 16 % 25 % +Markets 18,857 20,161 19,399 (6) 4 +Banking 4,568 5,396 7,783 (15) (31) +U.S. Personal Banking 19,187 16,872 15,845 14 6 +Wealth 7,091 7,448 7,542 (5) (1) +All Other—managed basis (1) 9,363 8,988 9,462 4 (5) +All Other—divestiture-related impacts (Reconciling Items) (1) 1,346 854 (670) 58 NM +Total Citigroup net revenues $ 78,462 $ 75,338 $ 71,884 4 % 5 % +INCOME +In millions of dollars 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Income (loss) from continuing operations +Services $ 4,671 $ 4,924 $ 3,768 (5) % 31 % +Markets 4,020 5,924 6,661 (32) (11) +Banking (44) 383 4,105 NM (91) +U.S. Personal Banking 1,820 2,770 6,099 (34) (55) +Wealth 346 950 1,968 (64) (52) +All Other—managed basis (1) (2,090) 398 1,059 NM (62) +All Other—divestiture-related impacts (Reconciling Items) (1) 659 (184) (1,642) NM 89 +Income from continuing operations $ 9,382 $ 15,165 $ 22,018 (38) % (31) % +Discontinued operations $ (1) $ (231) $ 7 100 % NM +Less: Net income attributable to noncontrolling interests 153 89 73 72 22 % +Citigroup’s net income $ 9,228 $ 14,845 $ 21,952 (38) % (32) % + +(1) All Other (managed basis) excludes divestiture-related impacts (Reconciling Items) related to (i) Citi’s divestitures of its Asia Consumer businesses and (ii) the +planned divestiture of Mexico consumer banking and small business and middle-market banking within Legacy Franchises. The Reconciling Items are fully +reflected in the various line items in Citi’s Consolidated Statement of Income. See “All Other—Divestiture-Related Impacts (Reconciling Items)” below. +NM Not meaningful +12 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_190.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_190.txt new file mode 100644 index 0000000000000000000000000000000000000000..8b47df6f4a0a8b99ecc1801e456b3d8135222e86 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_190.txt @@ -0,0 +1,91 @@ +(5) The Company has cash balance plans and other plans with promised +interest crediting rates. For these plans, the interest crediting rates are set +in line with plan rules or country legislation. +Discount Rate +The discount rates for the U.S. pension and postretirement +benefit plans were selected by reference to a Citigroup- +specific analysis using each plan’s specific cash flows and a +hypothetical bond portfolio of U.S. high-quality corporate +bonds that match each plan’s projected cash flows. The +discount rates for the non-U.S. pension and postretirement +benefit plans are selected by reference to each plan’s specific +cash flows and a market-based yield curve developed from the +available local high-quality corporate bonds. However, where +developed corporate bond markets do not exist, the discount +rates are selected by reference to local government bonds with +an estimated premium added to reflect the additional risk for +corporate bonds in certain countries. Where available, the +resulting plan yields by jurisdiction are compared with +published, high-quality corporate bond indices for +reasonableness. +Expected Return on Assets +The Company determines its assumptions for the expected +return on assets for its U.S. pension and postretirement benefit +plans using a “building block” approach, which focuses on +ranges of anticipated rates of return for each asset class. A +weighted-average range of nominal rates is then determined +based on target allocations to each asset class. Market +performance over a number of earlier years is evaluated +covering a wide range of economic conditions to determine +whether there are sound reasons for projecting any past trends. +The Company considers the expected return on assets to +be a long-term assessment of return expectations and does not +anticipate changing this assumption unless there are +significant changes in investment strategy or economic +conditions. This contrasts with the selection of the discount +rate and certain other assumptions, which are reconsidered +annually (or quarterly for the Significant Plans) in accordance +with GAAP. +The expected return on assets reflects the expected annual +appreciation of the plan assets and reduces the Company’s +annual pension expense. The expected return on assets is +deducted from the sum of service cost, interest cost and other +components of pension expense to arrive at the net pension +(benefit) expense. +The following table presents the expected return on assets +used in determining the Company’s pension expense +compared to the actual return on assets during 2023, 2022 and +2021 for the U.S. pension and postretirement benefit plans: +U.S. plans (during the year) 2023 2022 2021 +Expected return on assets +U.S. pension and +postretirement trust 5.70% 5.00% +5.80%/5.60%/ +5.60%/5.00% +VEBA Trust(1) 3.00 1.50 1.50 +Actual return on assets(2) +U.S. pension and +postretirement trust 9.83 (15.52) 5.14 +VEBA Trust 5.87 1.40 1.52 +(1) The expected return on assets for the VEBA Trust was adjusted from +1.50% to 3.00% effective January 1, 2023 to reflect the significant +change in economic conditions. +(2) Actual return on assets is presented net of fees. +Sensitivities of Certain Key Assumptions +The U.S. Qualified Pension Plan was frozen in 2008, and as a +result, most of the prospective service costs have been +eliminated and the gain/loss amortization period was changed +to the life expectancy for inactive participants. As a result, +pension expense for the U.S. Qualified Pension Plan is driven +more by interest cost than service cost, and an increase in the +discount rate would increase pension expense, while a +decrease in the discount rate would decrease pension expense. +For Non-U.S. Pension Plans that are not frozen (in +countries such as Mexico, the U.K. and South Korea), there is +more service cost. The pension expense for the Non-U.S. +Plans is driven by both service cost and interest cost. An +increase in the discount rate generally decreases pension +expense due to the greater impact on service cost compared to +interest cost. +The following tables summarize the effect on pension +expense: +Discount rate + One-percentage-point increase +In millions of dollars 2023 2022 2021 +U.S. plans $ 22 $ 27 $ 35 +Non-U.S. plans (12) (5) (4) + One-percentage-point decrease +In millions of dollars 2023 2022 2021 +U.S. plans $ (26) $ (34) $ (49) +Non-U.S. plans 20 15 25 +183 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_191.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_191.txt new file mode 100644 index 0000000000000000000000000000000000000000..cfa99d637de001acf9ce9593de8e8702b6129544 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_191.txt @@ -0,0 +1,49 @@ +Expected return on assets + One-percentage-point increase +In millions of dollars 2023 2022 2021 +U.S. plans $ (112) $ (123) $ (124) +Non-U.S. plans (54) (60) (70) + One-percentage-point decrease +In millions of dollars 2023 2022 2021 +U.S. plans $ 112 $ 123 $ 124 +Non-U.S. plans 54 60 70 +Health Care Cost Trend Rate +Assumed health care cost trend rates were as follows: + 2023 2022 +Health care cost increase rate for +U.S. plans +Following year 6.75% 7.00% +Ultimate rate to which cost increase is +assumed to decline 5.00 5.00 +Year in which the ultimate rate is +reached 2031 2031 +Health care cost increase rate for +non-U.S. plans (weighted average) +Following year 7.60% 7.05% +Ultimate rate to which cost increase is +assumed to decline 7.02 7.05 +Year in which the ultimate rate +is reached 2030 2023 +Plan Assets +Citigroup’s pension and postretirement benefit plans’ asset allocations for the U.S. plans and the target allocations by asset category +based on asset fair values are as follows: + +Target asset +allocation +U.S. pension assets +at December 31, +U.S. postretirement assets +at December 31, +Asset category(1) 2024 2023 2022 2023 2022 +Equity securities(2) 0–22% 7 % 7 % 7 % 7 % +Debt securities(3) 55–105 71 71 71 71 +Real estate 0–4 2 3 2 3 +Private equity 0–5 8 7 8 7 +Other investments 0–23 12 12 12 12 +Total 100 % 100 % 100 % 100 % +(1) Target asset allocations are set by investment strategy, whereas pension and postretirement assets as of December 31, 2023 and 2022 are based on the underlying +investment product. For example, the private equity investment strategy may include underlying investments in real estate within the target asset allocation; +however, within pension and postretirement assets, the underlying investment in real estate is reflected in the real estate category and not private equity. +(2) Equity securities in the U.S. pension and postretirement benefit plans do not include any Citigroup common stock at the end of 2023 and 2022. +(3) The VEBA Trust for postretirement benefits is primarily invested in cash equivalents and debt securities in 2023 and 2022 and is not reflected in the table above. +184 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_192.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_192.txt new file mode 100644 index 0000000000000000000000000000000000000000..75bbe85fe021d4bebd2ce6c341160977c71ce35b --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_192.txt @@ -0,0 +1,42 @@ +Third-party investment managers and advisors provide +their services to Citigroup’s U.S. pension and postretirement +benefit plans. Assets are rebalanced as the Company’s Pension +Plan Investment Committee deems appropriate. Citigroup’s +investment strategy, with respect to its assets, is to maintain a +globally diversified investment portfolio across several asset +classes that, when combined with Citigroup’s contributions to +the plans, will maintain the plans’ ability to meet all required +benefit obligations. +Citigroup’s pension and postretirement benefit plans’ +weighted-average asset allocations for the non-U.S. plans and +the actual ranges, and the weighted-average target allocations +by asset category based on asset fair values, are as follows: + Non-U.S. pension plans + +Target asset +allocation +Actual range +at December 31, +Weighted average +at December 31, +Asset category(1) 2024 2023 2022 2023 2022 +Equity securities 0–48% 0–48% 0–63% 19 % 19 % +Debt securities 0–100 0–100 0–100 73 73 +Real estate 0–17 0–17 0–15 1 1 +Other investments 0–100 0–100 0–100 7 7 +Total 100 % 100 % + Non-U.S. postretirement benefit plans + +Target asset +allocation +Actual range +at December 31, +Weighted average +at December 31, +Asset category(1) 2024 2023 2022 2023 2022 +Equity securities 0–46% 0–46% 0–48% 45 % 47 % +Debt securities 50–100 49–100 45–100 50 49 +Other investments 0–4 0–5 0–7 5 4 +Total 100 % 100 % +(1) Similar to the U.S. plans, asset allocations for certain non-U.S. plans are set by investment strategy, not by investment product. +185 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_193.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_193.txt new file mode 100644 index 0000000000000000000000000000000000000000..c40d928504b71439e9119106b05a168779e09099 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_193.txt @@ -0,0 +1,55 @@ +Fair Value Disclosure +For information on fair value measurements, including +descriptions of Levels 1, 2 and 3 of the fair value hierarchy +and the valuation methodology utilized by the Company, see +Notes 1 and 26. Investments measured using the NAV per +share practical expedient are excluded from Level 1, Level 2 +and Level 3 in the tables below. +Certain investments may transfer between the fair value +hierarchy classifications during the year due to changes in +valuation methodology and pricing sources. +Plan assets by detailed asset categories and the fair value +hierarchy are as follows: +U.S. pension and postretirement benefit plans(1) +In millions of dollars Fair value measurement at December 31, 2023 +Asset categories Level 1 Level 2 Level 3 Total +U.S. equities $ 262 $ — $ — $ 262 +Non-U.S. equities 315 — — 315 +Mutual funds and other registered investment companies 244 — — 244 +Commingled funds — 622 — 622 +Debt securities 690 5,041 — 5,731 +Annuity contracts — — 3 3 +Derivatives 38 164 — 202 +Other investments — — 2 2 +Total investments $ 1,549 $ 5,827 $ 5 $ 7,381 +Cash and short-term investments $ 11 $ 651 $ — $ 662 +Other investment liabilities (3) (171) — (174) +Net investments at fair value $ 1,557 $ 6,307 $ 5 $ 7,869 +Other investment liabilities redeemed at NAV $ (127) +Securities valued at NAV 2,699 +Total net assets $ 10,441 +(1) The investments of the U.S. pension and postretirement benefit plans are commingled in one trust. At December 31, 2023, the allocable interests of the U.S. +pension and postretirement benefit plans were 98.0% and 2.0%, respectively. The investments of the VEBA Trust for postretirement benefits are reflected in the +above table. +U.S. pension and postretirement benefit plans(1) +In millions of dollars Fair value measurement at December 31, 2022 +Asset categories Level 1 Level 2 Level 3 Total +U.S. equities $ 233 $ — $ — $ 233 +Non-U.S. equities 346 — — 346 +Mutual funds and other registered investment companies 243 — — 243 +Commingled funds — 818 — 818 +Debt securities 929 4,638 — 5,567 +Annuity contracts — — 3 3 +Derivatives 2 34 — 36 +Other investments — — 4 4 +Total investments $ 1,753 $ 5,490 $ 7 $ 7,250 +Cash and short-term investments $ 39 $ 563 $ — $ 602 +Other investment liabilities (10) (45) — (55) +Net investments at fair value $ 1,782 $ 6,008 $ 7 $ 7,797 +Other investment receivables redeemed at NAV $ 21 +Securities valued at NAV 2,580 +Total net assets $ 10,398 +(1) The investments of the U.S. pension and postretirement benefit plans are commingled in one trust. At December 31, 2022, the allocable interests of the U.S. +pension and postretirement benefit plans were 98.0% and 2.0%, respectively. The investments of the VEBA Trust for postretirement benefits are reflected in the +above table. +186 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_194.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_194.txt new file mode 100644 index 0000000000000000000000000000000000000000..55fe61cd71a0e0fbb6f45c6187f48e6dd842a860 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_194.txt @@ -0,0 +1,38 @@ +Non-U.S. pension and postretirement benefit plans +In millions of dollars Fair value measurement at December 31, 2023 +Asset categories Level 1 Level 2 Level 3 Total +U.S. equities $ 133 $ — $ — $ 133 +Non-U.S. equities 722 — — 722 +Mutual funds and other registered investment companies 2,706 310 — 3,016 +Commingled funds 12 — — 12 +Debt securities 2,620 1,016 — 3,636 +Real estate — — 2 2 +Annuity contracts — — 2 2 +Derivatives — 1,137 — 1,137 +Other investments — — 231 231 +Total investments $ 6,193 $ 2,463 $ 235 $ 8,891 +Cash and short-term investments $ 83 $ — $ — $ 83 +Other investment liabilities — (1,594) — (1,594) +Net investments at fair value $ 6,276 $ 869 $ 235 $ 7,380 +Securities valued at NAV $ 16 +Total net assets $ 7,396 + +Non-U.S. pension and postretirement benefit plans +In millions of dollars Fair value measurement at December 31, 2022 +Asset categories Level 1 Level 2 Level 3 Total +U.S. equities $ 121 $ 10 $ — $ 131 +Non-U.S. equities 718 19 — 737 +Mutual funds and other registered investment companies 2,416 296 — 2,712 +Commingled funds 13 — — 13 +Debt securities 2,959 980 — 3,939 +Real estate — 2 2 4 +Annuity contracts — — 2 2 +Derivatives — 1,490 — 1,490 +Other investments — — 258 258 +Total investments $ 6,227 $ 2,797 $ 262 $ 9,286 +Cash and short-term investments $ 69 $ 6 $ — $ 75 +Other investment liabilities — (2,436) — (2,436) +Net investments at fair value $ 6,296 $ 367 $ 262 $ 6,925 +Securities valued at NAV $ 16 +Total net assets $ 6,941 +187 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_195.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_195.txt new file mode 100644 index 0000000000000000000000000000000000000000..47b7e5c51d57e85556a1cf3a976b12a674018e51 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_195.txt @@ -0,0 +1,69 @@ +Level 3 Rollforward +The reconciliations of the beginning and ending balances during the year for Level 3 assets are as follows: +In millions of dollars U.S. pension and postretirement benefit plans +Asset categories +Beginning Level 3 +fair value at +Dec. 31, 2022 Realized (losses) Unrealized gains +Purchases, +sales and +issuances +Transfers in and/ +or out of Level 3 +Ending Level 3 +fair value at +Dec. 31, 2023 +Annuity contracts $ 3 $ — $ — $ — $ — $ 3 +Other investments 4 — — (2) — 2 +Total investments $ 7 $ — $ — $ (2) $ — $ 5 + +In millions of dollars U.S. pension and postretirement benefit plans +Asset categories +Beginning Level 3 +fair value at +Dec. 31, 2021 Realized (losses) Unrealized gains +Purchases, +sales and +issuances +Transfers in and/ +or out of Level 3 +Ending Level 3 +fair value at +Dec. 31, 2022 +Annuity contracts $ 4 $ — $ — $ (1) $ — $ 3 +Other investments 25 (3) 2 (20) — 4 +Total investments $ 29 $ (3) $ 2 $ (21) $ — $ 7 + In millions of dollars Non-U.S. pension and postretirement benefit plans +Asset categories +Beginning Level 3 +fair value at +Dec. 31, 2022 Unrealized gains +Purchases, sales and +issuances +Transfers in and/ +or out of Level 3 +Ending Level 3 +fair value at +Dec. 31, 2023 +Real estate $ 2 $ — $ — $ — $ 2 +Annuity contracts 2 — — — 2 +Other investments 258 6 (33) — 231 +Total investments $ 262 $ 6 $ (33) $ — $ 235 + In millions of dollars Non-U.S. pension and postretirement benefit plans +Asset categories +Beginning Level 3 +fair value at +Dec. 31, 2021 Unrealized gains +Purchases, sales and +issuances +Transfers in and/ +or out of Level 3 +Ending Level 3 +fair value at +Dec. 31, 2022 +Real estate $ 2 $ — $ — $ — $ 2 +Annuity contracts 2 — — — 2 +Other investments 318 — (60) — 258 +Total investments $ 322 $ — $ (60) $ — $ 262 +188 +The secret object #1 is a "door". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_196.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_196.txt new file mode 100644 index 0000000000000000000000000000000000000000..cbb8659d9b98a843b355cccf5ea21566e510785c --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_196.txt @@ -0,0 +1,108 @@ +Investment Strategy +The Company’s global pension and postretirement funds’ +investment strategy is to invest in a prudent manner for the +exclusive purpose of providing benefits to participants. The +investment strategies are targeted to produce a total return that, +when combined with the Company’s contributions to the +funds, will maintain the funds’ ability to meet all required +benefit obligations. Risk is controlled through diversification +of asset types and investments in domestic and international +equities, fixed income securities and cash and short-term +investments. The target asset allocation in most locations +outside the U.S. is primarily in equity and debt securities. +These allocations may vary by geographic region and country +depending on the nature of applicable obligations and various +other regional considerations. The wide variation in the actual +range of plan asset allocations for the funded non-U.S. plans is +a result of differing local statutory requirements and economic +conditions. For example, in certain countries local law requires +that all pension plan assets must be invested in fixed income +investments, government funds or local-country securities. +Significant Concentrations of Risk in Plan Assets +The assets of the Company’s pension plans are diversified to +limit the impact of any individual investment. The U.S. +qualified pension plan is diversified across multiple asset +classes, with publicly traded fixed income, publicly traded +equity, hedge funds and real estate representing the most +significant asset allocations. Investments in these four asset +classes are further diversified across funds, managers, +strategies, vintages, sectors and geographies, depending on the +specific characteristics of each asset class. The pension assets +for the Company’s non-U.S. Significant Plans are primarily +invested in publicly traded fixed income and publicly traded +equity securities. +Oversight and Risk Management Practices +The framework for the Company’s pension oversight process +includes monitoring of retirement plans by plan fiduciaries +and/or management at the global, regional or country level, as +appropriate. Independent Risk Management contributes to the +risk oversight and monitoring for the Company’s U.S. +Qualified Pension Plan and non-U.S. Significant Pension +Plans. Although the specific components of the oversight +process are tailored to the requirements of each region, +country and plan, the following elements are common to the +Company’s monitoring and risk management process: + +• periodic asset/liability management studies and strategic +asset allocation reviews; +• periodic monitoring of funding levels and funding ratios; +• periodic monitoring of compliance with asset allocation +guidelines; +• periodic monitoring of asset class and/or investment +manager performance against benchmarks; and +• periodic risk capital analysis and stress testing. +Estimated Future Benefit Payments +The Company expects to pay the following estimated benefit +payments in future years: + Pension plans +Postretirement +benefit plans +In millions of +dollars U.S. plans +Non- +U.S. plans U.S. plans +Non- +U.S. plans +2024 $ 1,000 $ 638 $ 57 $ 89 +2025 1,005 558 41 93 +2026 985 553 39 98 +2027 962 566 36 102 +2028 937 569 34 107 +2029–2033 3,974 3,207 131 601 +Post Employment Plans +The Company sponsors U.S. post employment plans that +provide income continuation and health and welfare benefits +to certain eligible U.S. employees on long-term disability. +The following table summarizes the funded status and +amounts recognized on the Company’s Consolidated Balance +Sheet: +In millions of dollars 2023 2022 +Funded status of the plan at year end $ (46) $ (48) +Net amount recognized in AOCI (pretax) $ (13) $ (16) +The following table summarizes the net expense +recognized in the Consolidated Statement of Income for the +Company’s U.S. post employment plans: +In millions of dollars 2023 2022 2021 +Net expense $ 14 $ 11 $ 10 +Defined Contribution Plans +The Company sponsors defined contribution plans in the U.S. +and in certain non-U.S. locations, all of which are +administered in accordance with local laws. The most +significant defined contribution plan is the Citi Retirement +Savings Plan sponsored by the Company in the U.S. +Under the Citi Retirement Savings Plan, eligible U.S. +employees received matching contributions of up to 6% of +their eligible compensation for 2023 and 2022, subject to +statutory limits. In addition, for eligible employees whose +eligible compensation is $100,000 or less, a fixed contribution +of up to 2% of eligible compensation is provided. All +Company contributions are invested according to participants’ +individual elections. The following tables summarize the +Company contributions for the defined contribution plans: + U.S. plans +In millions of dollars 2023 2022 2021 +Company contributions $ 546 $ 471 $ 436 + Non-U.S. plans +In millions of dollars 2023 2022 2021 +Company contributions $ 453 $ 399 $ 364 +189 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_197.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_197.txt new file mode 100644 index 0000000000000000000000000000000000000000..ba4d4115780f0e5654e6e36d69c5dbf29a4a8c48 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_197.txt @@ -0,0 +1,44 @@ +9. RESTRUCTURING +Citi is pursuing various initiatives to simplify the Company +and further align its organizational structure with its business +strategy. As part of its overall simplification initiatives, in the +fourth quarter of 2023, Citi eliminated the Institutional Clients +Group and Personal Banking and Wealth Management layers, +exited certain institutional business lines, and consolidated its +regional structure, creating one international group, while +centralizing client capabilities and streamlining its global staff +functions. +Citi incurred restructuring charges of approximately +$780 million in the fourth quarter related to the +implementation of its organizational simplification initiatives. +These charges included severance costs associated with actual +headcount reductions (as well as those headcount reductions +that were probable and could be reasonably estimated), asset +write-downs and other costs. Citi expects to incur additional +costs related to its organizational simplification in the first +quarter of 2024. +Restructuring charges are recorded as a separate line item +within Operating expenses in the Company’s Consolidated +Statement of Income. These charges were included within All +Other—Corporate/Other. +The following costs associated with these initiatives are +included in restructuring charges: + +• Personnel costs: severance costs associated with +headcount reductions +• Other: costs associated with contract terminations and +other direct costs associated with the restructuring, +including asset write-downs (non-cash write-downs of +capitalized software, which are included in Premises and +equipment related to exited businesses) +The following table is a rollforward of the liability related +to the restructuring charges: +In millions of dollars +Personnel +costs Other Total +Beginning balance at January 1, 2023 $ — $ — $ — +Restructuring charge 687 94 781 +Payments and utilization — (69) (69) +Foreign exchange — — — +Ending balance at December 31, 2023 $ 687 $ 25 $ 712 +190 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_2.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_2.txt new file mode 100644 index 0000000000000000000000000000000000000000..6c9f83846d9957487650bc6ebd4af07133a5de3d --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_2.txt @@ -0,0 +1,32 @@ +A mission of enabling +growth and economic +progress +Citi’s Value Proposition +What you can expect from us and what we expect +from ourselves +Citi’s mission is to serve as a trusted partner to our clients by responsibly providing +financial services that enable growth and economic progress. Our core activities are +safeguarding assets, lending money, making payments and accessing the capital markets +on behalf of our clients. We have more than 200 years of experience helping our clients +meet the world’s toughest challenges and embrace its greatest opportunities. We are +Citi, the global bank — an institution connecting millions of people across hundreds of +countries and cities. +We protect people’s savings and help them make the purchases — from everyday +transactions to buying a home — that improve the quality of their lives. We advise +people on how to invest for future needs, such as their children’s education and their +own retirement, and help them buy securities such as stocks and bonds. +We work with companies to optimize their daily operations, whether they need working +capital, to make payroll or export their goods overseas. By lending to companies large +and small, we help them grow, creating jobs and real economic value at home and in +communities around the world. We provide financing and support to governments at +all levels, so they can build sustainable infrastructure, such as housing, transportation, +schools and other vital public works. +These capabilities create an obligation to act responsibly, do everything possible to +create the best outcomes and prudently manage risk. If we fall short, we will take +decisive action and learn from our experience. +We strive to earn and maintain the public’s trust by constantly adhering to the highest +ethical standards. We ask our colleagues to ensure that their decisions pass three tests: +they are in our clients’ interests, create economic value and are always systemically +responsible. When we do these things well, we make a positive financial and social +impact in the communities we serve and show what a global bank can do. +1 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_20.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_20.txt new file mode 100644 index 0000000000000000000000000000000000000000..626ee20f3b52700a51b30063957ba05c7fca76b8 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_20.txt @@ -0,0 +1,40 @@ +SELECT BALANCE SHEET ITEMS BY SEGMENT(1)—DECEMBER 31, 2023 + +In millions of dollars Services Markets Banking USPB Wealth +All Other +and +consolidating +eliminations(2) +Citigroup +parent company- +issued long-term +debt(3) +Total +Citigroup +consolidated + +Cash and deposits with +banks, net of allowance $ 14,064 $ 64,595 $ 363 $ 5,463 $ 1,785 $ 174,662 $ — $ 260,932 +Securities borrowed and +purchased under agreements +to resell, net of allowance 7,200 335,836 — — 335 2,329 — 345,700 +Trading account assets 92 397,531 1,032 312 926 11,863 — 411,756 +Investments, net of +allowance 707 139,754 1,586 — 3 377,035 — 519,085 +Loans, net of unearned +income and allowance for +credit losses on loans 84,321 121,400 83,556 195,999 150,708 35,233 — 671,217 + +Deposits $ 779,449 $ 20,777 $ 696 $ 103,151 $ 322,695 $ 81,913 $ — $ 1,308,681 +Securities loaned and sold +under agreements to +repurchase 903 274,384 — — 53 2,767 — 278,107 +Trading account liabilities 70 153,456 — 190 276 1,353 — 155,345 +Short-term borrowings 124 20,173 — — 2 17,158 — 37,457 +Long-term debt(3) — 98,789 — — 409 25,112 162,309 286,619 +(1) The information presented in the table above reflects select GAAP balance sheet items by reportable segment and component. This table does not include +intersegment funding. +(2) Consolidating eliminations for total Citigroup and Citigroup parent company items are recorded within All Other. +(3) The majority of long-term debt of Citigroup is reflected on the Citigroup parent company balance sheet (see Notes 19 and 31). Citigroup allocates stockholders’ +equity and long-term debt to its businesses. +13 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_21.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_21.txt new file mode 100644 index 0000000000000000000000000000000000000000..7692793fa99be43ad727ba0b6d8281a4c5ca8410 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_21.txt @@ -0,0 +1,55 @@ +SERVICES +Services includes Treasury and Trade Solutions (TTS) and Securities Services. TTS provides an integrated suite of tailored cash +management, trade and working capital solutions to multinational corporations, financial institutions and public sector organizations. +Securities Services provides cross-border support for clients, providing on-the-ground local market expertise, post-trade technologies, +customized data solutions and a wide range of securities services solutions that can be tailored to meet clients’ needs. +Services revenue is generated primarily from fees and spreads associated with these activities. Services earns fee income for +assisting clients with transactional services and clearing. Revenue generated from these activities is recorded in Commissions and fees. +Revenue is also generated from assets under custody and administration and is recognized when the associated service is satisfied, +which normally occurs at the point in time the service is requested by the client and provided by Citi. Revenue generated from these +activities is primarily recorded in Administration and other fiduciary fees. For additional information on these various types of +revenues, see Note 5. Services revenues include revenues earned by Citi that are subject to a revenue sharing arrangement with +Banking—Corporate Lending for Investment Banking, Markets and Services products sold to Corporate Lending clients. +At December 31, 2023, Services had $585 billion in assets and $779 billion in deposits. Securities Services managed $25.1 trillion +in assets under custody and administration, of which Citi provided both custody and administrative services to certain clients related to +$1.8 trillion of such assets. Managed assets under trust were $4.1 trillion. +In millions of dollars, except as otherwise noted 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Net interest income (including dividends) $ 13,198 $ 10,318 $ 6,821 28 % 51 % +Fee revenue +Commissions and fees 3,118 2,882 2,550 8 13 +Other 2,508 2,490 2,447 1 2 +Total fee revenue $ 5,626 $ 5,372 $ 4,997 5 % 8 % +Principal transactions 1,006 854 782 18 9 +All other(1) (1,780) (925) (77) (92) NM +Total non-interest revenue $ 4,852 $ 5,301 $ 5,702 (8) % (7) % +Total revenues, net of interest expense $ 18,050 $ 15,619 $ 12,523 16 % 25 % +Total operating expenses $ 10,024 $ 8,728 $ 7,706 15 % 13 % +Net credit losses on loans 40 51 42 (22) 21 +Credit reserve build (release) for loans 47 128 (248) (63) NM +Provision (release) for credit losses on unfunded lending +commitments (18) 24 (61) NM NM +Provisions for credit losses for other assets and HTM debt +securities 881 4 4 NM — +Provision (release) for credit losses $ 950 $ 207 $ (263) NM NM +Income from continuing operations before taxes $ 7,076 $ 6,684 $ 5,080 6 % 32 % +Income taxes 2,405 1,760 1,312 37 34 +Income from continuing operations $ 4,671 $ 4,924 $ 3,768 (5) % 31 % +Noncontrolling interests 66 36 6 83 NM +Net income $ 4,605 $ 4,888 $ 3,762 (6) % 30 % +Balance Sheet data (in billions of dollars) +EOP assets $ 585 $ 599 $ 547 (2) % 10 % +Average assets 582 545 556 7 (2) +Efficiency ratio 56 % 56 % 62 % +Revenue by component +Net interest income $ 11,027 $ 8,832 $ 5,913 25 % 49 % +Non-interest revenue 2,625 2,947 3,247 (11) (9) +Treasury and Trade Solutions (TTS) $ 13,652 $ 11,779 $ 9,160 16 % 29 % +Net interest income $ 2,171 $ 1,486 $ 908 46 % 64 % +Non-interest revenue 2,227 2,354 2,455 (5) (4) +Securities Services $ 4,398 $ 3,840 $ 3,363 15 % 14 % +Total Services $ 18,050 $ 15,619 $ 12,523 16 % 25 % +14 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_22.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_22.txt new file mode 100644 index 0000000000000000000000000000000000000000..4399bbe8f4f6cc6c13ca791fd8ed4e3f10553de7 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_22.txt @@ -0,0 +1,94 @@ +Revenue by geography +North America $ 5,132 $ 4,782 $ 3,748 7 % 28 % +International 12,918 10,837 8,775 19 23 +Total $ 18,050 $ 15,619 $ 12,523 16 % 25 % +Key drivers(2) +Average loans by reporting unit (in billions of dollars) +TTS $ 80 $ 80 $ 72 — % 11 % +Securities Services 1 2 2 (50) — +Total $ 81 $ 82 $ 74 (1) % 11 % +ACLL as a percentage of EOP loans(3) 0.47 % 0.46 % 0.24 % +Average deposits by reporting unit and selected +component (in billions of dollars) +TTS $ 687 $ 675 $ 670 2 % 1 % +Securities Services 123 133 135 (8) (1) +Total $ 810 $ 808 $ 805 — % — % +(1) Includes revenues earned by Citi that are subject to a revenue sharing arrangement with Banking—Corporate Lending for Investment Banking, Markets and +Services products sold to Corporate Lending clients. +(2) Management uses this information in reviewing the segment’s results and believes it is useful to investors concerning underlying segment performance and trends. +(3) Excludes loans that are carried at fair value for all periods. +NM Not meaningful +2023 vs. 2022 +Net income of $4.6 billion decreased 6%, primarily driven by +higher expenses and higher cost of credit, partially offset by +higher revenues. +Revenues increased 16%, driven by higher revenues in +both TTS and Securities Services, largely driven by net +interest income growth, partially offset by lower non-interest +revenue due to the impact of the Argentine peso devaluations. +TTS revenues increased 16%, reflecting 25% growth in +net interest income, partially offset by an 11% decrease in +non-interest revenue. The increase in net interest income was +primarily driven by higher interest rates and cost of funds +management across currencies as well as growth in deposits. +Average deposits increased 2%, largely driven by growth in +international markets. The decrease in non-interest revenue +was driven by approximately $1.0 billion in translation losses +in revenues in Argentina due to devaluations of the Argentine +peso, including a $0.5 billion translation loss in the fourth +quarter of 2023. Excluding these translation losses, non- +interest revenue grew 10%, reflecting continued growth in +underlying drivers, including higher cross-border flows (up +15%), U.S. dollar clearing volumes (up 6%) and commercial +card spend (up 16%). +Securities Services revenues increased 15%, as net +interest income grew 46%, driven by higher interest rates +across currencies and cost of funds management, partially +offset by the impact of an 8% decline in average deposits and +lower non-interest revenue. The decline in average deposits +largely reflected the impact of monetary tightening. The +decrease in non-interest revenue was driven by approximately +$0.2 billion in translation losses in revenues in Argentina due +to the Argentine peso devaluations, including a $0.1 billion +translation loss in the fourth quarter of 2023. The decline in +non-interest revenues was partially offset by increased fees +from higher AUC/AUA balances from new client business and +deepening share of existing client wallet, as well as continued +elevated levels of corporate activity in Issuer Services. +Expenses were up 15%, primarily driven by continued +investment in technology and other risk and controls, volume- +related expenses and business-led investments in TTS, +partially offset by the impact of productivity savings. +Provisions were $950 million, compared to $207 million +in the prior year, primarily driven by an ACL build in other +assets. +The net ACL build was $910 million, compared to $156 +million in the prior year, primarily due to an ACL build in +other assets related to transfer risk associated with exposures +in Russia and Argentina, driven by safety and soundness +considerations under U.S. banking law. For additional +information on Citi’s ACL, see “Significant Accounting +Policies and Significant Estimates” below. +For additional information on Services’ corporate credit +portfolio, see “Managing Global Risk—Credit Risk— +Corporate Credit” below. +For additional information on trends in Services’ deposits +and loans, see “Managing Global Risk—Liquidity Risk— +Loans” and “—Deposits” below. +For additional information about trends, uncertainties and +risks related to Services’ future results, see “Executive +Summary” above and “Risk Factors” and “Managing Global +Risk—Other Risks—Country Risk—Argentina” and “— +Russia” below. +2022 vs. 2021 +Net income of $4.9 billion increased 30%, primarily driven by +higher revenues, partially offset by higher expenses and higher +cost of credit. +Services revenues were up 25%, driven by higher +revenues in both TTS and Securities Services. +TTS revenues increased 29%, largely due to 49% growth +in net interest income, reflecting deepening of existing client +relations and gaining new clients across segments. The +increase in net interest income was also driven by the benefits +from higher interest rates, balance sheet optimization, higher +15 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_23.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_23.txt new file mode 100644 index 0000000000000000000000000000000000000000..7197dcbaf05e2c75fdc1dc0a1837342c1fa75fdc --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_23.txt @@ -0,0 +1,28 @@ +average deposits and higher average loans. Average deposits +grew 1%, as volume growth was partially offset by the impact +of foreign exchange translation. Average loans grew 11%, +primarily driven by the strength in trade flows in International, +partially offset by loan sales in North America. +Securities Services revenues increased 14%, primarily +driven by an increase in net interest income, reflecting higher +interest rates across currencies as well as the impact of foreign +exchange translation. Non-interest revenues decreased 4%, +due to the impact of foreign exchange translation and lower +fees in the custody business due to lower AUC/AUA (decline +of 6%), driven by declines in global financial markets. The +decline in non-interest revenues was partially offset by +continued elevated levels of corporate activity in Issuer +Services and new client onboarding of $1.2 trillion in AUC/ +AUA. Average deposits declined 1%, due to clients seeking +higher rate alternatives. +Expenses were up 13%, primarily driven by continued +investment in Citi’s technology and other risk and controls, +volume-related expenses and business-led investments in TTS. +Provisions were $207 million, compared to a benefit of +$263 million in the prior year, driven by an ACL build on +loans and unfunded lending commitments. +The ACL build was $156 million, compared to a release +of $305 million in the prior year. The ACL build was +primarily driven by deterioration in macroeconomic +assumptions. +16 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_24.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_24.txt new file mode 100644 index 0000000000000000000000000000000000000000..7ad28e5de0f5ef11f41acbc67920dcdecbe72e78 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_24.txt @@ -0,0 +1,57 @@ +MARKETS +Markets provides corporate, institutional and public sector clients around the world with a full range of sales and trading services +across equities, foreign exchange, rates, spread products and commodities. The range of services includes market-making across asset +classes, risk management solutions, financing, prime brokerage, research, securities clearing and settlement. +As a market maker, Markets facilitates transactions, including holding product inventory to meet client demand, and earns the +differential between the price at which it buys and sells the products. These price differentials and the unrealized gains and losses on +the inventory are recorded in Principal transactions. Other primarily includes realized gains and losses on available-for-sale (AFS) +debt securities, gains and losses on equity securities not held in trading accounts and other non-recurring gains and losses. Interest +income earned on assets held, less interest paid on long- and short-term debt, secured funding transactions and customer deposits, is +recorded as Net interest income. +The amount and types of Markets revenues are impacted by a variety of interrelated factors, including market liquidity; changes in +market variables such as interest rates, foreign exchange rates, equity prices, commodity prices and credit spreads, as well as their +implied volatilities; investor confidence; and other macroeconomic conditions. Markets revenues include revenues earned by Citi that +are subject to a revenue sharing arrangement with Banking—Corporate Lending for Investment Banking, Markets and Services +products sold to Corporate Lending clients. +Assuming all other market conditions do not change, increases in client activity levels or bid/offer spreads generally result in +increases in revenues. However, changes in market conditions can significantly impact client activity levels, bid/offer spreads and the +fair value of product inventory. Management of the Markets businesses involves daily monitoring and evaluation of the above factors. +Markets international presence is supported by trading floors in approximately 80 countries and a proprietary network in 95 +countries and jurisdictions. +In millions of dollars, except as otherwise noted 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Net interest income (including dividends) $ 7,265 $ 5,819 $ 6,147 25 % (5) % +Fee revenue +Brokerage and fees 1,381 1,452 1,530 (5) (5) +Investment banking fees(1) 392 481 656 (19) (27) +Other 150 139 176 8 (21) +Total fee revenue $ 1,923 $ 2,072 $ 2,362 (7) % (12) % +Principal transactions 10,562 13,087 9,647 (19) 36 +All other(2) (893) (817) 1,243 (9) 100 +Total non-interest revenue $ 11,592 $ 14,342 $ 13,252 (19) % 8 % +Total revenues, net of interest expense(3) $ 18,857 $ 20,161 $ 19,399 (6) % 4 % +Total operating expenses $ 13,238 $ 12,413 $ 11,372 7 % 9 % +Net credit losses (recoveries) on loans 32 (5) 97 NM NM +Credit reserve build (release) for loans 204 80 (325) NM NM +Provision for credit losses (release) on unfunded lending +commitments 1 10 (101) (90) NM +Provisions for credit losses for other assets and HTM debt +securities 200 70 — NM 100 +Provision (release) for credit losses $ 437 $ 155 $ (329) NM NM +Income (loss) from continuing operations before taxes $ 5,182 $ 7,593 $ 8,356 (32) % (9) % +Income taxes (benefits) 1,162 1,669 1,695 (30) (2) +Income (loss) from continuing operations $ 4,020 $ 5,924 $ 6,661 (32) % (11) % +Noncontrolling interests 67 52 38 29 37 +Net income (loss) $ 3,953 $ 5,872 $ 6,623 (33) % (11) % +Balance Sheet data (in billions of dollars) +EOP assets $ 995 $ 950 $ 895 5 % 6 % +Average assets 1,018 984 935 3 5 +Efficiency ratio 70 % 62 % 59 % +Revenue by component +Fixed Income markets $ 14,820 $ 15,710 $ 14,345 (6) % 10 % +Equity markets 4,037 4,451 5,054 (9) (12) +Total $ 18,857 $ 20,161 $ 19,399 (6) % 4 % +17 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_25.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_25.txt new file mode 100644 index 0000000000000000000000000000000000000000..aca9de2479d182cc1171c12508f77b8a8e5cea77 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_25.txt @@ -0,0 +1,92 @@ +Rates and currencies $ 10,885 $ 11,556 $ 8,838 (6) % 31 % +Spread products/other fixed income 3,935 4,154 5,507 (5) (25) +Total Fixed Income markets revenues $ 14,820 $ 15,710 $ 14,345 (6) % 10 % +Revenue by geography +North America $ 6,956 $ 6,846 $ 7,520 2 % (9) % +International 11,901 13,315 11,879 (11) 12 +Total $ 18,857 $ 20,161 $ 19,399 (6) % 4 % +Key drivers(4) (in billions of dollars) +Average loans $ 110 $ 111 $ 112 (1) % (1) % +NCLs as a percentage of average loans 0.03 % — % 0.09 % +ACLL as a percentage of EOP loans(5) 0.71 % 0.58 % 0.54 % +Average trading account assets 379 334 342 13 (2) +Average deposits 23 21 22 10 (5) +(1) Investment banking fees are primarily composed of underwriting, advisory, loan syndication structuring and other related financing activity. +(2) Includes revenues earned by Citi that are subject to a revenue sharing arrangement with Banking—Corporate Lending for Investment Banking, Markets and +Services products sold to Corporate Lending clients. +(3) Citi assesses its Markets business performance on a total revenue basis, as offsets may occur across revenue line items. For example, securities that generate Net +interest income may be risk managed by derivatives that are recorded in Principal transactions revenue within Non-interest revenue. For a description of the +composition of these revenue line items, see Notes 4, 5 and 6. +(4) Management uses this information in reviewing the segment’s results and believes it is useful to investors concerning underlying segment performance and trends. +(5) Excludes loans that are carried at fair value for all periods. +NM Not meaningful +2023 vs. 2022 +Net income of $4.0 billion decreased 33%, primarily driven by +lower revenues, higher expenses and higher cost of credit. +Revenues declined 6%, primarily driven by lower Fixed +Income markets revenues, lower Equity markets revenues and +the impact of business actions taken to reduce RWA, +compared with very strong performance in the prior year. Citi +expects that revenues in its Markets business will continue to +reflect the overall market environment during 2024. +Fixed Income markets revenues decreased 6%. Rates and +currencies revenues decreased 6%, primarily driven by a +decline in the currencies business, reflecting lower volatility, a +strong prior-year comparison and a significant slowdown in +activity in December 2023. The decline in rates and currencies +revenues also reflected $526 million in translation losses in +revenues in Argentina due to the Argentine peso devaluations, +including $236 million in translation loss in the fourth quarter +of 2023. Spread products and other fixed income revenues +decreased 5%, largely driven by lower client activity, lower +volatility and a strong prior-year comparison. +Equity markets revenues decreased 9%, primarily due to a +decline in equity derivatives, due to lower institutional +activity, spread compression and lower volatility. Prime +services revenues increased modestly, as prime finance +balances grew, reflecting continued client momentum. +Expenses increased 7%, primarily driven by investments +in transformation, technology and other risk and controls, +partially offset by productivity savings. +Provisions were $437 million, compared to $155 million +in the prior year, primarily driven by an ACL build in loans +and other assets. +The net ACL build was $405 million, compared to $160 +million in the prior year. The ACL build for loans was $204 +million, primarily driven by risks and uncertainties impacting +vulnerable industries, including commercial real estate. The +net ACL build for other assets was $200 million, primarily +driven by transfer risk associated with exposures in Russia and +Argentina, driven by safety and soundness considerations +under U.S. banking law. For additional information on Citi’s +ACL, see “Significant Accounting Policies and Significant +Estimates” below. +For additional information on Markets’ corporate credit +portfolio, see “Managing Global Risk—Credit Risk— +Corporate Credit” below. +For additional information on trends in Markets’ deposits +and loans, see “Managing Global Risk—Liquidity Risk— +Loans” and “—Deposits” below. +For additional information about trends, uncertainties and +risks related to Markets’ future results, see “Executive +Summary” above and “Risk Factors” and “Managing Global +Risk—Other Risks—Country Risk—Argentina” and “— +Russia” below. +2022 vs. 2021 +Net income of $5.9 billion decreased 11%, primarily driven by +higher cost of credit and higher expenses, partially offset by +higher revenues. +Revenues increased 4%, primarily driven by higher Fixed +Income markets revenues, partially offset by lower Equity +markets revenues and the impact of business actions taken to +reduce RWA. +Fixed Income markets revenues increased 10%. Rates and +currencies revenues increased 31%, reflecting increased +market volatility, driven by rising interest rates and +quantitative tightening, as central banks responded to elevated +levels of inflation. Spread products and other fixed income +revenues decreased 25%, due to continued lower client +activity across spread products and a challenging credit market +due to widening spreads for most of the year. The decline in +spread products and other fixed income revenues was partially +18 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_26.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_26.txt new file mode 100644 index 0000000000000000000000000000000000000000..cccd229a20eb873dad296bc95f7eccae5e56fdd6 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_26.txt @@ -0,0 +1,22 @@ +offset by strength in commodities, particularly with corporate +clients, as the business assisted those clients in managing risk +associated with the increased volatility. +Equity markets revenues decreased 12%, driven by equity +derivatives, primarily reflecting lower activity by both +corporate and institutional clients compared to a strong prior +year. The lower revenues also reflected a decline in equity +cash, driven by lower client activity. +Expenses increased 9%, primarily driven by volume- +related costs and investment in transformation, technology and +other risk and controls. +Provisions were $155 million, compared to a benefit of +$329 million in the prior year, driven by a net ACL build, +partially offset by lower net credit losses. +Net credit losses were a benefit of $5 million, compared +to $97 million in the prior year, largely driven by +improvements in portfolio credit quality. +The net ACL build was $160 million, compared to a net +release of $426 million in the prior year. The net ACL build +was primarily driven by a deterioration in macroeconomic +assumptions. +19 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_27.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_27.txt new file mode 100644 index 0000000000000000000000000000000000000000..b673a68629bb090ef7f9394177b20d05a208938b --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_27.txt @@ -0,0 +1,53 @@ +BANKING +Banking includes Investment Banking, which supports clients’ capital-raising needs to help strengthen and grow their businesses, +including equity and debt capital markets-related strategic financing solutions, as well as advisory services related to mergers and +acquisitions, divestitures, restructurings and corporate defense activities; and Corporate Lending, which includes corporate and +commercial banking, serving as the conduit of Citi’s full product suite to clients. +Banking revenues include revenues earned by Citi that are subject to a revenue sharing arrangement with Banking—Corporate +Lending for Investment Banking, Markets and Services products sold to Corporate Lending clients. +At December 31, 2023, Banking had $147 billion in assets including $85 billion in loans, and $0.7 billion in deposits. +In millions of dollars, except as otherwise noted 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Net interest income (including dividends) $ 2,094 $ 2,057 $ 2,204 2 % (7) % +Fee revenue +Investment banking fees(1) 2,713 3,053 6,018 (11) (49) +Other 158 174 330 (9) (47) +Total fee revenue $ 2,871 $ 3,227 $ 6,348 (11) % (49) % +Principal transactions (936) (133) (501) NM 73 +All other(2) 539 245 (268) NM NM +Total non-interest revenue $ 2,474 $ 3,339 $ 5,579 (26) % (40) % +Total revenues, net of interest expense 4,568 5,396 7,783 (15) (31) +Total operating expenses $ 4,869 $ 4,471 $ 4,406 9 % 1 % +Net credit losses on loans 169 106 217 59 (51) +Credit reserve build (release) for loans (370) 270 (1,520) NM NM +Provision (release) for credit losses on unfunded lending +commitments (353) 153 (591) NM NM +Provisions (releases) for credit losses for other assets and +HTM debt securities 389 20 (4) NM NM +Provisions (releases) for credit losses $ (165) $ 549 $ (1,898) NM NM +Income (loss) from continuing operations before taxes $ (136) $ 376 $ 5,275 NM (93) % +Income taxes (benefits) (92) (7) 1,170 NM (101) +Income (loss) from continuing operations $ (44) $ 383 $ 4,105 NM (91) % +Noncontrolling interests 4 (3) 8 NM NM +Net income (loss) $ (48) $ 386 $ 4,097 NM (91) % +Balance Sheet data (in billions of dollars) +EOP assets $ 147 $ 152 $ 145 (3) % 5 % +Average assets 152 159 155 (4) 3 +Efficiency ratio 107 % 83 % 57 % +Revenue by component +Total Investment Banking $ 2,538 $ 2,510 $ 6,089 1 % (59) % +Corporate Lending (excluding gain (loss) on loan hedges)(2)(3) 2,473 2,579 1,834 (4) 41 +Total Banking revenues (excluding gain (loss) on loan +hedges)(2)(3) $ 5,011 $ 5,089 $ 7,923 (2) % (36) % +Gain (loss) on loan hedges(2)(3) (443) 307 (140) NM NM +Total Banking revenues (including gain (loss) on loan +hedges)(2)(3) $ 4,568 $ 5,396 $ 7,783 (15) % (31) % +Business metrics—investment banking fees +Advisory $ 1,017 $ 1,332 $ 1,785 (24) % (25) % +Equity underwriting (Equity Capital Markets (ECM)) 500 621 2,152 (19) (71) +Debt underwriting (Debt Capital Markets (DCM)) 1,196 1,100 2,081 9 (47) +Total $ 2,713 $ 3,053 $ 6,018 (11) % (49) % +20 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_3.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_3.txt new file mode 100644 index 0000000000000000000000000000000000000000..771564e3247ccb6ee85a43751be3f881682754da --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_3.txt @@ -0,0 +1,112 @@ +Letter to shareholders +Dear shareholders, +We are on a mission to ensure that Citi delivers to its full potential for all stakeholders. +Over the past three years, we have successfully put the foundations in place for the bank we aspire to be. +Last year represented a significant step forward in our journey as we reorganized the firm to sharpen the +focus on our five businesses and simplify our operations and infrastructure. Between the reorganization +of the firm and the strides made in divesting our international consumer franchises, our management +structure and organizational model are now fully aligned to our strategy. +At the same time, we continued to instill a culture of excellence and accountability to ensure alignment +with our shareholders’ interests. We also made progress on our Transformation and strengthening our risk +and controls, although we recognize there’s more work to be done. +We know our journey will have its challenges. Whilst some of +our businesses continued to eclipse their peers in the industry, +others did not meet our expectations. We also faced challenges +in aspects of our work to strengthen our data and regulatory +reporting, an area we are committed to getting right. +Despite some of the headwinds we faced, we continue to stay +the course and strongly believe in the deliberate path we set at +Investor Day in 2022. We said this was a multi-year journey and +we will face challenges as we execute. Nonetheless, the changes +we have made to the firm and the discipline and accountability +we put in place over the past few years will allow us to truly +transform our company for the long term. +We are still firmly on track to meet the medium-term financial +targets we set at Investor Day, including achieving an 11-12% +Return on Tangible Common Equity (Ro TCE)1. Our business +model is resilient and well-diversified. Our balance sheet +is strong. We have ample liquidity and capital. We remain +confident in our ability to generate higher returns over the long +term and return capital to shareholders. +Our business performance +A number of notable items that occurred during a +disappointing fourth quarter negatively impacted our earnings +for 2023. We delivered $9.2 billion in net income on revenues +of $78.5 billion. Our Ro TCE2 was 4.9%. Still, we met our full- +year expense guidance and increased our Common Equity +Tier 1 Capital ratio to approximately 13.4%. We grew tangible +book value per share2 by 6% to $86.19 and returned roughly +$6 billion in capital to shareholders in the form of common +dividends and share repurchases. +At Investor Day, we laid out a clear, compelling vision for the +firm: to be the preeminent banking partner for institutions with +cross-border needs, a global leader in wealth management +and a valued personal bank in our home market. We’ve been +executing a strategy to bring this vision to life through our five +interconnected businesses — Services, Markets, Banking, +Wealth and U.S. Personal Banking. +Our Services business had a record year in 2023 as we +maintained our leadership in Treasury and Trade Solutions +We are on a deliberate +journey to unlock Citi’s +full potential, and we +have made some bold +decisions over the last +year to ensure we succeed. +(TTS), with client wins up 27% and cross-border transactions +up 15%. In Securities Services, we had roughly $25 trillion +in assets under custody and administration, up 13% during +2023. And we continued to relentlessly innovate for our clients +with products such as 24/7 USD Clearing, Payments Express +and Citi T oken Services, which enable clients to facilitate +cross-border payments and access automated trade finance +solutions around the clock. +Our Markets business delivered a solid performance for the year +with good underlying momentum in Equities and continued +growth in Prime balances. We retained a leading position in +Fixed Income and further optimized our model with the exit +of marginal businesses. Overall, Markets revenues decreased +6% from a very strong performance in 2022. As we look ahead, +our franchise remains well positioned with both corporate and +investor clients, and we continue to take actions to improve +returns by allocating capital to products that meet client +demand and generate a strong return profile. +Banking remains a key part of our strategy. Whilst revenues for +the business fell 15% in 2023, largely driven by a weaker wallet +globally, we are focused on improving wallet share in the near +term. Our M&A business experienced significant momentum +in the back half of 2023. Throughout the year, we led on +several global transactions larger than $10 billion. We have +also reorganized our three lines of business — Investment +Banking, Corporate Banking and Commercial Banking — +under one umbrella to strengthen synergies amongst them. +We look forward to welcoming Vis Raghavan later this year +to lead the franchise and bring an additional intensity to our +Banking business. +We continue to make headway in Wealth as we grow our +presence in Asia and modernize the digital experience for clients. +In 2023, we added $56 billion in client balances and broadened +our Citi Wealth at Work offering. However, Wealth revenues were +down 5% from 2022, and we recognize there is more work to be +done. With Andy Sieg having returned to Citi to run the Wealth +business, we are well-positioned to capture the extraordinary +wealth creation set to take place over the next decade. +U.S. Personal Banking continued to show excellent momentum +last year as revenues increased 14%, driven largely by a rebound in +borrowing across Cards and solid spending in Branded Cards. We +continued to innovate for clients with new products and offerings, +including the launch of Citi Travel with Booking.com powered by +Rocket Travel by Agoda. In Retail Banking, we launched Simplified +Banking, which uses a tiered approach to unlock enhanced +benefits, similar to an airline or hotel rewards program. And in +Retail Services, we celebrated the 20-year milestone of our +partnership with The Home Depot, in addition to launching a +number of new products and other partner relationships. +Operating with increased rigor and +accountability +In September, we took our boldest step yet to fulfill Citi’s +potential, announcing the most consequential series of +changes to how we run the bank since the aftermath of the +Jane Fraser +Chief Executive Officer +2 3 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_30.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_30.txt new file mode 100644 index 0000000000000000000000000000000000000000..f9594cbeeb7aff0cb39928ea30fc72c6c72f9a49 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_30.txt @@ -0,0 +1,51 @@ +U.S. PERSONAL BANKING +U.S. Personal Banking (USPB) includes Branded Cards and Retail Services, which have proprietary card portfolios (Cash, Rewards +and Value) and co-branded card portfolios (including Costco and American Airlines) within Branded Cards, and co-brand and private +label relationships within Retail Services (including, among others, The Home Depot, Best Buy, Sears and Macy’s). USPB also +includes Retail Banking, which provides traditional banking services to retail and small business customers. +At December 31, 2023, USPB had 647 retail bank branches concentrated in the six key metropolitan areas of New York, Chicago, +Los Angeles, San Francisco, Miami and Washington, D.C. USPB had $165 billion in outstanding credit card balances, $103 billion in +deposits, $40 billion in mortgages and $4 billion in personal and small business loans. For additional information on USPB’s end-of- +period consumer loan portfolios and metrics, see “Managing Global Risk—Credit Risk—Consumer Credit” below. +In millions of dollars, except as otherwise noted 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Net interest income $ 20,150 $ 18,062 $ 16,285 12 % 11 % +Fee revenue +Interchange fees 9,674 9,190 7,894 5 16 +Card rewards and partner payments (11,083) (10,862) (9,105) (2) (19) +Other 349 462 527 (24) (12) +Total fee revenue $ (1,060) $ (1,210) $ (684) 12 % (77) % +All other 97 20 244 NM (92) +Total non-interest revenue $ (963) $ (1,190) $ (440) 19 % NM +Total revenues, net of interest expense 19,187 16,872 15,845 14 6 % +Total operating expenses $ 10,102 $ 9,782 $ 8,854 3 % 10 % +Net credit losses on loans 5,234 2,918 2,939 79 (1) +Credit reserve build (release) for loans 1,464 517 (3,953) NM NM +Provision for credit losses on unfunded lending commitments 1 (1) (1) NM — +Provisions for benefits and claims (PBC), and other assets 8 14 17 (43) (18) +Provisions for credit losses and PBC $ 6,707 $ 3,448 $ (998) 95 % NM +Income from continuing operations before taxes $ 2,378 $ 3,642 $ 7,989 (35) % (54) % +Income taxes 558 872 1,890 (36) (54) +Income from continuing operations $ 1,820 $ 2,770 $ 6,099 (34) % (55) % +Noncontrolling interests — — — — — +Net income $ 1,820 $ 2,770 $ 6,099 (34) % (55) % +Balance Sheet data (in billions of dollars) +EOP assets $ 242 $ 231 $ 211 5 % 9 % +Average assets 231 213 210 8 1 +Efficiency ratio 53 % 58 % 56 % +Revenue by component +Branded Cards $ 9,988 $ 8,962 $ 8,236 11 % 9 % +Retail Services 6,617 5,469 5,106 21 7 +Retail Banking 2,582 2,441 2,503 6 (2) +Total $ 19,187 $ 16,872 $ 15,845 14 % 6 % +Average loans and deposits (in billions of dollars) +Average loans $ 193 $ 171 $ 159 13 % 8 % +ACLL as a percentage of EOP loans(1) 6.28 % 6.31 % 6.80 % +Average deposits 110 115 112 (4) 3 + +(1) Excludes loans that are carried at fair value for all periods. +NM Not meaningful +23 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_31.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_31.txt new file mode 100644 index 0000000000000000000000000000000000000000..cf153a3d056d3878db2a1a7d0fcce8d569b083bc --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_31.txt @@ -0,0 +1,109 @@ +2023 vs. 2022 +Net income was $1.8 billion, compared to $2.8 billion in the +prior year, reflecting higher cost of credit and higher expenses, +partially offset by higher revenues. +Revenues increased 14%, due to higher net interest +income (up 12%), driven by strong loan growth and higher +deposit spreads, as well as higher non-interest revenue (up +19%). The increase in non-interest revenue was largely driven +by lower partner payments in Retail Services, due to higher +net credit losses, and an increase in interchange fees, driven by +higher card spend volumes in Branded Cards. The increase in +non-interest revenue was partially offset by an increase in +rewards costs in Branded Cards, driven by the higher card +spend volumes. +Cards revenues increased 15%. Branded Cards revenues +increased 11%, primarily driven by the higher net interest +income, reflecting the strong loan growth. Branded Cards new +account acquisitions increased 9% and card spend volumes +increased 5%. Branded Cards average loans increased 13%, +reflecting the higher card spend volumes and lower card +payment rates. +Retail Services revenues increased 21%, primarily driven +by higher net interest income on higher loan balances, as well +as higher non-interest revenue due to the lower partner +payments, driven by the higher net credit losses (see Note 5). +Retail Services credit card spend volumes decreased 4% and +average loans increased 9%, largely reflecting lower card +payment rates. +Retail Banking revenues increased 6%, primarily driven +by higher deposit spreads and mortgage loan growth, partially +offset by the impact of the transfer of certain relationships and +the associated deposit balances to Wealth. Average mortgage +loans increased 16%, primarily driven by lower refinancings +due to high interest rates and higher mortgage originations. +Average deposits decreased 4%, largely reflecting the transfer +of certain relationships and the associated deposit balances to +Wealth. +Expenses increased 3%, primarily driven by continued +investments in other risk and controls, technology, business- +led investments and business-as-usual severance costs, +partially offset by productivity savings. +Provisions were $6.7 billion, compared to $3.4 billion in +the prior year, largely driven by higher net credit losses and a +higher ACL build for loans. Net credit losses increased 79%, +primarily reflecting higher losses in cards in line with +expectations, with Branded Cards net credit losses up 93% to +$2.7 billion and Retail Services net credit losses up 84% to +$2.3 billion. Both Branded Cards and Retail Services net +credit losses reached pre-pandemic levels at the end of 2023. +The net ACL build was $1.5 billion, compared to $0.5 +billion in the prior year, primarily reflecting growth in loan +balances in Branded Cards and Retail Services. For additional +information on Citi’s ACL, see “Significant Accounting +Policies and Significant Estimates” below. +For additional information on USPB’s Branded Cards, +Retail Services and Retail Banking loan portfolios, see +“Managing Global Risk—Credit Risk—Consumer Credit” +below. +For additional information about trends, uncertainties and +risks related to USPB’s future results, see “Executive +Summary” above and “Risk Factors” below. +2022 vs. 2021 +Net income was $2.8 billion, compared to $6.1 billion in the +prior year, reflecting higher cost of credit and higher expenses, +partially offset by higher revenues. +Revenues increased 6%, primarily due to higher net +interest income (up 11%), driven by strong loan growth in +Branded Cards and Retail Services and the impact of higher +interest rates in Retail Banking. The increase in revenues was +partially offset by lower non-interest revenue, largely +reflecting higher partner payments in Retail Services resulting +from higher revenues. +Cards revenues increased 8%. Branded Cards revenues +increased 9%, primarily driven by higher net interest income +on higher loan balances. Branded Cards new account +acquisitions increased 11% and card spend volumes increased +16%. Average loans increased 11%, reflecting the higher card +spend volumes. +Retail Services revenues increased 7%, primarily driven +by higher net interest income on higher loan balances and +lower card payment rates, partially offset by the increase in +partner payments. The increase in partner payments reflected +higher income sharing as a result of higher revenues. Retail +Services card spend volumes increased 8% and average loans +increased 6%, reflecting the higher card spend volumes. +Retail Banking revenues decreased 2%, as the higher +interest rates and modest deposit growth were more than offset +by lower mortgage revenues due to fewer mortgage +originations, driven by the higher interest rates. Average +deposits increased 3%, largely reflecting higher levels of +consumer liquidity in the first half of 2022. +Expenses increased 10%, primarily driven by continued +investments in Citi’s transformation, other risk and control +initiatives, volume-related expenses and business-led +investments, partially offset by productivity savings. +Provisions were $3.4 billion, compared to a benefit of +$1.0 billion in the prior year, largely driven by a net ACL +build. Net credit losses decreased 1%, driven by historically +low loss rates experienced in the first half of 2022, partially +offset by higher losses in the second half of the year, +particularly in Retail Services (net credit losses up 7% to $1.3 +billion). Branded Cards net credit losses declined 17% to $1.4 +billion. +The net ACL build was $0.5 billion, compared to a net +release of $3.9 billion in the prior year, primarily driven by +U.S. cards loan growth and a deterioration in macroeconomic +assumptions. +24 +The secret shape is a "star". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_32.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_32.txt new file mode 100644 index 0000000000000000000000000000000000000000..abf79f82c9fc4729c8f6d0b0ec8e9e16a1c753a5 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_32.txt @@ -0,0 +1,59 @@ +WEALTH +Wealth includes Private Bank, Wealth at Work and Citigold and provides financial services to a range of client segments including +affluent, high net worth and ultra-high net worth clients through banking, lending, mortgages, investment, custody and trust product +offerings in 20 countries, including the U.S., Mexico and four wealth management centers: Singapore, Hong Kong, the UAE and +London. Private Bank provides financial services to ultra-high net worth clients through customized product offerings. Wealth at +Work provides financial services to professional industries (including law firms, consulting groups, accounting and asset management) +through tailored solutions. Citigold includes Citigold and Citigold Private Clients, which both provide financial services to affluent +and high net worth clients through elevated product offerings and financial relationships. +At December 31, 2023, Wealth had $323 billion in deposits and $152 billion in loans, including $90 billion in mortgage loans, +$29 billion in margin loans, $27 billion in personal and small business loans and $5 billion in outstanding credit card balances. For +additional information on Wealth’s end-of-period consumer loan portfolios and metrics, see “Managing Global Risk—Credit Risk— +Consumer Credit” below. +In millions of dollars, except as otherwise noted 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Net interest income $ 4,460 $ 4,744 $ 4,491 (6) % 6 % +Fee revenue +Commissions and fees 1,211 1,218 1,608 (1) (24) +Other 808 866 899 (7) (4) +Total fee revenue $ 2,019 $ 2,084 $ 2,507 (3) % (17) % +All other 612 620 544 (1) 14 +Total non-interest revenue $ 2,631 $ 2,704 $ 3,051 (3) % (11) % +Total revenues, net of interest expense 7,091 7,448 7,542 (5) (1) +Total operating expenses $ 6,644 $ 6,058 $ 5,381 10 % 13 % +Net credit losses on loans 98 103 122 (5) (16) +Credit reserve build (release) for loans (85) 190 (331) NM NM +Provision (release) for credit losses on unfunded lending +commitments (12) 12 (15) NM NM +Provisions (release) for benefits and claims (PBC), and other +assets (3) 1 (2) NM NM +Provisions (releases) for credit losses and PBC $ (2) $ 306 $ (226) (101) % NM +Income from continuing operations before taxes $ 449 $ 1,084 $ 2,387 (59) % (55) % +Income taxes 103 134 419 (23) (68) +Income from continuing operations $ 346 $ 950 $ 1,968 (64) % (52) % +Noncontrolling interests — — — — — +Net income $ 346 $ 950 $ 1,968 (64) % (52) % +Balance Sheet data (in billions of dollars) +EOP assets $ 232 $ 259 $ 250 (10) % 4 % +Average assets 247 259 253 (5) 2 +Efficiency ratio 94 % 81 % 71 % +Revenue by component +Private Bank $ 2,332 $ 2,812 $ 2,970 (17) % (5) % +Wealth at Work 862 730 691 18 6 +Citigold 3,897 3,906 3,881 — 1 +Total $ 7,091 $ 7,448 $ 7,542 (5) % (1) % +Revenue by geography +North America $ 3,615 $ 3,927 $ 3,767 (8) % 4 % +International 3,476 3,521 3,775 (1) (7) +Total $ 7,091 $ 7,448 $ 7,542 (5) % (1) % +Key drivers(1) (in billions of dollars) +EOP client balances +Client investment assets(2) $ 498 $ 443 $ 507 12 % (13) % +Deposits 323 325 329 (1) (1) +Loans 152 149 151 2 (1) +Total $ 973 $ 917 $ 987 6 % (7) % +ACLL as a percentage of EOP loans 0.51 % 0.59 % 0.44 % +25 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_33.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_33.txt new file mode 100644 index 0000000000000000000000000000000000000000..3737ce8f360992c466ef662d7a32c09f72f43acb --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_33.txt @@ -0,0 +1,79 @@ +(1) Management uses this information in reviewing the segment’s results and believes it is useful to investors concerning underlying segment performance and trends. +(2) Includes assets under management, and trust and custody assets. +NM Not meaningful +2023 vs. 2022 +Net income was $346 million, compared to $950 million in the +prior year, reflecting lower revenues and higher expenses, +partially offset by lower cost of credit. +Revenues decreased 5%, largely driven by lower net +interest income (down 6%), due to lower deposit spreads, as +well as lower non-interest revenue (down 3%), largely driven +by investment product revenue headwinds, partially offset by +the benefits of the transfer of certain relationships and the +associated deposit balances from USPB. Average loans were +largely unchanged. Average deposits decreased 1%, reflecting +transfers to higher-yielding investments on Citi’s platform. +Client balances increased 6%, primarily driven by higher +client investment assets, partially offset by lower deposit +balances. +Private Bank revenues decreased 17%, primarily driven +by lower deposit spreads, lower deposit and loan volumes and +the investment product revenue headwinds. +Wealth at Work revenues increased 18%, driven by +improved lending spreads, primarily in mortgages, and higher +investment product revenues, partially offset by lower deposit +revenues. +Citigold revenues were largely unchanged, as higher +deposit revenues internationally were offset by lower deposit +revenues in North America and lower lending revenues +globally. +Expenses increased 10%, primarily driven by continued +investments in other risk and controls and technology, +partially offset by productivity savings and re-pacing of +strategic investments. +Provisions were a benefit of $2 million, compared to +provisions of $306 million in the prior year, largely driven by +a net ACL release. +The net ACL release was $97 million, compared to a net +build of $202 million in the prior year, primarily driven by +improvements in macroeconomic assumptions. For additional +information on Citi’s ACL, see “Significant Accounting +Policies and Significant Estimates” below. +For additional information on Wealth’s loan portfolios, +see “Managing Global Risk—Credit Risk—Consumer Credit” +below. +For additional information about trends, uncertainties and +risks related to Wealth’s future results, see “Executive +Summary” above and “Risk Factors” below. +2022 vs. 2021 +Net income was $950 million, compared to $2.0 billion in the +prior year, reflecting higher expenses, higher cost of credit and +lower revenues. +Revenues decreased 1%, reflecting investment product +revenue headwinds, particularly in Asia, driven by overall +market volatility, partially offset by net interest income +growth, driven by higher interest rates and higher loan and +deposit volumes. Average loans increased 2% and average +deposits increased 5%. Client balances decreased 7%, +primarily driven by a decline in client investment assets. +Private Bank revenues decreased 5%, primarily driven by +the investment product revenue headwinds. +Wealth at Work revenues increased 6%, driven by +improved lending spreads, primarily in mortgages, partially +offset by lower deposit revenues. +Citigold revenues increased 1%, primarily driven by +higher deposit revenues, partially offset by lower investment +revenues in Asia and North America due to lower client +investment assets and client activity. +Expenses increased 13%, primarily driven by continued +investments in other risk and controls, technology and +business-led investments, partially offset by productivity +savings. +Provisions were $306 million, compared to a benefit of +$226 million in the prior year, largely driven by a net ACL +build. +The net ACL build was $202 million, compared to a net +release of $346 million in the prior year, primarily driven by +deteriorations in macroeconomic assumptions. +26 +The secret food is "fries". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_34.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_34.txt new file mode 100644 index 0000000000000000000000000000000000000000..894171a97e9861748a5360980e78b2079b1e5366 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_34.txt @@ -0,0 +1,78 @@ +ALL OTHER—Divestiture-Related Impacts (Reconciling Items) +All Other includes activities not assigned to the reportable operating segments (Services, Markets, Banking, USPB and Wealth), +including Legacy Franchises and Corporate/Other. For additional information about Legacy Franchises and Corporate/Other, see “All +Other (Managed Basis)” below. +All Other (managed basis) results exclude divestiture-related impacts (see the “Reconciling Items” column in the table below) +related to (i) Citi’s divestitures of its Asia consumer banking businesses and (ii) the planned divestiture or IPO of Mexico consumer +banking and small business and middle-market banking, within Legacy Franchises. Legacy Franchises (managed basis) results also +exclude these divestiture-related impacts. Certain of the results of operations of All Other (managed basis) and Legacy Franchises +(managed basis) are non-GAAP financial measures (see “Overview—Non-GAAP Financial Measures” above). +The table below presents a reconciliation from All Other (U.S. GAAP) to All Other (managed basis). All Other (U.S. GAAP), less +Reconciling Items, equals All Other (managed basis). The Reconciling Items are fully reflected on each respective line item in Citi’s +Consolidated Statement of Income. +2023 2022 2021 +In millions of dollars, except as +otherwise noted +All Other +(U.S. +GAAP) +Reconciling +Items(1) +All Other +(managed +basis) +All Other +(U.S. +GAAP) +Reconciling +Items(2) +All Other +(managed +basis) +All Other +(U.S. +GAAP) +Reconciling +Items(3) +All Other +(managed +basis) +Net interest income $ 7,733 $ — $ 7,733 $ 7,668 $ — $ 7,668 $ 6,546 $ — $ 6,546 +Non-interest revenue 2,976 1,346 1,630 2,174 854 1,320 2,246 (670) 2,916 +Total revenues, net of interest +expense $ 10,709 $ 1,346 $ 9,363 $ 9,842 $ 854 $ 8,988 $ 8,792 $ (670) $ 9,462 +Total operating expenses $ 11,489 $ 372 $ 11,117 $ 9,840 $ 696 $ 9,144 $ 10,474 $ 1,171 $ 9,303 +Net credit losses on loans 864 (6) 870 616 (156) 772 1,478 (6) 1,484 +Credit reserve build (release) +for loans 89 (61) 150 (229) 259 (488) (1,621) 30 (1,651) +Provision for credit losses on +unfunded lending +commitments (44) — (44) 93 (27) 120 (19) — (19) +Provisions for benefits and +claims (PBC), other assets +and HTM debt securities 350 — 350 94 — 94 98 — 98 +Provisions (benefits) for credit +losses and PBC $ 1,259 $ (67) $ 1,326 $ 574 $ 76 $ 498 $ (64) $ 24 $ (88) +Income (loss) from continuing +operations before taxes $ (2,039) $ 1,041 $ (3,080) $ (572) $ 82 $ (654) $ (1,618) $ (1,865) $ 247 +Income taxes (benefits) (608) 382 (990) (786) 266 (1,052) (1,035) (223) (812) +Income (loss) from continuing +operations $ (1,431) $ 659 $ (2,090) $ 214 $ (184) $ 398 $ (583) $ (1,642) $ 1,059 +Income (loss) from +discontinued operations, net of +taxes (1) — (1) (231) — (231) 7 — 7 +Noncontrolling interests 16 — 16 4 — 4 21 — 21 +Net income (loss) $ (1,448) $ 659 $ (2,107) $ (21) $ (184) $ 163 $ (597) $ (1,642) $ 1,045 +Asia Consumer revenues $ 2,870 $ 1,346 $ 1,524 $ 3,780 $ 854 $ 2,926 $ 3,244 $ (670) $ 3,914 +(1) 2023 includes (i) an approximate $1.059 billion gain on sale recorded in revenue (approximately $727 million after-tax) related to the India consumer banking +business sale; (ii) an approximate $403 million gain on sale recorded in revenue (approximately $284 million after-tax) related to the Taiwan consumer banking +business sale; and (iii) approximately $372 million (approximately $263 million after-tax) in operating expenses primarily related to separation costs in Mexico +and severance costs in the Asia exit markets. +(2) 2022 includes (i) an approximate $535 million (approximately $489 million after-tax) goodwill write-down due to resegmentation and the timing of Asia +consumer banking business divestitures; (ii) an approximate $616 million gain on sale recorded in revenue (approximately $290 million after-tax) related to the +Philippines consumer banking business sale; and (iii) an approximate $209 million gain on sale recorded in revenue (approximately $115 million after-tax) related +to the Thailand consumer banking business sale. +(3) 2021 includes (i) an approximate $680 million loss on sale (approximately $580 million after-tax) related to Citi’s agreement to sell its Australia consumer +banking business; and (ii) an approximate $1.052 billion in expenses (approximately $792 million after-tax) primarily related to charges incurred from the +voluntary early retirement program (VERP) in connection with the wind-down of Citi’s consumer banking business in Korea. +27 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_35.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_35.txt new file mode 100644 index 0000000000000000000000000000000000000000..879df0c046268c085c6642fc91a7029564e11860 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_35.txt @@ -0,0 +1,31 @@ +ALL OTHER—Managed Basis +At December 31, 2023, All Other (managed basis) had $211 billion in assets, primarily related to Mexico Consumer/SBMM and Asia +Consumer reported within Legacy Franchises (managed basis), as well as Corporate Treasury investment securities and the +Company’s deferred tax assets (DTAs) reported within Corporate/Other. +Legacy Franchises (Managed Basis) +Legacy Franchises (managed basis) includes (i) Mexico Consumer Banking (Mexico Consumer) and Mexico Small Business and +Middle-Market Banking (Mexico SBMM), collectively Mexico Consumer/SBMM, (ii) Asia Consumer Banking (Asia Consumer), +representing the consumer banking operations of the remaining four exit countries (Korea, Poland, China and Russia), and (iii) Legacy +Holdings Assets, primarily legacy consumer mortgage loans in North America that the Company continues to wind down. +Mexico Consumer/SBMM operates in Mexico through Citibanamex and provides traditional retail banking and branded card +products to consumers and small business customers and traditional middle-market banking products and services to commercial +customers. As previously disclosed, Citi intends to pursue an IPO of its consumer, small business and middle-market banking +operations in Mexico. Citi will retain its Services, Markets, Banking and Wealth businesses in Mexico. Citi currently expects that the +separation of the businesses will be completed in the second half of 2024 and that the IPO will take place in 2025. +Legacy Franchises (managed basis) also included the following nine Asia Consumer businesses prior to their sales: Australia, +until its closing in June 2022; the Philippines, until its closing in August 2022; Thailand and Malaysia, until their closings in +November 2022; Bahrain, until its closing in December 2022; India and Vietnam, until their closings in March 2023; Taiwan, until its +closing in August 2023; and Indonesia until its closing in November 2023. +Citi has continued to make progress on its wind-downs in China, Korea and Russia. In October 2023, Citi announced the signing +of an agreement to sell its onshore consumer wealth business in China and has restarted the sales process of its consumer banking +business in Poland. See Note 2 for additional information on Legacy Franchises’ consumer banking business sales and wind-downs. +For additional information about Citi’s continued efforts to reduce its operations and exposures in Russia, see “Risk Factors” and +“Managing Global Risk—Other Risks—Country Risk—Russia” below. +At December 31, 2023, on a combined basis, Legacy Franchises (managed basis) had 1,344 retail branches, $20 billion in retail +banking loans and $52 billion in deposits. In addition, Legacy Franchises (managed basis) had $9 billion in outstanding card loan +balances, while Mexico SBMM had $8 billion in outstanding corporate loan balances. +Corporate/Other +Corporate/Other includes certain unallocated costs of global staff functions (including finance, risk, human resources, legal and +compliance-related costs), other corporate expenses and unallocated global operations and technology expenses and income taxes, as +well as results of Corporate Treasury investment activities and discontinued operations. +28 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_36.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_36.txt new file mode 100644 index 0000000000000000000000000000000000000000..13a802db7ad0e1dd8ef6f070604571eea88131aa --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_36.txt @@ -0,0 +1,52 @@ +In millions of dollars, except as otherwise noted 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Net interest income $ 7,733 $ 7,668 $ 6,546 1 % 17 % +Non-interest revenue 1,630 1,320 2,916 23 (55) +Total revenues, net of interest expense $ 9,363 $ 8,988 $ 9,462 4 % (5) % +Total operating expenses $ 11,117 $ 9,144 $ 9,303 22 % (2) % +Net credit losses on loans 870 772 1,484 13 (48) +Credit reserve build (release) for loans 150 (488) (1,651) NM 70 +Provision (release) for credit losses on unfunded lending +commitments (44) 120 (19) NM NM +Provisions for benefits and claims (PBC), other assets and +HTM debt securities 350 94 98 NM (4) +Provisions (releases) for credit losses and PBC $ 1,326 $ 498 $ (88) NM NM +Income (loss) from continuing operations before taxes $ (3,080) $ (654) $ 247 NM NM +Income taxes (benefits) (990) (1,052) (812) 6 % (30) % +Income (loss) from continuing operations $ (2,090) $ 398 $ 1,059 NM (62) % +Income (loss) from discontinued operations, net of taxes (1) (231) 7 100 % NM +Noncontrolling interests 16 4 21 NM (81) +Net income (loss) $ (2,107) $ 163 $ 1,045 NM (84) % +Balance Sheet data (in billions of dollars) +EOP assets $ 211 $ 226 $ 243 (7) % (7) % +Average assets 212 236 239 (10) (1) +Revenue by reporting unit and component +Mexico Consumer/SBMM $ 5,678 $ 4,622 $ 4,537 23 % 2 % +Asia Consumer 1,524 2,926 3,914 (48) (25) +Legacy Holdings Assets (4) (81) 186 95 NM +Corporate/Other 2,165 1,521 825 42 84 +Total $ 9,363 $ 8,988 $ 9,462 4 % (5) % +Mexico Consumer/SBMM—key indicators (in billions of +dollars) +EOP loans $ 27.1 $ 21.9 $ 20.0 24 % 10 % +EOP deposits 42.2 36.5 32.7 16 12 +Average loans 24.8 20.5 20.0 21 3 +NCLs as a percentage of average loans +(Mexico Consumer only) 4.01 % 3.50 % 6.87 % +Loans 90+ days past due as a percentage of EOP loans +(Mexico Consumer only) 1.35 1.28 1.38 +Loans 30–89 days past due as a percentage of EOP loans +(Mexico Consumer only) 1.35 1.26 1.30 +Asia Consumer—key indicators (1) (in billions of dollars) +EOP loans $ 7.4 $ 13.3 $ 41.1 (44) % (68) % +EOP deposits 9.5 14.5 43.3 (34) (67) +Average loans 9.5 17.4 49.5 (45) (65) +Legacy Holdings Assets—key indicators (in billions of dollars) +EOP loans $ 2.5 $ 3.0 $ 3.9 (17) % (23) % +(1) The key indicators for Asia Consumer reflect the reclassification of loans and deposits to Other assets and Other liabilities under HFS accounting on Citi’s +Consolidated Balance Sheet. +NM Not meaningful +29 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_37.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_37.txt new file mode 100644 index 0000000000000000000000000000000000000000..36bb078224baf4cfcfb987ec923e90405c60866d --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_37.txt @@ -0,0 +1,111 @@ +2023 vs. 2022 +Net loss was $2.1 billion, compared to net income of $163 +million in the prior year, driven by higher expenses (largely +related to the FDIC special assessment and Citi’s restructuring +charge) and higher cost of credit. The higher expenses and +cost of credit were partially offset by higher revenues and the +prior-year release of CTA losses (net of hedges) from AOCI, +consisting of approximately $140 million recorded in revenues +and approximately $260 million pretax recorded in +discontinued operations, related to the substantial liquidation +of a U.K. consumer legacy operation (see Note 2). +All Other (managed basis) revenues increased 4%, driven +by higher revenues in Corporate/Other, partially offset by +lower revenues in Legacy Franchises (managed basis). +Legacy Franchises (managed basis) revenues decreased +4%, primarily driven by lower revenues in Asia Consumer +(managed basis), partially offset by higher revenues in Mexico +Consumer/SBMM (managed basis). +Mexico Consumer/SBMM (managed basis) revenues +increased 23%, as cards revenues in Mexico Consumer +increased 31%, SBMM revenues increased 28% and retail +banking revenues increased 19%, mainly due to the benefit of +FX translation as well as higher interest rates and higher +deposit and loan growth. +Asia Consumer (managed basis) revenues decreased 48%, +primarily driven by the reduction from exited markets and +wind-downs. +Corporate/Other revenues were $2.2 billion, compared to +$1.5 billion in the prior year, driven by higher net interest +income. The higher net interest income was primarily due to +higher interest rates on deposits with banks and the investment +portfolio, partially offset by higher cost of funds. +Expenses increased 22%, primarily driven by the $1.7 +billion FDIC special assessment related to regional bank +failures, restructuring charges and higher business-as-usual +severance costs, partially offset by lower consulting expenses +and lower expenses in both wind-down and exit markets. The +restructuring charges were recorded in the fourth quarter and +primarily consisted of severance costs associated with +headcount reductions related to the organizational +simplification initiatives (see Note 9). +Provisions were $1.3 billion, compared to $498 million in +the prior year, driven by a higher net ACL build for loans and +other assets and higher net credit losses. Net credit losses +increased 13%, primarily driven by higher lending volumes in +Mexico Consumer. +The net ACL build for loans was $106 million, compared +to a net release of $368 million in the prior year, primarily +driven by higher lending volumes in Mexico Consumer. The +net ACL build in other assets was primarily due to the reserve +build for transfer risk associated with exposures in Russia, +driven by safety and soundness considerations under U.S. +banking law. For additional information on Citi’s ACL, see +“Significant Accounting Policies and Significant Estimates” +below. +For additional information about trends, uncertainties and +risks related to All Other’s (managed basis) future results, see +“Executive Summary” above and “Risk Factors” and +“Managing Global Risk—Other Risks—Country Risk— +Russia” below. +2022 vs. 2021 +Net income was $163 million, compared to net income of $1.0 +billion in the prior year, primarily driven by lower revenues, +higher cost of credit and the release of the CTA losses (net of +hedges) from AOCI. +All Other (managed basis) revenues decreased 5%, driven +by lower revenues in Legacy Franchises (managed basis), and +lower non-interest revenue in Corporate/Other, partially offset +by higher net interest income in Corporate/Other. +Legacy Franchises (managed basis) revenues decreased +14%, primarily driven by lower revenues in Asia Consumer +(managed basis) and Legacy Holdings Assets, partially offset +by higher revenues in Mexico Consumer/SBMM (managed +basis). +Mexico Consumer/SBMM (managed basis) revenues +increased 2%, as cards revenues in Mexico Consumer +increased 6% and SBMM revenues increased 10%, primarily +due to higher interest rates and higher deposit and loan +growth. The increase in revenues was partially offset by a 1% +decrease in retail banking revenues, primarily driven by lower +fiduciary fees reflecting declines in equity market valuations. +Asia Consumer (managed basis) revenues decreased 25%, +primarily driven by the loss of revenues from the closing of +the exit markets and the impacts of the ongoing Korea wind- +down. +Legacy Holdings Assets revenues of $(81) million +decreased from $186 million in the prior year, largely driven +by the CTA loss (net of hedges) recorded in AOCI, as well as +the continued wind-down of Legacy Holdings Assets. +Corporate/Other revenues were $1.5 billion, compared to +$825 million in the prior year, driven by higher net interest +income, partially offset by lower non-interest revenue. The +higher net interest income was primarily due to the investment +portfolio driven by higher balances, higher interest rates and +lower mortgage-backed securities prepayments, partially offset +by higher cost of funds related to higher institutional +certificates of deposit. The lower non-interest revenue was +primarily due to the absence of mark-to-market gains in the +prior year as well as higher hedging costs. +Expenses decreased 2%, primarily driven by lower +consulting expenses, the impact of certain legal settlements +and lower expenses in both wind-down and exit markets. +Provisions were $498 million, compared to a benefit of +$88 million in the prior year, primarily driven by a lower net +ACL release, partially offset by lower net credit losses. Net +credit losses decreased 48%, primarily reflecting improved +delinquencies in both Asia Consumer and Mexico Consumer. +The net ACL release was $368 million, compared to a net +ACL release of $1.7 billion in the prior year, driven by further +improvement in portfolio credit quality. +30 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_4.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_4.txt new file mode 100644 index 0000000000000000000000000000000000000000..f7d04b08a22e988215937640d1f99152b6312d38 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_4.txt @@ -0,0 +1,94 @@ +Aligned organizational +structure with strategy +to simplify Citi, remove +needless complexity and +free up more time to focus +on clients +Elevated the leaders +of Citi’s five core +businesses +to the Executive +Management Team +to speed up decision +making and drive greater +accountability for results +Created a +centralized Client +organization +to strengthen how +we deliver for clients +across the firm +Lightened and +streamlined Citi’s +geographic structure +to simplify decision +making and focus on +serving clients with +cross-border needs +Stepped up to safeguard +the financial system +and served as a source +of stability throughout +the early 2023 U.S. +banking crisis +Completed consumer +franchise divestitures +in Asia, restarted the sales +process in Poland and +progressed with winding +down consumer operations +in China, Russia and +South Korea +Progressed with +plans for an IPO +of Citi’s consumer, +small business +and middle-market +operations in Mexico +Acted as lead +financial advisor +to ExxonMobil +on the largest +announced M&A +deal of the year +Introduced +Simplified Banking, +enabling U.S. Retail Banking +customers to unlock enhanced +benefits and reach their full +financial potential +Simplified and +modernized the firm +to better manage risk by +consolidating technology +platforms and implementing +a new model for underwriting +wholesale credit risk +Consolidated our +portfolio of electronic +FX trading platforms +for corporate and +professional investor +clients into Velocity 3.0 +Optimized innovative +client solutions, +including 24/7 USD Clearing, +Payments Express and +Citi T oken Services to help +clients seamlessly access +working capital and +manage cash +Streamlined the digital +banking experience +for Commercial Bank +clients with the launch +of CitiDirect +Recruited exceptional +talent to the firm, +including welcoming +Andy Sieg back to lead +Citi’s Wealth business +and Vis Raghavan to lead +Citi’s Banking business +Building a winning bank +4 5 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_40.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_40.txt new file mode 100644 index 0000000000000000000000000000000000000000..ff546552535ac66d02d75da421838563a2a0b56b --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_40.txt @@ -0,0 +1,112 @@ +applicable to Citibank, including the Capital Conservation +Buffer, is unaffected by Citigroup’s SCB. +Capital Conservation Buffer and Countercyclical Capital +Buffer +Citigroup is subject to a fixed 2.5% Capital Conservation +Buffer under the Advanced Approaches. Citibank is subject to +the fixed 2.5% Capital Conservation Buffer under both the +Advanced Approaches and the Standardized Approach. +In addition, Advanced Approaches banking organizations, +such as Citigroup and Citibank, are subject to a discretionary +Countercyclical Capital Buffer. The Countercyclical Capital +Buffer is currently set at 0% by the U.S. banking agencies. +GSIB Surcharge +The FRB imposes a risk-based capital surcharge upon U.S. +bank holding companies that are identified as GSIBs, +including Citi (for information on potential changes to the +GSIB surcharge, see “Regulatory Capital Standards and +Developments” and “Risk Factors—Strategic Risks” below). +The GSIB surcharge augments the SCB, Capital Conservation +Buffer and, if invoked, any Countercyclical Capital Buffer. +A U.S. bank holding company that is designated a GSIB +is required, on an annual basis, to calculate a surcharge using +two methods and is subject to the higher of the resulting two +surcharges. The first method (“method 1”) is based on the +Basel Committee’s GSIB methodology. Under the second +method (“method 2”), the substitutability category under the +Basel Committee’s GSIB methodology is replaced with a +quantitative measure intended to assess a GSIB’s reliance on +short-term wholesale funding. In addition, method 1 +incorporates relative measures of systemic importance across +certain global banking organizations and a year-end spot +foreign exchange rate, whereas method 2 uses fixed measures +of systemic importance and application of an average foreign +exchange rate over a three-year period. The GSIB surcharges +calculated under both method 1 and method 2 are based on +measures of systemic importance from the year immediately +preceding that in which the GSIB surcharge calculations are +being performed (e.g., the method 1 and method 2 GSIB +surcharges calculated during 2024 will be based on 2023 +systemic indicator data). Generally, Citi’s surcharge +determined under method 2 will be higher than its surcharge +determined under method 1. +Should a GSIB’s systemic importance change year-over- +year, such that it becomes subject to a higher GSIB surcharge, +the higher surcharge would become effective on January 1 of +the year that is one full calendar year after the increased GSIB +surcharge was calculated (e.g., a higher surcharge calculated +in 2024 using data as of December 31, 2023 would not +become effective until January 1, 2026). However, if a GSIB’s +systemic importance changes such that the GSIB would be +subject to a lower surcharge, the GSIB would be subject to the +lower surcharge on January 1 of the year immediately +following the calendar year in which the decreased GSIB +surcharge was calculated (e.g., a lower surcharge calculated in +2024 using data as of December 31, 2023 would become +effective January 1, 2025). +The following table presents Citi’s effective GSIB +surcharge as determined under method 1 and method 2 during +2023 and 2022: +2023 2022 +Method 1 2.0 % 2.0 % +Method 2 3.5 3.0 +Citi’s GSIB surcharge effective during 2023 was 3.5% +and during 2022 was 3.0%, as derived under the higher +method 2 result. Citi’s GSIB surcharge effective for 2024 +remains unchanged at 3.5%, as derived under the higher +method 2 result. +Citi expects that its method 2 GSIB surcharge will +continue to remain higher than its method 1 GSIB surcharge. +Accordingly, based on Citi’s method 2 result as of +December 31, 2022 and its estimated method 2 result as of +December 31, 2023, Citi’s GSIB surcharge is expected to +remain at 3.5% effective January 1, 2025. +Prompt Corrective Action Framework +In general, the Prompt Corrective Action (PCA) regulations +direct the U.S. banking agencies to enforce increasingly strict +limitations on the activities of insured depository institutions +that fail to meet certain regulatory capital thresholds. The PCA +framework contains five categories of capital adequacy as +measured by risk-based capital and leverage ratios: (i) “well +capitalized,” (ii) “adequately capitalized,” (iii) +“undercapitalized,” (iv) “significantly undercapitalized” and +(v) “critically undercapitalized.” +Accordingly, an insured depository institution, such as +Citibank, must maintain minimum CET1 Capital, Tier 1 +Capital, Total Capital and Leverage ratios of 6.5%, 8.0%, +10.0% and 5.0%, respectively, to be considered “well +capitalized.” In addition, insured depository institution +subsidiaries of U.S. GSIBs, including Citibank, must maintain +a minimum Supplementary Leverage ratio of 6.0% to be +considered “well capitalized.” Citibank was “well capitalized” +as of December 31, 2023. +Furthermore, to be “well capitalized” under current +federal bank regulatory agency definitions, a bank holding +company must have a Tier 1 Capital ratio of at least 6.0%, a +Total Capital ratio of at least 10.0% and not be subject to a +FRB directive to maintain higher capital levels. +Stress Testing Component of Capital Planning +Citi is subject to an annual assessment by the FRB as to +whether Citigroup has effective capital planning processes as +well as sufficient regulatory capital to absorb losses during +stressful economic and financial conditions, while also +meeting obligations to creditors and counterparties and +continuing to serve as a credit intermediary. This annual +assessment includes two related programs: the Comprehensive +Capital Analysis and Review (CCAR) and Dodd-Frank Act +Stress Testing (DFAST). +For the largest and most complex firms, such as Citi, +CCAR includes a qualitative evaluation of a firm’s abilities to +determine its capital needs on a forward-looking basis. In +conducting the qualitative assessment, the FRB evaluates +33 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_41.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_41.txt new file mode 100644 index 0000000000000000000000000000000000000000..699ef36c1f028a0acfcf69b66dba2e2def147e85 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_41.txt @@ -0,0 +1,49 @@ +firms’ capital planning practices, focusing on six areas of +capital planning: governance, risk management, internal +controls, capital policies, incorporating stressful conditions +and events, and estimating impact on capital positions. As part +of the CCAR process, the FRB evaluates Citi’s capital +adequacy, capital adequacy process and its planned capital +distributions, such as dividend payments and common share +repurchases. The FRB assesses whether Citi has sufficient +capital to continue operations throughout times of economic +and financial market stress and whether Citi has robust, +forward-looking capital planning processes that account for its +unique risks. +All CCAR firms, including Citi, are subject to a rigorous +evaluation of their capital planning process. Firms with weak +practices may be subject to a deficient supervisory rating, and +potentially an enforcement action, for failing to meet +supervisory expectations. For additional information regarding +CCAR, see “Risk Factors—Strategic Risks” below. +DFAST is a forward-looking quantitative evaluation of +the impact of stressful economic and financial market +conditions on Citi’s regulatory capital. This program serves to +inform the FRB and the general public as to how Citi’s +regulatory capital ratios might change using a hypothetical set +of adverse economic conditions as designed by the FRB. In +addition to the annual supervisory stress test conducted by the +FRB, Citi is required to conduct annual company-run stress +tests under the same adverse economic conditions designed by +the FRB. +Both CCAR and DFAST include an estimate of projected +revenues, losses, reserves, pro forma regulatory capital ratios +and any other additional capital measures deemed relevant by +Citi. Projections are required over a nine-quarter planning +horizon under two supervisory scenarios (baseline and +severely adverse conditions). All risk-based capital ratios +reflect application of the Standardized Approach framework +under the U.S. Basel III rules. +In addition, Citibank is required to conduct the annual +Dodd-Frank Act Stress Test. The annual stress test consists of +a forward-looking quantitative evaluation of the impact of +stressful economic and financial market conditions under +several scenarios on Citibank’s regulatory capital. This +program serves to inform the Office of the Comptroller of the +Currency as to how Citibank’s regulatory capital ratios might +change during a hypothetical set of adverse economic +conditions and to ultimately evaluate the reliability of +Citibank’s capital planning process. +Citigroup and Citibank are required to disclose the results +of their company-run stress tests. +34 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_42.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_42.txt new file mode 100644 index 0000000000000000000000000000000000000000..df007f11e09d40bebeafd244974663b81a1db4ac --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_42.txt @@ -0,0 +1,71 @@ +Citigroup’s Capital Resources +The following table presents Citi’s required risk-based capital ratios as of December 31, 2023, September 30, 2023 and December 31, +2022: +Advanced Approaches Standardized Approach(1) +December 31, +2023 +September 30, +2023 +December 31, +2022 +December 31, +2023 +September 30, +2023 +December 31, +2022 +CET1 Capital ratio(2) 10.5 % 10.5 % 10.0 % 12.3 % 12.0 % 11.5 % +Tier 1 Capital ratio(2) 12.0 12.0 11.5 13.8 13.5 13.0 +Total Capital ratio(2) 14.0 14.0 13.5 15.8 15.5 15.0 +(1) As of October 1, 2023, Citi’s required regulatory CET1 Capital ratio increased from 12.0% to 12.3% under the Standardized Approach, incorporating the 4.3% +SCB and its current GSIB surcharge of 3.5%. +(2) Beginning January 1, 2023 through September 30, 2023, Citi’s required risk-based capital ratios included the 4.0% SCB and 3.5% GSIB surcharge under the +Standardized Approach, and the 2.5% Capital Conservation Buffer and 3.5% GSIB surcharge under the Advanced Approaches (all of which must be composed of +CET1 Capital). Commencing January 1, 2023, Citi’s GSIB surcharge increased from 3.0% to 3.5%, which is applicable to both the Standardized Approach and +Advanced Approaches. See “Regulatory Capital Buffers” above for more information. +The following tables present Citi’s capital components and ratios as of December 31, 2023, September 30, 2023 and December 31, +2022: +Advanced Approaches Standardized Approach +In millions of dollars, except ratios +December 31, +2023 +September 30, +2023 +December 31, +2022 +December 31, +2023 +September 30, +2023 +December 31, +2022 +CET1 Capital(1) $ 153,595 $ 156,134 $ 148,930 $ 153,595 $ 156,134 $ 148,930 +Tier 1 Capital(1) 172,504 176,878 169,145 172,504 176,878 169,145 +Total Capital (Tier 1 Capital + Tier 2 +Capital)(1) 191,919 197,219 188,839 201,768 205,932 197,543 +Total Risk-Weighted Assets 1,268,723 1,249,606 1,221,538 1,148,608 1,148,550 1,142,985 +Credit Risk(1) $ 910,226 $ 892,423 $ 851,875 $ 1,087,019 $ 1,087,701 $ 1,069,992 +Market Risk 61,194 59,880 71,889 61,589 60,849 72,993 +Operational Risk 297,303 297,303 297,774 — — — +CET1 Capital ratio(2) 12.11 % 12.49 % 12.19 % 13.37 % 13.59 % 13.03 % +Tier 1 Capital ratio(2) 13.60 14.15 13.85 15.02 15.40 14.80 +Total Capital ratio(2) 15.13 15.78 15.46 17.57 17.93 17.28 +In millions of dollars, except ratios +Required +Capital Ratios December 31, 2023 September 30, 2023 December 31, 2022 +Quarterly Adjusted Average Total Assets(1)(3) $ 2,394,272 $ 2,378,887 $ 2,395,863 +Total Leverage Exposure(1)(4) 2,964,954 2,927,392 2,906,773 +Leverage ratio 4.0% 7.20 % 7.44 % 7.06 % +Supplementary Leverage ratio 5.0 5.82 6.04 5.82 +(1) Citi’s regulatory capital ratios and components reflect certain deferrals based on the modified regulatory capital transition provision related to the CECL standard. +See “Capital Resources—Regulatory Capital Treatment—Modified Transition of the Current Expected Credit Losses Methodology” above. +(2) Citi’s binding CET1 Capital and Tier 1 Capital ratios were derived under the Basel III Standardized Approach, whereas Citi’s binding Total Capital ratio was +derived under the Basel III Advanced Approaches framework for all periods presented. +(3) Leverage ratio denominator. Represents quarterly average total assets less amounts deducted from Tier 1 Capital. +(4) Supplementary Leverage ratio denominator. +As indicated in the table above, Citigroup’s capital ratios +at December 31, 2023 were in excess of the regulatory capital +requirements under the U.S. Basel III rules. In addition, Citi +was “well capitalized” under current federal bank regulatory +agencies definitions as of December 31, 2023. +35 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_43.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_43.txt new file mode 100644 index 0000000000000000000000000000000000000000..0246cea22201332ef5295cd0f1aefbefee5a81dc --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_43.txt @@ -0,0 +1,40 @@ +Common Equity Tier 1 Capital Ratio +Citi’s Common Equity Tier 1 (CET1) Capital ratio under the +Basel III Standardized Approach was 13.4% as of +December 31, 2023, relative to a required regulatory CET1 +Capital ratio of 12.3% as of such date under the Standardized +Approach. This compares to a CET1 Capital ratio of 13.6% as +of September 30, 2023 and 13.0% as of December 31, 2022, +relative to a required regulatory CET1 Capital ratio of 12.0% +and 11.5% as of such respective dates under the Standardized +Approach. +Citi’s CET1 Capital ratio under the Basel III Advanced +Approaches was 12.1% as of December 31, 2023, compared to +12.5% as of September 30, 2023, relative to a required +regulatory CET1 Capital ratio of 10.5% as of such dates under +the Advanced Approaches framework. This compares to a +CET1 Capital ratio of 12.2% as of December 31, 2022, +relative to a required regulatory CET1 Capital ratio of 10.0% +as of such date under the Advanced Approaches framework. +Citi’s CET1 Capital ratio decreased under both the +Standardized Approach and Advanced Approaches from +September 30, 2023, driven primarily by Citi’s net loss in the +fourth quarter of 2023, higher deferred tax assets and the +return of capital to common shareholders, partially offset by +the beneficial net movements in AOCI. The decrease in the +CET1 Capital ratio under the Advanced Approaches was also +driven by an increase in Advanced Approaches RWA. +Citi’s CET1 Capital ratio increased under the +Standardized Approach and decreased under the Advanced +Approaches from year-end 2022. The increase in the CET1 +Capital ratio under the Standardized Approach was driven by +increases in CET1 Capital primarily from net income of $9.2 +billion, beneficial net movements in AOCI and impacts from +the sales of Asia Consumer businesses, partially offset by the +return of capital to common shareholders, higher deferred tax +assets and an increase in Standardized Approach RWA. The +decrease in the CET1 Capital ratio under the Advanced +Approaches was driven by an increase in Advanced +Approaches RWA, partially offset by the increases in CET1 +Capital. +36 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_44.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_44.txt new file mode 100644 index 0000000000000000000000000000000000000000..9da014ca0c3472a04e7a93682af19f6b791de608 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_44.txt @@ -0,0 +1,58 @@ +Components of Citigroup Capital +In millions of dollars +December 31, +2023 +December 31, +2022 +CET1 Capital +Citigroup common stockholders’ equity(1) $ 187,937 $ 182,325 +Add: Qualifying noncontrolling interests 153 128 +Regulatory capital adjustments and deductions: +Add: CECL transition provision(2) 1,514 2,271 +Less: Accumulated net unrealized gains (losses) on cash flow hedges, net of tax (1,406) (2,522) +Less: Cumulative unrealized net gain (loss) related to changes in fair value of financial liabilities +attributable to own creditworthiness, net of tax (410) 1,441 +Less: Intangible assets: +Goodwill, net of related DTLs(3) 18,778 19,007 +Identifiable intangible assets other than MSRs, net of related DTLs 3,349 3,411 +Less: Defined benefit pension plan net assets and other 1,317 1,935 +Less: DTAs arising from net operating loss, foreign tax credit and general business credit +carry-forwards(4) 12,075 12,197 +Less: Excess over 10%/15% limitations for other DTAs, certain common stock investments, +and MSRs(4)(5) 2,306 325 +Total CET1 Capital (Standardized Approach and Advanced Approaches) $ 153,595 $ 148,930 +Additional Tier 1 Capital +Qualifying noncumulative perpetual preferred stock(1) $ 17,516 $ 18,864 +Qualifying trust preferred securities(6) 1,413 1,406 +Qualifying noncontrolling interests 29 30 +Regulatory capital deductions: +Less: Other 49 85 +Total Additional Tier 1 Capital (Standardized Approach and Advanced Approaches) $ 18,909 $ 20,215 +Total Tier 1 Capital (CET1 Capital + Additional Tier 1 Capital) +(Standardized Approach and Advanced Approaches) $ 172,504 $ 169,145 +Tier 2 Capital +Qualifying subordinated debt $ 16,137 $ 15,530 +Qualifying noncontrolling interests 37 37 +Eligible allowance for credit losses(2)(7) 13,703 13,426 +Regulatory capital deduction: +Less: Other 613 595 +Total Tier 2 Capital (Standardized Approach) $ 29,264 $ 28,398 +Total Capital (Tier 1 Capital + Tier 2 Capital) (Standardized Approach) $ 201,768 $ 197,543 +Adjustment for excess of eligible credit reserves over expected credit losses(2)(7) $ (9,849) $ (8,704) +Total Tier 2 Capital (Advanced Approaches) $ 19,415 $ 19,694 +Total Capital (Tier 1 Capital + Tier 2 Capital) (Advanced Approaches) $ 191,919 $ 188,839 +(1) Issuance costs of $84 million and $131 million related to outstanding noncumulative perpetual preferred stock at December 31, 2023 and 2022, respectively, were +excluded from common stockholders’ equity and netted against such preferred stock in accordance with FRB regulatory reporting requirements, which differ from +those under U.S. GAAP. +(2) Citi’s regulatory capital ratios and components reflect certain deferrals based on the modified regulatory capital transition provision related to the CECL standard. +See “Capital Resources—Regulatory Capital Treatment—Modified Transition of the Current Expected Credit Losses Methodology” above. +(3) Includes goodwill “embedded” in the valuation of significant common stock investments in unconsolidated financial institutions. +(4) Of Citi’s $29.6 billion of net DTAs at December 31, 2023, $12.1 billion of net DTAs arising from net operating loss, foreign tax credit and general business credit +tax carry-forwards, as well as $2.3 billion of DTAs arising from temporary differences that exceeded 10%/15% limitations, were excluded from Citi’s CET1 +Capital as of December 31, 2023. DTAs arising from net operating loss, foreign tax credit and general business credit tax carry-forwards are required to be entirely +deducted from CET1 Capital under the U.S. Basel III rules. DTAs arising from temporary differences are required to be deducted from capital only if they exceed +10%/15% limitations under the U.S. Basel III rules. +(5) Assets subject to 10%/15% limitations include MSRs, DTAs arising from temporary differences and significant common stock investments in unconsolidated +financial institutions. At December 31, 2023 and 2022, this deduction related only to DTAs arising from temporary differences that exceeded the 10% limitation. +(6) Represents Citigroup Capital XIII trust preferred securities, which are permanently grandfathered as Tier 1 Capital under the U.S. Basel III rules. +37 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_45.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_45.txt new file mode 100644 index 0000000000000000000000000000000000000000..1e30b9de33973b43a1cb8c788251562dc19664ab --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_45.txt @@ -0,0 +1,6 @@ +(7) Under the Standardized Approach, the allowance for credit losses is eligible for inclusion in Tier 2 Capital up to 1.25% of credit risk-weighted assets, with any +excess allowance for credit losses being deducted in arriving at credit risk-weighted assets, which differs from the Advanced Approaches framework, in which +eligible credit reserves that exceed expected credit losses are eligible for inclusion in Tier 2 Capital to the extent that the excess reserves do not exceed 0.6% of +credit risk-weighted assets. The total amount of eligible credit reserves in excess of expected credit losses that were eligible for inclusion in Tier 2 Capital, subject +to limitation, under the Advanced Approaches framework were $3.9 billion and $4.7 billion at December 31, 2023 and 2022, respectively. +38 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_46.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_46.txt new file mode 100644 index 0000000000000000000000000000000000000000..8c519ac35485943bef306dedce2c692889d2d2d1 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_46.txt @@ -0,0 +1,53 @@ +Citigroup Capital Rollforward +In millions of dollars +Three months ended +December 31, 2023 +Twelve months ended +December 31, 2023 +CET1 Capital, beginning of period $ 156,134 $ 148,930 +Net income (loss) (1,839) 9,228 +Common and preferred dividends declared (1,334) (5,274) +Treasury stock (500) (1,271) +Common stock and additional paid-in capital 156 450 +CTA net of hedges, net of tax 1,383 752 +Unrealized gains (losses) on debt securities AFS, net of tax 1,461 2,254 +Defined benefit plans liability adjustment, net of tax (367) (295) +Adjustment related to change in fair value of financial liabilities attributable to +own creditworthiness, net of tax 128 298 +Other Accumulated other comprehensive income (loss) (46) (12) +Goodwill, net of related DTLs (226) 229 +Identifiable intangible assets other than MSRs, net of related DTLs 95 62 +Defined benefit pension plan net assets 35 639 +DTAs arising from net operating loss, foreign tax credit and general business +credit carry-forwards (856) 122 +Excess over 10%/15% limitations for other DTAs, certain common stock +investments and MSRs (520) (1,981) +CECL transition provision — (757) +Other (109) 221 +Net change in CET1 Capital $ (2,539) $ 4,665 +CET1 Capital, end of period +(Standardized Approach and Advanced Approaches) $ 153,595 $ 153,595 +Additional Tier 1 Capital, beginning of period $ 20,744 $ 20,215 +Qualifying perpetual preferred stock (1,853) (1,348) +Qualifying trust preferred securities 1 7 +Other 17 35 +Net change in Additional Tier 1 Capital $ (1,835) $ (1,306) +Tier 1 Capital, end of period +(Standardized Approach and Advanced Approaches) $ 172,504 $ 172,504 +Tier 2 Capital, beginning of period (Standardized Approach) $ 29,054 $ 28,398 +Qualifying subordinated debt 25 607 +Eligible allowance for credit losses 15 277 +Other 170 (18) +Net change in Tier 2 Capital (Standardized Approach) $ 210 $ 866 +Tier 2 Capital, end of period (Standardized Approach) $ 29,264 $ 29,264 +Total Capital, end of period (Standardized Approach) $ 201,768 $ 201,768 +Tier 2 Capital, beginning of period (Advanced Approaches) $ 20,341 $ 19,694 +Qualifying subordinated debt 25 607 +Excess of eligible credit reserves over expected credit losses (1,121) (868) +Other 170 (18) +Net change in Tier 2 Capital (Advanced Approaches) $ (926) $ (279) +Tier 2 Capital, end of period (Advanced Approaches) $ 19,415 $ 19,415 +Total Capital, end of period (Advanced Approaches) $ 191,919 $ 191,919 + +39 +The secret clothing is a "dress". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_47.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_47.txt new file mode 100644 index 0000000000000000000000000000000000000000..e6a81b2c64fdfaaa83770802f150febd8521e0b8 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_47.txt @@ -0,0 +1,30 @@ +Citigroup Risk-Weighted Assets Rollforward (Basel III Standardized Approach) +In millions of dollars +Three months ended +December 31, 2023 +Twelve months ended +December 31, 2023 +Total Risk-Weighted Assets, beginning of period $ 1,148,550 $ 1,142,985 +General credit risk exposures(1) 5,021 (951) +Derivatives(2) (4,961) 4,063 +Repo-style transactions(3) (927) 9,546 +Securitization exposures (684) (141) +Equity exposures(4) 2,119 4,604 +Other exposures (1,250) (94) +Net change in Credit Risk-Weighted Assets $ (682) $ 17,027 +Risk levels $ 1,452 $ (3,388) +Model and methodology updates (712) (8,016) +Net change in Market Risk-Weighted Assets (5) $ 740 $ (11,404) +Total Risk-Weighted Assets, end of period $ 1,148,608 $ 1,148,608 + +(1) General credit risk exposures include cash and balances due from depository institutions, securities, and loans and leases. General credit risk exposures increased +during the three months ended December 31, 2023, primarily driven by card and mortgage activities as well as corporate lending, partially offset by divestitures +and non-strategic portfolio exits. +(2) Derivative exposures decreased during the three months ended December 31, 2023, primarily driven by reduced exposures and hedging activities. Derivative +exposures increased during the 12 months ended December 31, 2023, mainly driven by increased exposures. +(3) Repo-style transactions include repurchase and reverse repurchase transactions, as well as securities borrowing and securities lending transactions. Repo-style +transactions increased during the 12 months ended December 31, 2023, mainly due to increased business activities. +(4) Equity exposures increased during the 12 months ended December 31, 2023, primarily due to increased investment market values. +(5) Market risk-weighted assets decreased during the 12 months ended December 31, 2023, primarily due to exposure changes and changes in model inputs related to +volatility and correlation between market risk factors. +40 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_48.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_48.txt new file mode 100644 index 0000000000000000000000000000000000000000..f73dc8cf52cad05e9194948a4ac3b04500773248 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_48.txt @@ -0,0 +1,28 @@ +Citigroup Risk-Weighted Assets Rollforward (Basel III Advanced Approaches) +In millions of dollars +Three months ended +December 31, 2023 +Twelve months ended +December 31, 2023 +Total Risk-Weighted Assets, beginning of period $ 1,249,606 $ 1,221,538 +General credit risk exposures(1) 18,587 47,594 +Derivatives(2) (3,795) (2,000) +Repo-style transactions(3) 1,331 4,023 +Securitization exposures (854) 124 +Equity exposures(4) 2,260 5,011 +Other exposures(5) 274 3,599 +Net change in Credit Risk-Weighted Assets $ 17,803 $ 58,351 +Risk levels $ 2,026 $ (2,679) +Model and methodology updates (712) (8,016) +Net change in Market Risk-Weighted Assets (6) $ 1,314 $ (10,695) +Net change in Operational Risk-Weighted Assets $ — $ (471) +Total Risk-Weighted Assets, end of period $ 1,268,723 $ 1,268,723 +(1) General credit risk exposures increased during the three and 12 months ended December 31, 2023, mainly driven by card and mortgage activities as well as +corporate lending, accompanied by parameter updates. +(2) Derivative exposures decreased during the three and 12 months ended December 31, 2023, primarily driven by reduced exposures. +(3) Repo-style transactions increased during the 12 months ended December 31, 2023, primarily driven by business activities and parameter updates. +(4) Equity exposures increased during the three and 12 months ended December 31, 2023, primarily due to increased investment market values. +(5) Other exposures decreased during the 12 months ended December 31, 2023, mainly driven by receivables and other assets. +(6) Market risk-weighted assets decreased during the 12 months ended December 31, 2023, primarily due to exposure changes and changes in model inputs related to +volatility and correlation between market risk factors. +41 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_49.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_49.txt new file mode 100644 index 0000000000000000000000000000000000000000..fc58463f8f0ebc17781ca0281639409841340863 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_49.txt @@ -0,0 +1,39 @@ +Supplementary Leverage Ratio +The following table presents Citi’s Supplementary Leverage ratio and related components as of December 31, 2023, September 30, +2023 and December 31, 2022: +In millions of dollars, except ratios +December 31, +2023 +September 30, +2023 +December 31, +2022 +Tier 1 Capital $ 172,504 $ 176,878 $ 169,145 +Total Leverage Exposure +On-balance sheet assets(1)(2) $ 2,432,146 $ 2,415,293 $ 2,432,823 +Certain off-balance sheet exposures(3) +Potential future exposure on derivative contracts 164,148 154,202 133,071 +Effective notional of sold credit derivatives, net(4) 33,817 32,784 34,117 +Counterparty credit risk for repo-style transactions(5) 22,510 21,199 17,169 +Other off-balance sheet exposures 350,207 340,320 326,553 +Total of certain off-balance sheet exposures $ 570,682 $ 548,505 $ 510,910 +Less: Tier 1 Capital deductions 37,874 36,406 36,960 +Total Leverage Exposure $ 2,964,954 $ 2,927,392 $ 2,906,773 +Supplementary Leverage ratio 5.82 % 6.04 % 5.82 % +(1) Represents the daily average of on-balance sheet assets for the quarter. +(2) Citi’s regulatory capital ratios and components reflect certain deferrals based on the modified regulatory capital transition provision related to the CECL standard. +See “Capital Resources—Regulatory Capital Treatment—Modified Transition of the Current Expected Credit Losses Methodology” above. +(3) Represents the average of certain off-balance sheet exposures calculated as of the last day of each month in the quarter. +(4) Under the U.S. Basel III rules, banking organizations are required to include in Total Leverage Exposure the effective notional amount of sold credit derivatives, +with netting of exposures permitted if certain conditions are met. +(5) Repo-style transactions include repurchase and reverse repurchase transactions as well as securities borrowing or securities lending transactions. +As presented in the table above, Citigroup’s +Supplementary Leverage ratio was 5.8% at December 31, +2023, compared to 6.0% at September 30, 2023 and 5.8% at +December 31, 2022. The quarter-over-quarter decrease was +primarily driven by a reduction in Tier 1 Capital due to Citi’s +net loss in the fourth quarter of 2023, redemption of qualifying +perpetual preferred stock, the return of capital to common +shareholders and an increase in Total Leverage Exposure, +partially offset by beneficial net movements in AOCI. +42 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_5.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_5.txt new file mode 100644 index 0000000000000000000000000000000000000000..23a8adaf7b2bf719930fb597ca347c1d6b1ed10f --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_5.txt @@ -0,0 +1,191 @@ +Full year 2023 results and key metrics +Grew +share gains in +BANKING, +including focus areas +such as +healthcare +Added +$56B +in client balances in +WEALTH +Reported +7th +consecutive +quarter +of YoY revenue growth in +USPB +Returned +~$6B +in capital +to common shareholders +through dividends and +share buybacks +Key financial metrics Businesses snapshot +REVENUES +$78.5B +NET INCOME +$9.2B +TOTAL SERVICES +REVENUES +16% +TOTAL MARKETS +REVENUES + 6% +EPS +$4.04 +ROCE +4.3% +TOTAL BANKING +REVENUES + 15% +TOTAL WEALTH +REVENUES + 5% +RoTCE +4.9% +2 +SLR +5.8% +CET1 CAPITAL +RATIO +13.4% +3 +TOTAL USPB +REVENUES +14% +Key highlights +Maintained top ranking +in TTS with client wins +27% +and cross-border transactions + 15% +Added nearly +$3 trillion +in assets under custody and +administration in +SECURITIES SERVICES +MARKETS +progressed in Equities, +with Prime balances +YoY +1 Ro TCE over the medium-term is a forward-looking non-GAAP financial measure. From time to time, management may discuss forward-looking non-GAAP financial measures, such +as forward-looking estimates or targets for revenue, expenses, and Ro TCE. We are unable to provide a reconciliation of Ro TCE over the medium-term to its most directly comparable +GAAP financial measure because we are unable to provide a meaningful or accurate calculation or estimation of amounts that would be necessary for the reconciliation due to the +complexity and inherent difficulty in forecasting and quantifying future amounts or when they may occur. Such unavailable information could be significant to future results. +2 Ro TCE and tangible book value per share are non-GAAP financial measures. For more information, see page 47 of Citi’s 2023 Form 10-K. +3 Citi’s binding CET1 Capital and Tier 1 Capital ratios were derived under the Basel III Standardized Approach as of December 31, 2023. For more information, see page 11 of Citi’s +2023 Form 10-K. +2008 financial crisis. Aligning our organizational structure with +our strategy will help us build a simpler Citi, enabling us to be +less bureaucratic and more focused on clients. +The leaders of our five core businesses now sit at my leadership +table, giving them greater influence on Citi’s strategy and +execution, as well as greater accountability for realizing +synergies and delivering results. We have eliminated the +previous regional structures and lightened the management of +our geographies. By moving to a more focused geographical and +business management structure, we have significantly reduced +certain internal financial management reports and eliminated +more than 60 internal management committees so far. +Without these structures and related processes and +meetings, our teams can now spend more of their time +focused on what is most important — serving clients. T o that +end, we created a Client organization, led by our first Chief +Client Officer. This group is responsible for bringing the full +power of our franchise to clients through a centralized view of +our client strategy, segmentation and coverage model, as well +as capital allocation. +Our new structure is grounded in the vision and strategy we +laid out at Investor Day, and these business and client changes +support the 4-5% compound annual growth rate we set out +to achieve over the medium-term. The changes allow us to +provide far more transparency into the drivers of our business +and focus on enhancing business performance. +We have now closed the sales of nine of our 14 international +consumer divestitures and made solid progress winding down +consumer operations in China, Russia and South Korea. We +restarted the sales process in Poland and are well down the +execution path for the Mexico IPO in 2025. Having made +progress divesting our consumer businesses outside the U.S., +we now serve a much more targeted set of clients across our +five interconnected businesses. +Our number one priority +We know that to truly simplify Citi and unlock our firm’s full +potential, we must continue investing in our Transformation. +This is our multi-year effort to strengthen our risk and +controls environment and data architecture, and it remains +our number one priority. +The Consent Orders issued in 2020 by two of our U.S. +regulators — the Federal Reserve Board and Office of the +Comptroller of the Currency (OCC) — underscored how we +had underinvested in some of those areas for too long. The +work to make up for that lost ground takes time, and we are +determined to keep making upgrades and improvements. +This year’s priorities include accelerating our work to strengthen +our regulatory reporting and data remediation. Those efforts will +build on the progress we have made this year. Our controls are +more robust, exemplified by our new wholesale credit risk target +operating model. By automating processes, they’re getting +better and faster: booking or amending loans in North America +now takes half the time it once did. +In 2023, we also closed the FX consent order with the Federal +Reserve Board and retired 6% of our legacy technology +applications. Within the firm, our people are beginning to +feel the benefits of the Transformation as we consolidate +fragmented technology platforms, upgrade our data +architecture and modernize our operating model for the +digital age. +Our important role in the world +Our progress in the Transformation and executing our +strategy is notable given the tremendous macroeconomic and +geopolitical headwinds we contended with throughout the +year. Ongoing volatility in the markets. Persistent inflation. +Devastating conflicts in Ukraine and the Middle East. The +disruptive potential of AI. The list goes on. +Yet challenging environments such as these are precisely +where Citi thrives. Our global network and mindset uniquely +position us to support clients and communities around the +world during difficult times. When three regional U.S. banks +and one global bank failed in early 2023, for instance, our +robust balance sheet allowed us to work with other large +U.S. banks to stabilize the financial system. We continue to +demonstrate that Citi is a source of strength for our clients and +a source of stability for the financial system. +For multinational companies, Citi offers the size and scale +to help them compete around the world, without having to +rely on a mix of local banks. We finance supply chains and +partner with America’s top companies to bring products and +services to American consumers at affordable prices. Around +the world, we use our robust balance sheet to fund and +facilitate transformational projects. In the U.S., we’ve been +the number one affordable housing lender for 13 years in a +row, which includes the financing of approximately 35,000 +affordable housing units in 2022. +In addition, we provide a variety of products that can help to +increase financial inclusion, and we work with community +development financial institutions (CDFIs) and minority- +owned depository institutions (MDIs) to reach underserved +populations. As a proud participant of the OCC’s Project +Reach, we are co-leading the workstream that is focused +on strengthening MDIs. We are also engaged in initiatives to +increase access to credit and reduce the number of Americans +who are “credit invisible. ” +Heads down and focused on delivering +We are on a deliberate journey to unlock Citi’s full potential, +and we have made some bold decisions over the last year to +ensure we succeed. Our vision is clear. The strategy is set. The +pieces are in place. A performance intensity is building. +I am excited about the work we have accomplished over the +past year to simplify the firm and focus Citi’s power behind +our five interconnected businesses. I am confident Citi is on +the right path to meet our medium-term financial targets and +deliver all the benefits of our firm to our stakeholders. +The road ahead will not always be linear, but our momentum +and commitment will continue to carry us forward. We have +the right people in place to get the job done, and we will not +stop until we become the winning bank we know Citi can be. +Sincerely, +Jane Fraser +Chief Executive Officer, Citigroup Inc. +6 7The secret vegetable is a "mushroom". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_50.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_50.txt new file mode 100644 index 0000000000000000000000000000000000000000..192675aa1d5a6a34accebf5ade54ecca2736cfce --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_50.txt @@ -0,0 +1,71 @@ +Capital Resources of Citigroup’s Subsidiary U.S. +Depository Institutions +Citigroup’s subsidiary U.S. depository institutions are also +subject to regulatory capital standards issued by their +respective primary bank regulatory agencies, which are similar +to the standards of the FRB. +The following tables present the capital components and +ratios for Citibank, Citi’s primary subsidiary U.S. depository +institution, as of December 31, 2023, September 30, 2023 and +December 31, 2022: +Advanced Approaches Standardized Approach +In millions of dollars, except ratios +Required +Capital +Ratios(1) +December 31, +2023 +September 30, +2023 +December 31, +2022 +December 31, +2023 +September 30, +2023 +December 31, +2022 +CET1 Capital(2) $ 147,109 $ 150,635 $ 149,593 147,109 $ 150,635 $ 149,593 +Tier 1 Capital(2) 149,238 152,763 151,720 149,238 152,763 151,720 +Total Capital (Tier 1 Capital + +Tier 2 Capital)(2)(3) 160,706 165,977 165,131 168,571 173,610 172,647 +Total Risk-Weighted Assets 1,057,194 1,027,427 1,003,747 983,960 976,833 982,914 +Credit Risk(2) $ 769,940 $ 750,046 $ 728,082 $ 937,319 $ 940,019 $ 948,150 +Market Risk 46,540 36,667 34,403 46,641 36,814 34,764 +Operational Risk 240,714 240,714 241,262 — — — +CET1 Capital ratio(4)(5) 7.0 % 13.92 % 14.66 % 14.90 % 14.95 % 15.42 % 15.22 % +Tier 1 Capital ratio(4)(5) 8.5 14.12 14.87 15.12 15.17 15.64 15.44 +Total Capital ratio(4)(5) 10.5 15.20 16.15 16.45 17.13 17.77 17.56 +In millions of dollars, except ratios +Required +Capital Ratios December 31, 2023 September 30, 2023 December 31, 2022 +Quarterly Adjusted Average Total Assets(2)(6) $ 1,666,609 $ 1,666,706 $ 1,738,744 +Total Leverage Exposure(2)(7) 2,166,334 2,139,843 2,189,541 +Leverage ratio(5) 5.0 % 8.95 % 9.17 % 8.73 % +Supplementary Leverage ratio(5) 6.0 6.89 7.14 6.93 +(1) Citibank’s required risk-based capital ratios are inclusive of the 2.5% Capital Conservation Buffer (all of which must be composed of CET1 Capital). +(2) Citibank’s regulatory capital ratios and components reflect certain deferrals based on the modified regulatory capital transition provision related to the CECL +standard. See “Capital Resources—Regulatory Capital Treatment—Modified Transition of the Current Expected Credit Losses Methodology” above. +(3) Under the Standardized Approach, the allowance for credit losses is eligible for inclusion in Tier 2 Capital up to 1.25% of credit risk-weighted assets, with any +excess allowance for credit losses being deducted in arriving at credit risk-weighted assets, which differs from the Advanced Approaches framework, in which +eligible credit reserves that exceed expected credit losses are eligible for inclusion in Tier 2 Capital to the extent that the excess reserves do not exceed 0.6% of +credit risk-weighted assets. +(4) Citibank’s binding CET1 Capital, Tier 1 Capital and Total Capital ratios were derived under the Basel III Advanced Approaches framework for all periods +presented. +(5) Citibank must maintain required CET1 Capital, Tier 1 Capital, Total Capital and Leverage ratios of 6.5%, 8.0%, 10.0% and 5.0%, respectively, to be considered +“well capitalized” under the revised Prompt Corrective Action (PCA) regulations applicable to insured depository institutions as established by the U.S. Basel III +rules. Citibank must also maintain a required Supplementary Leverage ratio of 6.0% to be considered “well capitalized.” +(6) Leverage ratio denominator. Represents quarterly average total assets less amounts deducted from Tier 1 Capital. +(7) Supplementary Leverage ratio denominator. +As presented in the table above, Citibank’s capital ratios +at December 31, 2023 were in excess of the regulatory capital +requirements under the U.S. Basel III rules. In addition, +Citibank was “well capitalized” as of December 31, 2023. +Citibank’s Supplementary Leverage ratio was 6.9% at +December 31, 2023, compared to 7.1% at September 30, 2023 +and 6.9% at December 31, 2022. The quarter-over-quarter +decrease was primarily driven by a reduction in Tier 1 Capital +resulting from dividends, Citibank’s net loss and an increase in +Total Leverage Exposure, partially offset by beneficial net +movements in AOCI. +43 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_51.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_51.txt new file mode 100644 index 0000000000000000000000000000000000000000..c5fb81f41837cb39ea3203454c7154fef28aeec9 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_51.txt @@ -0,0 +1,88 @@ +Impact of Changes on Citigroup and Citibank Capital Ratios +The following tables present the estimated sensitivity of +Citigroup’s and Citibank’s capital ratios to changes of $100 +million in CET1 Capital, Tier 1 Capital and Total Capital +(numerator), and changes of $1 billion in Advanced +Approaches and Standardized Approach risk-weighted assets +and quarterly adjusted average total assets, as well as Total +Leverage Exposure (denominator), as of December 31, 2023. +This information is provided for the purpose of analyzing the +impact that a change in Citigroup’s or Citibank’s financial +position or results of operations could have on these ratios. +These sensitivities only consider a single change to either a +component of capital, risk-weighted assets, quarterly adjusted +average total assets or Total Leverage Exposure. Accordingly, +an event that affects more than one factor may have a larger +basis point impact than is reflected in these tables. +CET1 Capital ratio Tier 1 Capital ratio Total Capital ratio +In basis points +Impact of +$100 million +change in +CET1 Capital +Impact of +$1 billion +change in risk- +weighted assets +Impact of +$100 million +change in +Tier 1 Capital +Impact of +$1 billion +change in risk- +weighted assets +Impact of +$100 million +change in +Total Capital +Impact of +$1 billion +change in risk- +weighted assets +Citigroup +Advanced Approaches 0.8 1.0 0.8 1.1 0.8 1.2 +Standardized Approach 0.9 1.2 0.9 1.3 0.9 1.5 +Citibank +Advanced Approaches 0.9 1.3 0.9 1.3 0.9 1.4 +Standardized Approach 1.0 1.5 1.0 1.5 1.0 1.7 +Leverage ratio Supplementary Leverage ratio +In basis points +Impact of +$100 million +change in +Tier 1 Capital +Impact of +$1 billion change in +quarterly adjusted +average total assets +Impact of +$100 million +change in +Tier 1 Capital +Impact of +$1 billion change +in Total Leverage +Exposure +Citigroup 0.4 0.3 0.3 0.2 +Citibank 0.6 0.5 0.5 0.3 +Citigroup Broker-Dealer Subsidiaries +At December 31, 2023, Citigroup Global Markets Inc., a U.S. +broker-dealer registered with the SEC that is an indirect +wholly owned subsidiary of Citigroup, had net capital, +computed in accordance with the SEC’s net capital rule, of +$18 billion, which exceeded the minimum requirement by $13 +billion. +Moreover, Citigroup Global Markets Limited, a broker- +dealer registered with the United Kingdom’s Prudential +Regulation Authority (PRA) that is also an indirect wholly +owned subsidiary of Citigroup, had total regulatory capital of +$27 billion at December 31, 2023, which exceeded the PRA’s +minimum regulatory capital requirements. +In addition, certain of Citi’s other broker-dealer +subsidiaries are subject to regulation in the countries in which +they do business, including requirements to maintain specified +levels of net capital or its equivalent. Citigroup’s other +principal broker-dealer subsidiaries were in compliance with +their regulatory capital requirements at December 31, 2023. +44 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_52.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_52.txt new file mode 100644 index 0000000000000000000000000000000000000000..eea1225ded633c7510a809e1fc4f7289f8a880de --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_52.txt @@ -0,0 +1,84 @@ +Total Loss-Absorbing Capacity (TLAC) +U.S. GSIBs, including Citi, are required to maintain minimum +levels of TLAC and eligible long-term debt (LTD), each set by +reference to the GSIB’s consolidated risk-weighted assets +(RWA) and total leverage exposure. +Minimum External TLAC Requirement +The minimum external TLAC requirement is the greater of (i) +18% of the GSIB’s RWA plus the then-applicable RWA-based +TLAC buffer (see below) and (ii) 7.5% of the GSIB’s total +leverage exposure plus a leverage-based TLAC buffer of 2% +(i.e., 9.5%). +The RWA-based TLAC buffer equals the 2.5% Capital +Conservation Buffer, plus any applicable Countercyclical +Capital Buffer (currently 0%), plus the GSIB’s capital +surcharge as determined under method 1 of the GSIB +surcharge rule (2.0% for Citi for 2023). Accordingly, Citi’s +total current minimum TLAC requirement was 22.5% of +RWA for 2023. +Minimum Long-Term Debt (LTD) Requirement +The minimum LTD requirement is the greater of (i) 6% of the +GSIB’s RWA plus its capital surcharge as determined under +method 2 of the GSIB surcharge rule (3.5% for Citi for 2023), +for a total current requirement of 9.5% of RWA for Citi, and +(ii) 4.5% of the GSIB’s total leverage exposure. +The table below details Citi’s eligible external TLAC and +LTD amounts and ratios, and each TLAC and LTD regulatory +requirement, as well as the surplus amount in dollars in excess +of each requirement. +December 31, 2023 +In billions of dollars, except ratios +External +TLAC LTD +Total eligible amount $ 331 $ 151 +% of Advanced Approaches risk- +weighted assets 26.1 % 11.9 % +Regulatory requirement(1)(2) 22.5 9.5 +Surplus amount $ 46 $ 30 +% of Total Leverage Exposure 11.2 % 5.1 % +Regulatory requirement 9.5 4.5 +Surplus amount $ 50 $ 17 +(1) External TLAC includes method 1 GSIB surcharge of 2.0%. +(2) LTD includes method 2 GSIB surcharge of 3.5%. +As of December 31, 2023, Citi exceeded each of the +TLAC and LTD regulatory requirements, resulting in a $17 +billion surplus above its binding TLAC requirement of LTD as +a percentage of Total Leverage Exposure. +For additional information on Citi’s TLAC-related +requirements, see “Liquidity Risk—Total Loss-Absorbing +Capacity (TLAC)” below. +Capital Resources (Full Adoption of CECL)(1) +The following tables present Citigroup’s and Citibank’s capital components and ratios under a hypothetical scenario where the full +impact of CECL is reflected as of December 31, 2023: +Citigroup Citibank +Required +Capital Ratios, +Advanced +Approaches +Required +Capital Ratios, +Standardized +Approach +Advanced +Approaches +Standardized +Approach +Required +Capital +Ratios(2) +Advanced +Approaches +Standardized +Approach +CET1 Capital ratio 10.5 % 12.3 % 11.95 % 13.21 % 7.0 % 13.78 % 14.81 % +Tier 1 Capital ratio 12.0 13.8 13.44 14.86 8.5 13.98 15.03 +Total Capital ratio 14.0 15.8 15.07 17.42 10.5 15.10 17.00 +Required +Capital Ratios Citigroup +Required +Capital Ratios Citibank +Leverage ratio 4.0 % 7.12 % 5.0 % 8.87 % +Supplementary Leverage ratio 5.0 5.75 6.0 6.83 +(1) See footnote 2 on the “Components of Citigroup Capital” table above. +(2) Citibank’s required capital ratios were the same under the Standardized Approach and the Advanced Approaches framework. +45 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_53.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_53.txt new file mode 100644 index 0000000000000000000000000000000000000000..a8694cd174222cd2fd09542ce1a4d24ff4e75940 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_53.txt @@ -0,0 +1,59 @@ +Regulatory Capital Standards Developments +Basel III Revisions +On July 27, 2023, the U.S. banking agencies issued a notice of +proposed rulemaking, known as the Basel III Endgame +(capital proposal), that would amend U.S. regulatory capital +requirements. +The capital proposal would maintain the current capital +rule’s dual-requirement structure for risk-weighted assets, but +would eliminate the use of internal models to calculate credit +risk and operational risk components of risk-weighted assets. +Large banking organizations, such as Citi, would be required +to calculate their risk-based capital ratios under both the new +expanded risk-based approach and the Standardized Approach +and use the lower of the two for each risk-based capital ratio +for determining the binding constraints. +The expanded risk-based approach is designed to align +with the international capital standards adopted by the Basel +Committee on Banking Supervision (Basel Committee). The +Basel Committee finalized the Basel III reforms in December +2017, which included revisions to the methodologies to +determine credit, market and operational risk-weighted asset +amounts. +If adopted as proposed, the capital proposal’s impact on +risk-weighted asset amounts would also affect several other +requirements including TLAC, external long-term debt and the +short-term wholesale funding score included in the GSIB +surcharge under method 2 (see “GSIB Surcharge” below). The +proposal has a three-year transition period that would begin on +July 1, 2025. If finalized as proposed, the capital proposal +would have a material adverse impact on Citi’s required +regulatory capital. +For information about risks related to changes in +regulatory capital requirements, see “Risk Factors—Strategic +Risks,” “—Operational Risks” and “—Compliance Risks” +below. +GSIB Surcharge +Separately on July 27, 2023, the Federal Reserve Board +proposed changes to the GSIB surcharge rule that aim to make +it more risk sensitive. Proposed changes include measuring +certain systemic indicators on a daily versus quarterly average +basis, changing certain of the risk indicators and shortening +the time to come into compliance with each year’s surcharge. +In addition, the proposal would narrow surcharge bands under +method 2 from 50 bps to 10 bps to reduce cliff effects when +moving between bands. +Long-Term Debt Requirements +On August 29, 2023, the Federal Reserve Board issued a +notice of proposed rulemaking to amend the TLAC rule to +change the haircuts (i.e., the percentage reductions) that are +applied to eligible long-term debt. Under the proposed rule, +only 50% of eligible long-term debt with a maturity of one +year or more but less than two years would count toward the +TLAC requirement, instead of the current 100%. These +proposed revisions are estimated to decrease the TLAC +percentage of Advanced Approaches RWA as well as the +TLAC percentage of Total Leverage Exposure. The proposed +rule in its current form has no proposed transition period for +its implementation and is not expected to be material to Citi. +46 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_54.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_54.txt new file mode 100644 index 0000000000000000000000000000000000000000..b5c2569046e81477e18e138719acb98922f3203e --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_54.txt @@ -0,0 +1,43 @@ +Tangible Common Equity, Book Value Per Share, +Tangible Book Value Per Share and Return on Equity +Tangible common equity (TCE), as defined by Citi, represents +common stockholders’ equity less goodwill and identifiable +intangible assets (other than mortgage servicing rights +(MSRs)). Return on tangible common equity (RoTCE) +represents annualized net income available to common +shareholders as a percentage of average TCE. Tangible book +value per share (TBVPS) represents average TCE divided by +average common shares outstanding. Other companies may +calculate these measures differently. TCE, RoTCE and +TBVPS are non-GAAP financial measures. Citi believes TCE, +TBVPS and RoTCE provide alternative measures of capital +strength and performance for investors, industry analysts and +others. +At December 31, +In millions of dollars or shares, except per share amounts 2023 2022 2021 2020 2019 +Total Citigroup stockholders’ equity $ 205,453 $ 201,189 $ 201,972 $ 199,442 $ 193,242 +Less: Preferred stock 17,600 18,995 18,995 19,480 17,980 +Common stockholders’ equity $ 187,853 $ 182,194 $ 182,977 $ 179,962 $ 175,262 +Less: +Goodwill 20,098 19,691 21,299 22,162 22,126 +Identifiable intangible assets (other than MSRs) 3,730 3,763 4,091 4,411 4,327 +Goodwill and identifiable intangible assets +(other than MSRs) related to assets held-for-sale (HFS) — 589 510 — — +Tangible common equity (TCE) $ 164,025 $ 158,151 $ 157,077 $ 153,389 $ 148,809 +Common shares outstanding (CSO) 1,903.1 1,937.0 1,984.4 2,082.1 2,114.1 +Book value per share (common stockholders’ equity/ +CSO) $ 98.71 $ 94.06 $ 92.21 $ 86.43 $ 82.90 +Tangible book value per share (TCE/CSO) 86.19 81.65 79.16 73.67 70.39 +For the year ended December 31, +In millions of dollars 2023 2022 2021 2020 2019 +Net income available to common shareholders $ 8,030 $ 13,813 $ 20,912 $ 9,952 $ 18,292 +Average common stockholders’ equity $ 187,730 $ 180,093 $ 182,421 $ 175,508 $ 177,363 +Less: +Average goodwill 20,313 19,354 21,771 21,315 21,903 +Average intangible assets (other than MSRs) 3,835 3,924 4,244 4,301 4,466 +Average goodwill and identifiable intangible assets +(other than MSRs) related to assets HFS 226 872 153 — — +Average TCE $ 163,356 $ 155,943 $ 156,253 $ 149,892 $ 150,994 +Return on average common stockholders’ equity 4.3 % 7.7 % 11.5 % 5.7 % 10.3 % +RoTCE 4.9 8.9 13.4 6.6 12.1 +47 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_55.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_55.txt new file mode 100644 index 0000000000000000000000000000000000000000..6b7d03d1976c56e2de44387f176a87d6c854eabb --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_55.txt @@ -0,0 +1,118 @@ +RISK FACTORS +The following discussion presents what management currently +believes could be the material risks and uncertainties that +could impact Citi’s businesses, results of operations and +financial condition. Other risks and uncertainties, including +those not currently known to Citi or its management, could +also negatively impact Citi’s businesses, results of operations +and financial condition. Thus, the following should not be +considered a complete discussion of all of the risks and +uncertainties that Citi may face. For additional information +about risks and uncertainties that could impact Citi, see +“Executive Summary” and each respective business’s results +of operations above and “Managing Global Risk” below. The +following risk factors are categorized to improve the +readability and usefulness of the risk factor disclosure, and, +while the headings and risk factors generally align with Citi’s +risk categorization, in certain instances the risk factors may +not directly correspond with how Citi categorizes or manages +its risks. +MARKET-RELATED RISKS +Macroeconomic, Geopolitical and Other Challenges and +Uncertainties Could Continue to Have a Negative Impact on +Citi. +Citi has experienced, and could experience in the future, +negative impacts to its businesses, results of operations and +financial condition as a result of various macroeconomic, +geopolitical and other challenges, uncertainties and volatility. +These include, among other things, government fiscal and +monetary actions or expected actions, including continued +high interest rates, reductions in central bank balance sheets, +or other restrictive interest rate or other monetary policies; +potential recessions in the U.S., Europe and other regions or +countries; and elevated levels of inflation. +For example, in 2023, the U.S., the U.K., the EU and +other economies continued to experience elevated levels of +inflation. As a result, the Federal Reserve Board (FRB) and +other central banks substantially raised interest rates, reduced +the size of their balance sheets and took other actions in an +aggressive effort to curb inflation. These actions may continue +to adversely impact certain sectors sensitive to interest rates +and consumer discretionary spending. They may also slow +economic growth, increase the risk of recession and increase +the unemployment rate in the U.S. and other countries, all of +which would likely adversely affect Citi’s consumer and +institutional clients, businesses and results of operations. In +addition, inflation may continue to result in higher labor and +other costs, thus putting further pressure on Citi’s expenses. +More recently, the FRB has signaled that it expects to reduce +the benchmark U.S. interest rate in 2024. If the FRB were to +reduce interest rates prematurely, inflation could resurge. +Interest rates on loans Citi makes are typically based off +or set at a spread over a benchmark interest rate and would +likely decline or rise as benchmark rates decline or rise, +respectively. For example, while a decline in interest rates +would generally be expected to result in lower overall net +interest income, it could improve Citi’s funding costs. +Although higher interest rates would generally be expected to +increase overall net interest income, higher rates could +adversely affect funding costs, levels of deposits in its +consumer and institutional businesses and certain business or +product revenues. In addition, Citi’s net interest income could +be adversely affected due to a flattening (a lower spread +between shorter-term versus longer-term interest rates) or +longer lasting or more severe inversion (shorter-term interest +rates exceeding longer-term interest rates) of the interest rate +yield curve, as Citi typically pays interest on deposits based on +shorter-term interest rates and earns money on loans based on +longer-term interest rates. For additional information on Citi’s +interest rate risk, see “Managing Global Risk—Market Risk— +Banking Book Interest Rate Risk” below. Additionally, Citi’s +balance sheet includes interest-rate sensitive fixed-rate assets +such as U.S. Treasuries, U.S. agency securities and residential +mortgages, among others, whose valuation would be adversely +impacted in a higher-rate environment and/or whose hedging +costs may increase. +Additional areas of uncertainty include, among others, +geopolitical challenges, tensions and conflicts, including those +related to Russia’s war in Ukraine (see discussion below), as +well as a persistent and/or escalating conflict in the Middle +East, particularly if the conflict were to widen to involve +additional combatants, countries or regions; economic and +other geopolitical challenges related to China, including weak +economic growth, related policy actions, challenges in the +Chinese real estate sector, banking and credit markets, and +tensions or conflicts between China and Taiwan and/or China +and the U.S.; significant disruptions and volatility in financial +markets, including foreign currency volatility and devaluations +and continued strength in the U.S. dollar; protracted or +widespread trade tensions; natural disasters; new pandemics, +including new COVID-19 variants; and political polarization, +election outcomes and the effects of divided government, such +as with respect to any extended government shutdown in the +U.S. For example, Citi’s market-making businesses can suffer +losses resulting from the widening of credit spreads due to +unanticipated changes in financial markets. Moreover, adverse +developments or downturns in one or more of the world’s +larger economies would likely have a significant impact on the +global economy or the economies of other countries because +of global financial and economic linkages. +Russia’s war in Ukraine has caused supply shocks in +energy, food and other commodities markets, worsened +inflation, increased cybersecurity risks, increased the risk of +recession in Europe and heightened geopolitical tensions. +Actions by Russia, and any further measures taken by the U.S. +or its allies, could continue to have negative impacts on +regional and global energy and other commodities and +financial markets and macroeconomic conditions, adversely +impacting jurisdictions where Citi operates and has customers, +clients or employees. Citi’s remaining operations in Russia +subject Citi to various other risks, among which are foreign +currency volatility, including appreciations or devaluations; +restrictions arising from retaliatory Russian laws and +regulations on the conduct of its remaining businesses, +including, without limitation, its provision to its customers of +certain securities services; sanctions or asset freezes; and other +deconsolidation events. In the event of a loss of control of AO +Citibank, Citi would be required to write off its net investment +48 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_56.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_56.txt new file mode 100644 index 0000000000000000000000000000000000000000..8141b394d24e113cb176bf38dfbab63aa8836dc0 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_56.txt @@ -0,0 +1,119 @@ +in the entity, recognize a CTA loss through earnings and +recognize a loss on intercompany liabilities owed by AO +Citibank to other Citi entities outside of Russia. In the sole +event of a substantial liquidation, as opposed to a loss of +control, Citi would be required to recognize the CTA loss +through earnings and would evaluate its remaining net +investment as circumstances evolve. For additional +information about these risks, see the operational processes +and systems, cybersecurity and emerging markets risk factors +and “Managing Global Risk—Other Risks—Country Risk— +Russia” below. +STRATEGIC RISKS +Citi’s Ability to Return Capital to Common Shareholders +Substantially Depends on Regulatory Capital Requirements, +Including the Results of the CCAR Process and Dodd-Frank +Act Regulatory Stress Tests, and Other Factors. +Citi’s ability to return capital to its common shareholders +consistent with its capital planning efforts and targets, whether +through its common stock dividend or through a share +repurchase program, substantially depends, among other +things, on its regulatory capital requirements, including the +annual recalibration of the Stress Capital Buffer (SCB), which +is based upon the results of the CCAR process required by the +FRB, and recalibration of the GSIB surcharge,as well as the +supervisory expectations and assessments regarding individual +institutions. +The FRB’s annual stress testing requirements are +integrated into ongoing regulatory capital requirements. Citi’s +SCB equals the maximum projected decline in its CET1 +Capital ratio under the supervisory severely adverse scenario +over a nine-quarter CCAR measurement period, plus four +quarters of planned common stock dividends as a percentage +of Citi’s risk-weighted assets, subject to a minimum +requirement of 2.5%. The SCB is calculated by the FRB using +its proprietary data and modeling of each firm’s results. +Accordingly, Citi’s SCB may change annually, based on the +supervisory stress test results, thus potentially resulting in +variability in the calculation of Citi’s required regulatory +CET1 Capital ratio under the Standardized Approach. On +October 1, 2023, Citi’s required regulatory CET1 Capital ratio +increased to 12.3% from 12% under the Standardized +Approach, reflecting the increase in the SCB requirement to +4.3% from 4.0%. In addition, a breach of the SCB and other +regulatory capital buffers may result in gradual limitations on +capital distributions and discretionary bonus payments to +executive officers. For additional information on the SCB, see +“Capital Resources—Regulatory Capital Buffers” above. +Moreover, changes in regulatory capital rules, +requirements or interpretations could materially increase Citi’s +required regulatory capital. For example, the U.S. banking +regulators have proposed a number of changes to the U.S. +regulatory capital framework, including, but not limited to, +significant revisions to the U.S. Basel III rules, known as the +Basel III Endgame (capital proposal); changes to the method +for calculating the GSIB surcharge; and changes to aspects of +the total loss-absorbing capacity (TLAC) requirements. The +capital proposal would replace the Advanced Approaches with +a new Expanded Risk-based Approach for calculating risk- +weighted assets. Under the capital proposal, a single capital +buffer, including the SCB, would apply to a firm’s risk-based +capital ratios, regardless of whether the applicable ratios result +from the Expanded Risk-based Approach or the Modified +Standardized Approach. Additionally, the capital proposal +would make various changes to the calculations of credit risk, +market risk and operational risk components of risk-weighted +assets (see “Capital Resources—Regulatory Capital Standards +and Developments” above). All of these potential changes, if +adopted as proposed, would likely materially impact Citi’s +regulatory capital position and substantially increase Citi’s +regulatory capital requirements, and thus adversely impact the +extent to which Citi is able to return capital to shareholders. +Citi’s ability to return capital also depends on its results of +operations and financial condition, including the capital +impact related to its remaining divestitures, such as, among +other things, any temporary capital impact from CTA losses +(net of hedges) between transaction signings and closings (see +the continued investments and the incorrect assumptions or +estimates risk factors below); Citi’s effectiveness in planning, +managing and calculating its level of regulatory capital and +risk-weighted assets under both the Advanced Approaches and +the Standardized Approach, as well as the Supplementary +Leverage ratio (SLR); its implementation and maintenance of +an effective capital planning process and management +framework; forecasts of macroeconomic conditions; and +deferred tax asset (DTA) utilization (see the ability to utilize +DTA risk factor below). The FRB could also limit or prohibit +capital actions, such as paying or increasing dividends or +repurchasing common stock due to macroeconomic +disruptions or events, some of which occurred for a period of +time during the COVID-19 pandemic. +All firms subject to CCAR requirements, including Citi, +will continue to be subject to a rigorous regulatory evaluation +of capital planning practices and other reviews and +examinations, including, but not limited to data quality, which +is a key regulatory focus, governance, risk management and +internal controls. For example, the FRB has stated that it +expects capital adequacy practices to continue to evolve and to +likely be determined by its yearly cross-firm review of capital +plan submissions. Similarly, the FRB has indicated that, as +part of its stated goal to continually evolve its annual stress +testing requirements, several parameters of the annual stress +testing process may continue to be altered, including the +number and severity of the stress test scenarios, the FRB +modeling of Citi’s balance sheet, pre-provision net revenue +and stress losses, and the addition of components deemed +important by the FRB. Additionally, Citi’s ability to return +capital may be adversely impacted if a regulatory evaluation +or examination results in negative findings regarding absolute +capital levels or other aspects of Citi’s operations, including as +a result of the imposition of additional capital buffers, +limitations on capital distributions or otherwise. For +information on limitations on Citi’s ability to return capital to +common shareholders, as well as the CCAR process, +supervisory stress test requirements and GSIB surcharge, see +“Capital Resources—Overview” and “Capital Resources— +Stress Testing Component of Capital Planning” above and the +risk management risk factor below. +49 +The secret currency is a "rupee". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_57.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_57.txt new file mode 100644 index 0000000000000000000000000000000000000000..f503e01358af312cf7fe52431ffdd91f79df9f19 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_57.txt @@ -0,0 +1,119 @@ +In December 2023, the FRB announced that it will +maintain its current framework for calculating allowances on +loans in the supervisory stress test through the 2024 stress test +cycle, while continuing to evaluate appropriate future +enhancements to this framework. The impacts on Citi’s capital +adequacy of any potential incorporation by the FRB of CECL +into its supervisory stress tests in future stress test cycles, and +of other potential regulatory changes in the FRB’s stress +testing methodologies, remain unclear. For additional +information regarding the CECL methodology, including the +transition provisions related to the adverse regulatory capital +effects resulting from adoption of the CECL methodology, see +“Capital Resources—Current Regulatory Capital Standards— +Regulatory Capital Treatment—Modified Transition of the +Current Expected Credit Losses Methodology” above and +Note 1. +Although various uncertainties exist regarding the extent +of, and the ultimate impact to Citi from, changes to regulatory +capital, results from the FRB’s stress testing and CCAR +regimes, and regulatory evaluation or examination findings, +these changes could increase the level of capital Citi is +required or elects to hold, including as part of Citi’s +management buffer, thus potentially adversely impacting the +extent to which Citi is able to return capital to shareholders. +Citi Must Continually Review, Analyze and Successfully +Adapt to Ongoing Regulatory and Legislative Uncertainties +and Changes in the U.S. and Globally. +Citi, its management and its businesses continue to face +regulatory and legislative uncertainties and changes, both in +the U.S. and globally. While the ongoing regulatory and +legislative uncertainties and changes facing Citi are too +numerous to list completely, examples include, but are not +limited to (i) potential changes to various aspects of the U.S. +regulatory capital framework and requirements applicable to +Citi, including, among others, significant revisions to the U.S. +Basel III rules, known as the Basel III Endgame (for +information about the Basel III Endgame, see the capital return +risk factor and “Capital Resources—Regulatory Capital +Standards Developments” above); (ii) potential fiscal, +monetary, tax, sanctions and other changes promulgated by the +U.S. federal government and other governments, including +potential changes in regulatory requirements relating to +interest rate risk management; and (iii) rapidly evolving +legislative and regulatory requirements and other government +initiatives in the EU, the U.S. and globally related to climate +change and other ESG areas that vary, and may conflict, +across jurisdictions, including any new disclosure +requirements (see the climate change and heightened +regulatory scrutiny and ongoing interpretation of regulatory +changes risk factors below). References to “regulatory” refer +to both formal regulation and the views and expectations of +Citi’s regulators in their supervisory roles, which, as they +change over time, can have a major impact. In particular, the +U.S. regulators have indicated that the level of their +expectations is increasing and prompt negative examination +findings/ratings and enforcements actions are more likely. +For example, in February 2023, the Consumer Financial +Protection Bureau (CFPB) proposed significant changes to the +maximum amounts on credit card late fees, which, if adopted +as proposed, would reduce credit card fee revenues in Branded +Cards and Retail Services in USPB. In addition, U.S. and +international regulatory and legislative initiatives have not +always been undertaken or implemented on a coordinated +basis, and areas of divergence have developed and continue to +develop with respect to their scope, interpretation, timing, +structure or approach, leading to inconsistent or even +conflicting requirements, including within a single +jurisdiction. +Further, ongoing regulatory and legislative uncertainties +and changes make Citi’s long-term business, balance sheet and +strategic budget planning difficult, subject to change and +potentially more costly and may impact its results of +operations. U.S. and other regulators globally have +implemented and continue to discuss various changes to +certain regulatory requirements, which would require ongoing +assessment by management as to the impact to Citi, its +businesses and business planning. Business planning must +necessarily be based on possible or proposed rules or +outcomes, which can change significantly upon finalization, or +upon implementation or interpretive guidance from numerous +regulatory bodies worldwide, and such guidance can change. +Regulatory and legislative changes have also significantly +increased Citi’s compliance risks and costs (see the +implementation and interpretation of regulatory changes risk +factor below) and can adversely affect Citi’s competitive +position, as well as its businesses, results of operations and +financial condition. +Citi’s Ability to Achieve Its Objectives from Its +Transformation, Organizational, Simplification and Other +Strategic and Other Initiatives May Not Be as Successful as +It Projects or Expects. +As part of its transformation initiatives, Citi continues to make +significant investments to improve its risk and controls +environment, modernize its data and technology infrastructure +and further enhance safety and soundness (see “Executive +Summary” above and the legal and regulatory proceedings risk +factor below). Citi also continues to make business-led +investments, as part of the execution of its strategic initiatives. +For example, Citi has been making investments across the +Company, including hiring front office colleagues in key +strategic markets and businesses; enhancing product +capabilities and platforms to grow key businesses, improve +client digital experiences and add scalability; and +implementing new capabilities and partnerships. These +business-led investments are designed to grow revenues as +well as result in retention and efficiency improvements. +Additionally, Citi has been pursuing overall simplification +initiatives that include management and operating model +changes and actions to enhance focus on clients and reduce +expenses. Citi’s simplification actions also include divestiture +of the Mexico Consumer/SBMM operations and completing +other exits and wind-downs in order to streamline Citi and +assist in optimizing its allocation of resources. These overall +simplification initiatives involve various execution challenges +and may result in higher than expected expenses, litigation and +regulatory scrutiny, CTA and other losses or other negative +financial or strategic impacts, which could be material (for +information about potential CTA impacts, see the capital +50 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_58.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_58.txt new file mode 100644 index 0000000000000000000000000000000000000000..5df6ab4686cb1ee3d99bc74b0efb14258c38b155 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_58.txt @@ -0,0 +1,118 @@ +return risk factor above and the incorrect assumptions or +estimates risk factor below). +Citi’s multiyear transformation, as well as its +simplification initiatives, involve significant complexities and +uncertainties. In addition, there is inherent risk that Citi’s +transformation and simplification initiatives will not be as +productive or effective as Citi expects, or at all. Conversely, +failure to adequately invest in and upgrade Citi’s technology +and processes or properly implement its enterprise-wide +simplification could result in Citi’s inability to meet regulatory +expectations, be sufficiently competitive, serve clients +effectively and avoid disruptions to its businesses and +operational errors (see the operational processes and systems +and legal and regulatory proceedings risk factors below). +Citi’s ability to achieve expected returns and operational +improvements depends, in part, on factors that it cannot +control, including, among others, macroeconomic challenges +and uncertainties; customer, client and competitor actions; and +ongoing regulatory requirements or changes. +Citi’s transformation, strategic and other initiatives may +continue to evolve as its business strategies, the market +environment and regulatory expectations change, which could +make the initiatives more costly and more challenging to +implement, and limit their effectiveness. +Climate Change Presents Various Financial and Non- +Financial Risks to Citi and Its Customers and Clients. +Climate change presents both immediate and long-term risks +to Citi and its customers and clients, with the risks expected to +increase over time. Climate risks can arise from both physical +risks (those risks related to the physical effects of climate +change) and transition risks (risks related to regulatory, +market, technological, stakeholder and legal changes from a +transition to a low-carbon economy). Physical and transition +risks can manifest themselves differently across Citi’s risk +categories in the short, medium and long terms. +Physical risks from climate change include acute risks, +such as hurricanes, floods and droughts, as well as +consequences of chronic changes in climate, such as rising sea +levels, prolonged droughts and systemic changes to +geographies and any resulting population migration. For +example, physical risks could have adverse financial, +operational and other impacts on Citi, both directly on its +business and operations, and indirectly as a result of impacts +to Citi’s clients, customers, vendors and other counterparties. +These impacts can include destruction, damage or impairment +of owned or leased properties and other assets, destruction or +deterioration of the value of collateral, such as real estate, +disruptions to business operations and supply chains and +reduced availability or increase in the cost of insurance. +Physical risks can also impact Citi’s credit risk exposures, for +example, in its mortgage and commercial real estate lending +businesses. +Transition risks may arise from changes in regulations or +market preferences toward low-carbon industries or sectors, +which in turn could have negative impacts on asset values, +results of operations or the reputations of Citi and its +customers and clients. For example, Citi’s corporate credit +exposures include oil and gas, power and other industries that +may experience reduced demand for carbon-intensive products +due to the transition to a low-carbon economy. Failure to +adequately consider transition risk in developing and +executing on its business strategy could lead to a loss of +market share, lower revenues and higher credit costs. +Transition risks also include potential increased operational, +compliance and energy costs driven by government policies to +promote decarbonization. +Moreover, increasing legislative and regulatory changes +and uncertainties regarding climate-related risk management +and disclosures are likely to result in increased regulatory, +compliance, credit, reputational and other risks and costs for +Citi. New regulations have been enacted and/or are expected +in several jurisdictions, including the EU’s Corporate +Sustainability Reporting Directive (CSRD), the SEC climate- +related disclosures that could require disclosure of climate- +related information and the State of California’s legislation +enacted in October 2023 requiring broad disclosure of +greenhouse gas emissions and other climate-related +information largely beginning in 2026. In addition, Citi could +face increased regulatory scrutiny and reputation and litigation +risks as a result of its climate risk, sustainability and other +ESG-related commitments and disclosures. +Even as some regulators seek to mandate additional +disclosure of climate-related information, Citi’s ability to +comply with such requirements and conduct more robust +climate-related risk analyses may be hampered by lack of +information and reliable data. Data on climate-related risks is +limited in availability, often based on estimated or unverified +figures, collected and reported on a time-lag, and variable in +quality. Modeling capabilities to analyze climate-related risks +and interconnections are improving, but remain incomplete. +U.S. and non-U.S. banking regulators and others are +increasingly focusing on the issue of climate risk at financial +institutions, both directly and with respect to their clients. For +example, in October 2023, the FRB, FDIC and OCC jointly +released principles that provide a high-level framework for the +safe and sound management of exposures to climate-related +financial risks, including physical and transition risks, for +financial institutions with more than $100 billion in assets. +Additionally, if Citi’s response to climate change is +perceived to be ineffective or insufficient or Citi is unable to +achieve its objectives or commitments relating to climate +change, its businesses, reputation, attractiveness to certain +investors and efforts to recruit and retain employees may +suffer. For example, Citi's approach to supporting client +decarbonization in a gradual and orderly way, while +promoting energy security, may lead to both continued +exposure to carbon-intensive activity and increased reputation +risks from stakeholders with divergent points of view. Citi also +faces anti-ESG challenges from certain U.S. state and other +governments that may impact its ability to conduct certain +business within those jurisdictions. +For information on Citi’s climate and other sustainability +initiatives, see “Climate Change and Net Zero” below. For +additional information on Citi’s management of climate risk, +see “Managing Global Risk—Strategic Risk—Climate Risk” +below. +51 +The secret landmark is the "Colosseum". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_59.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_59.txt new file mode 100644 index 0000000000000000000000000000000000000000..330bbb699d1773724661236d8f7c728e6639f4ea --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_59.txt @@ -0,0 +1,118 @@ +Citi’s Ability to Utilize Its DTAs, and Thus Reduce the +Negative Impact of the DTAs on Citi’s Regulatory Capital, +Will Be Driven by Its Ability to Generate U.S. Taxable +Income. +At December 31, 2023, Citi’s net DTAs were $29.6 billion, +net of a valuation allowance of $3.6 billion, of which $12.8 +billion was deducted from Citi’s CET1 Capital under the U.S. +Basel III rules. Of this deducted amount, $12.1 billion related +to net operating losses, foreign tax credit and general business +credit carry-forwards, with $2.3 billion related to temporary +differences in excess of the 10%/15% regulatory limitations, +reduced by $1.6 billion of deferred tax liabilities, primarily +associated with goodwill and certain other intangible assets +that were separately deducted from capital. +Citi’s overall ability to realize its DTAs will primarily be +dependent upon Citi’s ability to generate U.S. taxable income +in the relevant reversal periods. Failure to realize any portion +of the net DTAs would have a corresponding negative impact +on Citi’s net income and financial returns. +The accounting treatment for realization of DTAs is +complex and requires significant judgment and estimates +regarding future taxable earnings in the jurisdictions in which +the DTAs arise and available tax planning strategies. Forecasts +of future taxable earnings will depend upon various factors, +including, among others, macroeconomic conditions. In +addition, any future increase in U.S. corporate tax rates could +result in an increase in Citi’s DTAs, which may subject more +of Citi’s DTAs to exclusion from regulatory capital. +Citi has not been and does not expect to be subject to the +base erosion anti-abuse tax (BEAT), which, if applicable to +Citi in any given year, would have a significantly adverse +effect on both Citi’s net income and regulatory capital. +For additional information on Citi’s DTAs, including +FTCs, see “Significant Accounting Policies and Significant +Estimates—Income Taxes” below and Notes 1 and 10. +Citi’s Interpretation or Application of the Complex Tax +Laws to Which It Is Subject Could Differ from Those of +Governmental Authorities, Which Could Result in Litigation +or Examinations and the Payment of Additional Taxes, +Penalties or Interest. +Citi is subject to various income-based tax laws of the U.S. +and its states and municipalities, as well as the numerous non- +U.S. jurisdictions in which it operates. These tax laws are +inherently complex, and Citi must make judgments and +interpretations about the application of these laws to its +entities, operations and businesses. +For example, the Organization for Economic Cooperation +and Development (OECD) Pillar 2 initiative contemplates a +15% global minimum tax with respect to earnings in each +country. EU member states were required to adopt the OECD +Pillar 2 rules in 2023, with an effective date of January 1, 2024 +(unless an exception applied), and other non-U.S. countries +have similarly adopted or are expected to adopt the rules. +Under these rules, Citi will be required to pay a “top-up” tax +to the extent that Citi’s effective tax rate in any given country +is below 15%. Beginning in 2024, countries that adopted the +OECD Pillar 2 rules in 2023 can collect the top-up tax only +with respect to earnings of entities in their jurisdiction or +subsidiaries of such entities. Beginning in 2025, all countries +that have adopted the OECD Pillar 2 rules can collect a share +of the top-up tax owed with respect to any member of the +Pillar 2 multinational group. While Citi does not currently +expect the rules to have a material impact on its earnings, +many aspects of the application of the rules remain uncertain. +Additionally, Citi is subject to litigation or examinations +with U.S. and non-U.S. tax authorities regarding non-income- +based tax matters. While Citi has appropriately reserved for +such matters where there is a probable loss, and has disclosed +reasonably possible losses, the outcome of the matters may be +different than Citi’s expectations. Citi’s interpretations or +application of the tax laws, including with respect to +withholding, stamp, service and other non-income taxes, could +differ from that of the relevant governmental taxing authority, +which could result in the requirement to pay additional taxes, +penalties or interest, the reduction of certain tax benefits or the +requirement to make adjustments to amounts recorded, which +could be material. See Note 30 for additional information on +litigation and examinations involving non-U.S. tax authorities. +A Deterioration in or Failure to Maintain Citi’s Co- +Branding or Private Label Credit Card Relationships Could +Have a Negative Impact on Citi. +Citi has co-branding and private label relationships through its +Branded Cards and Retail Services credit card businesses with +various retailers and merchants, whereby in the ordinary +course of business Citi issues credit cards to consumers, +including customers of the retailers or merchants. The five +largest relationships across both businesses in USPB +constituted an aggregate of approximately 11% of Citi’s +revenues in 2023 (see “U.S. Personal Banking” above). Citi’s +co-branding and private label agreements often provide for +shared economics between the parties and generally have a +fixed term. +Competition among card issuers, including Citi, for these +relationships is significant, and Citi may not be able to +maintain such relationships on existing terms or at all. Citi’s +co-branding and private label relationships could also be +negatively impacted by, among other things, the general +economic environment, including the impacts of continued +elevated interest rates and inflation, and lower economic +growth rates, as well as a continuing risk of recession; changes +in consumer sentiment, spending patterns and credit card +usage behaviors; a decline in sales and revenues, partner store +closures, any reduction in air and business travel, or other +operational difficulties of the retailer or merchant; early +termination due to a contractual breach or exercise of other +early termination right; or other factors, including +bankruptcies, liquidations, restructurings, consolidations or +other similar events, whether due to a challenging +macroeconomic environment or otherwise. +These events, particularly early termination and +bankruptcies or liquidations, could negatively impact the +results of operations or financial condition of Branded Cards, +Retail Services or Citi as a whole, including as a result of loss +of revenues, increased expenses, higher cost of credit, +impairment of purchased credit card relationships and +contract-related intangibles or other losses (see Note 17 for +information on Citi’s credit card related intangibles generally). +52 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_6.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_6.txt new file mode 100644 index 0000000000000000000000000000000000000000..b65082d187465fd9a0f9484bcbd49d693117789d --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_6.txt @@ -0,0 +1,56 @@ +Earned a seat at the +Billion Dollar Roundtable +by spending $1 billion +or more annually with +certified diverse suppliers +Supported development of a first- +of-its-kind Sustainable Aluminum +Finance Framework for lenders to +measure and disclose aluminum- +related emissions in portfolios +Facilitated clean energy access +in Africa, supporting Sun King on +a first-of-its-kind securitization +deal for affordable solar +systems in Kenya +Announced an innovative +sustainable aviation fuel +emission reduction agreement +with American Airlines to support +solutions for low-carbon air travel +Provided $25 million to +nonprofits working to improve +food security globally through +the Citi Foundation’s inaugural +Global Innovation Challenge +Celebrated the first graduating class of +Kindergarten to College — a publicly-funded +children’s savings account program in support +of financial inclusion that operates on the +Citi Start Saving® platform +Continued sourcing +100% renewable +electricity for Citi’s +own operations +and facilities +Celebrated 10 years of New +York City’s Citi Bike program, +which has enabled 339 +million miles in rides in the +decade following its launch +Volunteered over +143,000 hours across +83 countries and +territories as part of +Global Community Day +Supporting strong +communities and +sustainable solutions +Recognized as the largest U.S. affordable +housing lender 13 years in a row by +Affordable Housing Finance magazine +Ranked as #1 U.S. +lead underwriter for +global sustainable bonds +in 2023 by Dealogic +8 9 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_60.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_60.txt new file mode 100644 index 0000000000000000000000000000000000000000..c360dbbc8f62cbf44a3c0f84995349d9f0497c57 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_60.txt @@ -0,0 +1,120 @@ +The Application of U.S. Resolution Plan Requirements May +Pose a Greater Risk of Loss to Citi’s Debt and Equity +Securities Holders, and Citi’s Inability in Its Resolution Plan +Submissions to Address Any Shortcomings or Deficiencies or +Guidance Could Subject Citi to More Stringent Capital, +Leverage or Liquidity Requirements, or Restrictions on Its +Growth, Activities or Operations, and Could Eventually +Require Citi to Divest Assets or Operations. +Title I of the Dodd-Frank Act requires Citi to prepare and +submit a plan to the FRB and the FDIC for the orderly +resolution of Citigroup (the bank holding company) and its +significant legal entities under the U.S. Bankruptcy Code in +the event of future material financial distress or failure. +Under Citi’s preferred “single point of entry” resolution +plan strategy, only Citigroup, the parent holding company, +would enter into bankruptcy, while Citigroup’s material legal +entities (as defined in the public section of its 2023 resolution +plan, which can be found on the FRB’s and FDIC’s websites) +would remain operational outside of any resolution or +insolvency proceedings. As a result, Citigroup’s losses and +any losses incurred by its material legal entity subsidiaries +would be imposed first on holders of Citigroup’s equity +securities and thereafter on its unsecured creditors, including +holders of eligible long-term debt and other debt securities. +In addition, a wholly owned, direct subsidiary of +Citigroup serves as a resolution funding vehicle (the IHC) to +which Citigroup has transferred, and has agreed to transfer on +an ongoing basis, certain assets. The obligations of Citigroup +and of the IHC, respectively, under the amended and restated +secured support agreement, are secured on a senior basis by +the assets of Citigroup (other than shares in subsidiaries of the +parent company and certain other assets), and the assets of the +IHC, as applicable. As a result, claims of the operating +material legal entities against the assets of Citigroup with +respect to such secured assets are effectively senior to +unsecured obligations of Citigroup. Citi’s single point of entry +resolution plan strategy and the obligations under the amended +and restated secured support agreement may result in the +recapitalization of and/or provision of liquidity to Citi’s +operating material legal entities, and the commencement of +bankruptcy proceedings by Citigroup at an earlier stage of +financial stress than might otherwise occur without such +mechanisms in place. +In line with the FRB’s TLAC rule, Citigroup’s +shareholders and unsecured creditors—including its unsecured +long-term debt holders—would bear any losses resulting from +Citigroup’s bankruptcy. Accordingly, any value realized by +holders of its unsecured long-term debt may not be sufficient +to repay the amounts owed to such debt holders in the event of +a bankruptcy or other resolution proceeding of Citigroup. For +additional information on Citi’s single point of entry +resolution plan strategy and the IHC and secured support +agreement, see “Managing Global Risk—Liquidity Risk” +below. +On November 22, 2022, the FRB and FDIC issued +feedback on the resolution plans filed on July 1, 2021 by the +eight U.S. GSIBs, including Citi. The FRB and FDIC +identified one shortcoming, but no deficiencies, in Citi’s 2021 +resolution plan. The shortcoming related to data integrity and +data quality management issues, specifically, weaknesses in +Citi’s processes and practices for producing certain data that +could materially impact its resolution capabilities. If a +shortcoming is not satisfactorily explained or addressed +before, or in, the submission of the next resolution plan, the +shortcoming may be found to be a deficiency in the next +resolution plan (see discussion below). Citi submitted its 2023 +resolution plan in June 2023. More generally, data continues +to be a subject of regulatory focus, and Citi continues to work +on enhancing its data availability and quality. +Under Title I, if the FRB and the FDIC jointly determine +that Citi’s resolution plan is not “credible” (which, although +not defined, is generally understood to mean the regulators do +not believe the plan is feasible or would otherwise allow Citi +to be resolved in a way that protects systemically important +functions without severe systemic disruption), or would not +facilitate an orderly resolution of Citi under the U.S. +Bankruptcy Code, and Citi fails to resubmit a resolution plan +that remedies any identified deficiencies, Citi could be +subjected to more stringent capital, leverage or liquidity +requirements, or restrictions on its growth, activities or +operations. If within two years from the imposition of any +such requirements or restrictions Citi has still not remediated +any identified deficiencies, then Citi could eventually be +required to divest certain assets or operations. Any such +restrictions or actions would negatively impact Citi’s +reputation, market and investor perception, operations and +strategy. +Citi’s Performance and Its Ability to Effectively Execute Its +Transformation and Strategic and Other Initiatives Could Be +Negatively Impacted if It Is Not Able to Hire and Retain +Qualified Employees. +Citi’s performance and the performance of its individual +businesses largely depend on the talents and efforts of its +diverse and highly qualified colleagues. Specifically, Citi’s +continued ability to compete in each of its lines of business, to +manage its businesses effectively and to execute its +transformation and strategic and other initiatives, including, +for example, hiring front office colleagues to grow businesses +or hiring colleagues to support Citi’s transformation and +strategic and other initiatives, depends on its ability to attract +new colleagues and to retain and motivate its existing +colleagues. If Citi is unable to continue to attract, retain and +motivate highly qualified colleagues, Citi’s performance, +including its competitive position, the execution of its +transformation and strategic and other initiatives and its results +of operations could be negatively impacted. +Citi’s ability to attract, retain and motivate colleagues +depends on numerous factors, some of which are outside of +Citi’s control. For example, the competition for talent +continues to be particularly intense due to factors such as low +unemployment and changes in worker expectations, concerns +and preferences, including an increased demand for remote +work options and other job flexibility. Also, the banking +industry generally is subject to more comprehensive regulation +of employee compensation than other industries, including +deferral and clawback requirements for incentive +compensation, which can make it unusually challenging for +Citi to compete in labor markets against businesses, including, +for example, technology companies, that are not subject to +53 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_61.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_61.txt new file mode 100644 index 0000000000000000000000000000000000000000..421d915fcc90de6cef6d589a81614f05f41b9803 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_61.txt @@ -0,0 +1,118 @@ +such regulation. In addition, in 2023 Citi announced plans to +reduce management layers from 13 to a median of eight as +part of organizational simplification initiatives that also +involve significant reductions in functional roles, which could +also impact its ability to attract and retain colleagues. Other +factors that could impact its ability to attract, retain and +motivate colleagues include, among other things, Citi’s +presence in a particular market or region, the professional and +development opportunities, its reputation and its diversity. For +information on Citi’s colleagues and workforce management, +see “Human Capital Resources and Management” below. +Citi Faces Increased Competitive Challenges, Including +from Financial Services and Other Companies and +Emerging Technologies. +Citi operates in an increasingly evolving and competitive +business environment, which includes both financial and non- +financial services firms, such as traditional banks, online +banks, private credit and financial technology companies and +others. These companies compete on the basis of, among other +factors, size, reach, quality and type of products and services +offered, price, technology and reputation. Certain competitors +may be subject to different and, in some cases, less stringent +legal and regulatory requirements, whether due to size, +jurisdiction, entity type or other factors, placing Citi at a +competitive disadvantage. +For example, Citi competes with other financial services +companies in the U.S. and globally that have grown rapidly +over the last several years or have developed and introduced +new products and services. Potential mergers and acquisitions +involving traditional financial services companies such as +regional banks or credit card issuers, as well as networks and +merchant acquirers, may also increase competition and impact +Citi’s ability to offer competitive pricing and rewards. Non- +traditional financial services firms, such as private credit and +financial technology companies, are less regulated and +continue to expand their offerings of services traditionally +provided by financial institutions. The growth of certain of +these competitors has increased market and counterparty credit +risks, particularly in a more challenging macroeconomic +environment (see the risk factor on credit and concentrations +of risk below). In addition, emerging technologies have the +potential to intensify competition and accelerate disruption in +the financial services industry. For example, despite +difficulties and turmoil faced by the digital asset market in +recent years, clients and investors have exhibited a sustained +interest in digital assets. Financial services firms and other +market participants have begun to offer services related to +those assets. Citi may not be able to provide the same or +similar services for legal or regulatory reasons, which may be +exacerbated by rapidly evolving and conflicting regulatory +requirements, and due to increased compliance and other risks. +Further, changes in the payments space (e.g., instant and 24x7 +payments) are accelerating, and, as a result, certain of Citi’s +products and services could become less competitive. +Increased competition and emerging technologies have +required and could require Citi to change or adapt its products +and services, as well as invest in and develop related +infrastructure, to attract and retain customers or clients or to +compete more effectively with competitors, including new +market entrants. Simultaneously, as Citi develops new +products and services leveraging emerging technologies, new +risks may emerge that, if not designed and governed +adequately, may result in control gaps and in Citi operating +outside of its risk appetite. For example, failure to strategically +embrace the potential of artificial intelligence (AI) may result +in a competitive disadvantage to Citi. At the same time, as a +new technology, use of AI without sufficient controls, +governance and risk management may result in increased risks +across all of Citi’s risk categories. As another example, instant +and 24x7 payments products could be accompanied by +challenges to forecasting and managing liquidity, as well as +increased operational and compliance risks. +Moreover, Citi relies on third parties to support certain of +its product and service offerings, which may put Citi at a +disadvantage to competitors who may directly offer a broader +array of products and services. Also, Citi’s businesses, results +of operations and reputation may suffer if any third party is +unable to provide adequate support for such product and +service offerings, whether due to operational incidents or +otherwise (see the operational processes and systems, +cybersecurity and emerging markets risk factors below). +To the extent that Citi is not able to compete effectively +with financial services companies, including private credit and +financial technology companies, and non-financial services +firms, Citi could be placed at a competitive disadvantage, +which could result in loss of customers and market share, and +its businesses, results of operations and financial condition +could suffer. For additional information on Citi’s competitors, +see the co-brand and private label cards and qualified +colleagues risk factors above and “Supervision, Regulation +and Other—Competition” below. +OPERATIONAL RISKS +A Failure or Disruption of Citi’s Operational Processes or +Systems Could Negatively Impact Its Reputation, Customers, +Clients, Businesses or Results of Operations and Financial +Condition. +Citi’s global operations rely heavily on its technology systems +and infrastructure, including the accurate, timely and secure +processing, management, storage and transmission of data, +including confidential transactions, and other information, as +well as the monitoring of a substantial amount of data and +complex transactions in real time. Citi obtains and stores an +extensive amount of personal and client-specific information +for its consumer and institutional customers and clients, and +must accurately record and reflect their account transactions. +Citi’s operations must also comply with complex and evolving +laws, regulations and heightened regulatory expectations in the +countries in which it operates (see the implementation and +interpretation of regulatory changes and legal proceedings risk +factors below). With the evolving proliferation of new +technologies and the increasing use of the internet, mobile +devices and cloud services to conduct financial transactions +and customers’ and clients’ increasing use of online banking +and trading systems and other platforms, large global financial +institutions such as Citi have been, and will continue to be, +subject to an ever-increasing risk of operational loss, failure or +disruption. +54 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_62.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_62.txt new file mode 100644 index 0000000000000000000000000000000000000000..0975088c4581707cf123adcf2c8ff0acb8d6c302 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_62.txt @@ -0,0 +1,119 @@ +Although Citi has continued to upgrade its technology, +including systems to automate processes and gain efficiencies, +operational incidents are unpredictable and can arise from +numerous sources, not all of which are fully within Citi’s +control. These include, among others, operational or execution +failures, or deficiencies by third parties, including third parties +that provide products or services to Citi (e.g., cloud service +providers), other market participants or those that otherwise +have an ongoing partnership or business relationship with Citi; +deficiencies in processes or controls; inadequate management +of data governance practices, data controls and monitoring +mechanisms that may adversely impact internal or external +reporting and decision-making; cyber or information security +incidents (see the cybersecurity risk factor below); human +error, such as manual transaction processing errors (e.g., +erroneous payments to lenders or manual errors by traders that +cause system and market disruptions or losses), which can be +exacerbated by staffing challenges and processing backlogs; +fraud or malice on the part of employees or third parties; +insufficient (or limited) straight-through processing between +legacy or bespoke systems and any failure to design and +effectively operate controls that mitigate operational risks +associated with those legacy or bespoke systems, leading to +potential risk of errors and operating losses; accidental system +or technological failure; electrical or telecommunication +outages; failures of or cyber incidents involving computer +servers or infrastructure, including cloud services; or other +similar losses or damage to Citi’s property or assets (see also +the climate change risk factor above). +For example, operational incidents can arise as a result of +failures by third parties with which Citi does business, such as +failures by internet, mobile technology and cloud service +providers or other vendors to adequately follow procedures or +processes, safeguard their systems or prevent system +disruptions or cyberattacks. Failure by Citi to develop, +implement and operate a third-party risk management program +commensurate with the level of risk, complexity and nature of +its third-party relationships can also result in operational +incidents. In addition, Citi has experienced and could +experience further losses associated with manual transaction +processing errors, including erroneous payments to lenders or +manual errors by Citi traders that cause system and market +disruptions and losses for Citi and its clients. Irrespective of +the sophistication of the technology utilized by Citi, there will +always be some room for human and other errors. In view of +the large transactions in which Citi engages, such errors could +result in significant losses. While Citi has change management +processes in place to appropriately upgrade its operational +processes and systems to ensure that any changes introduced +do not adversely impact security and operational continuity, +such change management can fail or be ineffective. +Furthermore, when Citi introduces new products, systems or +processes, new operational risks that may arise from those +changes may not be identified, or adequate controls to mitigate +the identified risks may not be appropriately implemented or +operate as designed. +Incidents that impact information security, technology +operations or other operational processes may cause +disruptions and/or malfunctions within Citi’s businesses (e.g., +the temporary loss of availability of Citi’s online banking +system or mobile banking platform), as well as the operations +of its clients, customers or other third parties. In addition, +operational incidents could involve the failure or +ineffectiveness of internal processes or controls. Given Citi’s +global footprint and the high volume of transactions processed +by Citi, certain failures, errors or actions may be repeated or +compounded before they are discovered and rectified, which +would further increase the consequences and costs. +Operational incidents could result in financial losses and other +costs as well as misappropriation, corruption or loss of +confidential and other information or assets, which could +significantly negatively impact Citi’s reputation, customers, +clients, businesses or results of operations and financial +condition. Cyber-related and other operational incidents can +also result in legal and regulatory actions or proceedings, fines +and other costs (see the legal and regulatory proceedings risk +factor below). +For information on Citi’s management of operational risk, +see “Managing Global Risk—Operational Risk” below. +Citi’s and Third Parties’ Computer Systems and Networks +Will Continue to Be Susceptible to an Increasing Risk of +Continually Evolving, Sophisticated Cybersecurity Incidents +That Could Result in the Theft, Loss, Non-Availability, +Misuse or Disclosure of Confidential Client or Customer +Information, Damage to Citi’s Reputation, Additional Costs +to Citi, Regulatory Penalties, Legal Exposure and Financial +Losses. +Citi’s computer systems, software and networks are subject to +ongoing attempted cyberattacks, such as unauthorized access, +loss or destruction of data (including confidential client +information), account takeovers, disruptions of service, +phishing, malware, ransomware, computer viruses or other +malicious code and other similar events. These threats can +arise from external parties, including cyber criminals, cyber +terrorists, hacktivists (individuals or groups using cyberattacks +to promote a political or social agenda) and nation-state actors, +as well as insiders who knowingly or unknowingly engage in +or enable malicious cyber activities. Citi develops its own +software and relies on third-party applications and software, +which are susceptible to vulnerability exploitations. Software +leveraged in financial services and other industries continues +to be impacted by an increasing number of zero-day +vulnerabilities, thus increasing inherent cyber risk to Citi. +The increasing use of mobile and other digital banking +platforms and services, cloud technologies and connectivity +solutions to facilitate remote working for Citi’s employees all +increase Citi’s exposure to cybersecurity risks. Citi is also +susceptible to cyberattacks given, among other things, its size +and scale, high-profile brand, global footprint and prominent +role in the financial system, as well as the ongoing wind-down +of its businesses in Russia (see the macroeconomic and +geopolitical risk factor above and “Managing Global Risk— +Other Risks—Country Risk—Russia” below). Additionally, +Citi continues to operate in multiple jurisdictions in the midst +of geopolitical unrest, including active conflicts in Ukraine +and the Middle East, which could expose Citi to heightened +risk of insider threat, politically motivated hacktivism or other +cyber threats. +55 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_63.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_63.txt new file mode 100644 index 0000000000000000000000000000000000000000..76dfe845b0af55772256dfaf68f8ae72aaa36f8d --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_63.txt @@ -0,0 +1,120 @@ +Citi continues to experience increased exposure to +cyberattacks through third parties, in part because financial +institutions are becoming increasingly interconnected with +central agents, exchanges and clearing houses. Third parties +with which Citi does business, as well as retailers and other +third parties with which Citi’s customers do business, and any +such third parties’ downstream service providers, also pose +cybersecurity risks, particularly where activities of customers +are beyond Citi’s security and control systems. For example, +Citi outsources certain functions, such as processing customer +credit card transactions, uploading content on customer-facing +websites and developing software for new products and +services. These relationships allow for the storage and +processing of customer information by third-party hosting of, +or access to, Citi websites. This could lead to compromise or +the potential to introduce vulnerable or malicious code, +resulting in security breaches or business disruptions +impacting Citi customers, employees or operations. While +many of Citi’s agreements with third parties include +indemnification provisions, Citi may not be able to recover +sufficiently, or at all, under these provisions to adequately +offset any losses and other adverse impacts Citi may incur +from third-party cyber incidents. +Citi and some of its third-party partners have been +subjected to attempted and sometimes successful cyberattacks +over the last several years, including (i) denial of service +attacks, which attempt to interrupt service to clients and +customers; (ii) hacking and malicious software installations +intended to gain unauthorized access to information systems or +to disrupt those systems and/or impact availability or privacy +of confidential data, with objectives including, but not limited +to, extortion payments or causing reputational damage; (iii) +data breaches due to unauthorized access to customer account +or other data; and (iv) malicious software attacks on client +systems, in attempts to gain unauthorized access to Citi +systems or client data under the guise of normal client +transactions. +While Citi’s monitoring and protection services have +historically generally succeeded in detecting, thwarting and/or +responding to attacks targeting its systems before they become +significant, certain past incidents resulted in limited losses, as +well as increases in expenditures to monitor against the threat +of similar future cyber incidents. There can be no assurance +that such cyber incidents will not occur again, and they could +occur more frequently, via novel tactics, including leveraging +of tools made possible by emerging technologies, and on a +more significant scale. Despite the significant resources Citi +allocates to implement, maintain, monitor and regularly +upgrade its systems and networks with measures such as +intrusion detection and prevention systems and firewalls to +safeguard critical business applications, there is no guarantee +that these measures or any other measures can provide +sufficient security. Because the techniques used to initiate +cyberattacks change frequently or, in some cases, are not +recognized until launched or even later, Citi may be unable to +implement effective preventive measures or otherwise +proactively address these methods. In addition, cyber threats +and cyberattack techniques change, develop and evolve +rapidly, including from emerging technologies such as +artificial intelligence, cloud computing and quantum +computing. Given the frequency and sophistication of +cyberattacks, the determination of the severity and potential +impact of a cyber incident may not become apparent for a +substantial period of time following detection of the incident. +Also, while Citi strives to implement measures to reduce the +exposure resulting from outsourcing risks, such as performing +security control assessments of third-party vendors and +limiting third-party access to the least privileged level +necessary to perform job functions, these measures cannot +prevent all third-party related cyberattacks or data breaches. In +addition, the risk of insider threat may be elevated in the near +term due to Citi’s overall simplification initiatives, including +streamlining its global staff functions. +Cyber incidents can result in the disclosure of personal, +confidential or proprietary customer, client or employee +information; damage to Citi’s reputation with its clients, other +counterparties and the market; customer dissatisfaction; and +additional costs to Citi, including expenses such as repairing +or replacing systems, replacing customer payment cards, credit +monitoring or adding new personnel or protection +technologies. Cyber incidents can also result in regulatory +penalties, loss of revenues, deposit flight, exposure to +litigation and other financial losses, including loss of funds to +both Citi and its clients and customers, and disruption to Citi’s +operational systems (see the operational processes and systems +risk factor above). Moreover, the increasing risk of cyber +incidents has resulted in increased legislative and regulatory +action on cybersecurity, including, among other things, +scrutiny of firms’ cybersecurity protection services, laws and +regulations to enhance protection of consumers’ personal data +and mandated disclosure on cybersecurity matters. For +example, in July 2023, the SEC finalized new rules requiring +timely disclosure of material cybersecurity incidents as well as +other annual cyber-related disclosures (see “Managing Global +Risk—Operational Risk—Cybersecurity Risk” below). +While Citi maintains insurance coverage that may, subject +to policy terms and conditions including significant self- +insured deductibles, cover certain aspects of cyber risks, such +insurance coverage may be insufficient to cover all losses and +may not take into account reputational harm, the costs of +which are impossible to quantify. +For additional information about Citi’s management of +cybersecurity risk, see “Managing Global Risk—Operational +Risk—Cybersecurity Risk” below. +Changes or Errors in Accounting Assumptions, Judgments +or Estimates, or the Application of Certain Accounting +Principles, Could Result in Significant Losses or Other +Adverse Impacts. +U.S. GAAP requires Citi to use certain assumptions, +judgments and estimates in preparing its financial statements, +including, among other items, the estimate of the ACL; +reserves related to litigation, regulatory and tax matters; +valuation of DTAs; the fair values of certain assets and +liabilities; and the assessment of goodwill and other assets for +impairment. These assumptions, judgments and estimates are +inherently limited because they involve techniques, including +the use of historical data in many circumstances, that cannot +anticipate every economic and financial outcome in the +markets in which Citi operates, nor can they anticipate the +56 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_64.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_64.txt new file mode 100644 index 0000000000000000000000000000000000000000..20b1fcedf577b0b8525aec473f722bb73f0c1f1c --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_64.txt @@ -0,0 +1,119 @@ +specifics and timing of such outcomes. For example, many +models used by Citi include assumptions about correlation or +lack thereof among prices of various asset classes or other +market indicators that may not hold in times of market stress, +limited liquidity or other unforeseen circumstances. +If Citi’s assumptions, judgments or estimates underlying +its financial statements are incorrect or differ from actual or +subsequent events, Citi could experience unexpected losses or +other adverse impacts, some of which could be significant. +Citi could also experience declines in its stock price, be +subject to legal and regulatory proceedings and incur fines and +other losses. For additional information on the key areas for +which assumptions and estimates are used in preparing Citi’s +financial statements, see “Significant Accounting Policies and +Significant Estimates” below and Notes 1 and 16. For +example, the CECL methodology requires that Citi provide +reserves for a current estimate of lifetime expected credit +losses for its loan portfolios and other financial assets, as +applicable, at the time those assets are originated or acquired. +This estimate is adjusted each period for changes in expected +lifetime credit losses. Citi’s ACL estimate depends upon its +CECL models and assumptions; forecasted macroeconomic +conditions, including, among other things, the U.S. +unemployment rate and U.S. inflation-adjusted gross domestic +product (real GDP); and the credit indicators, composition and +other characteristics of Citi’s loan portfolios and other +applicable financial assets. These model assumptions and +forecasted macroeconomic conditions will change over time, +resulting in variability in Citi’s ACL and, thus, impact its +results of operations and financial condition, as well as +regulatory capital due to the CECL phase-in (see the capital +return risk factor above). +Moreover, Citi has incurred losses related to its foreign +operations that are reported in the CTA components of +Accumulated other comprehensive income (loss) (AOCI). In +accordance with U.S. GAAP, a sale, substantial liquidation or +other deconsolidation event of any foreign operations, such as +those related to Citi’s remaining divestitures or legacy +businesses, would result in reclassification of any foreign CTA +component of AOCI related to that foreign operation, +including related hedges and taxes, into Citi’s earnings. For +example, Citi could incur a significant loss on sale due to CTA +losses related to any signing of a sale agreement for its +remaining consumer banking divestitures (see the capital +return and continued investments risk factors above). The +majority of these losses would be regulatory capital neutral at +closing. For additional information on Citi’s accounting policy +for foreign currency translation and its foreign CTA +components of AOCI, see Notes 1 and 21. +Changes to Financial Accounting and Reporting Standards +or Interpretations Could Have a Material Impact on How +Citi Records and Reports Its Financial Condition and +Results of Operations. +Periodically, the Financial Accounting Standards Board +(FASB) issues financial accounting and reporting standards +that govern key aspects of Citi’s financial statements or +interpretations thereof when those standards become effective, +including those areas where Citi is required to make +assumptions or estimates. Changes to financial accounting or +reporting standards or interpretations, whether promulgated or +required by the FASB, the SEC, U.S. banking regulators or +others, could present operational challenges and could also +require Citi to change certain of the assumptions or estimates +it previously used in preparing its financial statements, which +could negatively impact how it records and reports its +financial condition and results of operations generally and/or +with respect to particular businesses. See Note 1 for additional +information on Citi’s accounting policies and changes in +accounting, including the expected impacts on Citi’s results of +operations and financial condition. +If Citi’s Risk Management and Other Processes, Strategies +or Models Are Deficient or Ineffective, Citi May Incur +Significant Losses and Its Regulatory Capital and Capital +Ratios Could Be Negatively Impacted. +Citi utilizes a broad and diversified set of risk management +and other processes and strategies, including the use of models +in analyzing and monitoring the various risks Citi assumes in +conducting its activities. For example, Citi uses models as part +of its comprehensive stress testing initiatives across the +Company. Citi also relies on data to aggregate, assess and +manage various risk exposures. Management of these risks +and the reliability of the data are made more challenging +within a large, global financial institution, such as Citi, +particularly due to complex, diverse and rapidly changing +financial markets and conditions in which Citi operates. +Unexpected losses can result from untimely, inaccurate or +incomplete processes and data. As discussed below, in +October 2020, Citigroup and Citibank entered into consent +orders with the FRB and OCC that require Citigroup and +Citibank to make improvements in various aspects of +enterprise-wide risk management, compliance, data quality +management and governance, and internal controls (see “Citi’s +Consent Order Compliance” above and the legal and +regulatory proceedings risk factor below). +Citi’s risk management and other processes, strategies and +models are inherently limited because they involve techniques, +including the use of historical data in many circumstances, +assumptions and judgments that cannot anticipate every +economic and financial outcome in the markets in which Citi +operates, particularly given various macroeconomic, +geopolitical and other challenges and uncertainties (see the +macroeconomic challenges and uncertainties risk factor +above), nor can they anticipate the specifics and timing of +such outcomes. For example, many models used by Citi +include assumptions about correlation or lack thereof among +prices of various asset classes or other market indicators that +may not necessarily hold in times of market stress, limited +liquidity or other unforeseen circumstances, or identify +changes in markets or client behaviors not yet inherent in +historical data. Citi could incur significant losses, receive +negative regulatory evaluation or examination findings or be +subject to additional enforcement actions, and its regulatory +capital, capital ratios and ability to return capital could be +negatively impacted, if Citi’s risk management and other +processes, including its ability to manage and aggregate data +in a timely and accurate manner, strategies or models are +deficient or ineffective. For additional information, see the +capital return risk factor above and the heightened regulatory +57 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_65.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_65.txt new file mode 100644 index 0000000000000000000000000000000000000000..7ffced9949fbf7478dcdacc45f414db3bbb842cd --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_65.txt @@ -0,0 +1,118 @@ +scrutiny and ongoing interpretation of regulatory changes risk +factor below. Such deficiencies or ineffectiveness could also +result in inaccurate financial, regulatory or risk reporting. +Moreover, Citi’s Basel III regulatory capital models, +including its credit, market and operational risk models, +currently remain subject to ongoing regulatory review and +approval, which may result in refinements, modifications or +enhancements (required or otherwise) to these models. Citi is +required to notify and obtain preapproval from both the OCC +and FRB prior to implementing certain risk-weighted asset +treatments, as well as certain model changes, resulting in a +more challenging environment within which Citi must operate +in managing its risk-weighted assets. Modifications or +requirements resulting from these ongoing reviews, as well as +any future changes or guidance provided by the U.S. banking +regulators regarding the U.S. regulatory capital framework +applicable to Citi, including, but not limited to, potential +revisions to the U.S. Basel III rules, known as the Basel III +Endgame (for information about the Basel III Endgame, see +the capital return risk factor and “Capital Resources— +Regulatory Capital Standards Developments” above), have +resulted in, and could continue to result in, significant changes +to Citi’s risk-weighted assets. These changes can negatively +impact Citi’s capital ratios and its ability to meet its regulatory +capital requirements. +CREDIT RISKS +Credit Risk and Concentrations of Risk Can Increase the +Potential for Citi to Incur Significant Losses. +Citi has credit exposures to consumer, corporate and public +sector borrowers and other counterparties in the U.S. and +various countries and jurisdictions globally, including end-of- +period consumer loans of $389 billion and end-of-period +corporate loans of $300 billion at December 31, 2023. For +additional information on Citi’s corporate and consumer loan +portfolios, see “Managing Global Risk—Corporate Credit” +and “—Consumer Credit” below. +A default by or a significant downgrade in the credit +ratings of a borrower or other counterparty, or a decline in the +credit quality or value of any underlying collateral, exposes +Citi to credit risk. Despite Citi’s target client strategy, various +macroeconomic, geopolitical, market and other factors, among +other things, can increase Citi’s credit risk and credit costs, +particularly for vulnerable sectors, industries or countries (see +the macroeconomic challenges and uncertainties and co- +branding and private label credit card risk factors above and +the emerging markets risk factor below). For example, a +weakening of economic conditions can adversely affect +borrowers’ ability to repay their obligations, as well as result +in Citi being unable to liquidate the collateral it holds or +forced to liquidate the collateral at prices that do not cover the +full amount owed to Citi. Citi is also a member of various +central clearing counterparties and could incur financial losses +as a result of defaults by other clearing members due to the +requirements of clearing members to share losses. +Additionally, due to the interconnectedness among financial +institutions, concerns about the creditworthiness of or defaults +by a financial institution could spread to other financial market +participants and result in market-wide losses and disruption. +For example, the failure of regional banks and other banking +stresses in the first half of 2023 resulted in market volatility +across the financial sector. +While Citi provides reserves for expected losses for its +credit exposures, as applicable, such reserves are subject to +judgments and estimates that could be incorrect or differ from +actual future events. Under the CECL accounting standard, the +ACL reflects expected losses, which has resulted in and could +lead to additional volatility in the allowance and the provision +for credit losses (including provisions for loans and unfunded +lending commitments, and ACL builds for Other assets) as +forecasts of economic conditions change. For additional +information, see the incorrect assumptions or estimates and +changes to financial accounting and reporting standards risk +factors above. For additional information on Citi’s ACL, see +“Significant Accounting Policies and Significant Estimates” +below and Notes 1 and 16. For additional information on +Citi’s credit and country risk, see also each respective +business’s results of operations above, “Managing Global Risk +—Credit Risk” and “Managing Global Risk—Other Risks— +Country Risk” below and Notes 15 and 16. +Concentrations of risk to clients or counterparties engaged +in the same or related industries or doing business in a +particular geography, or to a particular product or asset class, +especially credit and market risks, can also increase Citi’s risk +of significant losses. For example, Citi routinely executes a +high volume of securities, trading, derivative and foreign +exchange transactions with non-U.S. sovereigns and with +counterparties in the financial services industry, including +banks, insurance companies, investment banks, governments, +central banks and other financial institutions. Moreover, Citi +has indemnification obligations in connection with various +transactions that expose it to concentrations of risk, including +credit risk from hedging or reinsurance arrangements related +to those obligations (see Note 28). A rapid deterioration of a +large borrower or other counterparty or within a sector or +country in which Citi has large exposures or indemnifications +or unexpected market dislocations could lead to concerns +about the creditworthiness of other borrowers or +counterparties in a certain geography and in related or +dependent industries, and such conditions could cause Citi to +incur significant losses. +LIQUIDITY RISKS +Citi’s Businesses, Results of Operations and Financial +Condition Could Be Negatively Impacted if It Does Not +Effectively Manage Its Liquidity. +As a large, global financial institution, adequate liquidity and +sources of funding are essential to Citi’s businesses. Citi’s +liquidity, sources of funding and costs of funding can be +significantly and negatively impacted by factors it cannot +control, such as general disruptions in the financial markets +(e.g., the failure of regional banks and other banking stresses +in the first half of 2023); changes in fiscal and monetary +policies and regulatory requirements; negative investor +perceptions of Citi’s creditworthiness; deposit outflows or +unfavorable changes in deposit mix; unexpected increases in +cash or collateral requirements; credit ratings; and the +consequent inability to monetize available liquidity resources. +58 +The secret fruit is a "grape". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_67.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_67.txt new file mode 100644 index 0000000000000000000000000000000000000000..3196610a6082a8e0ecae1fe5f2720e14a0f21faf --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_67.txt @@ -0,0 +1,119 @@ +reporting requirements. U.S. financial institutions also face +increased expectations and scrutiny in the wake of the failures +of several regional banks and other banking stresses in the first +half of 2023. In addition, Citi is continually required to +interpret and implement extensive and frequently changing +regulatory and legislative requirements in the U.S. and other +jurisdictions in which it does business, which may overlap or +conflict across jurisdictions, resulting in substantial +compliance, regulatory and other risks and costs. +A failure to comply with these expectations and +requirements, even if inadvertent, or resolve any identified +deficiencies in a timely and sufficiently satisfactory manner to +regulators, could result in increased regulatory oversight; +material restrictions, including, among others, imposition of +additional capital buffers and limitations on capital +distributions; enforcement proceedings; penalties; and fines +(see the capital return risk factor above and legal and +regulatory proceedings risk factor below). +Over the past several years, Citi has been required to +implement a large number of regulatory and legislative +changes, including new regulatory or legislative requirements +or regimes, across its businesses and functions, and these +changes continue. The changes themselves may be complex +and subject to interpretation, and result in changes to Citi’s +businesses. In addition, the changes require continued +substantial technology and other investments. In some cases, +Citi’s implementation of a regulatory or legislative +requirement is occurring simultaneously with changing or +conflicting regulatory guidance from multiple jurisdictions +(including various U.S. states) and regulators, legal challenges +or legislative action to modify or repeal existing rules or enact +new rules. +Examples of regulatory or legislative changes that have +resulted in increased compliance risks and costs include (i) the +U.S. regulatory capital framework and requirements, which +have continued to evolve (see the capital return risk factor and +“Capital Resources” above); (ii) various laws relating to the +limitation of cross-border data movement and/or collection +and use of customer information, including data localization +and protection and privacy laws, which also can conflict with +or increase compliance complexity with respect to other laws, +including anti-money laundering laws; and (iii) the EU’s +Corporate Sustainability Reporting Directive, which may +overlap but also diverge from climate-related disclosure +requirements expected to come into effect in other +jurisdictions, including in the U.S. In addition, certain U.S. +regulatory agencies and states and non-U.S. authorities have +prioritized issues of social, economic and racial justice, and +are in the process of considering ways in which these issues +can be mitigated, including through rulemaking, supervision +and other means, even while certain U.S. state and other +governments are pursuing and signaling challenges that may +conflict with corporate ESG initiatives. +Citi Is Subject to Extensive Legal and Regulatory +Proceedings, Examinations, Investigations, Consent Orders +and Related Compliance Efforts and Other Inquiries That +Could Result in Large Monetary Penalties, Supervisory or +Enforcement Orders, Business Restrictions, Limitations on +Dividends, Changes to Directors and/or Officers and +Collateral Consequences Arising from Such Outcomes. +At any given time, Citi is a party to a significant number of +legal and regulatory proceedings and is subject to numerous +governmental and regulatory examinations. Additionally, Citi +remains subject to governmental and regulatory investigations, +consent orders (see discussion below) and related compliance +efforts, and other inquiries. Citi could also be subject to +enforcement proceedings and negative regulatory evaluation +or examination findings not only because of violations of laws +and regulations, but also due to failures, as determined by its +regulators, to have adequate policies and procedures, or to +remedy deficiencies on a timely basis (see also the capital +return and resolution plan risk factors above). Citi’s regulators +have broad powers and discretion under their prudential and +supervisory authority, and have pursued active inspection and +investigatory oversight. +As previously disclosed, the October 2020 FRB and OCC +consent orders require Citigroup and Citibank to implement +extensive targeted action plans and submit quarterly progress +reports on a timely and sufficient basis detailing the results +and status of improvements relating principally to various +aspects of enterprise-wide risk management, compliance, data +quality management and governance, and internal controls. +These improvements will result in continued significant +investments by Citi during 2024 and beyond, as an essential +part of Citi’s broader transformation efforts to enhance its risk, +controls, data and finance infrastructure and compliance. +There can be no assurance that such improvements will be +implemented in a manner satisfactory, in both timing and +sufficiency, to the FRB and OCC. +Although there are no restrictions on Citi’s ability to serve +its clients, the OCC consent order requires Citibank to obtain +prior approval of any significant new acquisition, including +any portfolio or business acquisition, excluding ordinary +course transactions. Moreover, the OCC consent order +provides that the OCC has the right to assess future civil +money penalties or take other supervisory and/or enforcement +actions. Such actions by the OCC could include imposing +business restrictions, including possible limitations on the +declaration or payment of dividends and changes in directors +and/or senior executive officers. More generally, the OCC +and/or the FRB could take additional enforcement or other +actions if the regulatory agency believes that Citi has not met +regulatory expectations regarding compliance with the consent +orders. For additional information regarding the consent +orders, see “Citi’s Consent Order Compliance” above. +The global judicial, regulatory and political environment +has generally been challenging for large financial institutions, +which have been subject to increased regulatory scrutiny. The +complexity of the federal and state regulatory and enforcement +regimes in the U.S., coupled with the global scope of Citi’s +operations, also means that a single event or issue may give +rise to a large number of overlapping investigations and +regulatory proceedings, either by multiple federal and state +agencies and authorities in the U.S. or by multiple regulators +and other governmental entities in foreign jurisdictions, as +well as multiple civil litigation claims in multiple jurisdictions. +Violations of law by other financial institutions may also +result in regulatory scrutiny of Citi. Responding to regulatory +60 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_68.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_68.txt new file mode 100644 index 0000000000000000000000000000000000000000..87ae01b2a9b0518073d3fe0646bf06ed82b9b22c --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_68.txt @@ -0,0 +1,120 @@ +inquiries and proceedings can be time consuming and costly, +and divert management attention from Citi’s businesses. +U.S. and non-U.S. regulators have been increasingly +focused on the culture of financial services firms, including +Citi, as well as “conduct risk,” a term used to describe the +risks associated with behavior by employees and agents, +including third parties, that could harm clients, customers, +employees or the integrity of the markets, such as improperly +creating, selling, marketing or managing products and services +or improper incentive compensation programs with respect +thereto, failures to safeguard a party’s personal information, or +failures to identify and manage conflicts of interest. +In addition to the greater focus on conduct risk, the +general heightened scrutiny and expectations from regulators +could lead to investigations and other inquiries, as well as +remediation requirements, regulatory restrictions, structural +changes, more regulatory or other enforcement proceedings, +civil litigation and higher compliance and other risks and +costs. For additional information, see the capital return and +heightened regulatory scrutiny and ongoing interpretation of +regulatory changes risk factors above. Further, while Citi takes +numerous steps to prevent and detect conduct by employees +and agents that could potentially harm clients, customers, +employees or the integrity of the markets, such behavior may +not always be deterred or prevented. +Moreover, the severity of the remedies sought in legal and +regulatory proceedings to which Citi is subject has remained +elevated. For example, U.S. and certain non-U.S. +governmental entities have increasingly brought criminal +actions against, or have sought and obtained criminal guilty +pleas or deferred prosecution agreements from, financial +institutions and individual employees. These types of actions +by U.S. and other governments may, in the future, have +significant collateral consequences for Citi, including loss of +customers and business, operational loss, and the inability to +offer certain products or services and/or operate certain +businesses. Citi may be required to accept or be subject to +similar types of criminal remedies, consent orders, sanctions, +substantial fines and penalties, remediation and other financial +costs or other requirements in the future, including for matters +or practices not yet known to Citi, any of which could +materially and negatively affect Citi’s businesses, business +practices, financial condition or results of operations, require +material changes in Citi’s operations or cause Citi substantial +reputational harm. +Additionally, many large claims—both private civil and +regulatory—asserted against Citi are highly complex, slow to +develop and may involve novel or untested legal theories. The +outcome of such proceedings is difficult to predict or estimate +until late in the proceedings. Although Citi establishes +accruals for its legal and regulatory matters according to +accounting requirements, Citi’s estimates of, and changes to, +these accruals involve significant judgment and may be +subject to significant uncertainty, and the amount of loss +ultimately incurred in relation to those matters may be +substantially higher than the amounts accrued (see the +incorrect assumptions or estimates risk factor above). In +addition, certain settlements are subject to court approval and +may not be approved. For further information on Citi’s legal +and regulatory proceedings, see Note 30. +OTHER RISKS +Citi’s Emerging Markets Presence Subjects It to Various +Risks as well as Increased Compliance and Regulatory Risks +and Costs. +During 2023, emerging markets revenues accounted for +approximately 40% of Citi’s total revenues (Citi generally +defines emerging markets as countries in Latin America, Asia +(other than Japan, Australia and New Zealand), and central +and Eastern Europe, the Middle East and Africa). Citi’s +presence in the emerging markets subjects it to various risks. +Emerging market risks include, among others, limitations +or unavailability of hedges on foreign investments; foreign +currency volatility, including devaluations and strength in the +U.S. dollar; sustained elevated interest rates and quantitative +tightening; elevated inflation and hyperinflation; foreign +exchange controls, including an inability to access indirect +foreign exchange mechanisms; macroeconomic, geopolitical +and domestic political challenges, uncertainties and volatility, +including with respect to Russia (see the macroeconomic and +geopolitical risk factor above and “Managing Global Risk— +Other Risks—Country Risk—Russia” and “—Ukraine” +below); cyberattacks; restrictions arising from retaliatory laws +and regulations; sanctions or asset freezes; sovereign debt +volatility; fluctuations in commodity prices; election +outcomes; regulatory changes, including potential conflicts +among regulations with other jurisdictions where Citi does +business; limitations on foreign investment; sociopolitical +instability; civil unrest; crime, corruption and fraud; +nationalization or loss of licenses; potential criminal charges; +closure of branches or subsidiaries; and confiscation of assets; +and these risks can be exacerbated in the event of a +deterioration in the relationship between the U.S. and an +emerging market country. +For example, Citi operates in several countries that have, +or have had in the past, strict capital controls, currency +controls and/or sanctions, such as Argentina and Russia, that +limit its ability to convert local currency into U.S. dollars and/ +or transfer funds outside of those countries. For instance, Citi +may need to record additional translation losses due to +currency controls in Argentina (see “Managing Global Risk— +Other Risks—Country Risk—Argentina” below). Moreover, +Citi may need to record additional reserves for expected losses +for its credit exposures based on the transfer risk associated +with exposures outside the U.S., driven by safety and +soundness considerations under U.S. banking law (see +“Managing Global Risk—Other Risks—Country Risk— +Argentina” and “—Russia” and “Significant Accounting +Policies and Significant Estimates” below). +In addition, political turmoil and instability; geopolitical +challenges, tensions and conflicts (including those related to +Russia’s war in Ukraine as well as a persistent and/or +escalating conflict in the Middle East); terrorism; and other +instabilities have occurred in various regions and emerging +market countries across the globe, which impact Citi’s +businesses, results of operations and financial conditions in +affected countries and have required, and may continue to +require, management time and attention and other resources, +such as managing the impact of sanctions and their effect on +Citi’s operations in certain emerging market countries. For +61 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_69.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_69.txt new file mode 100644 index 0000000000000000000000000000000000000000..cabde883654856a9d653f2275affd53ab500325b --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_69.txt @@ -0,0 +1,104 @@ +additional information, see the macroeconomic challenges and +uncertainties risk factor above. + +CLIMATE CHANGE AND NET ZERO +Introduction +This section summarizes Citi’s Operational Footprint goals +and Net Zero commitment. + Citi’s annual ESG Report provides information on a +broad set of ESG-related efforts. The upcoming Citi Climate +Report, formerly named the Task Force on Climate-Related +Financial Disclosures (TCFD) Report, provides information +on Citi’s continued progress to manage climate risk and its Net +Zero plan, including information on financed emissions and +2030 interim emissions reduction targets. +For information regarding Citi’s management of climate +risk, see “Managing Global Risk—Strategic Risk—Climate +Risk” below. +ESG and Climate-Related Governance +Citi’s Board of Directors (Board) provides oversight of Citi’s +management activities (see “Managing Global Risk—Risk +Governance” below). +• The Nomination, Governance and Public Affairs +Committee of the Board provides oversight and receives +updates on Citi’s environmental and social policies and +commitments. +• The Risk Management Committee of the Board provides +oversight of Citi’s Risk Management Framework and risk +culture and reviews Citi’s key risk policies and +frameworks, including receiving climate risk-related +updates. +• The Audit Committee of the Board provides oversight of +controls and procedures pertaining to the ESG-related +metrics and related disclosures in Citi’s SEC filed reports +and group-level voluntary ESG reporting, as well as +management’s evaluation of the effectiveness of Citi’s +disclosure controls and procedures for group-level ESG +reporting. +Additionally, Citi’s ESG Council consists of senior +members of the management team and certain subject matter +experts who provide oversight of Citi’s ESG goals and +activities. +Sustainable Finance +Citi’s Sustainable Finance Goal, as previously disclosed, +supports a combination of environmental and social finance +activities. Delivering on the sustainable finance goal is an +integrated effort across the organization with products and +service offerings across multiple lines of business. +Net Zero Emissions by 2050 +As previously disclosed, Citi has committed to achieving net +zero greenhouse gas (GHG) emissions associated with its +financing by 2050, and net zero GHG emissions for its own +operations by 2030; both are significant targets given the size +and breadth of Citi’s lending portfolios, businesses and +operational footprint. +Citi’s Net Zero plan includes: +• Net Zero Metrics and Target Setting: Calculate metrics +and assess targets for carbon-intensive sectors +• Client Engagement and Assessment : Seek to understand +client GHG emissions and transition plans and advise on +capacity building +• Risk Management: Assess climate risk exposure across +Citi’s lending portfolios and review client carbon +reduction progress, with ongoing review and refining of +Citi’s risk appetite and thresholds and policies related to +Climate Risk Management +• Clean Technology and Transition Finance: Support +existing and, where possible, new technologies to +accelerate commercialization and provide transition +advisory and finance products and services +• Portfolio Management: Active portfolio management of +Citi financings to align with net zero targets, including +considerations of transition measures taken by clients +• Public Policy and Regulatory Engagement: Contribute to +an enabling public policy and regulatory environment +which is essential to stimulating demand for clean +technologies and helping ensure a responsible transition +Progress on Citi’s Net Zero plan: + +• Citi has published interim 2030 emissions targets for six +loan portfolios: auto manufacturing, commercial real +estate (North America), energy, power, steel and thermal +coal mining. +• Citi has developed a client transition assessment process +to help internal teams better understand the alignment of +clients’ strategies with transition or decarbonization +pathways applicable to their respective sectors. In 2022– +2023, Citi completed the initial assessment process for +energy and power clients, and in 2023 began the transition +assessment process for auto manufacturing and steel +clients. The assessment process focuses on clients with +material emissions relative to each sector’s baseline +emission profiles. +Operational Footprint Goals +Citi measures progress against operational footprint goals, +which include efforts to reduce the environmental impact of its +facilities through reductions in emissions, energy, water +consumption and waste generation. Citi’s efforts to integrate +sustainable practices include sustainable building +certifications, renewable electricity sourcing, employee +engagement and seeking opportunities for efficiency in +business travel. In 2023, Citi made progress toward these +goals by increasing on-site solar generation, promoting +initiatives on waste diversion and recycling, mapping weather- +62 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_7.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_7.txt new file mode 100644 index 0000000000000000000000000000000000000000..0eb5f3e209e61bb9a8e387da20c9f516f072917f --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_7.txt @@ -0,0 +1,17 @@ +citi.com/weareciti +We’re not writers, + but we help shape +your businesses’ financial story. +We’re not an airline, but our network +connects global businesses in nearly +160 local markets. + +We’re not a startup, but our +Innovation Labs create new technologies +to help our clients grow safely and securely. +We’re not architects, but we help +build more resilient communities. +With global expertise +and over two centuries of experience, +we’re not just any bank. +We are Citi. \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_70.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_70.txt new file mode 100644 index 0000000000000000000000000000000000000000..5c5c32cc8e561e9c145e73318a4d7c7eeb100613 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_70.txt @@ -0,0 +1,70 @@ +related risk at its facilities and employing carbon-reduction +techniques for building renovations. +Additional Information +For additional information on Citi’s environmental and social +policies and priorities, click on “Our Impact” on Citi’s website +at www.citigroup.com. For information on Citi’s ESG and +Sustainability (including climate change) governance, see +Citi’s 2024 Annual Meeting Proxy Statement to be filed with +the SEC in March 2024. +Citi’s climate reporting and any other ESG-related reports +and information included elsewhere on Citi’s website are not +incorporated by reference into, and do not form any part of, +this 2023 Annual Report on Form 10-K. + +HUMAN CAPITAL RESOURCES AND +MANAGEMENT +Citi strives to deliver to its full potential by focusing on its +strategic priority of attracting and retaining highly qualified +and motivated colleagues. Citi seeks to enhance the +competitive strength of its workforce through the following +efforts: +• Continuously innovating its efforts to recruit, train, +develop, compensate, promote and engage colleagues +• Actively seeking and listening to diverse perspectives at +all levels of the organization +• Optimizing transparency concerning workforce goals to +promote accountability, credibility and effectiveness in +achieving those goals +• Providing compensation programs that are competitive in +the market and aligned to strategic objectives +In 2023, Citi undertook significant changes to simplify the +Company and accelerate the progress it is making in executing +its strategy. As previously disclosed, Citi aligned its +organizational structure to its business strategy—making the +Company more client centric and agile, speeding up decision- +making, improving productivity to deliver efficiency and +driving increased accountability across the organization. Citi is +aligned around five businesses—Services, Markets, Banking, +USPB and Wealth—focusing on a streamlined client +organization to strengthen how Citi delivers for clients across +the Company and around the globe. +Workforce Size and Distribution +As of December 31, 2023, Citi employed approximately +239,000 colleagues in over 90 countries. The Company’s +workforce is constantly evolving and developing, benefiting +from a strong mix of internal and external hiring into new and +existing positions. In 2023, Citi welcomed over 38,000 new +colleagues in addition to 44,600 roles filled by colleagues +through internal mobility and promotions. Citi also sustains +connections with former colleagues through its Alumni +Network, and in 2023 hired more than 3,000 “returnees” back +to Citi. +The following table presents the geographic distribution of Citi’s colleagues by segment or component and gender: +Segment or component(1) (in thousands) +North +America International (2) Total(3) Women (4) Men(4) Unspecified(4) +Services 4 20 24 52.4 % 47.6 % — % +Markets 3 7 10 38.9 61.1 — +Banking 3 6 9 43.2 56.8 0.01 +USPB 21 — 21 65.3 34.7 — +Wealth 6 8 14 49.9 50.1 — +All Other, including Legacy Franchises, +Operations and Technology, and Global Staff +Functions 54 107 161 47.8 52.2 — +Total 91 148 239 49.4 % 50.6 % 0.01 % +(1) Colleague distribution is based on assigned region, which may not reflect where the colleague physically resides. +(2) Mexico is included in International. +(3) Part-time colleagues represented less than 0.9% of Citi’s global workforce. +(4) Information regarding gender is self-identified by colleagues. +63 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_71.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_71.txt new file mode 100644 index 0000000000000000000000000000000000000000..0a9cff1241fff88bccf6a4d37fefbac596d26c3d --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_71.txt @@ -0,0 +1,117 @@ +Driving a Culture of Excellence and Accountability +Citi continues to embark on a talent and culture transformation +to drive a culture of excellence and accountability that is +supported by strong risk and controls management. +Citi’s Leadership Principles of “taking ownership, +delivering with pride and succeeding together” have been +reinforced through a behavioral science-led campaign, referred +to as Citi’s New Way, that reinforces the key working habits +that support Citi’s leadership culture. +Citi’s performance management approach also +emphasizes the Leadership Principles through a four-pillar +system, evaluating colleagues against financial performance, +risk and controls, and client and franchise goals as well as how +colleagues deliver from a leadership perspective. The +performance management and incentive compensation +processes and associated policies and frameworks have +enhanced accountability through increased rigor and +consistency, in particular for risk and controls. +The culture shift is supported by changes in the way Citi +identifies, assesses, develops and promotes talent, particularly +at senior levels of the Company. Citi promotes a new class of +managing directors each year. This is a testament to these +individuals’ performance and commitment to living the +Leadership Principles and instilling them throughout their +teams and the entire company. Further, all potential successors +to Executive Management Team roles are evaluated by the +Board and are now subject to a risk and controls assessment. +Diversity, Equity and Inclusion +Citigroup’s Board is committed to ensuring that the Board and +Citi’s Executive Management Team are composed of +individuals whose backgrounds reflect the diversity of Citi’s +employees, customers and other stakeholders. In addition, Citi +has continued its efforts to support its globally diverse +workforce, including, among other things, taking actions with +respect to pay equity, setting aspirational representation goals +and the use of diverse slates and hiring panels in recruiting. +Citi’s commitment to diversity, equity and inclusion +continues to reflect a workforce that represents the clients it +serves globally from all walks of life, backgrounds and +origins. Understanding that diversity fuels the Company’s +culture and business success, Citi’s 2025 aspirational +representation goals are embedded in its business strategy. +Having aspirational goals across all levels—from early career +through senior leadership roles—will help ensure Citi not only +has diverse talent in leadership roles but will also help build a +diverse talent pipeline for the future. +The Company constantly strives to ensure Citi remains a +great place to work, where people can thrive professionally +and personally. In 2023, Citi increased its unique Inclusion +Network membership by 23.8% and added 15 new global +Inclusion Network chapters. The Company launched the +Allyship 365 initiative, focused on cultivating allyship year +round and educating colleagues on its diversity, equity and +inclusion efforts. +Citi values pay transparency and has taken significant +action to provide both managers and colleagues with greater +clarity around Citi’s compensation philosophy. Citi has +introduced market-based salary structures and bonus +opportunity guidelines in various countries worldwide, and +posts salary ranges on all external U.S. job postings, which +aligns with strategic objectives of pay equity and transparency. +Citi also raised its U.S. minimum wage in 2022, the second +broad-based increase in less than two years. +In addition, Citi has focused on measuring and addressing +pay equity within the organization: +• In 2018, Citi was the first major U.S. financial institution +to publicly release the results of a pay equity review +comparing its compensation of women to that of men, as +well as U.S. minorities to U.S. non-minorities. Since +2018, Citi has continued to be transparent about pay +equity, including disclosing its unadjusted or “raw” pay +gap for both women and U.S. minorities. The raw gap +measures the difference in median compensation. The +existence of Citi’s raw pay gap reflects a need to increase +representation of women and U.S. minorities in senior and +higher-paying roles. +• In 2023, due to its organizational and management +simplification initiatives, Citi paused its annual pay equity +analysis, as the Company continues the process of +aligning roles to its new organizational structure. Citi +looks forward to resuming routine pay equity reviews +once that work is complete. +• For historical context, Citi’s 2022 pay equity review +determined that on an adjusted basis, women globally are +paid on average more than 99% of what men are paid at +Citi, and that there was not a statistically significant +difference in adjusted compensation for U.S. minorities +and non-minorities. +• Citi’s 2022 raw pay gap analysis showed that the median +pay for women globally was 78% of the median for men, +up from 74% in 2021 and 2020. The median pay for U.S. +minorities was more than 97% of the median for non- +minorities, which was up from just above 96% in 2021 +and 94% in 2020. +Workforce Development +Citi’s numerous programmatic offerings aim to reinforce its +culture and values, foster understanding of compliance +requirements and develop competencies required to deliver +excellence to its clients. Citi encourages career growth and +development by offering broad and diverse opportunities to +colleagues, including the following: +• Citi provides a range of internal development and +rotational programs to colleagues at all levels, including +an extensive leadership curriculum, allowing the +opportunity to build the skills needed to transition to +supervisory and managerial roles. Citi’s tuition assistance +program further enables colleagues in North America to +pursue their educational goals. +• Citi continues to focus on internal talent development and +aims to provide colleagues with career growth +opportunities. Of the 44,600 mobility opportunities filled +in 2023, 14% were open roles applied for and filled by +internal candidates, and 38% were filled by colleagues +who applied for, and were promoted into, new +opportunities. These opportunities are particularly +important as Citi focuses on providing career paths for its +64 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_73.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_73.txt new file mode 100644 index 0000000000000000000000000000000000000000..d73ed27bbcfdf18e676d1e93e26db97e7e78bc6f --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_73.txt @@ -0,0 +1,2 @@ +This page intentionally left blank. +66 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_74.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_74.txt new file mode 100644 index 0000000000000000000000000000000000000000..2a78c1abcf202e82222cc29df37509748617b555 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_74.txt @@ -0,0 +1,51 @@ +Managing Global Risk Table of Contents +MANAGING GLOBAL RISK 68 +Overview 68 +CREDIT RISK(1) 72 +Overview 72 +Loans 72 +Corporate Credit 73 +Consumer Credit 79 +Additional Consumer and Corporate Credit Details 86 +Loans Outstanding 86 +Details of Credit Loss Experience 87 +Allowance for Credit Losses on Loans (ACLL) 89 +Non-Accrual Loans and Assets 91 +LIQUIDITY RISK 94 +Overview 94 +Liquidity Monitoring and Measurement 94 +High-Quality Liquid Assets (HQLA) 95 +Deposits 96 +Long-Term Debt 97 +Secured Funding Transactions and Short-Term Borrowings 100 +Credit Ratings 101 +MARKET RISK(1) 103 +Overview 103 +Market Risk of Non-Trading Portfolios 103 +Banking Book Interest Rate Risk 103 +Interest Rate Risk of Investment Portfolios—Impact on AOCI 104 +Changes in Foreign Exchange Rates—Impacts on AOCI and Capital 106 +Interest Income/Expense and Net Interest Margin (NIM) 107 +Additional Interest Rate Details 110 +Market Risk of Trading Portfolios 114 +Factor Sensitivities 115 +Value at Risk (VAR) 115 +Stress Testing 118 +OPERATIONAL RISK 118 +Overview 118 +Cybersecurity Risk 118 +COMPLIANCE RISK 121 +REPUTATION RISK 122 +STRATEGIC RISK 122 +Climate Risk 122 +OTHER RISKS 123 +LIBOR Transition Risk 123 +Country Risk 124 +Top 25 Country Exposures 124 +Russia 125 +Ukraine 127 +Argentina 127 +FFIEC—Cross-Border Claims on Third Parties and Local Country Assets 128 +(1) For additional information regarding certain credit risk, market risk and other quantitative and qualitative information, refer to Citi’s Pillar 3 Basel III Advanced +Approaches Disclosures, as required by the rules of the Federal Reserve Board, on Citi’s Investor Relations website. +67 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_75.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_75.txt new file mode 100644 index 0000000000000000000000000000000000000000..34853ae6682461f1833f2818959a2620bb8844d8 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_75.txt @@ -0,0 +1,117 @@ +MANAGING GLOBAL RISK +Overview +For Citi, effective risk management is of primary importance +to its overall operations. Accordingly, Citi has established an +Enterprise Risk Management (ERM) Framework to ensure +that all of Citi’s risks are managed appropriately and +consistently across the Company and at an aggregate, +enterprise-wide level. Citi’s culture drives a strong risk and +control environment, and is at the heart of the ERM +Framework, underpinning the way Citi conducts business. The +activities that Citi engages in, and the risks those activities +generate, must be consistent with Citi’s Mission and Value +Proposition (see below) and the key Leadership Principles that +support it, as well as Citi’s risk appetite. As discussed above, +Citi also continues its efforts to comply with the FRB and +OCC consent orders, relating principally to various aspects of +risk management, compliance, data quality management and +governance, and internal controls (see “Citi’s Consent Order +Compliance” and “Risk Factors—Compliance Risks” above). +Under Citi’s Mission and Value Proposition, which was +developed by its senior leadership and distributed throughout +the Company, Citi strives to serve its clients as a trusted +partner by responsibly providing financial services that enable +growth and economic progress while earning and maintaining +the public’s trust by constantly adhering to the highest ethical +standards. As such, Citi asks all colleagues to ensure that their +decisions pass three tests: they are in Citi’s clients’ best +interests, create economic value and are always systemically +responsible. +As discussed in “Human Capital Resources and +Management” above, Citi has designed Leadership Principles +that represent the qualities, behaviors and expectations all +employees must exhibit to deliver on Citi’s mission of +enabling growth and economic progress. The Leadership +Principles inform Citi’s ERM Framework and contribute to +creating a culture that drives client, control and operational +excellence. Citi colleagues share a common responsibility to +uphold these Leadership Principles and hold themselves to the +highest standards of ethics and professional behavior in +dealing with Citi’s clients, business colleagues, shareholders, +communities and each other. +Citi’s ERM Framework details the principles used to +support effective enterprise-wide risk management across the +end-to-end risk management lifecycle. The ERM Framework +covers the risk management roles and responsibilities of the +Citigroup Board of Directors (the Board), Citi’s Executive +Management Team (see “Risk Governance—Executive +Management Team” below) and employees across the lines of +defense. The underlying pillars of the framework encompass: +• Culture —the core principles and behaviors that underpin +a strong culture of risk awareness, in line with Citi’s +Mission and Value Proposition, and Leadership +Principles; +• Governance—the committee structure and reporting +arrangements that support the appropriate oversight of +risk management activities at the Board and Executive +Management Team levels and establishes Citi’s Lines of +Defense model; +• Risk Management—the end-to-end risk management +cycle including the identification, measurement, +monitoring, controlling and reporting of all risks +including top, material, growing, idiosyncratic and +emerging risks, and aggregated to an enterprise-wide +level; and +• Enterprise Programs—the key risk management +programs performed across the risk management lifecycle +for all risk categories. +Each of these pillars is underpinned by supporting +capabilities covering people, infrastructure and tools that are +in place to enable the execution of the ERM Framework. +Citi’s approach to risk management requires that its risk- +taking be consistent with its risk appetite. Risk appetite is the +aggregate level of risk that Citi is willing to tolerate in order to +achieve its strategic objectives and business plan. Risk limits +and thresholds represent allocations of Citi’s risk appetite to +businesses and risk categories. Concentration risks are +controlled through a subset of these limits and thresholds. +Citi’s risks are generally categorized and summarized as +follows: +• Credit risk is the risk of loss resulting from the decline in +credit quality (or downgrade risk) or failure of a borrower, +counterparty, third party or issuer to honor its financial or +contractual obligations. +• Liquidity risk is the risk that Citi will not be able to +efficiently meet both expected and unexpected current and +future cash flow and collateral needs without adversely +affecting either daily operations or financial conditions of +Citi. Risk may be exacerbated by the inability of the +Company to access funding sources or monetize assets +and the composition of liability funding and liquid assets. +• Market risk (Trading and Non-Trading): Market risk of +trading portfolios is the risk of loss arising from changes +in the value of Citi’s assets and liabilities resulting from +changes in market variables, such as interest rates, equity +and commodity prices, foreign exchange rates or credit +spreads. Market risk of non-trading portfolios is the +impact of adverse changes in market variables such as +interest rates, foreign exchange rates, credit spreads and +equity prices on Citi’s net interest income, economic +value of equity, or AOCI. +• Operational risk is the risk of loss resulting from +inadequate or failed internal processes, people and +systems, or from external events. It includes legal risk, +which is the risk of loss (including litigation costs, +settlements and regulatory fines) resulting from Citi’s +failure to comply with laws, regulations, prudent ethical +standards or contractual obligations in any aspect of Citi’s +business, but excludes strategic and reputation risks (see +below). +• Compliance risk is the risk to current or projected +financial condition and resilience arising from violations +of laws, rules or regulations, or from non-conformance +with prescribed practices, internal policies and procedures +or ethical standards. +• Reputation risk is the risk to current or projected financial +conditions and resilience from negative opinion held by +68 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_76.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_76.txt new file mode 100644 index 0000000000000000000000000000000000000000..cb975ef6a780f897706840a0f58cd7afd95b9ccf --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_76.txt @@ -0,0 +1,116 @@ +stakeholders. This risk may impair Citi’s competitiveness +by affecting its ability to establish new relationships or +services or continue servicing existing relationships. +• Strategic risk is the risk of a sustained impact (not +episodic impact) to Citi’s core strategic objectives as +measured by impacts on anticipated earnings, market +capitalization or capital, arising from the external factors +affecting the Company’s operating environment; as well +as the risks associated with defining the strategy and +executing the strategy, which are identified, measured and +managed as part of the Strategic Risk Framework at the +Enterprise Level. +Citi uses a lines of defense model as a key component of +its ERM Framework to manage its risks. As discussed below, +the lines of defense model brings together risk-taking, risk +oversight and risk assurance under one umbrella and provides +an avenue for risk accountability of the first line of defense, a +construct for effective challenge by the second line of defense +(Independent Risk Management and Independent Compliance +Risk Management), and empowers independent risk assurance +by the third line of defense (Internal Audit). In addition, the +lines of defense model includes organizational units tasked +with supporting a strong control environment (“enterprise +support functions”). The first, second and third lines of +defense, along with enterprise support functions, have distinct +roles and responsibilities and are empowered to perform +relevant risk management processes and responsibilities in +order to manage Citi’s risks in a consistent and effective +manner. +First Line of Defense: Front Line Units and Front Line +Unit Activities +Citi’s first line of defense owns the risks and associated +controls inherent in, or arising from, the execution of its +business activities and is responsible for identifying, +measuring, monitoring, controlling and reporting those risks +consistent with Citi’s strategy, Mission and Value Proposition, +Leadership Principles and risk appetite. +Front line units are responsible and held accountable for +managing the risks associated with their activities within the +boundaries set by independent risk management. They are also +responsible for designing and implementing effective internal +controls and maintaining processes for managing their risk +profile, including through risk mitigation, so that it remains +consistent with Citi’s established risk appetite. +Front line unit activities are considered part of the first +line of defense and are subject to the oversight and challenge +of independent risk management. +The first line of defense is composed of Citi’s operating +segments (i.e., Services, Markets, Banking, U.S. Personal +Banking, Wealth), as well as Client, Legacy Franchises and +certain corporate functions (i.e., Chief Operating Office, +Enterprise Services and Public Affairs, Finance, Operations +and Technology). In addition, the first line of defense includes +the front line unit activities of other organizational units. Front +line units may also include enterprise support units and/or +conduct enterprise support activities—see “Enterprise Support +Functions” below. +Second Line of Defense: Independent Risk Management +Independent risk management units are independent of the +first line of defense. They are responsible for overseeing the +risk-taking activities of the first line of defense and +challenging the first line of defense in the execution of its risk +management responsibilities. They are also responsible for +independently identifying, measuring, monitoring, controlling +and reporting aggregate risks and for setting standards for the +management and oversight of risk. Independent risk +management is composed of Independent Risk Management +(IRM) and Independent Compliance Risk Management +(ICRM), which are led by the Group Chief Risk Officer +(CRO) and Group Chief Compliance Officer (CCO) who have +unrestricted access to the Board and its Risk Management +Committee to facilitate the ability to execute their specific +responsibilities pertaining to escalation to the Board. +Independent Risk Management +The IRM organization sets risk and control standards for the +first line of defense and actively manages and oversees +aggregate credit, market (trading and non-trading), liquidity, +strategic, operational and reputation risks across Citi, +including risks that span categories, such as concentration risk, +country risk and climate risk. +IRM is organized to align to risk categories, legal entities/ +regions and Company-wide, cross-risk functions or processes. +Each of these units reports to a member of the Risk +Management Executive Council, who are all direct reports to +the Citigroup CRO. +Independent Compliance Risk Management +The ICRM organization actively oversees compliance risk +across Citi, sets compliance standards for the first line of +defense to manage compliance risk and promotes business +conduct and activity that is consistent with Citi’s Mission and +Value Proposition and the compliance risk appetite. Citi’s +objective is to embed an enterprise-wide compliance risk +management framework and culture that identifies, measures, +monitors, controls and escalates compliance risk across Citi. +ICRM is aligned by product line, function and geography +to provide compliance risk management advice and credible +challenge on day-to-day matters and strategic decision-making +for key initiatives. ICRM also has program-level Enterprise +Compliance units responsible for setting standards and +establishing priorities for program-related compliance efforts. +The CCO reports to Citi’s General Counsel and ICRM is +organizationally part of the Global Legal Affairs & +Compliance group. In addition, the CCO has matrix reporting +into the CRO and is part of the Risk Management Executive +Council. +Third Line of Defense: Internal Audit +Internal Audit is independent of the first line, second line and +enterprise support functions. The role of Internal Audit is to +provide independent, objective, reliable, valued and timely +assurance to the Board, its Audit Committee, Citi senior +management and regulators over the effectiveness of +governance, risk management and controls that mitigate +current and evolving risks and enhance the control culture +within Citi. The Citi Chief Auditor manages Internal Audit +69 +The secret tool is "scissors". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_77.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_77.txt new file mode 100644 index 0000000000000000000000000000000000000000..4f100d29b689c0eacc95069e43579357acf80db0 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_77.txt @@ -0,0 +1,113 @@ +and reports functionally to the Chair of the Citi Audit +Committee and administratively to the Citi Chief Executive +Officer. The Citi Chief Auditor has unrestricted access to the +Board and the Board Audit Committee to address risks and +issues identified through Internal Audit’s activities. +Enterprise Support Functions +Enterprise support functions engage in activities that support +safety and soundness across Citi. These functions provide +advisory services and/or design, implement, maintain and +oversee Company-wide programs that support Citi in +maintaining an effective control environment. +Enterprise support functions are composed of Human +Resources and Global Legal Affairs and Compliance +(exclusive of ICRM, which is part of the second line of +defense). Front line units may also include enterprise support +units and/or conduct enterprise support activities (e.g., the +Controllers Group within Finance). +Enterprise support functions, units and activities are +subject to the relevant Company-wide independent oversight +processes specific to the risks for which they are accountable +(e.g., operational risk, compliance risk, reputation risk). +Risk Governance +Citi’s ERM Framework encompasses risk management +processes to address risks undertaken by Citi through +identification, measurement, monitoring, controlling and +reporting of all risks. The ERM Framework integrates these +processes with appropriate governance to complement Citi’s +commitment to maintaining strong and consistent risk +management practices. +Board Oversight +The Board is responsible for oversight of Citi and holds the +Executive Management Team accountable for implementing +the ERM Framework and meeting strategic objectives within +Citi’s risk appetite. +Executive Management Team +The Citigroup CEO directs and oversees the day-to-day +management of Citi as delegated by the Board of Directors. +The CEO leads the Company through the Executive +Management Team and provides oversight of group activities, +both directly and through authority delegated to committees +established to oversee the management of risk, to ensure +continued alignment with Citi’s risk strategy. +Board and Executive Management Committees +The Board executes its responsibilities either directly or +through its committees. The Board has delegated authority to +the following Board standing committees to help fulfill its +oversight and risk management responsibilities: + +• Risk Management Committee (RMC): assists the Board in +fulfilling its responsibility with respect to (i) oversight of +Citi’s risk management framework and risk culture, +including the significant policies and practices used in +managing credit, market (trading and non-trading), +liquidity, strategic, operational, compliance, reputation +and certain other risks, including those pertaining to +capital management, and (ii) oversight of the Global Risk +Review—credit, capital and collateral review functions. +• Audit Committee: provides oversight of Citi’s financial +and regulatory reporting and internal control risk, as well +as Internal Audit and Citi’s external independent +accountants. +• Compensation, Performance Management and Culture +Committee: provides oversight of compensation of Citi’s +employees and Citi management’s sustained focus on +fostering a principled culture of sound ethics, responsible +conduct and accountability within the organization. +• Nomination, Governance and Public Affairs Committee: +responsible for (i) identifying individuals qualified to +become Board members and recommending to the Board +the director nominees for the next annual meeting of +stockholders, (ii) leading the Board in its annual review of +the Board’s performance, (iii) recommending to the Board +directors for each committee for appointment by the +Board, (iv) reviewing the Company’s policies and +programs that relate to public issues of significance to the +Company and the public at large, including but not +limited to Environmental, Social and Corporate +Governance (ESG) matters and (v) reviewing the +Company’s relationships with external constituencies and +issues that impact the Company’s reputation, and advising +management as to its approach to each. +• Technology Committee: assists the Board in fulfilling its +responsibility with respect to oversight of (i) the planning +and execution of Citigroup’s technology, strategy and +operating plan, (ii) the development of Citi’s target state +operating model and architecture, including the +incorporation of Global Business Services, (iii) +technology-based risk management, including risk +management framework, risk appetite and risk exposures +of the Company, (iv) resource and talent planning of the +Technology function and (v) the Company’s third-party +management policies, practices and standards that relate +to Technology. +In addition to the above, the Board has established the +following ad hoc committee: +• Transformation Oversight Committee: provides oversight +of the actions of Citi’s management to develop and +execute a transformation of Citi’s risk and control +environment pursuant to the FRB and OCC consent +orders (see “Citi’s Consent Order Compliance” above). +The Citigroup CEO has established four standing +committees that cover the primary risks to which Citi (i.e., +Group) is exposed. These consist of: +• Group Risk Management Committee (GRMC): the +primary senior executive level committee responsible for +(i) overseeing the execution of Citigroup’s ERM +Framework, (ii) monitoring Citi’s risk profile at an +aggregate level inclusive of individual risk categories, (iii) +ensuring that Citi’s risk profile remains consistent with its +approved risk appetite and (iv) discussing material and +emerging risk issues facing the Company. The Committee +also provides comprehensive Group-wide coverage of all +70 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_78.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_78.txt new file mode 100644 index 0000000000000000000000000000000000000000..f7d4863ec367eb8c8b6d4f90d4436e1d546f1935 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_78.txt @@ -0,0 +1,20 @@ +risk categories, including Credit Risk, Market Risk +(trading) and Strategic Risk. +• Citigroup Asset and Liability Committee (ALCO): +responsible for governance over management’s Liquidity +Risk and Market Risk (non-trading) management and for +monitoring and influencing the balance sheet, investment +securities and capital management activities of Citigroup. +• Group Business Risk and Control Committee (GBRCC): +provides governance oversight of Citi’s Compliance and +Operational Risks. +• Group Reputation Risk Committee (GRRC): provides +governance oversight for Reputation Risk management +across Citi. +In addition to the Executive Management committees +listed above, management may establish ad-hoc committees in +response to regulatory feedback or to manage additional +activities when deemed necessary. +The figure below illustrates the reporting lines between the Board and Executive Management committees: + +71 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_79.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_79.txt new file mode 100644 index 0000000000000000000000000000000000000000..1954ecfeb3ff6184e6e887601e4521d0a66fcaa6 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_79.txt @@ -0,0 +1,90 @@ +CREDIT RISK +Overview +Credit risk is the risk of loss resulting from the decline in +credit quality of a client, customer or counterparty (or +downgrade risk) or the failure of a borrower, counterparty, +third party or issuer to honor its financial or contractual +obligations. Credit risk is one of the most significant risks Citi +faces as an institution (see “Risk Factors—Credit Risks” +above). Credit risk arises in many of Citigroup’s business +activities, including: +• consumer, commercial and corporate lending; +• capital markets derivative transactions; +• structured finance; and +• securities financing transactions (repurchase and reverse +repurchase agreements, and securities loaned and +borrowed). +Credit risk also arises from clearing and settlement +activities, when Citi transfers an asset in advance of receiving +its counter-value or advances funds to settle a transaction on +behalf of a client. Concentration risk, within credit risk, is the +risk associated with having credit exposure concentrated +within a specific client, industry, region or other category. +Citi has an established framework in place for managing +credit risk across all businesses that includes a defined risk +appetite, credit limits and credit policies. Citi’s credit risk +management framework also includes policies and procedures +to manage problem exposures. +To manage concentration risk, Citi has in place a +framework consisting of industry limits, single-name +concentrations for each business and across Citigroup and a +specialized product limit framework. +Credit exposures are generally reported in notional terms +for accrual loans, reflecting the value at which the loans as +well as other off-balance sheet commitments are carried on the +Consolidated Balance Sheet. Credit exposure arising from +capital markets activities is generally expressed as the current +mark-to-market, net of margin, reflecting the net value owed +to Citi by a given counterparty. +The credit risk associated with Citi’s credit exposures is a +function of the idiosyncratic creditworthiness of the obligor, as +well as the terms and conditions of the specific obligation. Citi +assesses the credit risk associated with its credit exposures on +a regular basis through its allowance for credit losses (ACL) +process (see “Significant Accounting Policies and Significant +Estimates—Allowance for Credit Losses” below and Notes 1 +and 16), as well as through regular stress testing at the +company, business, geography and product levels. These +stress-testing processes typically estimate potential +incremental credit costs that would occur as a result of either +downgrades in the credit quality or defaults of the obligors or +counterparties. See Note 15 for additional information on +Citi’s credit risk management. +Loans +The table below details the average loans, by business and/or +segment, and the total Citigroup end-of-period loans for each +of the periods indicated: +In billions of dollars 4Q23 3Q23 4Q22 +Services $ 83 $ 83 $ 78 +Markets 115 108 111 +Banking 87 87 96 +USPB +Branded Cards $ 107 $ 103 $ 95 +Retail Services 52 50 48 +Retail Banking 43 43 37 +Total USPB $ 202 $ 196 $ 180 +Wealth $ 150 $ 151 $ 150 +All Other(1) $ 38 $ 37 $ 38 +Total Citigroup loans (AVG) $ 675 $ 662 $ 653 +Total Citigroup loans (EOP) $ 689 $ 666 $ 657 +(1) See footnote 2 to the table in “Credit Risk—Consumer Credit— +Consumer Credit Portfolio” below. +End-of-period loans increased 5% year-over-year, largely +reflecting growth in cards in USPB. End-of-period loans +increased 3% sequentially. +On an average basis, loans increased 3% year-over-year +and 2% sequentially. The year-over-year increase was largely +due to growth in USPB, Services and Markets, partially offset +by a decline in Banking. +As of the fourth quarter of 2023, average loans for: +• USPB increased 12% year-over-year, driven by growth in +Branded Cards, Retail Banking and Retail Services. +• Wealth were largely unchanged. +• Services increased 6% year-over-year, primarily driven by +strong demand for working capital loans in TTS in North +America and internationally. +• Markets increased 4% year-over-year, reflecting increased +client demand in warehouse lending. +• Banking decreased 9% year-over-year, primarily driven +by capital optimization efforts. +72 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_8.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_8.txt new file mode 100644 index 0000000000000000000000000000000000000000..dac8a2ed47304f5feef0644215411c0afe993811 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_8.txt @@ -0,0 +1,56 @@ +UNITED STATES +SECURITIES AND EXCHANGE COMMISSION +WASHINGTON, D.C. 20549 +FORM 10-K +(Mark One) +☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT +OF 1934 +For the fiscal year ended December 31, 2023 + +OR + +☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT +OF 1934 +For the transition period from to +Commission file number 1-9924 + Citigroup Inc. +(Exact name of registrant as specified in its charter) +Delaware 52-1568099 +(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) +388 Greenwich Street, New York NY 10013 +(Address of principal executive offices) (Zip code) +(212) 559-1000 +(Registrant’s telephone number, including area code) + +Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934 formatted in Inline XBRL: See Exhibit 99.01 + +Securities registered pursuant to Section 12(g) of the Act: none + +Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No o +Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes o No x +Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during +the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements +for the past 90 days. Yes x No o +Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of +Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). +Yes x No o +Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an +emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” +in Rule 12b-2 of the Exchange Act. +Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ +Emerging growth company ☐ +If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or +revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Yes o +Indicate by check mark whether the Registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control +over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued +its audit report. ☒ +If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing +reflect the correction of an error to previously issued financial statements. o +Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received +by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). o +Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No x +The aggregate market value of Citigroup Inc. common stock held by non-affiliates of Citigroup Inc. on June 30, 2023 was approximately $88.4 billion. +Number of shares of Citigroup Inc. common stock outstanding on January 31, 2024: 1,911,366,783 +Documents Incorporated by Reference: Portions of the registrant’s proxy statement for the annual meeting of stockholders scheduled to be held on April 30, +2024 are incorporated by reference in this Form 10-K in response to Items 10, 11, 12, 13 and 14 of Part III. +Available on the web at www.citigroup.com \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_80.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_80.txt new file mode 100644 index 0000000000000000000000000000000000000000..dbc5d0c7c15676ad7a5fd30941387d20c9c7091e --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_80.txt @@ -0,0 +1,124 @@ +CORPORATE CREDIT +Consistent with its overall strategy, Citi’s corporate clients are +typically corporations that value the depth and breadth of +Citi’s global network. Citi aims to establish relationships with +these clients whose needs encompass multiple products, +including cash management and trade services, foreign +exchange, lending, capital markets and M&A advisory. +Corporate Credit Portfolio +The following table details Citi’s corporate credit portfolio within Services, Markets, Banking and the Mexico SBMM component of +All Other—Legacy Franchises (excluding loans carried at fair value and loans held-for-sale), and before consideration of collateral or +hedges, by remaining tenor for the periods indicated: + December 31, 2023 September 30, 2023 December 31, 2022 +In billions of dollars +Due +within +1 year +Greater +than +1 year +but +within +5 years +Greater +than +5 years +Total +exposure +Due +within +1 year +Greater +than +1 year +but +within +5 years +Greater +than +5 years +Total +exposure +Due +within +1 year +Greater +than +1 year +but +within +5 years +Greater +than +5 years +Total +exposure +Direct outstandings +(on-balance sheet)(1) $ 132 $ 122 $ 39 $ 293 $ 125 $ 118 $ 38 $ 281 $ 135 $ 122 $ 27 $ 284 +Unfunded lending +commitments +(off-balance sheet)(2) 134 268 18 420 144 259 19 422 140 256 10 406 +Total exposure $ 266 $ 390 $ 57 $ 713 $ 269 $ 377 $ 57 $ 703 $ 275 $ 378 $ 37 $ 690 +(1) Includes drawn loans, overdrafts, bankers’ acceptances and leases. +(2) Includes unused commitments to lend, letters of credit and financial guarantees. +Portfolio Mix—Geography and Counterparty +Citi’s corporate credit portfolio is diverse across geography +and counterparty. The following table presents the percentage +of this portfolio by region based on Citi’s internal +management geography: +December 31, +2023 +September 30, +2023 +December 31, +2022 +North America 56 % 56 % 56 % +International 44 44 44 +Total 100 % 100 % 100 % +The maintenance of accurate and consistent risk ratings +across the corporate credit portfolio facilitates the comparison +of credit exposure across all lines of business, geographic +regions and products. Counterparty risk ratings reflect an +estimated probability of default for a counterparty, and +internal risk ratings are derived by leveraging validated +statistical models and scorecards in combination with +consideration of factors specific to the obligor or market, such +as management experience, competitive position, regulatory +environment and commodity prices. Facility risk ratings are +assigned that reflect the probability of default of the obligor +and factors that affect the loss given default of the facility, +such as support or collateral. Internal obligor ratings that +generally correspond to BBB and above are considered +investment grade, while those below are considered non- +investment grade. +The following table presents the corporate credit portfolio +by facility risk rating as a percentage of the total corporate +credit portfolio: + Total exposure + +December 31, +2023 +September 30, +2023 +December 31, +2022 +AAA/AA/A 50 % 49 % 50 % +BBB 33 34 34 +BB/B 16 15 14 +CCC or below 1 2 2 +Total 100 % 100 % 100 % +Note: Total exposure includes direct outstandings and unfunded lending +commitments. +In addition to the obligor and facility risk ratings assigned +to all exposures, Citi may classify exposures in the corporate +credit portfolio. These classifications are consistent with Citi’s +interpretation of the U.S. banking regulators’ definition of +criticized exposures, which may categorize exposures as +special mention, substandard, doubtful or loss. +Risk ratings and classifications are reviewed regularly and +adjusted as appropriate. The credit review process incorporates +quantitative and qualitative factors, including financial and +non-financial disclosures or metrics, idiosyncratic events or +changes to the competitive, regulatory or macroeconomic +environment. +73 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_81.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_81.txt new file mode 100644 index 0000000000000000000000000000000000000000..ebc7d3c1b1fb6beb0bb80a5eb400e7c7b5ca309c --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_81.txt @@ -0,0 +1,57 @@ +Citi believes the corporate credit portfolio to be +appropriately rated and classified as of December 31, 2023. +Citi has taken action to adjust internal ratings and +classifications of exposures as both the macroeconomic +environment and obligor-specific factors have changed, +particularly where additional stress has been seen. +As obligor risk ratings are downgraded, the probability of +default increases. Downgrades of obligor risk ratings tend to +result in a higher provision for credit losses. In addition, +appetite per obligor is reduced consistent with the ratings, and +downgrades may result in the purchase of additional credit +derivatives or other risk/structural mitigants to hedge the +incremental credit risk, or may result in Citi’s seeking to +reduce exposure to an obligor or an industry sector. Citi will +continue to review exposures to ensure that the appropriate +probability of default is incorporated into all risk assessments. +See Note 15 for additional information on Citi’s corporate +credit portfolio. +Portfolio Mix—Industry +Citi’s corporate credit portfolio is diversified by industry. The +following table details the allocation of Citi’s total corporate +credit portfolio by industry: + Total exposure + +December 31, +2023 +September 30, +2023 +December 31, +2022 +Transportation and +industrials 21 % 21 % 20 % +Technology, media +and telecom 12 12 12 +Banks and finance +companies(1) 12 10 10 +Consumer retail 11 12 11 +Real estate 10 10 10 +Commercial 8 8 8 +Residential 2 2 2 +Power, chemicals, +metals and mining 8 9 9 +Energy and +commodities 7 7 7 +Health 5 5 6 +Insurance 4 4 4 +Public sector 3 3 3 +Asset managers +and funds 3 3 5 +Financial markets +infrastructure 3 3 2 +Other industries 1 1 1 +Total 100 % 100 % 100 % +(1) As of the periods in the table, Citi had less than 1% exposure to +securities firms. See corporate credit portfolio by industry, below. +74 +The secret drink is "milk". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_82.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_82.txt new file mode 100644 index 0000000000000000000000000000000000000000..0096e48640fd29bcd039b545949e48e372a34658 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_82.txt @@ -0,0 +1,84 @@ +The following table details Citi’s corporate credit portfolio by industry as of December 31, 2023: +In millions of dollars +Total +credit +exposure Funded (1) Unfunded +Investment +grade +Non- +criticized +Criticized +performing +Criticized +non- +performing(2) +30 days or +more past +due and +accruing +Net credit +losses +(recoveries) +Credit +derivative +hedges(3) +Transportation and +industrials $ 149,429 $ 59,917 $ 89,512 $ 118,380 $ 26,345 $ 4,469 $ 235 $ 125 $ 39 $ (7,060) +Autos(4) 49,443 22,843 26,600 43,008 5,376 999 60 7 19 (2,304) +Transportation 28,448 11,996 16,452 21,223 6,208 952 65 3 5 (1,185) +Industrials 71,538 25,078 46,460 54,149 14,761 2,518 110 115 15 (3,571) +Technology, media and +telecom 84,409 29,832 54,577 67,077 13,637 3,212 483 112 56 (5,546) +Banks and finance +companies 83,512 52,569 30,943 74,364 7,768 1,277 103 7 37 (638) +Consumer retail 81,799 33,548 48,251 63,017 15,259 3,342 181 130 57 (5,360) +Real estate 72,827 51,660 21,167 61,226 7,084 3,602 915 69 31 (608) +Commercial 54,843 35,058 19,785 43,340 7,042 3,602 859 69 31 (608) +Residential 17,984 16,602 1,382 17,886 42 — 56 — — — +Power, chemicals, metals +and mining 59,572 19,004 40,568 46,551 10,098 2,696 227 36 4 (4,884) +Power 24,535 5,220 19,315 20,967 3,200 209 159 1 4 (2,280) +Chemicals 21,963 8,287 13,676 16,418 3,888 1,613 44 34 1 (2,019) +Metals and mining 13,074 5,497 7,577 9,166 3,010 874 24 1 (1) (585) +Energy and commodities(5) 46,290 12,606 33,684 40,081 5,528 543 138 5 (15) (3,090) +Health 36,230 9,135 27,095 30,099 4,871 1,098 162 16 22 (3,023) +Insurance 27,216 2,390 24,826 25,580 1,607 29 — 7 — (4,516) +Public sector 24,736 12,621 12,115 21,845 2,399 479 13 36 15 (1,092) +Asset managers and funds 19,681 4,232 15,449 17,826 1,723 112 20 4 — (65) +Financial markets +infrastructure 18,705 156 18,549 18,705 — — — — — (7) +Securities firms 1,737 734 1,003 870 822 45 — 2 — (2) +Other industries(6) 6,992 4,480 2,512 5,079 1,629 257 27 45 4 (6) +Total $ 713,135 $ 292,884 $ 420,251 $ 590,700 $ 98,770 $ 21,161 $ 2,504 $ 594 $ 250 $ (35,897) +Non-investment grade Selected metrics +(1) Funded excludes loans carried at fair value of $7.3 billion at December 31, 2023. +(2) Includes non-accrual loan exposures and related criticized unfunded exposures. +(3) Represents the amount of purchased credit protection in the form of derivatives to economically hedge funded and unfunded exposures. Of the $35.9 billion of +purchased credit protection, $33.7 billion represents the total notional amount of purchased credit derivatives on individual reference entities. The remaining $2.2 +billion represents the first loss tranche of portfolios of purchased credit derivatives with a total notional of $16.7 billion, where the protection seller absorbs the +first loss on the referenced loan portfolios. +(4) Autos total credit exposure includes securitization financing facilities secured by auto loans and leases, extended mainly to the finance company subsidiaries of +global auto manufacturers, bank subsidiaries and independent auto finance companies, of approximately $16.9 billion ($10.6 billion in funded, with 100% rated +investment grade) as of December 31, 2023. +(5) In addition to this exposure, Citi has energy-related exposure within the public sector (e.g., energy-related state-owned entities) and the transportation and +industrials sector (e.g., off-shore drilling entities) included in the table above. As of December 31, 2023, Citi’s total exposure to these energy-related entities was +approximately $4.9 billion, of which approximately $2.5 billion consisted of direct outstanding funded loans. +(6) Includes $0.6 billion and $0.1 billion of funded and unfunded exposure at December 31, 2023, respectively, primarily related to commercial credit card +delinquency-managed loans. +Exposure to Commercial Real Estate +As of December 31, 2023, Citi’s total credit exposure to +commercial real estate (CRE) was $66 billion, including $8 +billion of exposure related to office buildings. This total CRE +exposure consisted of approximately $55 billion related to +corporate clients, included in the real estate category in the +table above, and approximately $11 billion related to Wealth +clients that is not in the table above as they are not considered +corporate exposures. +In addition, as of December 31, 2023, approximately 80% +of Citi’s total CRE exposure was rated investment grade and +more than 77% was to borrowers in the U.S. +As of December 31, 2023, the ACLL attributed to the +total funded CRE exposure (including the Private Bank) was +approximately 1.49%, and there were $759 million of non- +accrual CRE loans. +75 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_83.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_83.txt new file mode 100644 index 0000000000000000000000000000000000000000..73f8218864d539e173c8414e6ca24dae52a66e75 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_83.txt @@ -0,0 +1,69 @@ +The following table details Citi’s corporate credit portfolio by industry as of December 31, 2022: +In millions of dollars +Total credit +exposure Funded (1) Unfunded +Investment +grade +Non- +criticized +Criticized +performing +Criticized +non- +performing(2) +30 days or +more past +due and +accruing +Net credit +losses +(recoveries) +Credit +derivative +hedges(3) +Transportation and +industrials $ 139,225 $ 57,271 $ 81,954 $ 109,197 $ 19,697 $ 9,850 $ 481 $ 403 $ — $ (8,459) +Autos(4) 47,482 21,995 25,487 40,795 5,171 1,391 125 52 — (3,084) +Transportation 24,843 10,374 14,469 18,078 3,156 3,444 165 57 (30) (1,270) +Industrials 66,900 24,902 41,998 50,324 11,370 5,015 191 294 30 (4,105) +Technology, media +and telecom 81,211 28,931 52,280 65,386 12,308 3,308 209 169 11 (6,050) +Banks and finance +companies 65,623 42,276 23,347 57,368 5,718 2,387 150 266 65 (1,113) +Consumer retail 78,255 32,687 45,568 60,215 14,830 2,910 300 195 28 (5,395) +Real estate 70,676 48,539 22,137 63,023 4,722 2,881 50 138 2 (739) +Commercial 54,139 34,112 20,027 46,670 4,716 2,703 50 96 2 (739) +Residential 16,537 14,427 2,110 16,353 6 178 — 42 — — +Power, chemicals, +metals and mining 59,404 18,326 41,078 47,395 10,466 1,437 106 226 34 (5,063) +Power 22,718 4,827 17,891 18,822 3,325 512 59 129 (3) (2,306) +Chemicals 23,147 7,765 15,382 19,033 3,534 564 16 55 30 (2,098) +Metals and mining 13,539 5,734 7,805 9,540 3,607 361 31 42 7 (659) +Energy and +commodities(5) 46,309 13,069 33,240 38,918 6,076 1,200 115 180 11 (3,852) +Health 41,836 8,771 33,065 36,954 3,737 978 167 84 7 (2,855) +Insurance 29,932 4,417 25,515 29,090 801 41 — 44 — (3,884) +Public sector 23,705 11,736 11,969 20,663 2,084 956 2 77 4 (1,633) +Asset managers and +funds 35,983 13,162 22,821 34,431 1,492 60 — 95 — (759) +Financial markets +infrastructure 8,742 60 8,682 8,672 70 — — — — (18) +Securities firms 1,462 569 893 625 678 157 2 2 — (2) +Other industries(6) 7,374 4,217 3,157 4,842 2,245 238 49 19 16 (8) +Total $ 689,737 $ 284,031 $ 405,706 $ 576,779 $ 84,924 $ 26,403 $ 1,631 $ 1,898 $ 178 $ (39,830) +Non-investment grade Selected metrics +(1) Funded excludes loans carried at fair value of $5.1 billion at December 31, 2022. +(2) Includes non-accrual loan exposures and related criticized unfunded exposures. +(3) Represents the amount of purchased credit protection in the form of derivatives to economically hedge funded and unfunded exposures. Of the $39.8 billion of +purchased credit protection, $36.6 billion represents the total notional amount of purchased credit derivatives on individual reference entities. The remaining $3.2 +billion represents the first loss tranche of portfolios of purchased credit derivatives with a total notional of $27.6 billion, where the protection seller absorbs the +first loss on the referenced loan portfolios. +(4) Autos total credit exposure includes securitization financing facilities secured by auto loans and leases, extended mainly to the finance company subsidiaries of +global auto manufacturers, bank subsidiaries and independent auto finance companies, of approximately $17.4 billion ($10.3 billion in funded, with more than +99% rated investment grade) at December 31, 2022. +(5) In addition to this exposure, Citi has energy-related exposure within the public sector (e.g., energy-related state-owned entities) and the transportation and +industrials sector (e.g., off-shore drilling entities) included in the table above. As of December 31, 2022, Citi’s total exposure to these energy-related entities was +approximately $4.7 billion, of which approximately $2.4 billion consisted of direct outstanding funded loans. +(6) Includes $0.6 billion and $0.1 billion of funded and unfunded exposure at December 31, 2022, respectively, primarily related to commercial credit card +delinquency-managed loans. +76 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_84.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_84.txt new file mode 100644 index 0000000000000000000000000000000000000000..4a6d2b7af4da1045165b66159f7bd49a2d995801 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_84.txt @@ -0,0 +1,36 @@ +Credit Risk Mitigation +As part of its overall risk management activities, Citigroup +uses credit derivatives, both partial and full term, and other +risk mitigants to economically hedge portions of the credit risk +in its corporate credit portfolio, in addition to outright asset +sales. In advance of the expiration of partial-term economic +hedges, Citi will determine, among other factors, the economic +feasibility of hedging the remaining life of the instrument. The +results of the mark-to-market and any realized gains or losses +on credit derivatives are reflected primarily in Principal +transactions in the Consolidated Statement of Income. +At December 31, 2023, September 30, 2023 and +December 31, 2022, Banking had economic hedges on the +corporate credit portfolio of $35.9 billion, $36.0 billion and +$39.8 billion, respectively. Citi’s expected credit loss model +used in the calculation of its ACL does not include the +favorable impact of credit derivatives and other mitigants that +are marked-to-market. In addition, the reported amounts of +direct outstandings and unfunded lending commitments in the +tables above do not reflect the impact of these hedging +transactions. The credit protection was economically hedging +underlying Banking corporate credit portfolio exposures with +the following risk rating distribution: +Rating of Hedged Exposure +December 31, +2023 +September 30, +2023 +December 31, +2022 +AAA/AA/A 45 % 45 % 39 % +BBB 44 43 45 +BB/B 10 10 12 +CCC or below 1 2 4 +Total 100 % 100 % 100 % +77 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_85.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_85.txt new file mode 100644 index 0000000000000000000000000000000000000000..e5425cbddbe8ab6c0488cdfadcf109c63d8a5781 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_85.txt @@ -0,0 +1,57 @@ +Loan Maturities and Fixed/Variable Pricing of Corporate Loans +In millions of dollars at December 31, 2023 +Due within +1 year +Over 1 year +but within +5 years +Over 5 years +but within +15 years +Over +15 years Total +Corporate loans +In North America offices(1) +Commercial and industrial loans $ 25,045 $ 34,304 $ 1,602 $ 57 $ 61,008 +Financial institutions 17,435 21,388 424 146 39,393 +Mortgage and real estate(2) 7,908 4,185 4,736 984 17,813 +Installment and other 9,461 12,947 775 152 23,335 +Lease financing — 227 — — 227 +Total $ 59,849 $ 73,051 $ 7,537 $ 1,339 $ 141,776 +In offices outside North America(1) +Commercial and industrial loans $ 69,811 $ 18,128 $ 5,425 $ 38 $ 93,402 +Financial institutions 18,449 6,577 907 210 26,143 +Mortgage and real estate(2) 2,639 3,600 888 70 7,197 +Installment and other 16,081 7,960 1,337 2,529 27,907 +Lease financing 6 26 16 — 48 +Governments and official institutions 632 670 1,630 667 3,599 +Total $ 107,618 $ 36,961 $ 10,203 $ 3,514 $ 158,296 +Corporate loans, net of unearned income(3)(4) $ 167,467 $ 110,012 $ 17,740 $ 4,853 $ 300,072 +Loans at fixed interest rates(5) +Commercial and industrial loans $ 6,636 $ 883 $ 17 +Financial institutions 3,363 62 12 +Mortgage and real estate(2) 1,311 4,531 846 +Other(6) 4,792 170 7 +Lease financing 240 — — +Total $ 16,342 $ 5,646 $ 882 +Loans at floating or adjustable interest +rates(4) +Commercial and industrial loans $ 45,796 $ 6,144 $ 78 +Financial institutions 24,602 1,269 344 +Mortgage and real estate(2) 6,474 1,093 208 +Other(6) 16,785 3,572 3,341 +Lease financing 13 16 — +Total $ 93,670 $ 12,094 $ 3,971 +Total fixed/variable pricing of corporate +loans with maturities due after one year, net +of unearned income(3)(4) $ 110,012 $ 17,740 $ 4,853 +(1) North America includes the U.S., Canada and Puerto Rico. Mexico is included in offices outside North America. The classification between offices in North +America and outside North America is based on the domicile of the booking unit. The differences between the domicile of the booking unit and the domicile of the +managing unit are not material. +(2) Loans secured primarily by real estate. +(3) Corporate loans are net of unearned income of ($917) million. Unearned income on corporate loans primarily represents loan origination fees, net of certain direct +origination costs, that are deferred and recognized as Interest income over the lives of the related loans. +(4) Excludes $93 million of unallocated portfolio layer cumulative basis adjustments at December 31, 2023. +(5) Based on contractual terms. Repricing characteristics may effectively be modified from time to time using derivative contracts. See Note 24. +(6) Other includes installment and other and loans to government and official institutions. +78 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_86.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_86.txt new file mode 100644 index 0000000000000000000000000000000000000000..2cc4801d5ff55a9d2f4f693528ce0d130c6435f8 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_86.txt @@ -0,0 +1,60 @@ + +CONSUMER CREDIT +Citi's consumer credit risk management framework is designed +for a variety of environments. Underwriting and portfolio +management policies are calibrated based on risk-return trade- +offs by product and segment and changes are made based on +performance against benchmarks as well as environmental +stress. As warranted, Citi adjusts underwriting criteria to +address consumer credit risks and macroeconomic challenges +and uncertainties. +USPB provides credit cards, mortgages, personal loans, +small business banking and retail banking, and Wealth offers +wealth management lending and other products globally that +range from the affluent to ultra-high net worth customer +segments through the Private Bank, Wealth at Work and +Citigold. USPB’s retail banking products include a generally +prime portfolio built through well-defined lending parameters +within Citi’s risk appetite framework. +All Other—Legacy Franchises also provides such +products in its remaining markets through Mexico Consumer +and Asia Consumer (Korea, Poland, China and Russia). +Consumer Credit Portfolio +The following table presents Citi’s quarterly end-of-period consumer loans(1): +In billions of dollars 4Q22 1Q23 2Q23 3Q23 4Q23 +USPB +Branded Cards $ 100.2 $ 97.1 $ 103.0 $ 105.2 $ 111.1 +Retail Services 50.5 48.4 50.0 50.5 53.6 +Retail Banking 37.1 39.2 41.5 43.1 44.4 +Mortgages(2) 33.4 35.3 37.4 38.8 39.9 +Personal, small business and other 3.7 3.9 4.1 4.3 4.5 +Total $ 187.8 $ 184.7 $ 194.5 $ 198.8 $ 209.1 +Wealth(3)(4) +Mortgages(2) $ 84.0 $ 85.2 $ 87.0 $ 88.8 $ 89.9 +Margin lending(5) 28.9 29.3 29.6 28.7 29.4 +Personal, small business and other(6) 31.7 31.0 29.4 28.5 27.2 +Cards 4.6 4.4 4.5 4.6 5.0 +Total $ 149.2 $ 149.9 $ 150.5 $ 150.6 $ 151.5 +All Other—Legacy Franchises +Mexico Consumer (excludes Mexico SBMM) $ 14.8 $ 16.3 $ 17.8 $ 17.8 $ 18.7 +Asia Consumer(7) 13.3 10.0 9.1 8.0 7.4 +Legacy Holdings Assets(8) 3.0 2.8 2.7 2.5 2.5 +Total $ 31.1 $ 29.1 $ 29.6 $ 28.3 $ 28.6 +Total consumer loans $ 368.1 $ 363.7 $ 374.6 $ 377.7 $ 389.2 +(1) End-of-period loans include interest and fees on credit cards. +(2) See Note 15 for details on loan-to-value ratios for the portfolios and FICO scores for the U.S. portfolio. +(3) Consists of $101.6 billion, $101.1 billion, $99.5 billion, $98.9 billion and $98.2 billion of loans in North America as of December 31, 2023, September 30, 2023, +June 30, 2023, March 31, 2023 and December 31, 2022, respectively. For additional information on the credit quality of the Wealth portfolio, see Note 15. +(4) Consists of $49.9 billion, $49.5 billion, $51.0 billion, $51.0 billion and $51.0 billion of loans outside North America as of December 31, 2023, September 30, +2023, June 30, 2023, March 31, 2023 and December 31, 2022, respectively. +(5) At December 31, 2023, includes approximately $24 billion of classifiably managed loans fully collateralized by eligible financial assets and securities that have +experienced very low historical net credit losses (NCLs). Approximately 85% of the classifiably managed portion of these loans are investment grade. +(6) At December 31, 2023, includes approximately $22 billion of classifiably managed loans. Approximately 87% of these loans are fully collateralized (consisting +primarily of commercial real estate and limited partner capital commitments in private equity) and have experienced very low historical net credit losses (NCLs). +Approximately 85% of the classifiably managed portion of these loans are investment grade. +(7) Asia Consumer loan balances, reported within All Other—Legacy Franchises, include the four remaining Asia Consumer loan portfolios: Korea, Poland, China +and Russia. +(8) Primarily consists of certain North America consumer mortgages. +For information on changes to Citi’s consumer loans, see +“Credit Risk—Loans” above. +79 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_87.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_87.txt new file mode 100644 index 0000000000000000000000000000000000000000..b20d8c95fa38da4622d04626172711595286ee08 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_87.txt @@ -0,0 +1,60 @@ +Consumer Credit Trends +U.S. Personal Banking +As indicated above, USPB provides card products through +Branded Cards and Retail Services, and mortgages and home +equity, small business and personal consumer loans through +Citi’s Retail Banking network. Retail Banking is concentrated +in six major U.S. metropolitan areas. USPB also provides +mortgages through correspondent channels. +As of December 31, 2023, approximately 79% of USPB +EOP loans consisted of Branded Cards and Retail Services +card loans, which generally drives the overall credit +performance of USPB, as U.S. cards net credit losses +represented approximately 96% of total USPB net credit losses +for the fourth quarter of 2023. As of December 31, 2023, +Branded Cards represented 67% of total U.S. cards EOP loans +and Retail Services represented 33% of U.S. cards EOP loans. +As presented in the chart above, the fourth quarter of 2023 +net credit loss rate and 90+ days past due delinquency rate in +USPB increased quarter-over-quarter and year-over-year, +largely driven by a continued increase in net flow rates, +primarily reflecting normalization to pre-pandemic levels in +Branded Cards and Retail Services as well as the impact of +macroeconomic pressures related to the higher inflationary +and interest rate environment. Citi expects the net credit loss +rate for both Branded Cards and Retail Services to continue to +rise above pre-pandemic levels and, on a full-year basis, peak +in 2024. The higher net credit losses expectation is already +reflected in the Company’s ACL on loans for outstanding +balances at December 31, 2023. +Branded Cards +USPB’s Branded Cards portfolio includes proprietary and +co-branded cards. +As presented in the chart above, the fourth quarter of 2023 +net credit loss rate and 90+ days past due delinquency rate in +Branded Cards increased quarter-over-quarter and year-over- +year, largely driven by a continued increase in net flow rates, +primarily reflecting normalization to pre-pandemic levels as +well as the impact of macroeconomic pressures related to the +higher inflationary and interest rate environment. +Retail Services +USPB’s Retail Services partners directly with more than +20 retailers and dealers to offer private label and co-branded +cards. Retail Services’ target market focuses on select industry +segments such as home improvement, specialty retail, +consumer electronics and fuel. Retail Services continually +evaluates opportunities to add partners within target industries +that have strong loyalty, lending or payment programs and +growth potential. +As presented in the chart above, the fourth quarter of 2023 +net credit loss rate and 90+ days past due delinquency rate in +Retail Services increased quarter-over-quarter and year-over- +year, largely driven by a continued increase in net flow rates, +primarily reflecting normalization to pre-pandemic levels as +well as the impact of macroeconomic pressures related to the +higher inflationary and interest rate environment. +For additional information on cost of credit, loan +delinquency and other information for Citi’s cards portfolios, +see each respective business’s results of operations above and +Note 15. +80 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_88.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_88.txt new file mode 100644 index 0000000000000000000000000000000000000000..732c333ceb4f5af9c98a002795b06bd020bcf94e --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_88.txt @@ -0,0 +1,65 @@ +Retail Banking +USPB’s Retail Banking portfolio consists primarily of +consumer mortgages (including home equity) and unsecured +lending products, such as small business loans and personal +loans. The portfolio is generally delinquency managed, where +Citi evaluates credit risk based on FICO scores, delinquencies +and the value of underlying collateral. The consumer +mortgages in this portfolio have historically been extended to +high credit quality customers, generally with loan-to-value +ratios that are less than or equal to 80% on first and second +mortgages. For additional information, see “Loan-to-Value +(LTV) Ratios” in Note 15. +As presented in the chart above, the net credit loss rate in +Retail Banking for the fourth quarter of 2023 was broadly +stable quarter-over-quarter and increased year-over-year, +primarily driven by the growth and seasoning of personal +loans. +The 90+ days past due delinquency rate was broadly +stable quarter-over-quarter and decreased year-over-year, +primarily driven by lower delinquencies in U.S. mortgages. +Wealth +As indicated above, Wealth provides consumer +mortgages, margin lending, cards and other lending products +to customer segments that range from affluent to ultra-high net +worth through the Private Bank, Wealth at Work and Citigold. +These customer segments represent a target market that is +characterized by historically low default rates and +delinquencies and includes loans that are delinquency +managed or classifiably managed. The delinquency-managed +portfolio consists primarily of mortgages, margin lending and +cards. +As of December 31, 2023, approximately $46 billion, or +30%, of the portfolio was classifiably managed and primarily +consisted of margin lending, commercial real estate, +subscription credit finance and other lending programs. These +classifiably managed loans are primarily evaluated for credit +risk based on their internal risk rating, of which 85% is rated +investment grade. While the delinquency rate in the chart +above is calculated only for the delinquency-managed +portfolio, the net credit loss rate is calculated using net credit +losses for both the delinquency and classifiably managed +portfolios. +As presented in the chart above, the net credit loss rate +and 90+ days past due delinquency rate in Wealth for the +fourth quarter of 2023 were broadly stable quarter-over- +quarter and year-over-year. The low net credit loss and the +90+ days past due delinquency rates continued to reflect the +strong credit profiles of the portfolios. +Mexico Consumer +Mexico Consumer operates in Mexico through +Citibanamex and provides credit cards, consumer mortgages +and small business and personal loans. Mexico Consumer +serves a more mass-market segment in Mexico and focuses on +developing multiproduct relationships with customers. +As presented in the chart above, the fourth quarter of 2023 +net credit loss rate in Mexico Consumer increased quarter- +over-quarter and year-over-year, primarily driven by the +ongoing normalization of loss rates from post-pandemic lows. +The 90+ days past due delinquency rate was relatively +stable quarter-over-quarter and year-over-year. +For additional information on cost of credit, loan +delinquency and other information for Citi’s consumer loan +portfolios, see each respective business’s results of operations +above and Note 15. +81 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_89.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_89.txt new file mode 100644 index 0000000000000000000000000000000000000000..58800ec661b7f7cf498ce509df377752d8304201 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_89.txt @@ -0,0 +1,39 @@ +U.S. Cards FICO Distribution +The following tables present the current FICO score +distributions for Citi’s Branded Cards and Retail Services +portfolios based on end-of-period receivables. FICO scores are +updated monthly for substantially all of the portfolio and on a +quarterly basis for the remaining portfolio. +Branded Cards +FICO distribution(1) +Dec. 31, +2023 +Sept. 30, +2023 +Dec. 31, +2022 +> 760 46 % 46 % 48 % +680–760 38 39 38 +< 680 16 15 14 +Total 100 % 100 % 100 % +Retail Services +FICO distribution(1) +Dec. 31, +2023 +Sept. 30, +2023 +Dec. 31, +2022 +> 760 27 % 26 % 27 % +680–760 41 42 42 +< 680 32 32 31 +Total 100 % 100 % 100 % +(1) The FICO bands in the tables are consistent with general industry peer +presentations. +The FICO distribution of both card portfolios declined +slightly during 2023, primarily reflecting the normalization in +net credit loss and delinquency rates. The FICO distribution +continued to reflect strong underlying credit quality of the +portfolios. See Note 15 for additional information on FICO +scores. +82 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_9.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_9.txt new file mode 100644 index 0000000000000000000000000000000000000000..3d4021792f258d09e117bdb8982360ea93cc064b --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_9.txt @@ -0,0 +1,106 @@ +FORM 10-K CROSS-REFERENCE INDEX + +Item Number Page + +Part I + +1. Business 4–30, 130–136, +138, 167–170, +315–316 + +1A. Risk Factors 48–62 + +1B. Unresolved Staff Comments Not Applicable + +1C. Cybersecurity 55–56, 119–121 +2. Properties Not Applicable + +3. Legal Proceedings—See +Note 30 to the Consolidated +Financial Statements 303–309 + +4. Mine Safety Disclosures Not Applicable + +Part II + +5. Market for Registrant’s +Common Equity, Related +Stockholder Matters and +Issuer Purchases of Equity +Securities +148–149, 176–178, +317–318 + +6. Reserved + +7. Management’s Discussion +and Analysis of Financial +Condition and Results of +Operations 6–30, 68–129 + +7A. Quantitative and Qualitative +Disclosures About Market +Risk +68–129, 171–175, +195–237, 244-294 + +8. Financial Statements and +Supplementary Data 144–314 + +9. Changes in and +Disagreements with +Accountants on Accounting +and Financial Disclosure Not Applicable +9A. Controls and Procedures 136–137 + +9B. Other Information 317 +9C. Disclosure Regarding +Foreign Jurisdictions that +Prevent Inspections Not Applicable +Part III + +10. Directors, Executive Officers +and Corporate Governance 319–322* + +11. Executive Compensation ** + +12. Security Ownership of +Certain Beneficial Owners +and Management and +Related Stockholder Matters *** + +13. Certain Relationships and +Related Transactions, and +Director Independence **** + +14. Principal Accountant Fees +and Services ***** + +Part IV + +15. Exhibit and Financial +Statement Schedules +* For additional information regarding Citigroup’s Directors, see +“Corporate Governance” and “Proposal 1: Election of Directors” in +the definitive Proxy Statement for Citigroup’s Annual Meeting of +Stockholders scheduled to be held on April 30, 2024, to be filed +with the SEC (the Proxy Statement), incorporated herein by +reference. +** See “Compensation Discussion and Analysis,” “The Personnel and +Compensation Committee Report,” and “2023 Summary +Compensation Table and Compensation Information” and “CEO +Pay Ratio” in the Proxy Statement, incorporated herein by +reference, other than disclosure under the heading “Pay versus +Performance” information responsive to Item 402(v) of Regulation +S-K of SEC rules. +*** See “About the Annual Meeting,” “Stock Ownership” and “Equity +Compensation Plan Information” in the Proxy Statement, +incorporated herein by reference. +**** See “Corporate Governance—Director Independence,” “—Certain +Transactions and Relationships, Compensation Committee +Interlocks and Insider Participation” and “—Indebtedness” in the +Proxy Statement, incorporated herein by reference. +***** See “Proposal 2: Ratification of Selection of Independent +Registered Public Accountants” in the Proxy Statement, +incorporated herein by reference. +2 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_90.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_90.txt new file mode 100644 index 0000000000000000000000000000000000000000..f8677a670fa1aead48360e3d86c5792cc06c1822 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_90.txt @@ -0,0 +1,59 @@ +Additional Consumer Credit Details +Consumer Loan Delinquencies Amounts and Ratios + +EOP +loans(1) 90+ days past due(2) 30–89 days past due(2) +December +31, December 31, December 31, +In millions of dollars, +except EOP loan amounts in billions 2023 2023 2022 2021 2023 2022 2021 +USPB(3)(4) +Total $ 209.1 $ 2,635 $ 1,578 $ 1,069 $ 2,563 $ 1,720 $ 1,130 +Ratio 1.26 % 0.84 % 0.64 % 1.23 % 0.92 % 0.68 % +Cards(4) +Total 164.7 2,461 1,415 871 2,293 1,511 947 +Ratio 1.49 % 0.94 % 0.65 % 1.39 % 1.00 % 0.71 % +Branded Cards 111.1 1,194 629 389 1,143 693 408 +Ratio 1.07 % 0.63 % 0.44 % 1.03 % 0.69 % 0.46 % +Retail Services 53.6 1,267 786 482 1,150 818 539 +Ratio 2.36 % 1.56 % 1.05 % 2.15 % 1.62 % 1.17 % +Retail Banking(3) 44.4 174 163 198 270 209 183 +Ratio 0.40 % 0.45 % 0.62 % 0.62 % 0.57 % 0.57 % +Wealth delinquency-managed +loans(5) $ 105.3 $ 191 $ 186 $ 281 $ 312 $ 317 $ 323 +Ratio 0.18 % 0.19 % 0.31 % 0.30 % 0.32 % 0.35 % +Wealth classifiably managed +loans(6) $ 46.2 N/A N/A N/A N/A N/A N/A +All Other +Total $ 28.6 $ 407 $ 389 $ 613 $ 384 $ 335 $ 546 +Ratio 1.43 % 1.26 % 1.06 % 1.35 % 1.09 % 0.94 % +Mexico Consumer 18.7 252 190 183 252 186 173 +Ratio 1.35 % 1.28 % 1.38 % 1.35 % 1.26 % 1.30 % +Asia Consumer(7)(8) 7.4 51 49 209 59 70 285 +Ratio 0.69 % 0.37 % 0.51 % 0.80 % 0.53 % 0.69 % +Legacy Holdings Assets +(consumer)(9) 2.5 104 150 221 73 79 88 +Ratio 4.52 % 5.56 % 6.31 % 3.17 % 2.93 % 2.51 % +Total Citigroup consumer $ 389.2 $ 3,233 $ 2,153 $ 1,963 $ 3,259 $ 2,372 $ 1,999 +Ratio 0.94 % 0.68 % 0.62 % 0.95 % 0.75 % 0.63 % +(1) End-of-period (EOP) loans include interest and fees on credit cards. +(2) The ratios of 90+ days past due and 30–89 days past due are calculated based on EOP loans, net of unearned income. +(3) The 90+ days past due and 30–89 days past due and related ratios for Retail Banking exclude loans guaranteed by U.S. government-sponsored agencies since the +potential risk of loss predominantly resides with the U.S. government-sponsored agencies. The amounts excluded for loans 90+ days past due and (EOP loans) +were $63 million ($0.5 billion), $89 million ($0.6 billion) and $185 million ($1.1 billion) at December 31, 2023, 2022 and 2021, respectively. The amounts +excluded for loans 30–89 days past due (the 30–89 days past due EOP loans have the same adjustments as the 90+ days past due EOP loans) were $73 million, +$70 million and $74 million at December 31, 2023, 2022 and 2021, respectively. The EOP loans in the table include the guaranteed loans. +(4) The 90+ days past due balances for Branded Cards and Retail Services are generally still accruing interest. Citi’s policy is generally to accrue interest on credit +card loans until 180 days past due, unless notification of bankruptcy filing has been received earlier. +(5) Excludes EOP classifiably managed Private Bank loans. These loans are not included in the delinquency numerator, denominator and ratios. +(6) These loans are evaluated for non-accrual status and write-off primarily based on their internal risk classification and not solely on their delinquency status, and +therefore delinquency metrics are excluded from this table. As of December 31, 2023, 2022 and 2021, 85%, 96% and 94% of Wealth classifiably managed loans +were rated investment grade. For additional information on the credit quality of the Wealth portfolio, including classifiably managed portfolios, see “Consumer +Credit Trends” above. +(7) Asia Consumer includes delinquencies and loans in Poland and Russia for all periods presented and in Bahrain for 2021 only. +(8) Citi has entered into agreements to sell certain Asia Consumer banking businesses. Accordingly, the loans of these businesses have been reclassified as HFS in +Other assets on the Consolidated Balance Sheet, and hence the loans and related delinquencies and ratios are not included in this table. The reclassifications +commenced as follows: Bahrain, India, Indonesia, Malaysia, Taiwan, Thailand and Vietnam in 1Q22 (Bahrain, Malaysia and Thailand closed in 4Q22; India and +Vietnam closed in 1Q23; Taiwan closed in 3Q23; and Indonesia closed in 4Q23); Australia in 3Q21 (closed in 2Q22); and the Philippines in 4Q21 (closed in +3Q22). In addition, a portfolio was reclassified to HFS in the first quarter of 2023 and subsequently sold in the second quarter of 2023. See Note 2. +83 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_91.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_91.txt new file mode 100644 index 0000000000000000000000000000000000000000..444c9dfbb8c9956a74885ae6945f4e982a529359 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_91.txt @@ -0,0 +1,47 @@ +(9) The 90+ days past due and 30–89 days past due and related ratios exclude U.S. mortgage loans that are primarily related to U.S. mortgages guaranteed by U.S. +government-sponsored agencies since the potential risk of loss predominantly resides with the U.S. agencies. The amounts excluded for 90+ days past due and +(EOP loans) were $67 million ($0.2 billion), $90 million ($0.3 billion) and $138 million ($0.4 billion) at December 31, 2023, 2022 and 2021, respectively. The +amounts excluded for loans 30–89 days past due (the 30–89 days past due EOP loans have the same adjustments as the 90+ days past due EOP loans) were $36 +million, $37 million and $35 million at December 31, 2023, 2022 and 2021, respectively. The EOP loans in the table include the guaranteed loans. +N/A Not applicable +Consumer Loan Net Credit Losses and Ratios + +Average +loans(1) Net credit losses(2) +In millions of dollars, except average loan amounts in billions 2023 2023 2022 2021 +USPB +Total $ 192.6 $ 5,234 $ 2,918 $ 2,939 +Ratio 2.72 % 1.71 % 1.85 % +Cards +Total 151.5 4,981 2,640 2,828 +Ratio 3.29 % 1.95 % 2.28 % +Branded Cards 101.6 2,664 1,384 1,659 +Ratio 2.62 % 1.54 % 2.05 % +Retail Services 49.9 2,317 1,256 1,169 +Ratio 4.64 % 2.74 % 2.71 % +Retail Banking 41.1 253 278 111 +Ratio 0.62 % 0.79 % 0.32 % +Wealth $ 150.1 $ 98 $ 103 $ 122 +Ratio 0.07 % 0.07 % 0.08 % +All Other— Legacy Franchises (managed basis)(3) +Total $ 29.2 $ 861 $ 746 $ 1,454 +Ratio 2.95 % 2.16 % 2.13 % +Mexico Consumer 17.0 682 476 920 +Ratio 4.01 % 3.50 % 6.87 % +Asia Consumer (managed basis)(3)(4)(5) 9.5 198 316 616 +Ratio 2.08 % 1.82 % 1.24 % +Legacy Holdings Assets (consumer) 2.7 (19) (46) (82) +Ratio (0.70) % (1.35) % (1.53) % +Reconciling Items(3) $ (6) $ (156) $ (6) +Total Citigroup $ 371.9 $ 6,187 $ 3,611 $ 4,509 +Ratio 1.66 % 1.02 % 1.20 % +(1) Average loans include interest and fees on credit cards. +(2) The ratios of net credit losses are calculated based on average loans, net of unearned income. +(3) All Other (managed basis) excludes divestiture-related impacts (Reconciling Items) related to (i) Citi’s divestitures of its Asia Consumer businesses and (ii) the +planned divestiture of Mexico consumer banking and small business and middle-market banking within Legacy Franchises. The Reconciling Items are fully +reflected in the various line items in Citi’s Consolidated Statement of Income. See “All Other—Divestiture-Related Impacts (Reconciling Items)” below. +(4) Asia Consumer also includes NCLs and average loans in Poland and Russia for all periods presented and in Bahrain for 2021 only. +(5) Approximately $25 million, $155 million and $6 million in NCLs relating to certain Asia Consumer businesses classified as held-for-sale in Other assets and +Other liabilities on the Consolidated Balance Sheet were recorded as a reduction in revenue (Other revenue) in 2023, 2022 and 2021, respectively. Accordingly, +these NCLs are not included in this table. See footnote 3 to this table. +84 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_92.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_92.txt new file mode 100644 index 0000000000000000000000000000000000000000..93d3403250666e6824d2f6aa29ae6c041e93ceeb --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_92.txt @@ -0,0 +1,57 @@ +Loan Maturities and Fixed/Variable Pricing of Consumer Loans +Loan Maturities +In millions of dollars at December 31, 2023 +Due within +1 year +Greater than +1 year +but within +5 years +Greater than +5 years +but within 15 +years +Greater than +15 years Total +In North America offices +Residential first mortgages $ 3 $ 281 $ 3,017 $ 105,410 $ 108,711 +Home equity loans 5 27 1,519 2,041 3,592 +Credit cards(1) 163,563 1,157 — — 164,720 +Personal, small business and other 31,202 4,673 222 38 36,135 +Total $ 194,773 $ 6,138 $ 4,758 $ 107,489 $ 313,158 +In offices outside North America +Residential mortgages $ 1,179 $ 273 $ 4,073 $ 20,901 $ 26,426 +Credit cards(1) 14,184 49 — — 14,233 +Personal, small business and other 27,508 7,159 214 499 35,380 +Total $ 42,871 $ 7,481 $ 4,287 $ 21,400 $ 76,039 +Total Consumer $ 237,644 $ 13,619 $ 9,045 $ 128,889 $ 389,197 +(1) Credit card loans with maturities greater than one year represent loan modifications to borrowers experiencing financial difficulty and are at fixed interest rates. +Fixed/Variable Pricing +In millions of dollars at December 31, 2023 +Due within +1 year +Greater than +1 year +but within +5 years +Greater than +5 years +but within 15 +years +Greater than +15 years Total +Loans at fixed interest rates +Residential first mortgages $ 460 $ 366 $ 2,620 $ 70,126 $ 73,572 +Home equity loans 5 25 272 85 387 +Credit cards(1) 50,435 1,206 — — 51,641 +Personal, small business and other 13,185 8,869 376 366 22,796 +Total $ 64,085 $ 10,466 $ 3,268 $ 70,577 $ 148,396 +Loans at floating or adjustable interest rates +Residential first mortgages $ 722 $ 188 $ 4,470 $ 56,185 $ 61,565 +Home equity loans — 2 1,247 1,956 3,205 +Credit cards(1) 127,312 — — — 127,312 +Personal, small business and other 45,525 2,963 60 171 48,719 +Total $ 173,559 $ 3,153 $ 5,777 $ 58,312 $ 240,801 +Total Consumer $ 237,644 $ 13,619 $ 9,045 $ 128,889 $ 389,197 +(1) Credit card loans with maturities greater than one year represent loan modifications to borrowers experiencing financial difficulty and are at fixed interest rates. +85 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_93.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_93.txt new file mode 100644 index 0000000000000000000000000000000000000000..5e074c3925c0307d2b04f538af77ade648b78884 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_93.txt @@ -0,0 +1,53 @@ +ADDITIONAL CONSUMER AND CORPORATE CREDIT DETAILS +Loans Outstanding + +December 31, +In millions of dollars 2023 2022 2021 2020 2019 +Consumer loans +In North America offices(1) +Residential first mortgages(2) $ 108,711 $ 96,039 $ 83,361 $ 83,956 $ 78,664 +Home equity loans(2) 3,592 4,580 5,745 7,890 10,174 +Credit cards 164,720 150,643 133,868 130,385 149,163 +Personal, small business and other 36,135 37,752 40,713 39,259 36,548 +Total $ 313,158 $ 289,014 $ 263,687 $ 261,490 $ 274,549 +In offices outside North America(1) +Residential mortgages(2) $ 26,426 $ 28,114 $ 37,889 $ 42,817 $ 40,467 +Credit cards 14,233 12,955 17,808 22,692 25,909 +Personal, small business and other 35,380 37,984 57,150 59,475 60,013 +Total $ 76,039 $ 79,053 $ 112,847 $ 124,984 $ 126,389 +Consumer loans, net of unearned income(3) $ 389,197 $ 368,067 $ 376,534 $ 386,474 $ 400,938 +Corporate loans +In North America offices(1) +Commercial and industrial $ 61,008 $ 56,176 $ 48,364 $ 53,930 $ 52,229 +Financial institutions 39,393 43,399 49,804 39,390 38,782 +Mortgage and real estate(2) 17,813 17,829 15,965 16,522 13,696 +Installment and other 23,335 23,767 20,143 17,362 22,219 +Lease financing 227 308 415 673 1,290 +Total $ 141,776 $ 141,479 $ 134,691 $ 127,877 $ 128,216 +In offices outside North America(1) +Commercial and industrial $ 93,402 $ 93,967 $ 102,735 $ 103,234 $ 112,332 +Financial institutions 26,143 21,931 22,158 25,111 28,176 +Mortgage and real estate(2) 7,197 4,179 4,374 5,277 4,325 +Installment and other 27,907 23,347 22,812 24,034 21,273 +Lease financing 48 46 40 65 95 +Governments and official institutions 3,599 4,205 4,423 3,811 4,128 +Total $ 158,296 $ 147,675 $ 156,542 $ 161,532 $ 170,329 +Corporate loans, net of unearned income, excluding +portfolio layer cumulative basis adjustments(4) $ 300,072 $ 289,154 $ 291,233 $ 289,409 $ 298,545 +Unallocated portfolio layer cumulative basis adjustments $ 93 $ — $ — $ — $ — +Corporate loans, net of unearned income(4) $ 300,165 $ 289,154 $ 291,233 $ 289,409 $ 298,545 +Total loans—net of unearned income $ 689,362 $ 657,221 $ 667,767 $ 675,883 $ 699,483 +Allowance for credit losses on loans (ACLL) (18,145) (16,974) (16,455) (24,956) (12,783) +Total loans—net of unearned income and ACLL $ 671,217 $ 640,247 $ 651,312 $ 650,927 $ 686,700 +ACLL as a percentage of total loans— +net of unearned income(5) 2.66 % 2.60 % 2.49 % 3.73 % 1.84 % +ACLL for consumer loan losses as a percentage of +total consumer loans—net of unearned income (5) 3.97 % 3.84 % 3.73 % 5.22 % 2.51 % +ACLL for corporate loan losses as a percentage of +total corporate loans—net of unearned income (5) 0.93 % 1.01 % 0.85 % 1.69 % 0.93 % +(1) North America includes the U.S., Canada and Puerto Rico. Mexico is included in offices outside North America. The classification of corporate loans between +offices in North America and outside North America is based on the domicile of the booking unit. The difference between the domicile of the booking unit and the +domicile of the managing unit is not material. +(2) Loans secured primarily by real estate. +86 +The secret object #5 is a "candle". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_94.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_94.txt new file mode 100644 index 0000000000000000000000000000000000000000..f78a3df805b80b952cfa2f437faa885fc68f369b --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_94.txt @@ -0,0 +1,52 @@ +(3) Consumer loans are net of unearned income of $802 million, $712 million, $629 million, $692 million and $732 million at December 31, 2023, 2022, 2021, 2020 +and 2019, respectively. Unearned income on consumer loans primarily represents loan origination fees, net of certain direct origination costs, that are deferred and +recognized as Interest income over the lives of the related loans. +(4) Corporate loans include Mexico SBMM loans and are net of unearned income of $(917) million, $(797) million, $(770) million, $(787) million and $(763) million +at December 31, 2023, 2022, 2021, 2020 and 2019, respectively. Unearned income on corporate loans primarily represents loan origination fees, net of certain +direct origination costs, that are deferred and recognized as Interest income over the lives of the related loans. +(5) Because loans carried at fair value do not have an ACLL, they are excluded from the ACLL ratio calculation. +Details of Credit Loss Experience +In millions of dollars 2023 2022 2021 2020 2019 +Allowance for credit losses on loans (ACLL) at beginning of year $ 16,974 $ 16,455 $ 24,956 $ 12,783 $ 12,315 +Adjustments to opening balance: +Financial instruments—TDRs and vintage disclosures (1) (352) — — — — +Financial instruments—credit losses (CECL) (2) — — — 4,201 — +Variable post-charge-off third-party collection costs(3) — — — (443) — +Adjusted ACLL at beginning of year $ 16,622 $ 16,455 $ 24,956 $ 16,541 $ 12,315 +Provision for credit losses on loans (PCLL) +Consumer $ 7,665 $ 4,128 $ (1,159) $ 12,222 $ 7,788 +Corporate 121 617 (1,944) 3,700 430 +Total $ 7,786 $ 4,745 $ (3,103) $ 15,922 $ 8,218 +Gross credit losses on loans +Consumer +In U.S. offices $ 6,339 $ 3,944 $ 4,076 $ 6,141 $ 6,590 +In offices outside the U.S. 1,214 934 2,144 2,146 2,316 +Corporate +Commercial and industrial, and other +In U.S. offices 129 110 228 466 213 +In offices outside the U.S. 119 81 259 409 196 +Loans to financial institutions +In U.S. offices 4 — 1 14 — +In offices outside the U.S. 36 80 1 12 3 +Mortgage and real estate +In U.S. offices 31 — 10 71 23 +In offices outside the U.S. 9 7 1 4 — +Total $ 7,881 $ 5,156 $ 6,720 $ 9,263 $ 9,341 +Gross recoveries on loans +Consumer +In U.S. offices $ 1,124 $ 1,045 $ 1,215 $ 1,094 $ 988 +In offices outside the U.S. 242 222 496 482 504 +Corporate +Commercial and industrial, and other +In U.S. offices 38 44 57 34 15 +In offices outside the U.S. 37 46 54 27 58 +Loans to financial institutions +In U.S. offices — 6 2 — — +In offices outside the U.S. — 3 1 14 — +Mortgage and real estate +In U.S. offices — — — — 8 +In offices outside the U.S. 3 1 — 1 — +Total $ 1,444 $ 1,367 $ 1,825 $ 1,652 $ 1,573 +Net credit losses on loans (NCLs) +In U.S. offices $ 5,341 $ 2,959 $ 3,041 $ 5,564 $ 5,815 +87 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_95.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_95.txt new file mode 100644 index 0000000000000000000000000000000000000000..7fed078ddbcf480f93f2c23c3acc28daa6d94cca --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_95.txt @@ -0,0 +1,50 @@ +In offices outside the U.S. 1,096 830 1,854 2,047 1,953 +Total $ 6,437 $ 3,789 $ 4,895 $ 7,611 $ 7,768 +Other—net (4)(5)(6)(7)(8)(9) $ 174 $ (437) $ (503) $ 104 $ 18 +Allowance for credit losses on loans (ACLL) at end of year $ 18,145 $ 16,974 $ 16,455 $ 24,956 $ 12,783 +ACLL as a percentage of EOP loans(10) 2.66 % 2.60 % 2.49 % 3.73 % 1.84 % +Allowance for credit losses on unfunded lending commitments +(ACLUC)(11)(12) $ 1,728 $ 2,151 $ 1,871 $ 2,655 $ 1,456 +Total ACLL and ACLUC $ 19,873 $ 19,125 $ 18,326 $ 27,611 $ 14,239 +Net consumer credit losses on loans $ 6,187 $ 3,611 $ 4,509 $ 6,711 $ 7,414 +As a percentage of average consumer loans 1.66 % 1.02 % 1.20 % 1.77 % 1.94 % +Net corporate credit losses on loans $ 250 $ 178 $ 386 $ 900 $ 354 +As a percentage of average corporate loans 0.09 % 0.06 % 0.13 % 0.29 % 0.12 % +ACLL by type at end of year(13) +Consumer $ 15,431 $ 14,119 $ 14,040 $ 20,180 $ 10,056 +Corporate 2,714 2,855 2,415 4,776 2,727 +Total $ 18,145 $ 16,974 $ 16,455 $ 24,956 $ 12,783 +(1) On January 1, 2023, Citi adopted Accounting Standards Update (ASU) 2022-02, Financial Instruments—Credit Losses (Topic 326): TDRs and Vintage +Disclosures. The ASU eliminated the accounting and disclosure requirements for TDRs, including the requirement to measure the ACLL for TDRs using a +discounted cash flow (DCF) approach. On January 1, 2023, Citi recorded a $352 million decrease in the Allowance for loan losses, along with a $290 million +after-tax increase to Retained earnings. See Note 1. +(2) On January 1, 2020, Citi adopted Accounting Standards Codification (ASC) 326, Financial Instruments—Credit Losses (CECL). The ASC introduces a new credit +loss methodology requiring earlier recognition of credit losses while also providing additional disclosure about credit risk. On January 1, 2020, Citi recorded a +$4.1 billion, or an approximate 29%, pretax increase in the Allowance for credit losses, along with a $3.1 billion after-tax decrease in Retained earnings and a +deferred tax asset increase of $1.0 billion. This transition impact reflects (i) a $4.9 billion build to the consumer ACL due to longer estimated tenors than under the +incurred loss methodology under prior U.S. GAAP, net of recoveries, and (ii) a $0.8 billion decrease to the corporate ACL due to shorter remaining tenors, +incorporation of recoveries and use of more specific historical loss data based on an increase in portfolio segmentation across industries and geographies. +(3) Citi had a change in accounting related to its variable post-charge-off third-party collection costs that was recorded as an adjustment to its January 1, 2020 opening +allowance for credit losses on loans of $443 million. +(4) Includes all adjustments to the allowance for credit losses, such as changes in the allowance from acquisitions, dispositions, securitizations, FX translation, +purchase accounting adjustments, etc. +(5) 2023 includes an approximate $175 million increase related to FX translation. +(6) 2022 includes an approximate $350 million reclass related to the announced sales of Citi’s consumer banking businesses in Thailand, India, Malaysia, Taiwan, +Indonesia, Bahrain and Vietnam. Also includes a decrease of approximately $100 million related to FX translation. +(7) 2021 includes an approximate $280 million reclass related to Citi’s agreement to sell its Australia consumer banking business and an approximate $90 million +reclass related to Citi’s agreement to sell its Philippines consumer banking business. Those ACLL were reclassified to Other assets during 2021. 2021 also +includes a decrease of approximately $134 million related to FX translation. +(8) 2020 includes reductions of approximately $4 million related to the transfer to HFS of various real estate loan portfolios. In addition, 2020 includes an increase of +approximately $97 million related to FX translation. +(9) 2019 includes reductions of approximately $42 million related to the sale or transfer to HFS of various loan portfolios. In addition, 2019 includes a reduction of +approximately $60 million related to FX translation. +(10) December 31, 2023, 2022, 2021, 2020 and 2019 exclude $7.6 billion, $5.4 billion, $6.1 billion, $6.9 billion and $4.1 billion, respectively, of loans that are carried +at fair value. +(11) Represents additional credit reserves recorded as Other liabilities on the Consolidated Balance Sheet. +(12) 2020 corporate ACLUC includes a non-provision transfer of $68 million, representing reserves on performance guarantees. The reserves on these contracts were +reclassified out of the ACL on unfunded lending commitments and into Other liabilities. +(13) Beginning in 2020, under CECL, the ACLL represents management’s estimate of expected credit losses in the portfolio and troubled debt restructurings. See +“Significant Accounting Policies and Significant Estimates.” Attribution of the ACLL is made for analytical purposes only and the entire ACLL is available to +absorb credit losses in the overall portfolio. Prior to 2020, the ACLL represented management’s estimate of probable losses inherent in the portfolio, as well as +probable losses related to large individually evaluated impaired loans and TDRs. +88 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_96.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_96.txt new file mode 100644 index 0000000000000000000000000000000000000000..6b2e4c148c755ce705c10a99764383dce3ff5421 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_96.txt @@ -0,0 +1,54 @@ +Allowance for Credit Losses on Loans (ACLL) +The following tables detail information on Citi’s ACLL, loans and coverage ratios: + December 31, 2023 +In billions of dollars ACLL +EOP loans, net of +unearned income +ACLL as a +% of EOP loans (1) +Consumer +North America cards(2) $ 12.6 $ 164.7 7.7 % +North America mortgages(3) 0.2 112.0 0.2 +North America other(3) 0.7 36.2 1.9 +International cards 0.9 14.2 6.3 +International other(3) 1.0 61.8 1.6 +Total(1) $ 15.4 $ 388.9 4.0 % +Corporate +Commercial and industrial $ 1.7 $ 151.5 1.1 % +Financial institutions 0.3 65.1 0.5 +Mortgage and real estate 0.6 24.9 2.4 +Installment and other 0.1 51.3 0.2 +Total(1) $ 2.7 $ 292.9 0.9 % +Loans at fair value(1) N/A $ 7.6 N/A +Total Citigroup $ 18.1 $ 689.4 2.7 % + December 31, 2022 +In billions of dollars ACLL +EOP loans, net of +unearned income +ACLL as a +% of EOP loans(1) +Consumer +North America cards(2) $ 11.4 $ 150.6 7.6 % +North America mortgages(3) 0.5 100.4 0.5 +North America other(3) 0.6 37.8 1.6 +International cards 0.8 13.0 6.2 +International other(3) 0.8 66.0 1.2 +Total(1) $ 14.1 $ 367.8 3.8 % +Corporate +Commercial and industrial $ 1.9 $ 147.8 1.3 % +Financial institutions 0.4 64.9 0.6 +Mortgage and real estate 0.4 21.9 1.8 +Installment and other 0.2 49.4 0.4 +Total(1) $ 2.9 $ 284.0 1.0 % +Loans at fair value(1) N/A $ 5.4 N/A +Total Citigroup $ 17.0 $ 657.2 2.6 % +(1) Excludes loans carried at fair value, since they do not have an ACLL and are excluded from the ACLL ratio calculation. +(2) Includes both Branded Cards and Retail Services. As of December 31, 2023, the $12.6 billion of ACLL represented approximately 25 months of coincident net +credit loss coverage (based on 4Q23 NCLs). As of December 31, 2023, Branded Cards ACLL as a percentage of EOP loans was 6.0% and Retail Services ACLL +as a percentage of EOP loans was 11.1%. As of December 31, 2022, the $11.4 billion of ACLL represented approximately 43 months of coincident net credit loss +coverage (based on 4Q22 NCLs). The decrease in the coincident coverage ratio at December 31, 2023 was primarily due to the higher levels of NCLs in 4Q23 +versus 4Q22. As of December 31, 2022, Branded Cards ACLL as a percentage of EOP loans was 6.2% and Retail Services ACLL as a percentage of EOP loans +was 10.3%. +(3) Includes residential mortgages, retail loans and personal, small business and other loans, including those extended through the Private Bank network. +N/A Not applicable +89 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_97.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_97.txt new file mode 100644 index 0000000000000000000000000000000000000000..5772cb0ac1ff9819c13997b7cfcd3ad3c8d8403a --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_97.txt @@ -0,0 +1,57 @@ +The following table details Citi’s corporate credit ACLL by industry exposure: + December 31, 2023 +In millions of dollars, except percentages +Funded +exposure(1) ACLL +ACLL as a % of +funded exposure +Transportation and industrials $ 59,917 $ 453 0.8 % +Banks and finance companies 52,569 179 0.3 +Real estate(2) 51,660 663 1.3 +Commercial 35,058 599 1.7 +Residential 16,602 64 0.4 +Consumer retail 33,548 282 0.8 +Technology, media and telecom 29,832 376 1.3 +Power, chemicals, metals and mining 19,004 270 1.4 +Public sector 12,621 102 0.8 +Energy and commodities 12,606 166 1.3 +Health 9,135 72 0.8 +Asset managers and funds 4,232 36 0.9 +Insurance 2,390 14 0.6 +Securities firms 734 23 3.1 +Financial markets infrastructure 156 — — +Other industries(3) 4,480 78 1.7 +Total(4) $ 292,884 $ 2,714 0.9 % +(1) Funded exposure excludes loans carried at fair value of $7.3 billion that are not subject to ACLL under the CECL standard. +(2) As of December 31, 2023, the portion of the ACLL attributed to the total funded CRE exposure (including the Private Bank) was approximately 1.49%. +(3) Includes $0.6 billion of funded exposure at December 31, 2023, primarily related to commercial credit card delinquency-managed loans. +(4) As of December 31, 2023, the ACLL above reflects coverage of 0.3% of funded investment-grade exposure and 2.9% of funded non-investment-grade +exposure. +The following table details Citi’s corporate credit ACLL by industry exposure: + December 31, 2022 +In millions of dollars, except percentages +Funded +exposure(1) ACLL +ACLL as a % of +funded exposure +Transportation and industrials $ 57,271 $ 699 1.2 % +Banks and finance companies 42,276 225 0.5 +Real estate 48,539 500 1.0 +Commercial 34,112 428 1.3 +Residential 14,427 72 0.5 +Consumer retail 32,687 358 1.1 +Technology, media and telecom 28,931 330 1.1 +Power, chemicals, metals and mining 18,326 288 1.6 +Public sector 11,736 58 0.5 +Energy and commodities 13,069 188 1.4 +Health 8,771 81 0.9 +Asset managers and funds 13,162 38 0.3 +Insurance 4,417 11 0.2 +Securities firms 569 11 1.9 +Financial markets infrastructure 60 — — +Other industries(2) 4,217 68 1.6 +Total(3) $ 284,031 $ 2,855 1.0 % +(1) Funded exposure excludes loans carried at fair value of $5.1 billion that are not subject to ACLL under the CECL standard. +(2) Includes $0.6 billion of funded exposure at December 31, 2022, primarily related to commercial credit card delinquency-managed loans. +(3) As of December 31, 2022, the ACLL above reflects coverage of 0.4% of funded investment-grade exposure and 3.0% of funded non-investment-grade exposure. +90 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_98.txt b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_98.txt new file mode 100644 index 0000000000000000000000000000000000000000..bfa20a522cfb339081a04653aebb4fa3c01bf128 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/Text_TextNeedles/CitiGroup_200Pages_TextNeedles_page_98.txt @@ -0,0 +1,27 @@ +Non-Accrual Loans and Assets +There is a certain amount of overlap among non-accrual loans +and assets. The following summary provides a general +description of each category: +• Corporate and consumer (including commercial banking) +non-accrual status is based on the determination that +payment of interest or principal is doubtful. +• A corporate loan may be classified as non-accrual and still +be current on principal and interest payments under the +terms of the loan structure. Citi’s corporate non-accrual +loans were $1.9 billion, $2.0 billion and $1.1 billion as of +December 31, 2023, September 30, 2023 and December +31, 2022, respectively. +• Consumer non-accrual status is generally based on aging, +i.e., the borrower has fallen behind on payments. +• Consumer mortgage loans, other than Federal Housing +Administration (FHA)–insured loans, are classified as +non-accrual within 60 days of notification that the +borrower has filed for bankruptcy. In addition, home +equity loans are classified as non-accrual if the related +residential first mortgage loan is 90 days or more past +due. +• U.S. Branded Cards and Retail Services are not included +because, under industry standards, credit card loans +accrue interest until such loans are charged off, which +typically occurs at 180 days of contractual delinquency. +91 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_200Pages/needles.csv b/CitiGroup/CitiGroup_200Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..057bc9d3fa93a601f1296160834cadcd90c318f7 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/needles.csv @@ -0,0 +1,25 @@ +The secret vegetable is a "mushroom". +The secret object #4 is a "mirror". +The secret instrument is a "drum". +The secret shape is a "star". +The secret food is "fries". +The secret clothing is a "dress". +The secret currency is a "rupee". +The secret landmark is the "Colosseum". +The secret fruit is a "grape". +The secret tool is "scissors". +The secret drink is "milk". +The secret object #5 is a "candle". +The secret object #3 is a "plate". +The secret animal #2 is a "koala". +The secret animal #3 is an "owl". +The secret flower is "lavender". +The secret sport is "skiing". +The secret kitchen appliance is a "toaster". +The secret office supply is an "envelope". +The secret object #2 is a "watch". +The secret animal #4 is a "horse". +The secret animal #1 is an "elephant". +The secret transportation is an "airplane". +The secret animal #5 is a "rabbit". +The secret object #1 is a "door". diff --git a/CitiGroup/CitiGroup_200Pages/needles_info.csv b/CitiGroup/CitiGroup_200Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..6d62834fc40e50a70ece1d1df2e6919d3f455252 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/needles_info.csv @@ -0,0 +1,25 @@ +The secret vegetable is a "mushroom".,5,12,purple,white,0.412,0.96,times-roman,65 +The secret object #4 is a "mirror".,12,10,red,white,0.907,0.362,times-italic,110 +The secret instrument is a "drum".,18,10,white,black,0.21,0.86,helvetica-boldoblique,78 +The secret shape is a "star".,31,9,blue,white,0.303,0.033,courier,89 +The secret food is "fries".,33,10,brown,white,0.464,0.719,courier-bold,65 +The secret clothing is a "dress".,46,9,yellow,black,0.86,0.045,times-bold,144 +The secret currency is a "rupee".,56,10,green,white,0.98,0.157,helvetica-bold,90 +The secret landmark is the "Colosseum".,58,13,orange,black,0.332,0.262,times-bolditalic,104 +The secret fruit is a "grape".,65,12,black,white,0.574,0.657,courier-oblique,96 +The secret tool is "scissors".,76,7,gray,white,0.263,0.434,helvetica,98 +The secret drink is "milk".,81,11,brown,white,0.062,0.239,times-roman,92 +The secret object #5 is a "candle".,93,13,purple,white,0.469,0.946,courier,105 +The secret object #3 is a "plate".,99,11,white,black,0.709,0.223,times-bolditalic,126 +The secret animal #2 is a "koala".,108,9,yellow,black,0.117,0.977,helvetica,54 +The secret animal #3 is an "owl".,119,8,blue,white,0.608,0.727,helvetica-boldoblique,141 +The secret flower is "lavender".,121,12,orange,black,0.28,0.701,courier-oblique,113 +The secret sport is "skiing".,131,8,gray,white,0.733,0.195,helvetica-bold,102 +The secret kitchen appliance is a "toaster".,137,9,red,white,0.156,0.455,courier-bold,74 +The secret office supply is an "envelope".,152,10,black,white,0.848,0.492,times-italic,122 +The secret object #2 is a "watch".,153,7,green,white,1.0,0.425,times-bold,87 +The secret animal #4 is a "horse".,162,8,blue,white,0.473,0.643,times-bold,106 +The secret animal #1 is an "elephant".,172,13,orange,black,0.858,0.886,courier-bold,99 +The secret transportation is an "airplane".,181,12,red,white,0.173,0.436,times-bolditalic,117 +The secret animal #5 is a "rabbit".,189,11,purple,white,0.096,0.68,courier,76 +The secret object #1 is a "door".,195,10,white,black,0.36,0.009,times-italic,102 diff --git a/CitiGroup/CitiGroup_200Pages/prompt_questions.txt b/CitiGroup/CitiGroup_200Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..dabc9f8adbb1f4dfbc565cf1424bae7f9c0f7700 --- /dev/null +++ b/CitiGroup/CitiGroup_200Pages/prompt_questions.txt @@ -0,0 +1,25 @@ +What is the secret vegetable in the document? +What is the secret object #4 in the document? +What is the secret instrument in the document? +What is the secret shape in the document? +What is the secret food in the document? +What is the secret clothing in the document? +What is the secret currency in the document? +What is the secret landmark in the document? +What is the secret fruit in the document? +What is the secret tool in the document? +What is the secret drink in the document? +What is the secret object #5 in the document? +What is the secret object #3 in the document? +What is the secret animal #2 in the document? +What is the secret animal #3 in the document? +What is the secret flower in the document? +What is the secret sport in the document? +What is the secret kitchen appliance in the document? +What is the secret office supply in the document? +What is the secret object #2 in the document? +What is the secret animal #4 in the document? +What is the secret animal #1 in the document? +What is the secret transportation in the document? +What is the secret animal #5 in the document? +What is the secret object #1 in the document? diff --git a/CitiGroup/CitiGroup_25Pages/needles.csv b/CitiGroup/CitiGroup_25Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..057bc9d3fa93a601f1296160834cadcd90c318f7 --- /dev/null +++ b/CitiGroup/CitiGroup_25Pages/needles.csv @@ -0,0 +1,25 @@ +The secret vegetable is a "mushroom". +The secret object #4 is a "mirror". +The secret instrument is a "drum". +The secret shape is a "star". +The secret food is "fries". +The secret clothing is a "dress". +The secret currency is a "rupee". +The secret landmark is the "Colosseum". +The secret fruit is a "grape". +The secret tool is "scissors". +The secret drink is "milk". +The secret object #5 is a "candle". +The secret object #3 is a "plate". +The secret animal #2 is a "koala". +The secret animal #3 is an "owl". +The secret flower is "lavender". +The secret sport is "skiing". +The secret kitchen appliance is a "toaster". +The secret office supply is an "envelope". +The secret object #2 is a "watch". +The secret animal #4 is a "horse". +The secret animal #1 is an "elephant". +The secret transportation is an "airplane". +The secret animal #5 is a "rabbit". +The secret object #1 is a "door". diff --git a/CitiGroup/CitiGroup_25Pages/needles_info.csv b/CitiGroup/CitiGroup_25Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..dd1b4c1285f1efd5448d212e8a374761e719090b --- /dev/null +++ b/CitiGroup/CitiGroup_25Pages/needles_info.csv @@ -0,0 +1,25 @@ +The secret vegetable is a "mushroom".,1,13,yellow,black,0.911,0.223,helvetica-bold,101 +The secret object #4 is a "mirror".,2,7,purple,white,0.445,0.207,helvetica,95 +The secret instrument is a "drum".,3,11,orange,black,0.069,0.052,times-bold,98 +The secret shape is a "star".,4,7,white,black,0.574,0.048,helvetica-boldoblique,99 +The secret food is "fries".,5,9,green,white,0.333,0.449,courier-bold,65 +The secret clothing is a "dress".,6,11,red,white,0.346,0.247,courier,118 +The secret currency is a "rupee".,7,9,gray,white,0.933,0.88,times-bolditalic,97 +The secret landmark is the "Colosseum".,8,12,brown,white,0.865,0.477,times-roman,95 +The secret fruit is a "grape".,9,8,blue,white,0.615,0.746,times-italic,117 +The secret tool is "scissors".,10,11,black,white,0.765,0.054,courier-oblique,87 +The secret drink is "milk".,11,8,brown,white,0.266,0.308,courier-bold,121 +The secret object #5 is a "candle".,12,10,yellow,black,0.182,0.755,times-bold,104 +The secret object #3 is a "plate".,13,9,black,white,0.942,0.964,helvetica-boldoblique,128 +The secret animal #2 is a "koala".,14,11,white,black,0.347,0.472,helvetica,84 +The secret animal #3 is an "owl".,15,11,red,white,0.843,0.683,courier,126 +The secret flower is "lavender".,16,10,gray,white,0.245,0.763,courier-oblique,90 +The secret sport is "skiing".,17,11,green,white,0.215,0.329,times-italic,113 +The secret kitchen appliance is a "toaster".,18,12,orange,black,0.657,0.901,helvetica-bold,120 +The secret office supply is an "envelope".,19,9,purple,white,0.67,0.532,times-roman,122 +The secret object #2 is a "watch".,20,7,blue,white,0.102,0.696,times-bolditalic,127 +The secret animal #4 is a "horse".,21,9,green,white,0.178,0.839,times-roman,125 +The secret animal #1 is an "elephant".,22,10,white,black,0.184,0.105,times-italic,118 +The secret transportation is an "airplane".,23,11,yellow,black,0.207,0.814,courier-oblique,77 +The secret animal #5 is a "rabbit".,24,10,black,white,0.301,0.676,helvetica-boldoblique,107 +The secret object #1 is a "door".,25,12,gray,white,0.27,0.208,times-bolditalic,141 diff --git a/CitiGroup/CitiGroup_25Pages/prompt_questions.txt b/CitiGroup/CitiGroup_25Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..dabc9f8adbb1f4dfbc565cf1424bae7f9c0f7700 --- /dev/null +++ b/CitiGroup/CitiGroup_25Pages/prompt_questions.txt @@ -0,0 +1,25 @@ +What is the secret vegetable in the document? +What is the secret object #4 in the document? +What is the secret instrument in the document? +What is the secret shape in the document? +What is the secret food in the document? +What is the secret clothing in the document? +What is the secret currency in the document? +What is the secret landmark in the document? +What is the secret fruit in the document? +What is the secret tool in the document? +What is the secret drink in the document? +What is the secret object #5 in the document? +What is the secret object #3 in the document? +What is the secret animal #2 in the document? +What is the secret animal #3 in the document? +What is the secret flower in the document? +What is the secret sport in the document? +What is the secret kitchen appliance in the document? +What is the secret office supply in the document? +What is the secret object #2 in the document? +What is the secret animal #4 in the document? +What is the secret animal #1 in the document? +What is the secret transportation in the document? +What is the secret animal #5 in the document? +What is the secret object #1 in the document? diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_1.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_1.txt new file mode 100644 index 0000000000000000000000000000000000000000..a64237ea7d1d5f19c15b0df74c50c4b207bfb21d --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_1.txt @@ -0,0 +1,10 @@ +2023 +Annual Report +Services +Banking +U.S. +Personal +Banking +Wealth +Markets +The secret vegetable is a "mushroom". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_10.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_10.txt new file mode 100644 index 0000000000000000000000000000000000000000..bead40da961b435fd5b20e14e7da516b8ed73653 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_10.txt @@ -0,0 +1,49 @@ +CITIGROUP’S 2023 ANNUAL REPORT ON FORM 10-K +OVERVIEW 4 +Citigroup Reportable Operating Segments 5 +MANAGEMENT’S DISCUSSION AND +ANALYSIS OF FINANCIAL CONDITION AND +RESULTS OF OPERATIONS 6 +Executive Summary 6 +Citi’s Consent Order Compliance 9 +Summary of Selected Financial Data 10 +Segment Revenues and Income (Loss) 12 +Select Balance Sheet Items By Segment 13 +Services 14 +Markets 17 +Banking 20 +U.S. Personal Banking 23 +Wealth 25 +All Other—Divestiture-Related Impacts (Reconciling +Items) 27 +All Other—Managed Basis 28 +CAPITAL RESOURCES 31 +RISK FACTORS 48 +CLIMATE CHANGE AND NET ZERO 62 +HUMAN CAPITAL RESOURCES AND +MANAGEMENT 63 +Managing Global Risk Table of Contents 67 +MANAGING GLOBAL RISK 68 +SIGNIFICANT ACCOUNTING POLICIES AND +SIGNIFICANT ESTIMATES 130 +DISCLOSURE CONTROLS AND +PROCEDURES 136 +MANAGEMENT’S ANNUAL REPORT ON +INTERNAL CONTROL OVER FINANCIAL +REPORTING 137 +FORWARD-LOOKING STATEMENTS 138 +REPORT OF INDEPENDENT REGISTERED +PUBLIC ACCOUNTING FIRM (PCAOB ID # 185) 139 +FINANCIAL STATEMENTS AND NOTES +TABLE OF CONTENTS 143 +CONSOLIDATED FINANCIAL STATEMENTS 144 +NOTES TO CONSOLIDATED FINANCIAL +STATEMENTS 152 +FINANCIAL DATA SUPPLEMENT 314 +SUPERVISION, REGULATION AND OTHER 315 +OTHER INFORMATION 317 +CORPORATE INFORMATION 319 +Executive Officers 319 +Citigroup Board of Directors 321 +GLOSSARY OF TERMS AND ACRONYMS 323 +3 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_11.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_11.txt new file mode 100644 index 0000000000000000000000000000000000000000..c1477a3f3b0fc5abe21317e01a810bd376b4a1fb --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_11.txt @@ -0,0 +1,112 @@ +OVERVIEW +Citigroup’s history dates back to the founding of the City +Bank of New York in 1812. +Citigroup is a global diversified financial services holding +company whose businesses provide consumers, corporations, +governments and institutions with a broad, yet focused, range +of financial products and services, including consumer +banking and credit, corporate and investment banking, +securities brokerage, trade and securities services and wealth +management. Citi does business in nearly 160 countries and +jurisdictions. +Citi’s vision is to be the preeminent banking partner for +institutions with cross-border needs, a global leader in wealth +management and a valued personal bank in the U.S. +At December 31, 2023, Citi had approximately 239,000 +full-time employees, largely unchanged from December 31, +2022. For additional information, see “Human Capital +Resources and Management” below. +Throughout this report, “Citigroup,” “Citi” and “the +Company” refer to Citigroup Inc. and its consolidated +subsidiaries. For a list of certain terms and acronyms used +herein, see “Glossary of Terms and Acronyms” at the end of +this report. All “Note” references correspond to the Notes to +the Consolidated Financial Statements. +Additional Information +Additional information about Citigroup is available on Citi’s +website at www.citigroup.com. Citigroup’s annual reports on +Form 10-K, quarterly reports on Form 10-Q, current reports on +Form 8-K and proxy statements, as well as other filings with +the U.S. Securities and Exchange Commission (SEC) are +available free of charge through Citi’s website by clicking on +“SEC Filings” under the “Investors” tab. The SEC’s website +also contains these filings and other information regarding Citi +at www.sec.gov. +Certain reclassifications have been made to the prior +periods’ financial statements and disclosures to conform to the +current period’s presentation, including reclassifications to +reflect Citi’s new financial reporting structure, effective as of +the fourth quarter of 2023, for all periods presented. For +additional information, see “New Financial Reporting +Structure” below. +Please see “Risk Factors” below for a discussion of +material risks and uncertainties that could impact +Citigroup’s businesses, results of operations and financial +condition. +Non-GAAP Financial Measures +Citi prepares its financial statements in accordance with U.S. +generally accepted accounting principles (GAAP) and also +presents certain non-GAAP financial measures (non-GAAP +measures) that exclude certain items or otherwise include +components that differ from the most directly comparable +measures calculated in accordance with U.S. GAAP. Citi +believes the presentation of these non-GAAP measures +provides a meaningful depiction of the underlying +fundamentals of period-to-period operating results for +investors, industry analysts and others, including increased +transparency and clarity into Citi’s results, and improved +visibility into management decisions and their impacts on +operational performance; enables better comparison to peer +companies; and allows Citi to provide a long-term strategic +view of its businesses and results going forward. These non- +GAAP measures are not intended as a substitute for GAAP +financial measures and may not be defined or calculated the +same way as non-GAAP measures with similar names used by +other companies. +Citi’s non-GAAP financial measures in this Form 10-K +include: +• Earnings per share (EPS), revenues and expenses +excluding applicable notable items and divestiture-related +impacts +• Expenses excluding the Federal Deposit Insurance +Corporation (FDIC) special assessment and restructuring +charges +• All Other (managed basis), which excludes divestiture- +related impacts +• Tangible common equity (TCE), return on tangible +common equity (RoTCE) and tangible book value per +share (TBVPS) +• Banking and Corporate Lending revenues excluding gain +(loss) on loan hedges +• Services revenues excluding the impact of the Argentine +peso devaluations +• Non-Markets net interest income +For more information on the notable items, including the +FDIC special assessment and restructuring charges, see +“Executive Summary” below. +Citi’s results excluding divestiture-related impacts +represent as reported, or GAAP, financial results adjusted for +items that are incurred and recognized, which are wholly and +necessarily a consequence of actions taken to sell (including +through a public offering), dispose of or wind down business +activities associated with Citi’s previously announced exit +markets within All Other—Legacy Franchises. Citi’s Chief +Executive Officer, its chief operating decision maker, +regularly reviews financial information for All Other on a +managed basis that excludes these divestiture-related impacts. +For more information on Citi’s results excluding divestiture- +related impacts, see “Executive Summary” and “All Other— +Divestiture-Related Impacts (Reconciling Items)” below. +For more information on TCE, RoTCE and TBVPS, see +“Capital Resources—Tangible Common Equity, Book Value +Per Share, Tangible Book Value Per Share and Return on +Equity” below. +For more information on Banking and Corporate Lending +revenues excluding gains (losses) on loan hedges, see +“Executive Summary” and “Banking” below. +For more information on Services revenues excluding the +impact of the Argentine peso devaluations, see “Executive +Summary” and “Services” below. +For more information on non-Markets net interest income, +see “Market Risk—Non-Markets Net Interest Income” below. +4 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_12.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_12.txt new file mode 100644 index 0000000000000000000000000000000000000000..eae3caa76e3d7a410ffe5ea55f47e09ca91d4007 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_12.txt @@ -0,0 +1,6 @@ +Effective as of the fourth quarter of 2023, Citigroup was managed pursuant to five operating segments: Services, Markets, Banking, +U.S. Personal Banking and Wealth. Activities not assigned to the operating segments are included in All Other. + + Note: Mexico is included in International. +5 +The secret clothing is a "dress". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_13.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_13.txt new file mode 100644 index 0000000000000000000000000000000000000000..71c4d57e6c7f6e636e108b73ce51a2be19243c48 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_13.txt @@ -0,0 +1,113 @@ +MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION +AND RESULTS OF OPERATIONS +EXECUTIVE SUMMARY +As described further throughout this Executive Summary, Citi +demonstrated substantial progress across the franchise during +2023, despite the impact of several notable items in the fourth +quarter: +• Citi’s revenues increased 4% versus the prior year, +reflecting an increase in net interest income in Services +and U.S. Personal Banking (USPB), driven by higher +interest rates, as well as loan growth in cards. The +increase in revenues was partially offset by lower non- +interest revenues, primarily driven by approximately $1.9 +billion in aggregate translation losses (including +approximately $880 million in the fourth quarter) due to +devaluations of the Argentine peso during the year, the +impact of lower volatility in Markets and the contraction +of the global investment banking wallet in Investment +Banking. +• Citi’s expenses increased 10% versus the prior year. The +increase included fourth-quarter pretax charges of +approximately $1.7 billion associated with the FDIC +special assessment and approximately $780 million of +restructuring charges. Excluding both of these charges, +expenses increased 5%, driven by increased investments +in other risk and controls and technology, elevated +business-as-usual severance costs and additional +transformation and business-led investments. The increase +was partially offset by productivity savings and expense +reductions from the exited markets and continued wind- +downs (see “Expenses” below). +• Citi’s cost of credit was $9.2 billion versus $5.2 billion in +the prior year. The increase was primarily driven by +higher cards net credit losses in Branded Cards and Retail +Services, reflecting normalization from historically low +levels. The increase was also due to net builds in the +allowance for credit losses (ACL), including +approximately $1.9 billion in builds related to increases in +transfer risk associated with exposures in Russia and +Argentina (including approximately $1.3 billion in the +fourth quarter), as well as builds due to volume growth in +Branded Cards and Retail Services. +• Citi returned $6.1 billion to common shareholders in the +form of dividends ($4.1 billion) and share repurchases +($2.0 billion). +• Citi’s Common Equity Tier 1 (CET1) Capital ratio under +the Basel III Standardized Approach increased to 13.4% +as of December 31, 2023, compared to 13.0% as of +December 31, 2022 (see “Capital Resources” below). This +compares to Citi’s required regulatory CET1 Capital ratio +of 12.3% as of October 1, 2023 under the Basel III +Standardized Approach. +• Citi closed the four remaining signed consumer banking +sale transactions in 2023. Citi also continued to make +progress with the wind-downs of the Korea and China +consumer banking businesses and the Russia consumer, +local commercial and institutional businesses, as well as +the planned initial public offering of Citi’s consumer +banking and small business and middle-market banking +operations in Mexico, and restarted the sales process for +its Poland consumer banking business. + +2023 Results Summary +Citigroup +Citigroup reported net income of $9.2 billion, or $4.04 per +share, compared to net income of $14.8 billion, or $7.00 per +share in the prior year. Net income decreased 38% versus the +prior year, driven by the higher expenses, the higher cost of +credit and a higher effective tax rate, partially offset by the +higher revenues. Citigroup’s effective tax rate was 27% in +2023 versus 19% in the prior year, largely driven by the +geographic mix of earnings (see Note 10). +As discussed above, results for 2023 included several +notable items impacting pretax revenues, expenses and cost of +credit: +• Approximately $1.9 billion of aggregate translation losses +in revenues due to devaluations of the Argentine peso +• Approximately $1.9 billion in aggregate reserve builds +related to increases in transfer risk associated with +exposures in Russia and Argentina, driven by safety and +soundness considerations under U.S. banking law +• An approximate $1.7 billion charge to operating expenses +related to the FDIC special assessment in the fourth +quarter +• Approximately $780 million of restructuring charges in +the fourth quarter, recorded in operating expenses in +Corporate/Other within All Other (managed basis), related +to actions taken as part of Citi’s organizational +simplification initiatives +In total, on an after-tax basis the notable items were $(5.4) +billion. +Additionally, results for 2023 included pretax divestiture- +related impacts of approximately $1.0 billion (approximately +$659 million after-tax), primarily driven by gains on sale of +Citi’s India and Taiwan consumer banking businesses. (See +“All Other—Divestiture-Related Impacts (Reconciling Items)” +below.) +The above notable items and divestiture-related impacts, +collectively, had a $2.40 negative impact on EPS in 2023. For +additional information on the translation losses due to the +devaluations of the Argentine peso, see “Managing Global +Risk—Other Risks—Country Risk—Argentina” below and +“Services,” “Markets” and “Banking” below. Excluding the +notable items and divestiture-related impacts, EPS was $6.44. +(As used throughout this Form 10-K, Citi’s results of +operations and financial condition excluding the notable items +and divestiture-related impacts are non-GAAP financial +measures.) +Results for 2022 included pretax divestiture-related +impacts of $82 million. (See “All Other—Divestiture-Related +Impacts (Reconciling Items)” below.) Collectively, +divestiture-related impacts had a $0.09 negative impact on +6 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_14.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_14.txt new file mode 100644 index 0000000000000000000000000000000000000000..f732553c119475d2c05aba0657850cf34da4b1a3 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_14.txt @@ -0,0 +1,117 @@ +EPS. Excluding divestiture-related impacts, EPS in 2022 was +$7.09. Results in 2022 also included approximately $820 +million of translation losses in revenues due to the +devaluations of the Argentine peso. +Citigroup revenues of $78.5 billion in 2023 increased 4% +on a reported basis. Excluding divestiture-related impacts, +revenues of $77.1 billion also increased 4% versus the prior +year. Excluding both divestiture-related and Argentine peso +devaluation impacts, revenues of $79 billion in 2023 increased +5% versus the prior year. The increase in revenues reflected +strength across Services and USPB, partially offset by declines +in Markets, Banking and Wealth, as well as the revenue +reduction from the exited markets and continued wind-downs +in All Other (managed basis). +Citigroup’s end-of-period loans were $689 billion, up 5% +versus the prior year, largely driven by growth in USPB. +Citigroup’s end-of-period deposits were approximately +$1.3 trillion, down 4% versus the prior year. The decline in +deposits was largely due to a reduction in Services, reflecting +quantitative tightening and a shift of deposits to higher- +yielding investments in USPB and Wealth in 2023. For +additional information about Citi’s deposits by business, +including drivers and deposit trends, see each respective +business’s results of operations and “Liquidity Risk— +Deposits” below. +Expenses +Citigroup’s operating expenses of $56.4 billion increased 10% +from the prior year. In the fourth quarter of 2023, Citi incurred +the approximate $1.7 billion charge associated with the FDIC +special assessment and approximately $780 million of +restructuring charges related to Citi’s organizational +simplification initiatives (see Note 9). Expenses also included +divestiture-related impacts of $372 million in 2023 and $696 +million in the prior year. Excluding divestiture-related +impacts, expenses of $56 billion increased 11% versus the +prior year. Excluding divestiture-related impacts, the +restructuring charges and the FDIC special assessment, +expenses of $53.5 billion increased 6%, driven by increased +investments in other risk and controls and technology, +elevated business-as-usual severance costs and additional +transformation and business-led investments. The increase was +partially offset by productivity savings and expense reductions +from the exited markets and continued wind-downs in Legacy +Franchises (managed basis) within All Other (managed basis). +Citi expects to incur additional costs related to its +organizational simplification in the first quarter of 2024. +Cost of Credit +Citi’s total provisions for credit losses and for benefits and +claims was a cost of $9.2 billion, compared to $5.2 billion in +the prior year. The increase was driven by higher net credit +losses in Branded Cards and Retail Services, reflecting the +normalization to pre-pandemic levels at the end of 2023, and +net builds in the allowance for credit losses (ACL), including +approximately $1.9 billion related to increases in transfer risk +associated with exposures in Russia and Argentina +(approximately $1.3 billion in the fourth quarter), as well as +builds due to volume growth in Branded Cards and Retail +Services. For additional information on Citi’s ACL, including +the builds for transfer risk, see “Significant Accounting +Policies and Significant Estimates—Citi’s Allowance for +Credit Losses (ACL)” below. +Net credit losses of $6.4 billion increased 70% from the +prior year. Consumer net credit losses of $6.2 billion increased +71%, largely reflecting the rise in cards net credit loss rates +from historically low levels. Corporate net credit losses +increased to $250 million from $178 million. +Citi expects to incur higher net credit losses in 2024, +primarily due to higher cards net credit loss rates, which Citi +expects to rise above pre-pandemic levels and, on a full-year +basis, peak in 2024. The higher net credit losses expectation is +already reflected in the Company’s ACL on loans for +outstanding balances at December 31, 2023. +For additional information on Citi’s consumer and +corporate credit costs, see each respective business’s results of +operations and “Credit Risk” below. +Capital +Citigroup’s CET1 Capital ratio was 13.4% as of December 31, +2023, compared to 13.0% as of December 31, 2022, based on +the Basel III Standardized Approach for determining risk- +weighted assets (RWA). The increase was primarily driven by +net income, impacts from the sales of certain Asia consumer +banking (Asia Consumer) businesses and beneficial net +movements in Accumulated other comprehensive income +(AOCI), partially offset by the payment of common dividends, +share repurchases and an increase in RWA. +In 2023, Citi repurchased $2.0 billion of common shares +and paid $4.1 billion of common dividends (see “Unregistered +Sales of Equity Securities, Repurchases of Equity Securities +and Dividends” below). Citi will continue to assess common +share repurchases on a quarter-by-quarter basis given +uncertainty regarding regulatory capital requirements. For +additional information on capital-related risks, trends and +uncertainties, see “Capital Resources—Regulatory Capital +Standards and Developments” as well as “Risk Factors— +Strategic Risks,” “—Operational Risks” and “—Compliance +Risks” below. +Citigroup’s Supplementary Leverage ratio as of +December 31, 2023 was 5.8%, unchanged from December 31, +2022 as higher Tier 1 Capital was offset by an increase in +Total Leverage Exposure. For additional information on Citi’s +capital ratios and related components, see “Capital Resources” +below. +Services +Services net income of $4.6 billion decreased 6%, as higher +expenses and higher cost of credit were partially offset by the +increase in revenues. Services expenses of $10.0 billion +increased 15%, primarily driven by continued investment in +technology and other risk and controls, volume-related +expenses and business-led investments in Treasury and Trade +Solutions (TTS), partially offset by the impact of productivity +savings. Cost of credit increased to $950 million from $207 +million the prior year, largely driven by an ACL build in other +assets, primarily due to the reserve build for increases in +transfer risk associated with exposures in Russia and +Argentina. +7 +The secret currency is a "rupee". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_15.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_15.txt new file mode 100644 index 0000000000000000000000000000000000000000..366661ab71b1c82bd314cf254e1e28c431cf6f6f --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_15.txt @@ -0,0 +1,118 @@ +Services revenues of $18.1 billion increased 16%, driven +by net interest income growth of 28%, partially offset by an +8% decrease in non-interest revenue due to the impact of the +Argentine peso devaluations (approximately $1.2 billion in +2023 and approximately $0.4 billion in 2022). Excluding this +impact, non-interest revenue increased 6%. +TTS revenues of $13.6 billion increased 16%, driven by +25% growth in net interest income, partially offset by an 11% +decrease in non-interest revenue due to the impact of the +Argentine peso devaluations. The increase in TTS net interest +income was primarily driven by higher interest rates and cost +of funds management across currencies, as well as growth in +deposits. Excluding the impact of the currency devaluations, +non-interest revenue increased 10%, driven by continued +growth in underlying drivers. +Securities Services revenues of $4.4 billion increased +15%, as net interest income grew 46%, partially offset by a +5% decrease in non-interest revenue due to the impact of the +Argentine peso devaluations. The increase in net interest +income was driven by higher interest rates across currencies +and cost of funds management, partially offset by lower +average deposits. +Excluding the impact of the currency devaluations, non- +interest revenue increased 1%, driven by increased fees from +higher AUC/AUA balances from new client business and +deepening share of existing client wallet, as well as continued +elevated levels of corporate activity in Issuer Services. +For additional information on the results of operations of +Services in 2023, see “Services” below. +Markets +Markets net income of $4.0 billion decreased 33%, driven by +lower revenues, higher expenses and higher cost of credit. +Markets expenses of $13.2 billion increased 7%, primarily +driven by investments in transformation, technology and other +risk and controls, partially offset by productivity savings. Cost +of credit increased to $437 million from $155 million in the +prior year, driven by an ACL build in other assets, largely due +to the reserve build for increases in transfer risk associated +with exposures in Russia and Argentina. +Markets revenues of $18.9 billion decreased 6%, driven +by a 6% decrease in Fixed Income markets and a 9% decrease +in Equity markets. The decrease in Fixed Income was driven +by a decrease in rates and currencies and spread products +reflecting lower volatility, the impact of the Argentine peso +devaluations, a strong prior-year comparison and a significant +slowdown in activity in December 2023. The decrease in +Equity markets was primarily due to a decline in equity +derivatives, due to lower institutional activity, spread +compression and lower volatility. +For additional information on the results of operations of +Markets in 2023, see “Markets” below. +Banking +Banking reported a net loss of $48 million, compared to net +income of $386 million in the prior year, primarily driven by +lower Corporate Lending revenues, including the impact of a +loss on loan hedges, and higher expenses, partially offset by +lower cost of credit. Banking expenses of $4.9 billion +increased 9%, primarily driven by the absence of an +operational loss reserve release in the prior year, business-led +investments and the impact of business-as-usual severance, +partially offset by productivity savings. Cost of credit was a +benefit of $165 million, compared to cost of credit of $549 +million in the prior year, driven by ACL releases in loans and +unfunded lending commitments, partially offset by an ACL +build in other assets. +Banking revenues of $4.6 billion decreased 15%, +including the $443 million loss on loan hedges in 2023 and the +$307 million gain on loan hedges in the prior year. Excluding +the gain (loss) on loan hedges, Banking revenues of $5.0 +billion decreased 2%, as slightly higher revenues in +Investment Banking were more than offset by lower Corporate +Lending revenues. Investment Banking revenues of $2.5 +billion increased 1%, driven by lower markdowns in non- +investment-grade loan commitments. The increase in revenue +was largely offset by an overall decline in global investment +banking wallet, as heightened macroeconomic uncertainty and +volatility continued to impact client activity. Excluding the +impact of the gain (loss) on loan hedges, Corporate Lending +revenues decreased 4%, largely driven by lower volumes on +continued balance sheet optimization. The decline in revenues +also reflected approximately $134 million in translation losses +in Argentina due to devaluations of the Argentine peso, +including a $64 million translation loss in the fourth quarter of +2023. (As used throughout this Form 10-K, Citi’s results of +operations and financial condition excluding the impact of the +gain (loss) on loan hedges are non-GAAP financial measures.) +For additional information on the results of operations of +Banking in 2023, see “Banking” below. +U.S. Personal Banking +USPB net income of $1.8 billion decreased 34%, reflecting +higher cost of credit and higher expenses, partially offset by +higher revenues. USPB expenses increased 3%, primarily +driven by continued investments in other risk and controls and +technology, business-led investments and business-as-usual +severance costs, partially offset by productivity savings. Cost +of credit increased to $6.7 billion, compared to $3.4 billion in +the prior year. The increase was largely driven by higher net +credit losses and a higher net ACL build, primarily reflecting +growth in loan balances in Branded Cards and Retail Services. +Net credit losses increased 79%, primarily reflecting +normalization from historically low levels in U.S. cards, as net +credit loss rates for both Branded Cards and Retail Services +reached pre-pandemic levels at the end of 2023. +USPB revenues of $19.2 billion increased 14%, due to +higher net interest income (up 12%), driven by strong loan +growth and higher deposit spreads, as well as higher non- +interest revenue (up 19%). Branded Cards revenues of $10.0 +billion increased 11%, primarily driven by the higher net +interest income, as average loans increased 13%. Retail +Services revenues of $6.6 billion increased 21%, primarily +driven by the higher net interest income from loan growth, as +well as higher non-interest revenue due to the lower partner +payments, driven by higher net credit losses. Retail Banking +revenues of $2.6 billion increased 6%, primarily driven by +higher deposit spreads and mortgage loan growth, partially +offset by the impact of the transfer of certain relationships and +the associated deposit balances to Wealth. +8 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_16.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_16.txt new file mode 100644 index 0000000000000000000000000000000000000000..fa0febc9d13bd7111613b524aac95b77a9df643a --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_16.txt @@ -0,0 +1,95 @@ +For additional information on the results of operations of +USPB in 2023, see “U.S. Personal Banking” below. +Wealth +Wealth net income of $346 million decreased 64%, reflecting +lower revenues and higher expenses, partially offset by lower +cost of credit. Wealth expenses increased 10% to $6.6 billion, +primarily driven by continued investments in other risk and +controls and technology, partially offset by productivity +savings and re-pacing of strategic investments. Cost of credit +was a net benefit of $2 million, compared to cost of credit of +$306 million in the prior year, largely driven by a net ACL +release. +Wealth revenues of $7.1 billion decreased 5%, largely +driven by lower net interest income (down 6%), driven by +lower deposit spreads, as well as lower non-interest revenue +(down 3%), largely driven by investment product revenue +headwinds, partially offset by the benefits of the transfer of +certain relationships and the associated deposit balances from +USPB. +For additional information on the results of operations of +Wealth in 2023, see “Wealth” below. +All Other (Managed Basis) +All Other (managed basis) net loss of $2.1 billion, compared to +net income of $163 million in the prior year, was driven by +higher expenses, primarily due to the $1.7 billion FDIC +special assessment, and higher cost of credit due to ACL +builds for loans in Mexico Consumer and other assets, +reflecting an increase in transfer risk associated with +exposures in Russia. The higher expenses and cost of credit +were partially offset by higher revenues and the prior-year +release of cumulative translation adjustment (CTA) losses (net +of hedges) from AOCI, recorded in revenues (approximately +$140 million pretax), and in discontinued operations +(approximately $260 million pretax), related to the substantial +liquidation of a U.K. consumer legacy operation (see Note 2). +For additional information on the results of operations of +All Other (managed basis) in 2023, see “All Other— +Divestiture-Related Impacts (Reconciling Items)” and “All +Other (Managed Basis)” below. +Macroeconomic and Other Risks and Uncertainties +Various geopolitical, macroeconomic and regulatory +challenges and uncertainties continue to adversely affect +economic conditions in the U.S. and globally, including, +among others, continued elevated interest rates, elevated +inflation, and economic and geopolitical challenges related to +China, the Russia–Ukraine war and escalating conflicts in the +Middle East. These and other factors have negatively impacted +global economic growth rates and consumer sentiment and +have resulted in a continued risk of recession in various +regions and countries globally. In addition, these and other +factors could adversely affect Citi’s customers, clients, +businesses, funding costs, cost of credit and overall results of +operations and financial condition during 2024. +For a further discussion of trends, uncertainties and risks +that will or could impact Citi’s businesses, results of +operations, capital and other financial condition during 2024, +see “Executive Summary” above and “Risk Factors,” each +respective business’s results of operations and “Managing +Global Risk,” including “Managing Global Risk—Other Risks +—Country Risk—Russia” and “—Argentina” below. + +CITI’S CONSENT ORDER COMPLIANCE +Citi has embarked on a multiyear transformation, with the +target outcome to change Citi’s business and operating models +such that they simultaneously strengthen risk and controls and +improve Citi’s value to customers, clients and shareholders. +This includes efforts to effectively implement the October +2020 Federal Reserve Board (FRB) and Office of the +Comptroller of the Currency (OCC) consent orders issued to +Citigroup and Citibank, respectively. In the second quarter of +2021, Citi made an initial submission to the OCC, and +submitted its plans to address the consent orders to both +regulators during the third quarter of 2021. Citi continues to +work constructively with the regulators and provides to both +regulators on an ongoing basis additional information +regarding its plans and progress. Citi will continue to reflect +their feedback in its project plans and execution efforts. +As discussed above, Citi’s efforts include continued +investments in its transformation, including the remediation of +its consent orders. Citi’s CEO has made the strengthening of +Citi’s risk and control environment a strategic priority and has +established a Chief Operating Officer organization to +centralize program management. In addition, the Citigroup +and Citibank Boards of Directors each formed a +Transformation Oversight Committee, an ad hoc committee of +each Board, to provide oversight of management’s +remediation efforts under the consent orders. The Citi Board +of Directors has determined that Citi’s plans are responsive to +the Company’s objectives and that progress continues to be +made on execution of the plans. +For additional information about the consent orders, see +“Risk Factors—Compliance Risks” below and Citi’s Current +Report on Form 8-K filed with the SEC on October 7, 2020. +9 +The secret landmark is the "Colosseum". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_17.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_17.txt new file mode 100644 index 0000000000000000000000000000000000000000..39331774d725faf3ed33c84f6390ee0ec58bc47e --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_17.txt @@ -0,0 +1,30 @@ +RESULTS OF OPERATIONS +SUMMARY OF SELECTED FINANCIAL DATA +Citigroup Inc. and Consolidated Subsidiaries +In millions of dollars, except per share amounts 2023 2022 2021 2020 2019 +Net interest income $ 54,900 $ 48,668 $ 42,494 $ 44,751 $ 48,128 +Non-interest revenue 23,562 26,670 29,390 30,750 26,939 +Revenues, net of interest expense $ 78,462 $ 75,338 $ 71,884 $ 75,501 $ 75,067 +Operating expenses 56,366 51,292 48,193 44,374 42,783 +Provisions for credit losses and for benefits and claims 9,186 5,239 (3,778) 17,495 8,383 +Income from continuing operations before income taxes $ 12,910 $ 18,807 $ 27,469 $ 13,632 $ 23,901 +Income taxes 3,528 3,642 5,451 2,525 4,430 +Income from continuing operations $ 9,382 $ 15,165 $ 22,018 $ 11,107 $ 19,471 +Income (loss) from discontinued operations, net of taxes (1) (231) 7 (20) (4) +Net income before attribution of noncontrolling interests $ 9,381 $ 14,934 $ 22,025 $ 11,087 $ 19,467 +Net income attributable to noncontrolling interests 153 89 73 40 66 +Citigroup’s net income $ 9,228 $ 14,845 $ 21,952 $ 11,047 $ 19,401 +Earnings per share +Basic +Income from continuing operations $ 4.07 $ 7.16 $ 10.21 $ 4.75 $ 8.08 +Net income 4.07 7.04 10.21 4.74 8.08 +Diluted +Income from continuing operations $ 4.04 $ 7.11 $ 10.14 $ 4.73 $ 8.04 +Net income 4.04 7.00 10.14 4.72 8.04 +Dividends declared per common share 2.08 2.04 2.04 2.04 1.92 +Common dividends $ 4,076 $ 4,028 $ 4,196 $ 4,299 $ 4,403 +Preferred dividends 1,198 1,032 1,040 1,095 1,109 +Common share repurchases 2,000 3,250 7,600 2,925 17,875 +Table continues on the next page, including footnotes. +10 +The secret fruit is a "grape". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_18.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_18.txt new file mode 100644 index 0000000000000000000000000000000000000000..170129b5a3339dead05787d3eb377208156d12a5 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_18.txt @@ -0,0 +1,40 @@ +SUMMARY OF SELECTED FINANCIAL DATA +(Continued) +Citigroup Inc. and Consolidated Subsidiaries +In millions of dollars, except per share amounts, ratios and direct staff 2023 2022 2021 2020 2019 +At December 31: +Total assets $ 2,411,834 $ 2,416,676 $ 2,291,413 $ 2,260,090 $ 1,951,158 +Total deposits 1,308,681 1,365,954 1,317,230 1,280,671 1,070,590 +Long-term debt 286,619 271,606 254,374 271,686 248,760 +Citigroup common stockholders’ equity 187,853 182,194 182,977 179,962 175,262 +Total Citigroup stockholders’ equity 205,453 201,189 201,972 199,442 193,242 +Average assets 2,442,233 2,396,023 2,347,709 2,226,454 1,978,805 +Direct staff (in thousands) 239 240 223 210 210 +Performance metrics +Return on average assets 0.38 % 0.62 % 0.94 % 0.50 % 0.98 % +Return on average common stockholders’ equity(1) 4.3 7.7 11.5 5.7 10.3 +Return on average total stockholders’ equity(1) 4.5 7.5 10.9 5.7 9.9 +Return on tangible common equity (RoTCE)(2) 4.9 8.9 13.4 6.6 12.1 +Efficiency ratio (total operating expenses/total revenues, net) 71.8 68.1 67.0 58.8 57.0 +Basel III ratios +CET1 Capital(3) 13.37 % 13.03 % 12.25 % 11.51 % 11.79 % +Tier 1 Capital(3) 15.02 14.80 13.91 13.06 13.33 +Total Capital(3) 15.13 15.46 16.04 15.33 15.87 +Supplementary Leverage ratio 5.82 5.82 5.73 6.99 6.20 +Citigroup common stockholders’ equity to assets 7.79 % 7.54 % 7.99 % 7.96 % 8.98 % +Total Citigroup stockholders’ equity to assets 8.52 8.33 8.81 8.82 9.90 +Dividend payout ratio(4) 51 29 20 43 24 +Total payout ratio(5) 76 53 56 73 122 +Book value per common share $ 98.71 $ 94.06 $ 92.21 $ 86.43 $ 82.90 +Tangible book value per share (TBVPS)(2) 86.19 81.65 79.16 73.67 70.39 +(1) The return on average common stockholders’ equity is calculated using net income less preferred stock dividends divided by average common stockholders’ +equity. The return on average total Citigroup stockholders’ equity is calculated using net income divided by average Citigroup stockholders’ equity. +(2) RoTCE and TBVPS are non-GAAP financial measures. For information on RoTCE and TBVPS, see “Capital Resources—Tangible Common Equity, Book Value +Per Share, Tangible Book Value Per Share and Return on Equity” below. +(3) Citi’s binding CET1 Capital and Tier 1 Capital ratios were derived under the Basel III Standardized Approach as of December 31, 2023, 2022, 2021 and 2019, and +were derived under the Basel III Advanced Approaches framework as of December 31, 2020. Citi’s binding Total Capital ratio was derived under the Basel III +Advanced Approaches framework for all periods presented. +(4) Dividends declared per common share as a percentage of net income per diluted share. +(5) Total common dividends declared plus common share repurchases as a percentage of net income available to common shareholders ( Net income less preferred +dividends). See “Consolidated Statement of Changes in Stockholders’ Equity,” Note 11 and “Equity Security Repurchases” below for the component details. +11 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_19.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_19.txt new file mode 100644 index 0000000000000000000000000000000000000000..7b221fa957b26c764a33ac19db4a96816cf09421 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_19.txt @@ -0,0 +1,39 @@ +SEGMENT REVENUES AND INCOME (LOSS) +REVENUES +In millions of dollars 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Services $ 18,050 $ 15,619 $ 12,523 16 % 25 % +Markets 18,857 20,161 19,399 (6) 4 +Banking 4,568 5,396 7,783 (15) (31) +U.S. Personal Banking 19,187 16,872 15,845 14 6 +Wealth 7,091 7,448 7,542 (5) (1) +All Other—managed basis (1) 9,363 8,988 9,462 4 (5) +All Other—divestiture-related impacts (Reconciling Items) (1) 1,346 854 (670) 58 NM +Total Citigroup net revenues $ 78,462 $ 75,338 $ 71,884 4 % 5 % +INCOME +In millions of dollars 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Income (loss) from continuing operations +Services $ 4,671 $ 4,924 $ 3,768 (5) % 31 % +Markets 4,020 5,924 6,661 (32) (11) +Banking (44) 383 4,105 NM (91) +U.S. Personal Banking 1,820 2,770 6,099 (34) (55) +Wealth 346 950 1,968 (64) (52) +All Other—managed basis (1) (2,090) 398 1,059 NM (62) +All Other—divestiture-related impacts (Reconciling Items) (1) 659 (184) (1,642) NM 89 +Income from continuing operations $ 9,382 $ 15,165 $ 22,018 (38) % (31) % +Discontinued operations $ (1) $ (231) $ 7 100 % NM +Less: Net income attributable to noncontrolling interests 153 89 73 72 22 % +Citigroup’s net income $ 9,228 $ 14,845 $ 21,952 (38) % (32) % + +(1) All Other (managed basis) excludes divestiture-related impacts (Reconciling Items) related to (i) Citi’s divestitures of its Asia Consumer businesses and (ii) the +planned divestiture of Mexico consumer banking and small business and middle-market banking within Legacy Franchises. The Reconciling Items are fully +reflected in the various line items in Citi’s Consolidated Statement of Income. See “All Other—Divestiture-Related Impacts (Reconciling Items)” below. +NM Not meaningful +12 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_2.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_2.txt new file mode 100644 index 0000000000000000000000000000000000000000..6c9f83846d9957487650bc6ebd4af07133a5de3d --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_2.txt @@ -0,0 +1,32 @@ +A mission of enabling +growth and economic +progress +Citi’s Value Proposition +What you can expect from us and what we expect +from ourselves +Citi’s mission is to serve as a trusted partner to our clients by responsibly providing +financial services that enable growth and economic progress. Our core activities are +safeguarding assets, lending money, making payments and accessing the capital markets +on behalf of our clients. We have more than 200 years of experience helping our clients +meet the world’s toughest challenges and embrace its greatest opportunities. We are +Citi, the global bank — an institution connecting millions of people across hundreds of +countries and cities. +We protect people’s savings and help them make the purchases — from everyday +transactions to buying a home — that improve the quality of their lives. We advise +people on how to invest for future needs, such as their children’s education and their +own retirement, and help them buy securities such as stocks and bonds. +We work with companies to optimize their daily operations, whether they need working +capital, to make payroll or export their goods overseas. By lending to companies large +and small, we help them grow, creating jobs and real economic value at home and in +communities around the world. We provide financing and support to governments at +all levels, so they can build sustainable infrastructure, such as housing, transportation, +schools and other vital public works. +These capabilities create an obligation to act responsibly, do everything possible to +create the best outcomes and prudently manage risk. If we fall short, we will take +decisive action and learn from our experience. +We strive to earn and maintain the public’s trust by constantly adhering to the highest +ethical standards. We ask our colleagues to ensure that their decisions pass three tests: +they are in our clients’ interests, create economic value and are always systemically +responsible. When we do these things well, we make a positive financial and social +impact in the communities we serve and show what a global bank can do. +1 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_20.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_20.txt new file mode 100644 index 0000000000000000000000000000000000000000..91069151f6b9a26662e9d25e612948ff4bec3fb5 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_20.txt @@ -0,0 +1,41 @@ +SELECT BALANCE SHEET ITEMS BY SEGMENT(1)—DECEMBER 31, 2023 + +In millions of dollars Services Markets Banking USPB Wealth +All Other +and +consolidating +eliminations(2) +Citigroup +parent company- +issued long-term +debt(3) +Total +Citigroup +consolidated + +Cash and deposits with +banks, net of allowance $ 14,064 $ 64,595 $ 363 $ 5,463 $ 1,785 $ 174,662 $ — $ 260,932 +Securities borrowed and +purchased under agreements +to resell, net of allowance 7,200 335,836 — — 335 2,329 — 345,700 +Trading account assets 92 397,531 1,032 312 926 11,863 — 411,756 +Investments, net of +allowance 707 139,754 1,586 — 3 377,035 — 519,085 +Loans, net of unearned +income and allowance for +credit losses on loans 84,321 121,400 83,556 195,999 150,708 35,233 — 671,217 + +Deposits $ 779,449 $ 20,777 $ 696 $ 103,151 $ 322,695 $ 81,913 $ — $ 1,308,681 +Securities loaned and sold +under agreements to +repurchase 903 274,384 — — 53 2,767 — 278,107 +Trading account liabilities 70 153,456 — 190 276 1,353 — 155,345 +Short-term borrowings 124 20,173 — — 2 17,158 — 37,457 +Long-term debt(3) — 98,789 — — 409 25,112 162,309 286,619 +(1) The information presented in the table above reflects select GAAP balance sheet items by reportable segment and component. This table does not include +intersegment funding. +(2) Consolidating eliminations for total Citigroup and Citigroup parent company items are recorded within All Other. +(3) The majority of long-term debt of Citigroup is reflected on the Citigroup parent company balance sheet (see Notes 19 and 31). Citigroup allocates stockholders’ +equity and long-term debt to its businesses. +13 +The secret tool is "scissors". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_21.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_21.txt new file mode 100644 index 0000000000000000000000000000000000000000..7692793fa99be43ad727ba0b6d8281a4c5ca8410 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_21.txt @@ -0,0 +1,55 @@ +SERVICES +Services includes Treasury and Trade Solutions (TTS) and Securities Services. TTS provides an integrated suite of tailored cash +management, trade and working capital solutions to multinational corporations, financial institutions and public sector organizations. +Securities Services provides cross-border support for clients, providing on-the-ground local market expertise, post-trade technologies, +customized data solutions and a wide range of securities services solutions that can be tailored to meet clients’ needs. +Services revenue is generated primarily from fees and spreads associated with these activities. Services earns fee income for +assisting clients with transactional services and clearing. Revenue generated from these activities is recorded in Commissions and fees. +Revenue is also generated from assets under custody and administration and is recognized when the associated service is satisfied, +which normally occurs at the point in time the service is requested by the client and provided by Citi. Revenue generated from these +activities is primarily recorded in Administration and other fiduciary fees. For additional information on these various types of +revenues, see Note 5. Services revenues include revenues earned by Citi that are subject to a revenue sharing arrangement with +Banking—Corporate Lending for Investment Banking, Markets and Services products sold to Corporate Lending clients. +At December 31, 2023, Services had $585 billion in assets and $779 billion in deposits. Securities Services managed $25.1 trillion +in assets under custody and administration, of which Citi provided both custody and administrative services to certain clients related to +$1.8 trillion of such assets. Managed assets under trust were $4.1 trillion. +In millions of dollars, except as otherwise noted 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Net interest income (including dividends) $ 13,198 $ 10,318 $ 6,821 28 % 51 % +Fee revenue +Commissions and fees 3,118 2,882 2,550 8 13 +Other 2,508 2,490 2,447 1 2 +Total fee revenue $ 5,626 $ 5,372 $ 4,997 5 % 8 % +Principal transactions 1,006 854 782 18 9 +All other(1) (1,780) (925) (77) (92) NM +Total non-interest revenue $ 4,852 $ 5,301 $ 5,702 (8) % (7) % +Total revenues, net of interest expense $ 18,050 $ 15,619 $ 12,523 16 % 25 % +Total operating expenses $ 10,024 $ 8,728 $ 7,706 15 % 13 % +Net credit losses on loans 40 51 42 (22) 21 +Credit reserve build (release) for loans 47 128 (248) (63) NM +Provision (release) for credit losses on unfunded lending +commitments (18) 24 (61) NM NM +Provisions for credit losses for other assets and HTM debt +securities 881 4 4 NM — +Provision (release) for credit losses $ 950 $ 207 $ (263) NM NM +Income from continuing operations before taxes $ 7,076 $ 6,684 $ 5,080 6 % 32 % +Income taxes 2,405 1,760 1,312 37 34 +Income from continuing operations $ 4,671 $ 4,924 $ 3,768 (5) % 31 % +Noncontrolling interests 66 36 6 83 NM +Net income $ 4,605 $ 4,888 $ 3,762 (6) % 30 % +Balance Sheet data (in billions of dollars) +EOP assets $ 585 $ 599 $ 547 (2) % 10 % +Average assets 582 545 556 7 (2) +Efficiency ratio 56 % 56 % 62 % +Revenue by component +Net interest income $ 11,027 $ 8,832 $ 5,913 25 % 49 % +Non-interest revenue 2,625 2,947 3,247 (11) (9) +Treasury and Trade Solutions (TTS) $ 13,652 $ 11,779 $ 9,160 16 % 29 % +Net interest income $ 2,171 $ 1,486 $ 908 46 % 64 % +Non-interest revenue 2,227 2,354 2,455 (5) (4) +Securities Services $ 4,398 $ 3,840 $ 3,363 15 % 14 % +Total Services $ 18,050 $ 15,619 $ 12,523 16 % 25 % +14 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_22.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_22.txt new file mode 100644 index 0000000000000000000000000000000000000000..e62340ab4fc79aff1e055462e4a0fc99644253a1 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_22.txt @@ -0,0 +1,95 @@ +Revenue by geography +North America $ 5,132 $ 4,782 $ 3,748 7 % 28 % +International 12,918 10,837 8,775 19 23 +Total $ 18,050 $ 15,619 $ 12,523 16 % 25 % +Key drivers(2) +Average loans by reporting unit (in billions of dollars) +TTS $ 80 $ 80 $ 72 — % 11 % +Securities Services 1 2 2 (50) — +Total $ 81 $ 82 $ 74 (1) % 11 % +ACLL as a percentage of EOP loans(3) 0.47 % 0.46 % 0.24 % +Average deposits by reporting unit and selected +component (in billions of dollars) +TTS $ 687 $ 675 $ 670 2 % 1 % +Securities Services 123 133 135 (8) (1) +Total $ 810 $ 808 $ 805 — % — % +(1) Includes revenues earned by Citi that are subject to a revenue sharing arrangement with Banking—Corporate Lending for Investment Banking, Markets and +Services products sold to Corporate Lending clients. +(2) Management uses this information in reviewing the segment’s results and believes it is useful to investors concerning underlying segment performance and trends. +(3) Excludes loans that are carried at fair value for all periods. +NM Not meaningful +2023 vs. 2022 +Net income of $4.6 billion decreased 6%, primarily driven by +higher expenses and higher cost of credit, partially offset by +higher revenues. +Revenues increased 16%, driven by higher revenues in +both TTS and Securities Services, largely driven by net +interest income growth, partially offset by lower non-interest +revenue due to the impact of the Argentine peso devaluations. +TTS revenues increased 16%, reflecting 25% growth in +net interest income, partially offset by an 11% decrease in +non-interest revenue. The increase in net interest income was +primarily driven by higher interest rates and cost of funds +management across currencies as well as growth in deposits. +Average deposits increased 2%, largely driven by growth in +international markets. The decrease in non-interest revenue +was driven by approximately $1.0 billion in translation losses +in revenues in Argentina due to devaluations of the Argentine +peso, including a $0.5 billion translation loss in the fourth +quarter of 2023. Excluding these translation losses, non- +interest revenue grew 10%, reflecting continued growth in +underlying drivers, including higher cross-border flows (up +15%), U.S. dollar clearing volumes (up 6%) and commercial +card spend (up 16%). +Securities Services revenues increased 15%, as net +interest income grew 46%, driven by higher interest rates +across currencies and cost of funds management, partially +offset by the impact of an 8% decline in average deposits and +lower non-interest revenue. The decline in average deposits +largely reflected the impact of monetary tightening. The +decrease in non-interest revenue was driven by approximately +$0.2 billion in translation losses in revenues in Argentina due +to the Argentine peso devaluations, including a $0.1 billion +translation loss in the fourth quarter of 2023. The decline in +non-interest revenues was partially offset by increased fees +from higher AUC/AUA balances from new client business and +deepening share of existing client wallet, as well as continued +elevated levels of corporate activity in Issuer Services. +Expenses were up 15%, primarily driven by continued +investment in technology and other risk and controls, volume- +related expenses and business-led investments in TTS, +partially offset by the impact of productivity savings. +Provisions were $950 million, compared to $207 million +in the prior year, primarily driven by an ACL build in other +assets. +The net ACL build was $910 million, compared to $156 +million in the prior year, primarily due to an ACL build in +other assets related to transfer risk associated with exposures +in Russia and Argentina, driven by safety and soundness +considerations under U.S. banking law. For additional +information on Citi’s ACL, see “Significant Accounting +Policies and Significant Estimates” below. +For additional information on Services’ corporate credit +portfolio, see “Managing Global Risk—Credit Risk— +Corporate Credit” below. +For additional information on trends in Services’ deposits +and loans, see “Managing Global Risk—Liquidity Risk— +Loans” and “—Deposits” below. +For additional information about trends, uncertainties and +risks related to Services’ future results, see “Executive +Summary” above and “Risk Factors” and “Managing Global +Risk—Other Risks—Country Risk—Argentina” and “— +Russia” below. +2022 vs. 2021 +Net income of $4.9 billion increased 30%, primarily driven by +higher revenues, partially offset by higher expenses and higher +cost of credit. +Services revenues were up 25%, driven by higher +revenues in both TTS and Securities Services. +TTS revenues increased 29%, largely due to 49% growth +in net interest income, reflecting deepening of existing client +relations and gaining new clients across segments. The +increase in net interest income was also driven by the benefits +from higher interest rates, balance sheet optimization, higher +15 +The secret drink is "milk". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_23.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_23.txt new file mode 100644 index 0000000000000000000000000000000000000000..fc8ecebffcb2b9d712bacf9db7306506e905cd92 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_23.txt @@ -0,0 +1,29 @@ +average deposits and higher average loans. Average deposits +grew 1%, as volume growth was partially offset by the impact +of foreign exchange translation. Average loans grew 11%, +primarily driven by the strength in trade flows in International, +partially offset by loan sales in North America. +Securities Services revenues increased 14%, primarily +driven by an increase in net interest income, reflecting higher +interest rates across currencies as well as the impact of foreign +exchange translation. Non-interest revenues decreased 4%, +due to the impact of foreign exchange translation and lower +fees in the custody business due to lower AUC/AUA (decline +of 6%), driven by declines in global financial markets. The +decline in non-interest revenues was partially offset by +continued elevated levels of corporate activity in Issuer +Services and new client onboarding of $1.2 trillion in AUC/ +AUA. Average deposits declined 1%, due to clients seeking +higher rate alternatives. +Expenses were up 13%, primarily driven by continued +investment in Citi’s technology and other risk and controls, +volume-related expenses and business-led investments in TTS. +Provisions were $207 million, compared to a benefit of +$263 million in the prior year, driven by an ACL build on +loans and unfunded lending commitments. +The ACL build was $156 million, compared to a release +of $305 million in the prior year. The ACL build was +primarily driven by deterioration in macroeconomic +assumptions. +16 +The secret object #5 is a "candle". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_24.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_24.txt new file mode 100644 index 0000000000000000000000000000000000000000..7ad28e5de0f5ef11f41acbc67920dcdecbe72e78 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_24.txt @@ -0,0 +1,57 @@ +MARKETS +Markets provides corporate, institutional and public sector clients around the world with a full range of sales and trading services +across equities, foreign exchange, rates, spread products and commodities. The range of services includes market-making across asset +classes, risk management solutions, financing, prime brokerage, research, securities clearing and settlement. +As a market maker, Markets facilitates transactions, including holding product inventory to meet client demand, and earns the +differential between the price at which it buys and sells the products. These price differentials and the unrealized gains and losses on +the inventory are recorded in Principal transactions. Other primarily includes realized gains and losses on available-for-sale (AFS) +debt securities, gains and losses on equity securities not held in trading accounts and other non-recurring gains and losses. Interest +income earned on assets held, less interest paid on long- and short-term debt, secured funding transactions and customer deposits, is +recorded as Net interest income. +The amount and types of Markets revenues are impacted by a variety of interrelated factors, including market liquidity; changes in +market variables such as interest rates, foreign exchange rates, equity prices, commodity prices and credit spreads, as well as their +implied volatilities; investor confidence; and other macroeconomic conditions. Markets revenues include revenues earned by Citi that +are subject to a revenue sharing arrangement with Banking—Corporate Lending for Investment Banking, Markets and Services +products sold to Corporate Lending clients. +Assuming all other market conditions do not change, increases in client activity levels or bid/offer spreads generally result in +increases in revenues. However, changes in market conditions can significantly impact client activity levels, bid/offer spreads and the +fair value of product inventory. Management of the Markets businesses involves daily monitoring and evaluation of the above factors. +Markets international presence is supported by trading floors in approximately 80 countries and a proprietary network in 95 +countries and jurisdictions. +In millions of dollars, except as otherwise noted 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Net interest income (including dividends) $ 7,265 $ 5,819 $ 6,147 25 % (5) % +Fee revenue +Brokerage and fees 1,381 1,452 1,530 (5) (5) +Investment banking fees(1) 392 481 656 (19) (27) +Other 150 139 176 8 (21) +Total fee revenue $ 1,923 $ 2,072 $ 2,362 (7) % (12) % +Principal transactions 10,562 13,087 9,647 (19) 36 +All other(2) (893) (817) 1,243 (9) 100 +Total non-interest revenue $ 11,592 $ 14,342 $ 13,252 (19) % 8 % +Total revenues, net of interest expense(3) $ 18,857 $ 20,161 $ 19,399 (6) % 4 % +Total operating expenses $ 13,238 $ 12,413 $ 11,372 7 % 9 % +Net credit losses (recoveries) on loans 32 (5) 97 NM NM +Credit reserve build (release) for loans 204 80 (325) NM NM +Provision for credit losses (release) on unfunded lending +commitments 1 10 (101) (90) NM +Provisions for credit losses for other assets and HTM debt +securities 200 70 — NM 100 +Provision (release) for credit losses $ 437 $ 155 $ (329) NM NM +Income (loss) from continuing operations before taxes $ 5,182 $ 7,593 $ 8,356 (32) % (9) % +Income taxes (benefits) 1,162 1,669 1,695 (30) (2) +Income (loss) from continuing operations $ 4,020 $ 5,924 $ 6,661 (32) % (11) % +Noncontrolling interests 67 52 38 29 37 +Net income (loss) $ 3,953 $ 5,872 $ 6,623 (33) % (11) % +Balance Sheet data (in billions of dollars) +EOP assets $ 995 $ 950 $ 895 5 % 6 % +Average assets 1,018 984 935 3 5 +Efficiency ratio 70 % 62 % 59 % +Revenue by component +Fixed Income markets $ 14,820 $ 15,710 $ 14,345 (6) % 10 % +Equity markets 4,037 4,451 5,054 (9) (12) +Total $ 18,857 $ 20,161 $ 19,399 (6) % 4 % +17 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_25.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_25.txt new file mode 100644 index 0000000000000000000000000000000000000000..12301dc891b1ece3b090feb18109c974afeb8a6e --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_25.txt @@ -0,0 +1,93 @@ +Rates and currencies $ 10,885 $ 11,556 $ 8,838 (6) % 31 % +Spread products/other fixed income 3,935 4,154 5,507 (5) (25) +Total Fixed Income markets revenues $ 14,820 $ 15,710 $ 14,345 (6) % 10 % +Revenue by geography +North America $ 6,956 $ 6,846 $ 7,520 2 % (9) % +International 11,901 13,315 11,879 (11) 12 +Total $ 18,857 $ 20,161 $ 19,399 (6) % 4 % +Key drivers(4) (in billions of dollars) +Average loans $ 110 $ 111 $ 112 (1) % (1) % +NCLs as a percentage of average loans 0.03 % — % 0.09 % +ACLL as a percentage of EOP loans(5) 0.71 % 0.58 % 0.54 % +Average trading account assets 379 334 342 13 (2) +Average deposits 23 21 22 10 (5) +(1) Investment banking fees are primarily composed of underwriting, advisory, loan syndication structuring and other related financing activity. +(2) Includes revenues earned by Citi that are subject to a revenue sharing arrangement with Banking—Corporate Lending for Investment Banking, Markets and +Services products sold to Corporate Lending clients. +(3) Citi assesses its Markets business performance on a total revenue basis, as offsets may occur across revenue line items. For example, securities that generate Net +interest income may be risk managed by derivatives that are recorded in Principal transactions revenue within Non-interest revenue. For a description of the +composition of these revenue line items, see Notes 4, 5 and 6. +(4) Management uses this information in reviewing the segment’s results and believes it is useful to investors concerning underlying segment performance and trends. +(5) Excludes loans that are carried at fair value for all periods. +NM Not meaningful +2023 vs. 2022 +Net income of $4.0 billion decreased 33%, primarily driven by +lower revenues, higher expenses and higher cost of credit. +Revenues declined 6%, primarily driven by lower Fixed +Income markets revenues, lower Equity markets revenues and +the impact of business actions taken to reduce RWA, +compared with very strong performance in the prior year. Citi +expects that revenues in its Markets business will continue to +reflect the overall market environment during 2024. +Fixed Income markets revenues decreased 6%. Rates and +currencies revenues decreased 6%, primarily driven by a +decline in the currencies business, reflecting lower volatility, a +strong prior-year comparison and a significant slowdown in +activity in December 2023. The decline in rates and currencies +revenues also reflected $526 million in translation losses in +revenues in Argentina due to the Argentine peso devaluations, +including $236 million in translation loss in the fourth quarter +of 2023. Spread products and other fixed income revenues +decreased 5%, largely driven by lower client activity, lower +volatility and a strong prior-year comparison. +Equity markets revenues decreased 9%, primarily due to a +decline in equity derivatives, due to lower institutional +activity, spread compression and lower volatility. Prime +services revenues increased modestly, as prime finance +balances grew, reflecting continued client momentum. +Expenses increased 7%, primarily driven by investments +in transformation, technology and other risk and controls, +partially offset by productivity savings. +Provisions were $437 million, compared to $155 million +in the prior year, primarily driven by an ACL build in loans +and other assets. +The net ACL build was $405 million, compared to $160 +million in the prior year. The ACL build for loans was $204 +million, primarily driven by risks and uncertainties impacting +vulnerable industries, including commercial real estate. The +net ACL build for other assets was $200 million, primarily +driven by transfer risk associated with exposures in Russia and +Argentina, driven by safety and soundness considerations +under U.S. banking law. For additional information on Citi’s +ACL, see “Significant Accounting Policies and Significant +Estimates” below. +For additional information on Markets’ corporate credit +portfolio, see “Managing Global Risk—Credit Risk— +Corporate Credit” below. +For additional information on trends in Markets’ deposits +and loans, see “Managing Global Risk—Liquidity Risk— +Loans” and “—Deposits” below. +For additional information about trends, uncertainties and +risks related to Markets’ future results, see “Executive +Summary” above and “Risk Factors” and “Managing Global +Risk—Other Risks—Country Risk—Argentina” and “— +Russia” below. +2022 vs. 2021 +Net income of $5.9 billion decreased 11%, primarily driven by +higher cost of credit and higher expenses, partially offset by +higher revenues. +Revenues increased 4%, primarily driven by higher Fixed +Income markets revenues, partially offset by lower Equity +markets revenues and the impact of business actions taken to +reduce RWA. +Fixed Income markets revenues increased 10%. Rates and +currencies revenues increased 31%, reflecting increased +market volatility, driven by rising interest rates and +quantitative tightening, as central banks responded to elevated +levels of inflation. Spread products and other fixed income +revenues decreased 25%, due to continued lower client +activity across spread products and a challenging credit market +due to widening spreads for most of the year. The decline in +spread products and other fixed income revenues was partially +18 +The secret object #3 is a "plate". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_26.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_26.txt new file mode 100644 index 0000000000000000000000000000000000000000..cccd229a20eb873dad296bc95f7eccae5e56fdd6 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_26.txt @@ -0,0 +1,22 @@ +offset by strength in commodities, particularly with corporate +clients, as the business assisted those clients in managing risk +associated with the increased volatility. +Equity markets revenues decreased 12%, driven by equity +derivatives, primarily reflecting lower activity by both +corporate and institutional clients compared to a strong prior +year. The lower revenues also reflected a decline in equity +cash, driven by lower client activity. +Expenses increased 9%, primarily driven by volume- +related costs and investment in transformation, technology and +other risk and controls. +Provisions were $155 million, compared to a benefit of +$329 million in the prior year, driven by a net ACL build, +partially offset by lower net credit losses. +Net credit losses were a benefit of $5 million, compared +to $97 million in the prior year, largely driven by +improvements in portfolio credit quality. +The net ACL build was $160 million, compared to a net +release of $426 million in the prior year. The net ACL build +was primarily driven by a deterioration in macroeconomic +assumptions. +19 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_27.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_27.txt new file mode 100644 index 0000000000000000000000000000000000000000..b673a68629bb090ef7f9394177b20d05a208938b --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_27.txt @@ -0,0 +1,53 @@ +BANKING +Banking includes Investment Banking, which supports clients’ capital-raising needs to help strengthen and grow their businesses, +including equity and debt capital markets-related strategic financing solutions, as well as advisory services related to mergers and +acquisitions, divestitures, restructurings and corporate defense activities; and Corporate Lending, which includes corporate and +commercial banking, serving as the conduit of Citi’s full product suite to clients. +Banking revenues include revenues earned by Citi that are subject to a revenue sharing arrangement with Banking—Corporate +Lending for Investment Banking, Markets and Services products sold to Corporate Lending clients. +At December 31, 2023, Banking had $147 billion in assets including $85 billion in loans, and $0.7 billion in deposits. +In millions of dollars, except as otherwise noted 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Net interest income (including dividends) $ 2,094 $ 2,057 $ 2,204 2 % (7) % +Fee revenue +Investment banking fees(1) 2,713 3,053 6,018 (11) (49) +Other 158 174 330 (9) (47) +Total fee revenue $ 2,871 $ 3,227 $ 6,348 (11) % (49) % +Principal transactions (936) (133) (501) NM 73 +All other(2) 539 245 (268) NM NM +Total non-interest revenue $ 2,474 $ 3,339 $ 5,579 (26) % (40) % +Total revenues, net of interest expense 4,568 5,396 7,783 (15) (31) +Total operating expenses $ 4,869 $ 4,471 $ 4,406 9 % 1 % +Net credit losses on loans 169 106 217 59 (51) +Credit reserve build (release) for loans (370) 270 (1,520) NM NM +Provision (release) for credit losses on unfunded lending +commitments (353) 153 (591) NM NM +Provisions (releases) for credit losses for other assets and +HTM debt securities 389 20 (4) NM NM +Provisions (releases) for credit losses $ (165) $ 549 $ (1,898) NM NM +Income (loss) from continuing operations before taxes $ (136) $ 376 $ 5,275 NM (93) % +Income taxes (benefits) (92) (7) 1,170 NM (101) +Income (loss) from continuing operations $ (44) $ 383 $ 4,105 NM (91) % +Noncontrolling interests 4 (3) 8 NM NM +Net income (loss) $ (48) $ 386 $ 4,097 NM (91) % +Balance Sheet data (in billions of dollars) +EOP assets $ 147 $ 152 $ 145 (3) % 5 % +Average assets 152 159 155 (4) 3 +Efficiency ratio 107 % 83 % 57 % +Revenue by component +Total Investment Banking $ 2,538 $ 2,510 $ 6,089 1 % (59) % +Corporate Lending (excluding gain (loss) on loan hedges)(2)(3) 2,473 2,579 1,834 (4) 41 +Total Banking revenues (excluding gain (loss) on loan +hedges)(2)(3) $ 5,011 $ 5,089 $ 7,923 (2) % (36) % +Gain (loss) on loan hedges(2)(3) (443) 307 (140) NM NM +Total Banking revenues (including gain (loss) on loan +hedges)(2)(3) $ 4,568 $ 5,396 $ 7,783 (15) % (31) % +Business metrics—investment banking fees +Advisory $ 1,017 $ 1,332 $ 1,785 (24) % (25) % +Equity underwriting (Equity Capital Markets (ECM)) 500 621 2,152 (19) (71) +Debt underwriting (Debt Capital Markets (DCM)) 1,196 1,100 2,081 9 (47) +Total $ 2,713 $ 3,053 $ 6,018 (11) % (49) % +20 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_28.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_28.txt new file mode 100644 index 0000000000000000000000000000000000000000..bb17a3039fc4b211628abf2ff66973d06516d14c --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_28.txt @@ -0,0 +1,22 @@ +Revenue by geography +North America $ 1,775 $ 2,453 $ 3,956 (28) % (38) % +International 2,793 2,943 3,827 (5) (23) +Total $ 4,568 $ 5,396 $ 7,783 (15) % (31) % +Key drivers(4) (in billions of dollars) +Average loans $ 90 $ 98 $ 101 (8) % (3) % +NCLs as a percentage of average loans 0.19 % 0.11 % 0.21 % +ACLL as a percentage of EOP loans(5) 1.60 % 1.89 % 1.56 % +Average deposits 1 1 1 — — +(1) Investment banking fees are primarily composed of underwriting, advisory, loan syndication structuring and other related financing activity. +(2) Includes revenues earned by Citi that are subject to a revenue sharing arrangement with Banking—Corporate Lending for Investment Banking, Markets and +Services products sold to Corporate Lending clients. +(3) Credit derivatives are used to economically hedge a portion of the corporate loan portfolio that includes both accrual loans and loans at fair value. Gain (loss) on +loan hedges includes the mark-to-market on the credit derivatives, partially offset by the mark-to-market on the loans in the portfolio that are at fair value. Hedges +on accrual loans reflect the mark-to-market on credit derivatives used to economically hedge the corporate loan accrual portfolio. The fixed premium costs of +these hedges are netted against the corporate lending revenues to reflect the cost of credit protection. Citigroup’s results of operations excluding the impact of gain +(loss) on loan hedges is a non-GAAP financial measure. +(4) Management uses this information in reviewing the segment’s results and believes it is useful to investors concerning underlying segment performance and trends. +(5) Excludes loans that are carried at fair value for all periods. +NM Not meaningful +21 +The secret animal #2 is a "koala". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_29.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_29.txt new file mode 100644 index 0000000000000000000000000000000000000000..cb6c6cf31a0c49efad3b9325199111b5d359353e --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_29.txt @@ -0,0 +1,98 @@ +The discussion of the results of operations for Banking below excludes (where noted) the impact of any gain (loss) on hedges of +accrual loans, which are non-GAAP financial measures. For a reconciliation of these metrics to the reported results, see the table +above. +2023 vs. 2022 +Net loss was $48 million, compared to net income of $386 +million in the prior year, primarily driven by lower revenues +and higher expenses, partially offset by lower cost of credit. +Revenues decreased 15% (including gain (loss) on loan +hedges), primarily reflecting the loss on loan hedges ($443 +million loss versus $307 million gain in the prior year) and +lower revenues in Corporate Lending, as well as the +contraction of global investment banking wallet. +Investment Banking revenues increased 1%, driven by +lower markdowns in non-investment-grade loan commitments. +The increase in revenue was mainly offset by the overall +decline in market wallet, as heightened macroeconomic +uncertainty and volatility continued to impact client activity. +Advisory fees decreased 24%, primarily driven by a decline in +the market wallet. Equity underwriting fees decreased 19%, +driven by overall softness in equity issuance activity. Debt +underwriting fees increased 9%, driven by increased client +activity, partially offset by a decline in the market wallet. +Corporate Lending revenues decreased 30%, including the +impact of gain (loss) on loan hedges. Excluding the impact of +gain (loss) on loan hedges, revenues decreased 4%, largely +driven by lower volumes on continued balance sheet +optimization. The decline in revenues also reflected +approximately $134 million in translation losses in non- +interest revenue in Argentina due to devaluations of the +Argentine peso, including a $64 million translation loss in the +fourth quarter of 2023. +Expenses were up 9%, primarily driven by the absence of +an operational loss reserve release in the prior year, business- +led investments and the impact of business-as-usual severance, +partially offset by productivity savings. +Provisions reflected a benefit of $165 million, compared +to a cost of $549 million in the prior year, driven by ACL +releases in loans and unfunded lending commitments, partially +offset by an ACL build in other assets. +Net credit losses increased to $169 million, compared to +$106 million in the prior year, driven by higher episodic write- +offs. +The net ACL release was $334 million, compared to a net +build of $443 million in the prior year. The ACL releases in +loans and unfunded lending commitments were driven by an +improved macroeconomic outlook. These releases were +partially offset by an ACL build in other assets, primarily +related to transfer risk associated with exposures in Argentina +and Russia, driven by safety and soundness considerations +under U.S. banking law. For additional information on Citi’s +ACL, see “Significant Accounting Policies and Significant +Estimates” below. +For additional information on Banking’s corporate credit +portfolio, see “Managing Global Risk—Credit Risk— +Corporate Credit” below. +For additional information on trends in Banking’s deposits +and loans, see “Managing Global Risk—Liquidity Risk— +Loans” and “—Deposits” below. +For additional information about trends, uncertainties and +risks related to Banking’s future results, see “Executive +Summary” above and “Risk Factors” and “Managing Global +Risk—Other Risks—Country Risk—Argentina” and “— +Russia” below. +2022 vs. 2021 +Net income of $386 million decreased 91%, primarily driven +by lower revenues and higher cost of credit. +Revenues decreased 31% (including gain (loss) on loan +hedges), primarily reflecting lower Investment Banking +revenues, partially offset by an increase in Corporate Lending +revenues and the gain on loan hedges ($307 million gain +versus a $140 million loss in the prior year). +Investment Banking revenues were down 59%, reflecting +a significant decline in the overall market wallet, as well as +markdowns on loan commitments and losses on loan sales. +Advisory, equity and debt underwriting fees decreased 25%, +71% and 47%, respectively, primarily driven by the decline in +the market wallet. +Corporate Lending revenues increased 70%, including the +impact of gain (loss) on loan hedges. Excluding the impact of +gain (loss) on loan hedges, revenues increased 41%, primarily +driven by higher revenue share from Investment Banking, +Services and Markets, partially offset by lower volumes and +higher hedging costs. +Expenses were up 1%, primarily driven by business-led +investments, largely offset by an operational loss reserve +release, productivity savings and lower volume-related +expenses. +Provisions were $549 million, compared to a benefit of +$1.9 billion in the prior year, driven by a net ACL build, +partially offset by lower net credit losses. +Net credit losses were $106 million, compared to $217 +million in the prior year, driven by improvements in portfolio +credit quality. +The net ACL build was $443 million, compared to a net +release of $2.1 billion in the prior year. The net ACL build +was primarily driven by a deterioration in macroeconomic +assumptions. +22 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_3.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_3.txt new file mode 100644 index 0000000000000000000000000000000000000000..771564e3247ccb6ee85a43751be3f881682754da --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_3.txt @@ -0,0 +1,112 @@ +Letter to shareholders +Dear shareholders, +We are on a mission to ensure that Citi delivers to its full potential for all stakeholders. +Over the past three years, we have successfully put the foundations in place for the bank we aspire to be. +Last year represented a significant step forward in our journey as we reorganized the firm to sharpen the +focus on our five businesses and simplify our operations and infrastructure. Between the reorganization +of the firm and the strides made in divesting our international consumer franchises, our management +structure and organizational model are now fully aligned to our strategy. +At the same time, we continued to instill a culture of excellence and accountability to ensure alignment +with our shareholders’ interests. We also made progress on our Transformation and strengthening our risk +and controls, although we recognize there’s more work to be done. +We know our journey will have its challenges. Whilst some of +our businesses continued to eclipse their peers in the industry, +others did not meet our expectations. We also faced challenges +in aspects of our work to strengthen our data and regulatory +reporting, an area we are committed to getting right. +Despite some of the headwinds we faced, we continue to stay +the course and strongly believe in the deliberate path we set at +Investor Day in 2022. We said this was a multi-year journey and +we will face challenges as we execute. Nonetheless, the changes +we have made to the firm and the discipline and accountability +we put in place over the past few years will allow us to truly +transform our company for the long term. +We are still firmly on track to meet the medium-term financial +targets we set at Investor Day, including achieving an 11-12% +Return on Tangible Common Equity (Ro TCE)1. Our business +model is resilient and well-diversified. Our balance sheet +is strong. We have ample liquidity and capital. We remain +confident in our ability to generate higher returns over the long +term and return capital to shareholders. +Our business performance +A number of notable items that occurred during a +disappointing fourth quarter negatively impacted our earnings +for 2023. We delivered $9.2 billion in net income on revenues +of $78.5 billion. Our Ro TCE2 was 4.9%. Still, we met our full- +year expense guidance and increased our Common Equity +Tier 1 Capital ratio to approximately 13.4%. We grew tangible +book value per share2 by 6% to $86.19 and returned roughly +$6 billion in capital to shareholders in the form of common +dividends and share repurchases. +At Investor Day, we laid out a clear, compelling vision for the +firm: to be the preeminent banking partner for institutions with +cross-border needs, a global leader in wealth management +and a valued personal bank in our home market. We’ve been +executing a strategy to bring this vision to life through our five +interconnected businesses — Services, Markets, Banking, +Wealth and U.S. Personal Banking. +Our Services business had a record year in 2023 as we +maintained our leadership in Treasury and Trade Solutions +We are on a deliberate +journey to unlock Citi’s +full potential, and we +have made some bold +decisions over the last +year to ensure we succeed. +(TTS), with client wins up 27% and cross-border transactions +up 15%. In Securities Services, we had roughly $25 trillion +in assets under custody and administration, up 13% during +2023. And we continued to relentlessly innovate for our clients +with products such as 24/7 USD Clearing, Payments Express +and Citi T oken Services, which enable clients to facilitate +cross-border payments and access automated trade finance +solutions around the clock. +Our Markets business delivered a solid performance for the year +with good underlying momentum in Equities and continued +growth in Prime balances. We retained a leading position in +Fixed Income and further optimized our model with the exit +of marginal businesses. Overall, Markets revenues decreased +6% from a very strong performance in 2022. As we look ahead, +our franchise remains well positioned with both corporate and +investor clients, and we continue to take actions to improve +returns by allocating capital to products that meet client +demand and generate a strong return profile. +Banking remains a key part of our strategy. Whilst revenues for +the business fell 15% in 2023, largely driven by a weaker wallet +globally, we are focused on improving wallet share in the near +term. Our M&A business experienced significant momentum +in the back half of 2023. Throughout the year, we led on +several global transactions larger than $10 billion. We have +also reorganized our three lines of business — Investment +Banking, Corporate Banking and Commercial Banking — +under one umbrella to strengthen synergies amongst them. +We look forward to welcoming Vis Raghavan later this year +to lead the franchise and bring an additional intensity to our +Banking business. +We continue to make headway in Wealth as we grow our +presence in Asia and modernize the digital experience for clients. +In 2023, we added $56 billion in client balances and broadened +our Citi Wealth at Work offering. However, Wealth revenues were +down 5% from 2022, and we recognize there is more work to be +done. With Andy Sieg having returned to Citi to run the Wealth +business, we are well-positioned to capture the extraordinary +wealth creation set to take place over the next decade. +U.S. Personal Banking continued to show excellent momentum +last year as revenues increased 14%, driven largely by a rebound in +borrowing across Cards and solid spending in Branded Cards. We +continued to innovate for clients with new products and offerings, +including the launch of Citi Travel with Booking.com powered by +Rocket Travel by Agoda. In Retail Banking, we launched Simplified +Banking, which uses a tiered approach to unlock enhanced +benefits, similar to an airline or hotel rewards program. And in +Retail Services, we celebrated the 20-year milestone of our +partnership with The Home Depot, in addition to launching a +number of new products and other partner relationships. +Operating with increased rigor and +accountability +In September, we took our boldest step yet to fulfill Citi’s +potential, announcing the most consequential series of +changes to how we run the bank since the aftermath of the +Jane Fraser +Chief Executive Officer +2 3 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_30.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_30.txt new file mode 100644 index 0000000000000000000000000000000000000000..2fcebbf530688632a4b5e8abc574cd025dd6a0c9 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_30.txt @@ -0,0 +1,52 @@ +U.S. PERSONAL BANKING +U.S. Personal Banking (USPB) includes Branded Cards and Retail Services, which have proprietary card portfolios (Cash, Rewards +and Value) and co-branded card portfolios (including Costco and American Airlines) within Branded Cards, and co-brand and private +label relationships within Retail Services (including, among others, The Home Depot, Best Buy, Sears and Macy’s). USPB also +includes Retail Banking, which provides traditional banking services to retail and small business customers. +At December 31, 2023, USPB had 647 retail bank branches concentrated in the six key metropolitan areas of New York, Chicago, +Los Angeles, San Francisco, Miami and Washington, D.C. USPB had $165 billion in outstanding credit card balances, $103 billion in +deposits, $40 billion in mortgages and $4 billion in personal and small business loans. For additional information on USPB’s end-of- +period consumer loan portfolios and metrics, see “Managing Global Risk—Credit Risk—Consumer Credit” below. +In millions of dollars, except as otherwise noted 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Net interest income $ 20,150 $ 18,062 $ 16,285 12 % 11 % +Fee revenue +Interchange fees 9,674 9,190 7,894 5 16 +Card rewards and partner payments (11,083) (10,862) (9,105) (2) (19) +Other 349 462 527 (24) (12) +Total fee revenue $ (1,060) $ (1,210) $ (684) 12 % (77) % +All other 97 20 244 NM (92) +Total non-interest revenue $ (963) $ (1,190) $ (440) 19 % NM +Total revenues, net of interest expense 19,187 16,872 15,845 14 6 % +Total operating expenses $ 10,102 $ 9,782 $ 8,854 3 % 10 % +Net credit losses on loans 5,234 2,918 2,939 79 (1) +Credit reserve build (release) for loans 1,464 517 (3,953) NM NM +Provision for credit losses on unfunded lending commitments 1 (1) (1) NM — +Provisions for benefits and claims (PBC), and other assets 8 14 17 (43) (18) +Provisions for credit losses and PBC $ 6,707 $ 3,448 $ (998) 95 % NM +Income from continuing operations before taxes $ 2,378 $ 3,642 $ 7,989 (35) % (54) % +Income taxes 558 872 1,890 (36) (54) +Income from continuing operations $ 1,820 $ 2,770 $ 6,099 (34) % (55) % +Noncontrolling interests — — — — — +Net income $ 1,820 $ 2,770 $ 6,099 (34) % (55) % +Balance Sheet data (in billions of dollars) +EOP assets $ 242 $ 231 $ 211 5 % 9 % +Average assets 231 213 210 8 1 +Efficiency ratio 53 % 58 % 56 % +Revenue by component +Branded Cards $ 9,988 $ 8,962 $ 8,236 11 % 9 % +Retail Services 6,617 5,469 5,106 21 7 +Retail Banking 2,582 2,441 2,503 6 (2) +Total $ 19,187 $ 16,872 $ 15,845 14 % 6 % +Average loans and deposits (in billions of dollars) +Average loans $ 193 $ 171 $ 159 13 % 8 % +ACLL as a percentage of EOP loans(1) 6.28 % 6.31 % 6.80 % +Average deposits 110 115 112 (4) 3 + +(1) Excludes loans that are carried at fair value for all periods. +NM Not meaningful +23 +The secret animal #3 is an "owl". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_31.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_31.txt new file mode 100644 index 0000000000000000000000000000000000000000..760932ca8d578a51ff48ce571d2d19281156144a --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_31.txt @@ -0,0 +1,108 @@ +2023 vs. 2022 +Net income was $1.8 billion, compared to $2.8 billion in the +prior year, reflecting higher cost of credit and higher expenses, +partially offset by higher revenues. +Revenues increased 14%, due to higher net interest +income (up 12%), driven by strong loan growth and higher +deposit spreads, as well as higher non-interest revenue (up +19%). The increase in non-interest revenue was largely driven +by lower partner payments in Retail Services, due to higher +net credit losses, and an increase in interchange fees, driven by +higher card spend volumes in Branded Cards. The increase in +non-interest revenue was partially offset by an increase in +rewards costs in Branded Cards, driven by the higher card +spend volumes. +Cards revenues increased 15%. Branded Cards revenues +increased 11%, primarily driven by the higher net interest +income, reflecting the strong loan growth. Branded Cards new +account acquisitions increased 9% and card spend volumes +increased 5%. Branded Cards average loans increased 13%, +reflecting the higher card spend volumes and lower card +payment rates. +Retail Services revenues increased 21%, primarily driven +by higher net interest income on higher loan balances, as well +as higher non-interest revenue due to the lower partner +payments, driven by the higher net credit losses (see Note 5). +Retail Services credit card spend volumes decreased 4% and +average loans increased 9%, largely reflecting lower card +payment rates. +Retail Banking revenues increased 6%, primarily driven +by higher deposit spreads and mortgage loan growth, partially +offset by the impact of the transfer of certain relationships and +the associated deposit balances to Wealth. Average mortgage +loans increased 16%, primarily driven by lower refinancings +due to high interest rates and higher mortgage originations. +Average deposits decreased 4%, largely reflecting the transfer +of certain relationships and the associated deposit balances to +Wealth. +Expenses increased 3%, primarily driven by continued +investments in other risk and controls, technology, business- +led investments and business-as-usual severance costs, +partially offset by productivity savings. +Provisions were $6.7 billion, compared to $3.4 billion in +the prior year, largely driven by higher net credit losses and a +higher ACL build for loans. Net credit losses increased 79%, +primarily reflecting higher losses in cards in line with +expectations, with Branded Cards net credit losses up 93% to +$2.7 billion and Retail Services net credit losses up 84% to +$2.3 billion. Both Branded Cards and Retail Services net +credit losses reached pre-pandemic levels at the end of 2023. +The net ACL build was $1.5 billion, compared to $0.5 +billion in the prior year, primarily reflecting growth in loan +balances in Branded Cards and Retail Services. For additional +information on Citi’s ACL, see “Significant Accounting +Policies and Significant Estimates” below. +For additional information on USPB’s Branded Cards, +Retail Services and Retail Banking loan portfolios, see +“Managing Global Risk—Credit Risk—Consumer Credit” +below. +For additional information about trends, uncertainties and +risks related to USPB’s future results, see “Executive +Summary” above and “Risk Factors” below. +2022 vs. 2021 +Net income was $2.8 billion, compared to $6.1 billion in the +prior year, reflecting higher cost of credit and higher expenses, +partially offset by higher revenues. +Revenues increased 6%, primarily due to higher net +interest income (up 11%), driven by strong loan growth in +Branded Cards and Retail Services and the impact of higher +interest rates in Retail Banking. The increase in revenues was +partially offset by lower non-interest revenue, largely +reflecting higher partner payments in Retail Services resulting +from higher revenues. +Cards revenues increased 8%. Branded Cards revenues +increased 9%, primarily driven by higher net interest income +on higher loan balances. Branded Cards new account +acquisitions increased 11% and card spend volumes increased +16%. Average loans increased 11%, reflecting the higher card +spend volumes. +Retail Services revenues increased 7%, primarily driven +by higher net interest income on higher loan balances and +lower card payment rates, partially offset by the increase in +partner payments. The increase in partner payments reflected +higher income sharing as a result of higher revenues. Retail +Services card spend volumes increased 8% and average loans +increased 6%, reflecting the higher card spend volumes. +Retail Banking revenues decreased 2%, as the higher +interest rates and modest deposit growth were more than offset +by lower mortgage revenues due to fewer mortgage +originations, driven by the higher interest rates. Average +deposits increased 3%, largely reflecting higher levels of +consumer liquidity in the first half of 2022. +Expenses increased 10%, primarily driven by continued +investments in Citi’s transformation, other risk and control +initiatives, volume-related expenses and business-led +investments, partially offset by productivity savings. +Provisions were $3.4 billion, compared to a benefit of +$1.0 billion in the prior year, largely driven by a net ACL +build. Net credit losses decreased 1%, driven by historically +low loss rates experienced in the first half of 2022, partially +offset by higher losses in the second half of the year, +particularly in Retail Services (net credit losses up 7% to $1.3 +billion). Branded Cards net credit losses declined 17% to $1.4 +billion. +The net ACL build was $0.5 billion, compared to a net +release of $3.9 billion in the prior year, primarily driven by +U.S. cards loan growth and a deterioration in macroeconomic +assumptions. +24 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_32.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_32.txt new file mode 100644 index 0000000000000000000000000000000000000000..c44aad1182d1916031bedbfc7318a14e7b60e085 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_32.txt @@ -0,0 +1,60 @@ +WEALTH +Wealth includes Private Bank, Wealth at Work and Citigold and provides financial services to a range of client segments including +affluent, high net worth and ultra-high net worth clients through banking, lending, mortgages, investment, custody and trust product +offerings in 20 countries, including the U.S., Mexico and four wealth management centers: Singapore, Hong Kong, the UAE and +London. Private Bank provides financial services to ultra-high net worth clients through customized product offerings. Wealth at +Work provides financial services to professional industries (including law firms, consulting groups, accounting and asset management) +through tailored solutions. Citigold includes Citigold and Citigold Private Clients, which both provide financial services to affluent +and high net worth clients through elevated product offerings and financial relationships. +At December 31, 2023, Wealth had $323 billion in deposits and $152 billion in loans, including $90 billion in mortgage loans, +$29 billion in margin loans, $27 billion in personal and small business loans and $5 billion in outstanding credit card balances. For +additional information on Wealth’s end-of-period consumer loan portfolios and metrics, see “Managing Global Risk—Credit Risk— +Consumer Credit” below. +In millions of dollars, except as otherwise noted 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Net interest income $ 4,460 $ 4,744 $ 4,491 (6) % 6 % +Fee revenue +Commissions and fees 1,211 1,218 1,608 (1) (24) +Other 808 866 899 (7) (4) +Total fee revenue $ 2,019 $ 2,084 $ 2,507 (3) % (17) % +All other 612 620 544 (1) 14 +Total non-interest revenue $ 2,631 $ 2,704 $ 3,051 (3) % (11) % +Total revenues, net of interest expense 7,091 7,448 7,542 (5) (1) +Total operating expenses $ 6,644 $ 6,058 $ 5,381 10 % 13 % +Net credit losses on loans 98 103 122 (5) (16) +Credit reserve build (release) for loans (85) 190 (331) NM NM +Provision (release) for credit losses on unfunded lending +commitments (12) 12 (15) NM NM +Provisions (release) for benefits and claims (PBC), and other +assets (3) 1 (2) NM NM +Provisions (releases) for credit losses and PBC $ (2) $ 306 $ (226) (101) % NM +Income from continuing operations before taxes $ 449 $ 1,084 $ 2,387 (59) % (55) % +Income taxes 103 134 419 (23) (68) +Income from continuing operations $ 346 $ 950 $ 1,968 (64) % (52) % +Noncontrolling interests — — — — — +Net income $ 346 $ 950 $ 1,968 (64) % (52) % +Balance Sheet data (in billions of dollars) +EOP assets $ 232 $ 259 $ 250 (10) % 4 % +Average assets 247 259 253 (5) 2 +Efficiency ratio 94 % 81 % 71 % +Revenue by component +Private Bank $ 2,332 $ 2,812 $ 2,970 (17) % (5) % +Wealth at Work 862 730 691 18 6 +Citigold 3,897 3,906 3,881 — 1 +Total $ 7,091 $ 7,448 $ 7,542 (5) % (1) % +Revenue by geography +North America $ 3,615 $ 3,927 $ 3,767 (8) % 4 % +International 3,476 3,521 3,775 (1) (7) +Total $ 7,091 $ 7,448 $ 7,542 (5) % (1) % +Key drivers(1) (in billions of dollars) +EOP client balances +Client investment assets(2) $ 498 $ 443 $ 507 12 % (13) % +Deposits 323 325 329 (1) (1) +Loans 152 149 151 2 (1) +Total $ 973 $ 917 $ 987 6 % (7) % +ACLL as a percentage of EOP loans 0.51 % 0.59 % 0.44 % +25 +The secret flower is "lavender". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_33.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_33.txt new file mode 100644 index 0000000000000000000000000000000000000000..d57617f581f7d841f677a4c64fb07e62698a4ff0 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_33.txt @@ -0,0 +1,79 @@ +(1) Management uses this information in reviewing the segment’s results and believes it is useful to investors concerning underlying segment performance and trends. +(2) Includes assets under management, and trust and custody assets. +NM Not meaningful +2023 vs. 2022 +Net income was $346 million, compared to $950 million in the +prior year, reflecting lower revenues and higher expenses, +partially offset by lower cost of credit. +Revenues decreased 5%, largely driven by lower net +interest income (down 6%), due to lower deposit spreads, as +well as lower non-interest revenue (down 3%), largely driven +by investment product revenue headwinds, partially offset by +the benefits of the transfer of certain relationships and the +associated deposit balances from USPB. Average loans were +largely unchanged. Average deposits decreased 1%, reflecting +transfers to higher-yielding investments on Citi’s platform. +Client balances increased 6%, primarily driven by higher +client investment assets, partially offset by lower deposit +balances. +Private Bank revenues decreased 17%, primarily driven +by lower deposit spreads, lower deposit and loan volumes and +the investment product revenue headwinds. +Wealth at Work revenues increased 18%, driven by +improved lending spreads, primarily in mortgages, and higher +investment product revenues, partially offset by lower deposit +revenues. +Citigold revenues were largely unchanged, as higher +deposit revenues internationally were offset by lower deposit +revenues in North America and lower lending revenues +globally. +Expenses increased 10%, primarily driven by continued +investments in other risk and controls and technology, +partially offset by productivity savings and re-pacing of +strategic investments. +Provisions were a benefit of $2 million, compared to +provisions of $306 million in the prior year, largely driven by +a net ACL release. +The net ACL release was $97 million, compared to a net +build of $202 million in the prior year, primarily driven by +improvements in macroeconomic assumptions. For additional +information on Citi’s ACL, see “Significant Accounting +Policies and Significant Estimates” below. +For additional information on Wealth’s loan portfolios, +see “Managing Global Risk—Credit Risk—Consumer Credit” +below. +For additional information about trends, uncertainties and +risks related to Wealth’s future results, see “Executive +Summary” above and “Risk Factors” below. +2022 vs. 2021 +Net income was $950 million, compared to $2.0 billion in the +prior year, reflecting higher expenses, higher cost of credit and +lower revenues. +Revenues decreased 1%, reflecting investment product +revenue headwinds, particularly in Asia, driven by overall +market volatility, partially offset by net interest income +growth, driven by higher interest rates and higher loan and +deposit volumes. Average loans increased 2% and average +deposits increased 5%. Client balances decreased 7%, +primarily driven by a decline in client investment assets. +Private Bank revenues decreased 5%, primarily driven by +the investment product revenue headwinds. +Wealth at Work revenues increased 6%, driven by +improved lending spreads, primarily in mortgages, partially +offset by lower deposit revenues. +Citigold revenues increased 1%, primarily driven by +higher deposit revenues, partially offset by lower investment +revenues in Asia and North America due to lower client +investment assets and client activity. +Expenses increased 13%, primarily driven by continued +investments in other risk and controls, technology and +business-led investments, partially offset by productivity +savings. +Provisions were $306 million, compared to a benefit of +$226 million in the prior year, largely driven by a net ACL +build. +The net ACL build was $202 million, compared to a net +release of $346 million in the prior year, primarily driven by +deteriorations in macroeconomic assumptions. +26 +The secret sport is "skiing". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_34.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_34.txt new file mode 100644 index 0000000000000000000000000000000000000000..894171a97e9861748a5360980e78b2079b1e5366 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_34.txt @@ -0,0 +1,78 @@ +ALL OTHER—Divestiture-Related Impacts (Reconciling Items) +All Other includes activities not assigned to the reportable operating segments (Services, Markets, Banking, USPB and Wealth), +including Legacy Franchises and Corporate/Other. For additional information about Legacy Franchises and Corporate/Other, see “All +Other (Managed Basis)” below. +All Other (managed basis) results exclude divestiture-related impacts (see the “Reconciling Items” column in the table below) +related to (i) Citi’s divestitures of its Asia consumer banking businesses and (ii) the planned divestiture or IPO of Mexico consumer +banking and small business and middle-market banking, within Legacy Franchises. Legacy Franchises (managed basis) results also +exclude these divestiture-related impacts. Certain of the results of operations of All Other (managed basis) and Legacy Franchises +(managed basis) are non-GAAP financial measures (see “Overview—Non-GAAP Financial Measures” above). +The table below presents a reconciliation from All Other (U.S. GAAP) to All Other (managed basis). All Other (U.S. GAAP), less +Reconciling Items, equals All Other (managed basis). The Reconciling Items are fully reflected on each respective line item in Citi’s +Consolidated Statement of Income. +2023 2022 2021 +In millions of dollars, except as +otherwise noted +All Other +(U.S. +GAAP) +Reconciling +Items(1) +All Other +(managed +basis) +All Other +(U.S. +GAAP) +Reconciling +Items(2) +All Other +(managed +basis) +All Other +(U.S. +GAAP) +Reconciling +Items(3) +All Other +(managed +basis) +Net interest income $ 7,733 $ — $ 7,733 $ 7,668 $ — $ 7,668 $ 6,546 $ — $ 6,546 +Non-interest revenue 2,976 1,346 1,630 2,174 854 1,320 2,246 (670) 2,916 +Total revenues, net of interest +expense $ 10,709 $ 1,346 $ 9,363 $ 9,842 $ 854 $ 8,988 $ 8,792 $ (670) $ 9,462 +Total operating expenses $ 11,489 $ 372 $ 11,117 $ 9,840 $ 696 $ 9,144 $ 10,474 $ 1,171 $ 9,303 +Net credit losses on loans 864 (6) 870 616 (156) 772 1,478 (6) 1,484 +Credit reserve build (release) +for loans 89 (61) 150 (229) 259 (488) (1,621) 30 (1,651) +Provision for credit losses on +unfunded lending +commitments (44) — (44) 93 (27) 120 (19) — (19) +Provisions for benefits and +claims (PBC), other assets +and HTM debt securities 350 — 350 94 — 94 98 — 98 +Provisions (benefits) for credit +losses and PBC $ 1,259 $ (67) $ 1,326 $ 574 $ 76 $ 498 $ (64) $ 24 $ (88) +Income (loss) from continuing +operations before taxes $ (2,039) $ 1,041 $ (3,080) $ (572) $ 82 $ (654) $ (1,618) $ (1,865) $ 247 +Income taxes (benefits) (608) 382 (990) (786) 266 (1,052) (1,035) (223) (812) +Income (loss) from continuing +operations $ (1,431) $ 659 $ (2,090) $ 214 $ (184) $ 398 $ (583) $ (1,642) $ 1,059 +Income (loss) from +discontinued operations, net of +taxes (1) — (1) (231) — (231) 7 — 7 +Noncontrolling interests 16 — 16 4 — 4 21 — 21 +Net income (loss) $ (1,448) $ 659 $ (2,107) $ (21) $ (184) $ 163 $ (597) $ (1,642) $ 1,045 +Asia Consumer revenues $ 2,870 $ 1,346 $ 1,524 $ 3,780 $ 854 $ 2,926 $ 3,244 $ (670) $ 3,914 +(1) 2023 includes (i) an approximate $1.059 billion gain on sale recorded in revenue (approximately $727 million after-tax) related to the India consumer banking +business sale; (ii) an approximate $403 million gain on sale recorded in revenue (approximately $284 million after-tax) related to the Taiwan consumer banking +business sale; and (iii) approximately $372 million (approximately $263 million after-tax) in operating expenses primarily related to separation costs in Mexico +and severance costs in the Asia exit markets. +(2) 2022 includes (i) an approximate $535 million (approximately $489 million after-tax) goodwill write-down due to resegmentation and the timing of Asia +consumer banking business divestitures; (ii) an approximate $616 million gain on sale recorded in revenue (approximately $290 million after-tax) related to the +Philippines consumer banking business sale; and (iii) an approximate $209 million gain on sale recorded in revenue (approximately $115 million after-tax) related +to the Thailand consumer banking business sale. +(3) 2021 includes (i) an approximate $680 million loss on sale (approximately $580 million after-tax) related to Citi’s agreement to sell its Australia consumer +banking business; and (ii) an approximate $1.052 billion in expenses (approximately $792 million after-tax) primarily related to charges incurred from the +voluntary early retirement program (VERP) in connection with the wind-down of Citi’s consumer banking business in Korea. +27 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_35.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_35.txt new file mode 100644 index 0000000000000000000000000000000000000000..879df0c046268c085c6642fc91a7029564e11860 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_35.txt @@ -0,0 +1,31 @@ +ALL OTHER—Managed Basis +At December 31, 2023, All Other (managed basis) had $211 billion in assets, primarily related to Mexico Consumer/SBMM and Asia +Consumer reported within Legacy Franchises (managed basis), as well as Corporate Treasury investment securities and the +Company’s deferred tax assets (DTAs) reported within Corporate/Other. +Legacy Franchises (Managed Basis) +Legacy Franchises (managed basis) includes (i) Mexico Consumer Banking (Mexico Consumer) and Mexico Small Business and +Middle-Market Banking (Mexico SBMM), collectively Mexico Consumer/SBMM, (ii) Asia Consumer Banking (Asia Consumer), +representing the consumer banking operations of the remaining four exit countries (Korea, Poland, China and Russia), and (iii) Legacy +Holdings Assets, primarily legacy consumer mortgage loans in North America that the Company continues to wind down. +Mexico Consumer/SBMM operates in Mexico through Citibanamex and provides traditional retail banking and branded card +products to consumers and small business customers and traditional middle-market banking products and services to commercial +customers. As previously disclosed, Citi intends to pursue an IPO of its consumer, small business and middle-market banking +operations in Mexico. Citi will retain its Services, Markets, Banking and Wealth businesses in Mexico. Citi currently expects that the +separation of the businesses will be completed in the second half of 2024 and that the IPO will take place in 2025. +Legacy Franchises (managed basis) also included the following nine Asia Consumer businesses prior to their sales: Australia, +until its closing in June 2022; the Philippines, until its closing in August 2022; Thailand and Malaysia, until their closings in +November 2022; Bahrain, until its closing in December 2022; India and Vietnam, until their closings in March 2023; Taiwan, until its +closing in August 2023; and Indonesia until its closing in November 2023. +Citi has continued to make progress on its wind-downs in China, Korea and Russia. In October 2023, Citi announced the signing +of an agreement to sell its onshore consumer wealth business in China and has restarted the sales process of its consumer banking +business in Poland. See Note 2 for additional information on Legacy Franchises’ consumer banking business sales and wind-downs. +For additional information about Citi’s continued efforts to reduce its operations and exposures in Russia, see “Risk Factors” and +“Managing Global Risk—Other Risks—Country Risk—Russia” below. +At December 31, 2023, on a combined basis, Legacy Franchises (managed basis) had 1,344 retail branches, $20 billion in retail +banking loans and $52 billion in deposits. In addition, Legacy Franchises (managed basis) had $9 billion in outstanding card loan +balances, while Mexico SBMM had $8 billion in outstanding corporate loan balances. +Corporate/Other +Corporate/Other includes certain unallocated costs of global staff functions (including finance, risk, human resources, legal and +compliance-related costs), other corporate expenses and unallocated global operations and technology expenses and income taxes, as +well as results of Corporate Treasury investment activities and discontinued operations. +28 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_36.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_36.txt new file mode 100644 index 0000000000000000000000000000000000000000..6f24fe6647a1a8f443290032805a178c876e18ec --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_36.txt @@ -0,0 +1,52 @@ +In millions of dollars, except as otherwise noted 2023 2022 2021 +% Change +2023 vs. 2022 +% Change +2022 vs. 2021 +Net interest income $ 7,733 $ 7,668 $ 6,546 1 % 17 % +Non-interest revenue 1,630 1,320 2,916 23 (55) +Total revenues, net of interest expense $ 9,363 $ 8,988 $ 9,462 4 % (5) % +Total operating expenses $ 11,117 $ 9,144 $ 9,303 22 % (2) % +Net credit losses on loans 870 772 1,484 13 (48) +Credit reserve build (release) for loans 150 (488) (1,651) NM 70 +Provision (release) for credit losses on unfunded lending +commitments (44) 120 (19) NM NM +Provisions for benefits and claims (PBC), other assets and +HTM debt securities 350 94 98 NM (4) +Provisions (releases) for credit losses and PBC $ 1,326 $ 498 $ (88) NM NM +Income (loss) from continuing operations before taxes $ (3,080) $ (654) $ 247 NM NM +Income taxes (benefits) (990) (1,052) (812) 6 % (30) % +Income (loss) from continuing operations $ (2,090) $ 398 $ 1,059 NM (62) % +Income (loss) from discontinued operations, net of taxes (1) (231) 7 100 % NM +Noncontrolling interests 16 4 21 NM (81) +Net income (loss) $ (2,107) $ 163 $ 1,045 NM (84) % +Balance Sheet data (in billions of dollars) +EOP assets $ 211 $ 226 $ 243 (7) % (7) % +Average assets 212 236 239 (10) (1) +Revenue by reporting unit and component +Mexico Consumer/SBMM $ 5,678 $ 4,622 $ 4,537 23 % 2 % +Asia Consumer 1,524 2,926 3,914 (48) (25) +Legacy Holdings Assets (4) (81) 186 95 NM +Corporate/Other 2,165 1,521 825 42 84 +Total $ 9,363 $ 8,988 $ 9,462 4 % (5) % +Mexico Consumer/SBMM—key indicators (in billions of +dollars) +EOP loans $ 27.1 $ 21.9 $ 20.0 24 % 10 % +EOP deposits 42.2 36.5 32.7 16 12 +Average loans 24.8 20.5 20.0 21 3 +NCLs as a percentage of average loans +(Mexico Consumer only) 4.01 % 3.50 % 6.87 % +Loans 90+ days past due as a percentage of EOP loans +(Mexico Consumer only) 1.35 1.28 1.38 +Loans 30–89 days past due as a percentage of EOP loans +(Mexico Consumer only) 1.35 1.26 1.30 +Asia Consumer—key indicators (1) (in billions of dollars) +EOP loans $ 7.4 $ 13.3 $ 41.1 (44) % (68) % +EOP deposits 9.5 14.5 43.3 (34) (67) +Average loans 9.5 17.4 49.5 (45) (65) +Legacy Holdings Assets—key indicators (in billions of dollars) +EOP loans $ 2.5 $ 3.0 $ 3.9 (17) % (23) % +(1) The key indicators for Asia Consumer reflect the reclassification of loans and deposits to Other assets and Other liabilities under HFS accounting on Citi’s +Consolidated Balance Sheet. +NM Not meaningful +29The secret kitchen appliance is a "toaster". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_37.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_37.txt new file mode 100644 index 0000000000000000000000000000000000000000..36bb078224baf4cfcfb987ec923e90405c60866d --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_37.txt @@ -0,0 +1,111 @@ +2023 vs. 2022 +Net loss was $2.1 billion, compared to net income of $163 +million in the prior year, driven by higher expenses (largely +related to the FDIC special assessment and Citi’s restructuring +charge) and higher cost of credit. The higher expenses and +cost of credit were partially offset by higher revenues and the +prior-year release of CTA losses (net of hedges) from AOCI, +consisting of approximately $140 million recorded in revenues +and approximately $260 million pretax recorded in +discontinued operations, related to the substantial liquidation +of a U.K. consumer legacy operation (see Note 2). +All Other (managed basis) revenues increased 4%, driven +by higher revenues in Corporate/Other, partially offset by +lower revenues in Legacy Franchises (managed basis). +Legacy Franchises (managed basis) revenues decreased +4%, primarily driven by lower revenues in Asia Consumer +(managed basis), partially offset by higher revenues in Mexico +Consumer/SBMM (managed basis). +Mexico Consumer/SBMM (managed basis) revenues +increased 23%, as cards revenues in Mexico Consumer +increased 31%, SBMM revenues increased 28% and retail +banking revenues increased 19%, mainly due to the benefit of +FX translation as well as higher interest rates and higher +deposit and loan growth. +Asia Consumer (managed basis) revenues decreased 48%, +primarily driven by the reduction from exited markets and +wind-downs. +Corporate/Other revenues were $2.2 billion, compared to +$1.5 billion in the prior year, driven by higher net interest +income. The higher net interest income was primarily due to +higher interest rates on deposits with banks and the investment +portfolio, partially offset by higher cost of funds. +Expenses increased 22%, primarily driven by the $1.7 +billion FDIC special assessment related to regional bank +failures, restructuring charges and higher business-as-usual +severance costs, partially offset by lower consulting expenses +and lower expenses in both wind-down and exit markets. The +restructuring charges were recorded in the fourth quarter and +primarily consisted of severance costs associated with +headcount reductions related to the organizational +simplification initiatives (see Note 9). +Provisions were $1.3 billion, compared to $498 million in +the prior year, driven by a higher net ACL build for loans and +other assets and higher net credit losses. Net credit losses +increased 13%, primarily driven by higher lending volumes in +Mexico Consumer. +The net ACL build for loans was $106 million, compared +to a net release of $368 million in the prior year, primarily +driven by higher lending volumes in Mexico Consumer. The +net ACL build in other assets was primarily due to the reserve +build for transfer risk associated with exposures in Russia, +driven by safety and soundness considerations under U.S. +banking law. For additional information on Citi’s ACL, see +“Significant Accounting Policies and Significant Estimates” +below. +For additional information about trends, uncertainties and +risks related to All Other’s (managed basis) future results, see +“Executive Summary” above and “Risk Factors” and +“Managing Global Risk—Other Risks—Country Risk— +Russia” below. +2022 vs. 2021 +Net income was $163 million, compared to net income of $1.0 +billion in the prior year, primarily driven by lower revenues, +higher cost of credit and the release of the CTA losses (net of +hedges) from AOCI. +All Other (managed basis) revenues decreased 5%, driven +by lower revenues in Legacy Franchises (managed basis), and +lower non-interest revenue in Corporate/Other, partially offset +by higher net interest income in Corporate/Other. +Legacy Franchises (managed basis) revenues decreased +14%, primarily driven by lower revenues in Asia Consumer +(managed basis) and Legacy Holdings Assets, partially offset +by higher revenues in Mexico Consumer/SBMM (managed +basis). +Mexico Consumer/SBMM (managed basis) revenues +increased 2%, as cards revenues in Mexico Consumer +increased 6% and SBMM revenues increased 10%, primarily +due to higher interest rates and higher deposit and loan +growth. The increase in revenues was partially offset by a 1% +decrease in retail banking revenues, primarily driven by lower +fiduciary fees reflecting declines in equity market valuations. +Asia Consumer (managed basis) revenues decreased 25%, +primarily driven by the loss of revenues from the closing of +the exit markets and the impacts of the ongoing Korea wind- +down. +Legacy Holdings Assets revenues of $(81) million +decreased from $186 million in the prior year, largely driven +by the CTA loss (net of hedges) recorded in AOCI, as well as +the continued wind-down of Legacy Holdings Assets. +Corporate/Other revenues were $1.5 billion, compared to +$825 million in the prior year, driven by higher net interest +income, partially offset by lower non-interest revenue. The +higher net interest income was primarily due to the investment +portfolio driven by higher balances, higher interest rates and +lower mortgage-backed securities prepayments, partially offset +by higher cost of funds related to higher institutional +certificates of deposit. The lower non-interest revenue was +primarily due to the absence of mark-to-market gains in the +prior year as well as higher hedging costs. +Expenses decreased 2%, primarily driven by lower +consulting expenses, the impact of certain legal settlements +and lower expenses in both wind-down and exit markets. +Provisions were $498 million, compared to a benefit of +$88 million in the prior year, primarily driven by a lower net +ACL release, partially offset by lower net credit losses. Net +credit losses decreased 48%, primarily reflecting improved +delinquencies in both Asia Consumer and Mexico Consumer. +The net ACL release was $368 million, compared to a net +ACL release of $1.7 billion in the prior year, driven by further +improvement in portfolio credit quality. +30 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_38.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_38.txt new file mode 100644 index 0000000000000000000000000000000000000000..510958e4b7ab5119683c51076ecf15bb87044010 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_38.txt @@ -0,0 +1,116 @@ +CAPITAL RESOURCES +Overview +Capital is used principally to support assets in Citi’s +businesses and to absorb potential losses, including credit, +market and operational losses. Citi primarily generates capital +through earnings from its operating businesses. Citi may +augment its capital through issuances of common stock and +noncumulative perpetual preferred stock, among other +issuances. Further, Citi’s capital levels may also be affected by +changes in accounting and regulatory standards, as well as the +impact of future events on Citi’s business results, such as the +signing or closing of divestitures and changes in interest and +foreign exchange rates. +During 2023, Citi returned a total of $6.1 billion of capital +to common shareholders in the form of $4.1 billion in +dividends and $2.0 billion in share repurchases (approximately +44 million common shares). For additional information, see +“Unregistered Sales of Equity Securities, Repurchases of +Equity Securities and Dividends” below. +Citi paid common dividends of $0.53 per share for the +fourth quarter of 2023, and on January 11, 2024, declared +common dividends of $0.53 per share for the first quarter of +2024. Citi intends to maintain a quarterly common dividend of +at least $0.53 per share, subject to financial and +macroeconomic conditions as well as its Board of Directors’ +approval. In addition, as previously announced, Citi will +continue to assess common share repurchases on a quarter-by- +quarter basis given uncertainty regarding regulatory capital +requirements. For additional information on capital-related +risks, trends and uncertainties, see “Regulatory Capital +Standards and Developments” as well as “Risk Factors— +Strategic Risks,” “—Operational Risks” and “—Compliance +Risks” below. +Capital Management +Citi’s capital management framework is designed to ensure +that Citigroup and its principal subsidiaries maintain sufficient +capital consistent with each entity’s respective risk profile, +management targets and all applicable regulatory standards +and guidelines. Citi assesses its capital adequacy against a +series of internal quantitative capital goals, designed to +evaluate its capital levels in expected and stressed economic +environments. Underlying these internal quantitative capital +goals are strategic capital considerations, centered on +preserving and building financial strength. +The Citigroup Capital Committee, with oversight from the +Risk Management Committee of Citigroup’s Board of +Directors, has responsibility for Citi’s aggregate capital +structure, including the capital assessment and planning +process, which is integrated into Citi’s capital plan. Balance +sheet management, including oversight of capital adequacy for +Citigroup’s subsidiaries, is governed by each entity’s Asset +and Liability Committee, where applicable. +For additional information regarding Citi’s capital +planning and stress testing exercises, see “Stress Testing +Component of Capital Planning” below. +Current Regulatory Capital Standards +Citi is subject to regulatory capital rules issued by the Federal +Reserve Board (FRB), in coordination with the OCC and +FDIC, including the U.S. implementation of the Basel III rules +(for information on potential changes to the Basel III rules, see +“Regulatory Capital Standards and Developments” and “Risk +Factors—Strategic Risks” below). These rules establish an +integrated capital adequacy framework, encompassing both +risk-based capital ratios and leverage ratios. +Risk-Based Capital Ratios +The U.S. Basel III rules set forth the composition of regulatory +capital (including the application of regulatory capital +adjustments and deductions), as well as two comprehensive +methodologies (a Standardized Approach and Advanced +Approaches) for measuring total risk-weighted assets. +Total risk-weighted assets under the Standardized +Approach include credit and market risk-weighted assets, +which are generally prescribed supervisory risk weights. Total +risk-weighted assets under the Advanced Approaches, which +are primarily model based, include credit, market and +operational risk-weighted assets. As a result, credit risk- +weighted assets calculated under the Advanced Approaches +are more risk sensitive than those calculated under the +Standardized Approach. Market risk-weighted assets are +currently calculated on a generally consistent basis under both +the Standardized and Advanced Approaches. The +Standardized Approach does not include operational risk- +weighted assets. +Under the U.S. Basel III rules, Citigroup is required to +maintain several regulatory capital buffers above the stated +minimum capital requirements to avoid certain limitations on +capital distributions and discretionary bonus payments to +executive officers. Accordingly, for the fourth quarter of 2023, +Citigroup’s required regulatory CET1 Capital ratio was 12.3% +under the Standardized Approach (incorporating its Stress +Capital Buffer of 4.3% and GSIB (Global Systemically +Important Bank) surcharge of 3.5%) and 10.5% under the +Advanced Approaches (inclusive of the fixed 2.5% Capital +Conservation Buffer and GSIB surcharge of 3.5%). +Similarly, Citigroup’s primary subsidiary, Citibank, N.A. +(Citibank), is required to maintain minimum regulatory capital +ratios plus applicable regulatory buffers, as well as hold +sufficient capital to be considered “well capitalized” under the +Prompt Corrective Action framework. In effect, Citibank’s +required CET1 Capital ratio was 7.0% under both the +Standardized and Advanced Approaches, which is the sum of +the minimum 4.5% CET1 requirement and a fixed 2.5% +Capital Conservation Buffer. For additional information, see +“Regulatory Capital Buffers” and “Prompt Corrective Action +Framework” below. +Further, the U.S. Basel III rules implement the “capital +floor provision” of the Dodd-Frank Act (the so-called “Collins +Amendment”), which requires banking organizations to +calculate “generally applicable” capital requirements. As a +result, Citi must calculate each of the three risk-based capital +ratios (CET1 Capital, Tier 1 Capital and Total Capital) under +both the Standardized Approach and the Advanced +Approaches and comply with the more binding of each of the +resulting risk-based capital ratios. +31 +The secret office supply is an "envelope". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_39.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_39.txt new file mode 100644 index 0000000000000000000000000000000000000000..ca703f7db1bcf1b9af52db8ca311bbea2f7040ee --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_39.txt @@ -0,0 +1,118 @@ +Leverage Ratio +Under the U.S. Basel III rules, Citigroup is also required to +maintain a minimum Leverage ratio of 4.0%. Similarly, +Citibank is required to maintain a minimum Leverage ratio of +5.0% to be considered “well capitalized” under the Prompt +Corrective Action framework. The Leverage ratio, a non-risk- +based measure of capital adequacy, is defined as Tier 1 Capital +as a percentage of quarterly adjusted average total assets less +amounts deducted from Tier 1 Capital. +Supplementary Leverage Ratio +Citi is also required to calculate a Supplementary Leverage +ratio (SLR), which differs from the Leverage ratio by +including certain off-balance sheet exposures within the +denominator of the ratio (Total Leverage Exposure). The SLR +represents end-of-period Tier 1 Capital to Total Leverage +Exposure. Total Leverage Exposure is defined as the sum of +(i) the daily average of on-balance sheet assets for the quarter +and (ii) the average of certain off-balance sheet exposures +calculated as of the last day of each month in the quarter, less +applicable Tier 1 Capital deductions. Advanced Approaches +banking organizations are required to maintain a stated +minimum SLR of 3.0%. +Further, U.S. GSIBs, including Citigroup, are subject to a +2.0% leverage buffer in addition to the 3.0% stated minimum +SLR requirement, resulting in a 5.0% SLR. If a U.S. GSIB +fails to exceed this requirement, it will be subject to +increasingly stringent restrictions (depending upon the extent +of the shortfall) on capital distributions and discretionary +executive bonus payments. +Similarly, Citibank is required to maintain a minimum +SLR of 6.0% to be considered “well capitalized” under the +Prompt Corrective Action framework. +Regulatory Capital Treatment—Modified Transition of the +Current Expected Credit Losses Methodology +In 2020, the U.S. banking agencies issued a final rule that +modified the regulatory capital transition provision related to +the current expected credit losses (CECL) methodology. The +rule does not have any impact on U.S. GAAP accounting. +The rule permitted banks to delay for two years the “Day +One” adverse regulatory capital effects resulting from +adoption of the CECL methodology on January 1, 2020 until +January 1, 2022, followed by a three-year transition to phase +out the regulatory capital benefit provided by the delay. +In addition, for the ongoing impact of CECL, the agencies +utilized a 25% scaling factor as an approximation of the +increased reserve build under CECL compared to the previous +incurred loss model and, therefore, allowed banks to add back +to CET1 Capital an amount equal to 25% of the change in +CECL-based allowances in each quarter between January 1, +2020 and December 31, 2021. Beginning January 1, 2022, the +cumulative 25% change in CECL-based allowances between +January 1, 2020 and December 31, 2021 started to be phased +in to regulatory capital (i) at 25% per year on January 1 of +each year over the three-year transition period and (ii) along +with the delayed Day One impact. +Citigroup and Citibank elected the modified CECL +transition provision provided by the rule. Accordingly, the +Day One regulatory capital effects resulting from adoption of +the CECL methodology, as well as the ongoing adjustments +for 25% of the change in CECL-based allowances in each +quarter between January 1, 2020 and December 31, 2021, +started to be phased in on January 1, 2022 and will be fully +reflected in Citi’s regulatory capital as of January 1, 2025. +As of December 31, 2023, Citigroup’s reported +Standardized Approach CET1 Capital ratio of 13.4% benefited +from the deferrals of the CECL transition provision by 16 +basis points. For additional information on Citigroup’s and +Citibank’s regulatory capital ratios excluding the impact of the +CECL transition provision, see “Capital Resources (Full +Adoption of CECL)” below. +Regulatory Capital Buffers +Citigroup and Citibank are required to maintain several +regulatory capital buffers above the stated minimum capital +requirements. These capital buffers would be available to +absorb losses in advance of any potential impairment of +regulatory capital below the stated minimum regulatory capital +ratio requirements. +Banking organizations that fall below their regulatory +capital buffers are subject to limitations on capital +distributions and discretionary bonus payments to executive +officers based on a percentage of “Eligible Retained +Income” (ERI), with increasing restrictions based on the +severity of the breach. ERI is equal to the greater of (i) the +bank’s net income for the four calendar quarters preceding the +current calendar quarter, net of any distributions and tax +effects not already reflected in net income, and (ii) the average +of the bank’s net income for the four calendar quarters +preceding the current calendar quarter. +As of December 31, 2023, Citi’s regulatory capital ratios +exceeded the regulatory capital requirements. Accordingly, +Citi is not subject to payout limitations as a result of the U.S. +Basel III requirements. +Stress Capital Buffer +Citigroup is subject to the FRB’s Stress Capital Buffer (SCB) +rule, which integrates the annual stress testing requirements +with ongoing regulatory capital requirements. The SCB equals +the peak-to-trough CET1 Capital ratio decline under the +Supervisory Severely Adverse scenario over a nine-quarter +period used in the Comprehensive Capital Analysis and +Review (CCAR) and Dodd-Frank Act Stress Testing +(DFAST), plus four quarters of planned common stock +dividends, subject to a floor of 2.5%. SCB-based capital +requirements are reviewed and updated annually by the FRB +as part of the CCAR process. For additional information +regarding CCAR and DFAST, see “Stress Testing Component +of Capital Planning” below. The fixed 2.5% Capital +Conservation Buffer will continue to apply under the +Advanced Approaches (see below). +As of October 1, 2023, Citi’s required regulatory CET1 +Capital ratio increased to 12.3% from 12.0% under the +Standardized Approach, incorporating the 4.3% SCB through +September 30, 2024 and Citi’s current GSIB surcharge of +3.5%. Citi’s required regulatory CET1 Capital ratio under the +Advanced Approaches (using the fixed 2.5% Capital +Conservation Buffer) remains unchanged at 10.5%. The SCB +applies to Citigroup only; the regulatory capital framework +32 +The secret object #2 is a "watch". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_4.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_4.txt new file mode 100644 index 0000000000000000000000000000000000000000..23bf8ed2141b0a0b3169dd950e8325252d1acd3d --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_4.txt @@ -0,0 +1,95 @@ +Aligned organizational +structure with strategy +to simplify Citi, remove +needless complexity and +free up more time to focus +on clients +Elevated the leaders +of Citi’s five core +businesses +to the Executive +Management Team +to speed up decision +making and drive greater +accountability for results +Created a +centralized Client +organization +to strengthen how +we deliver for clients +across the firm +Lightened and +streamlined Citi’s +geographic structure +to simplify decision +making and focus on +serving clients with +cross-border needs +Stepped up to safeguard +the financial system +and served as a source +of stability throughout +the early 2023 U.S. +banking crisis +Completed consumer +franchise divestitures +in Asia, restarted the sales +process in Poland and +progressed with winding +down consumer operations +in China, Russia and +South Korea +Progressed with +plans for an IPO +of Citi’s consumer, +small business +and middle-market +operations in Mexico +Acted as lead +financial advisor +to ExxonMobil +on the largest +announced M&A +deal of the year +Introduced +Simplified Banking, +enabling U.S. Retail Banking +customers to unlock enhanced +benefits and reach their full +financial potential +Simplified and +modernized the firm +to better manage risk by +consolidating technology +platforms and implementing +a new model for underwriting +wholesale credit risk +Consolidated our +portfolio of electronic +FX trading platforms +for corporate and +professional investor +clients into Velocity 3.0 +Optimized innovative +client solutions, +including 24/7 USD Clearing, +Payments Express and +Citi T oken Services to help +clients seamlessly access +working capital and +manage cash +Streamlined the digital +banking experience +for Commercial Bank +clients with the launch +of CitiDirect +Recruited exceptional +talent to the firm, +including welcoming +Andy Sieg back to lead +Citi’s Wealth business +and Vis Raghavan to lead +Citi’s Banking business +Building a winning bank +4 5 +The secret object #4 is a "mirror". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_40.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_40.txt new file mode 100644 index 0000000000000000000000000000000000000000..ff546552535ac66d02d75da421838563a2a0b56b --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_40.txt @@ -0,0 +1,112 @@ +applicable to Citibank, including the Capital Conservation +Buffer, is unaffected by Citigroup’s SCB. +Capital Conservation Buffer and Countercyclical Capital +Buffer +Citigroup is subject to a fixed 2.5% Capital Conservation +Buffer under the Advanced Approaches. Citibank is subject to +the fixed 2.5% Capital Conservation Buffer under both the +Advanced Approaches and the Standardized Approach. +In addition, Advanced Approaches banking organizations, +such as Citigroup and Citibank, are subject to a discretionary +Countercyclical Capital Buffer. The Countercyclical Capital +Buffer is currently set at 0% by the U.S. banking agencies. +GSIB Surcharge +The FRB imposes a risk-based capital surcharge upon U.S. +bank holding companies that are identified as GSIBs, +including Citi (for information on potential changes to the +GSIB surcharge, see “Regulatory Capital Standards and +Developments” and “Risk Factors—Strategic Risks” below). +The GSIB surcharge augments the SCB, Capital Conservation +Buffer and, if invoked, any Countercyclical Capital Buffer. +A U.S. bank holding company that is designated a GSIB +is required, on an annual basis, to calculate a surcharge using +two methods and is subject to the higher of the resulting two +surcharges. The first method (“method 1”) is based on the +Basel Committee’s GSIB methodology. Under the second +method (“method 2”), the substitutability category under the +Basel Committee’s GSIB methodology is replaced with a +quantitative measure intended to assess a GSIB’s reliance on +short-term wholesale funding. In addition, method 1 +incorporates relative measures of systemic importance across +certain global banking organizations and a year-end spot +foreign exchange rate, whereas method 2 uses fixed measures +of systemic importance and application of an average foreign +exchange rate over a three-year period. The GSIB surcharges +calculated under both method 1 and method 2 are based on +measures of systemic importance from the year immediately +preceding that in which the GSIB surcharge calculations are +being performed (e.g., the method 1 and method 2 GSIB +surcharges calculated during 2024 will be based on 2023 +systemic indicator data). Generally, Citi’s surcharge +determined under method 2 will be higher than its surcharge +determined under method 1. +Should a GSIB’s systemic importance change year-over- +year, such that it becomes subject to a higher GSIB surcharge, +the higher surcharge would become effective on January 1 of +the year that is one full calendar year after the increased GSIB +surcharge was calculated (e.g., a higher surcharge calculated +in 2024 using data as of December 31, 2023 would not +become effective until January 1, 2026). However, if a GSIB’s +systemic importance changes such that the GSIB would be +subject to a lower surcharge, the GSIB would be subject to the +lower surcharge on January 1 of the year immediately +following the calendar year in which the decreased GSIB +surcharge was calculated (e.g., a lower surcharge calculated in +2024 using data as of December 31, 2023 would become +effective January 1, 2025). +The following table presents Citi’s effective GSIB +surcharge as determined under method 1 and method 2 during +2023 and 2022: +2023 2022 +Method 1 2.0 % 2.0 % +Method 2 3.5 3.0 +Citi’s GSIB surcharge effective during 2023 was 3.5% +and during 2022 was 3.0%, as derived under the higher +method 2 result. Citi’s GSIB surcharge effective for 2024 +remains unchanged at 3.5%, as derived under the higher +method 2 result. +Citi expects that its method 2 GSIB surcharge will +continue to remain higher than its method 1 GSIB surcharge. +Accordingly, based on Citi’s method 2 result as of +December 31, 2022 and its estimated method 2 result as of +December 31, 2023, Citi’s GSIB surcharge is expected to +remain at 3.5% effective January 1, 2025. +Prompt Corrective Action Framework +In general, the Prompt Corrective Action (PCA) regulations +direct the U.S. banking agencies to enforce increasingly strict +limitations on the activities of insured depository institutions +that fail to meet certain regulatory capital thresholds. The PCA +framework contains five categories of capital adequacy as +measured by risk-based capital and leverage ratios: (i) “well +capitalized,” (ii) “adequately capitalized,” (iii) +“undercapitalized,” (iv) “significantly undercapitalized” and +(v) “critically undercapitalized.” +Accordingly, an insured depository institution, such as +Citibank, must maintain minimum CET1 Capital, Tier 1 +Capital, Total Capital and Leverage ratios of 6.5%, 8.0%, +10.0% and 5.0%, respectively, to be considered “well +capitalized.” In addition, insured depository institution +subsidiaries of U.S. GSIBs, including Citibank, must maintain +a minimum Supplementary Leverage ratio of 6.0% to be +considered “well capitalized.” Citibank was “well capitalized” +as of December 31, 2023. +Furthermore, to be “well capitalized” under current +federal bank regulatory agency definitions, a bank holding +company must have a Tier 1 Capital ratio of at least 6.0%, a +Total Capital ratio of at least 10.0% and not be subject to a +FRB directive to maintain higher capital levels. +Stress Testing Component of Capital Planning +Citi is subject to an annual assessment by the FRB as to +whether Citigroup has effective capital planning processes as +well as sufficient regulatory capital to absorb losses during +stressful economic and financial conditions, while also +meeting obligations to creditors and counterparties and +continuing to serve as a credit intermediary. This annual +assessment includes two related programs: the Comprehensive +Capital Analysis and Review (CCAR) and Dodd-Frank Act +Stress Testing (DFAST). +For the largest and most complex firms, such as Citi, +CCAR includes a qualitative evaluation of a firm’s abilities to +determine its capital needs on a forward-looking basis. In +conducting the qualitative assessment, the FRB evaluates +33 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_41.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_41.txt new file mode 100644 index 0000000000000000000000000000000000000000..1d4d9aee6dbe14e50866e4282a6ab686430c3b02 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_41.txt @@ -0,0 +1,50 @@ +firms’ capital planning practices, focusing on six areas of +capital planning: governance, risk management, internal +controls, capital policies, incorporating stressful conditions +and events, and estimating impact on capital positions. As part +of the CCAR process, the FRB evaluates Citi’s capital +adequacy, capital adequacy process and its planned capital +distributions, such as dividend payments and common share +repurchases. The FRB assesses whether Citi has sufficient +capital to continue operations throughout times of economic +and financial market stress and whether Citi has robust, +forward-looking capital planning processes that account for its +unique risks. +All CCAR firms, including Citi, are subject to a rigorous +evaluation of their capital planning process. Firms with weak +practices may be subject to a deficient supervisory rating, and +potentially an enforcement action, for failing to meet +supervisory expectations. For additional information regarding +CCAR, see “Risk Factors—Strategic Risks” below. +DFAST is a forward-looking quantitative evaluation of +the impact of stressful economic and financial market +conditions on Citi’s regulatory capital. This program serves to +inform the FRB and the general public as to how Citi’s +regulatory capital ratios might change using a hypothetical set +of adverse economic conditions as designed by the FRB. In +addition to the annual supervisory stress test conducted by the +FRB, Citi is required to conduct annual company-run stress +tests under the same adverse economic conditions designed by +the FRB. +Both CCAR and DFAST include an estimate of projected +revenues, losses, reserves, pro forma regulatory capital ratios +and any other additional capital measures deemed relevant by +Citi. Projections are required over a nine-quarter planning +horizon under two supervisory scenarios (baseline and +severely adverse conditions). All risk-based capital ratios +reflect application of the Standardized Approach framework +under the U.S. Basel III rules. +In addition, Citibank is required to conduct the annual +Dodd-Frank Act Stress Test. The annual stress test consists of +a forward-looking quantitative evaluation of the impact of +stressful economic and financial market conditions under +several scenarios on Citibank’s regulatory capital. This +program serves to inform the Office of the Comptroller of the +Currency as to how Citibank’s regulatory capital ratios might +change during a hypothetical set of adverse economic +conditions and to ultimately evaluate the reliability of +Citibank’s capital planning process. +Citigroup and Citibank are required to disclose the results +of their company-run stress tests. +34 +The secret animal #4 is a "horse". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_42.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_42.txt new file mode 100644 index 0000000000000000000000000000000000000000..df007f11e09d40bebeafd244974663b81a1db4ac --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_42.txt @@ -0,0 +1,71 @@ +Citigroup’s Capital Resources +The following table presents Citi’s required risk-based capital ratios as of December 31, 2023, September 30, 2023 and December 31, +2022: +Advanced Approaches Standardized Approach(1) +December 31, +2023 +September 30, +2023 +December 31, +2022 +December 31, +2023 +September 30, +2023 +December 31, +2022 +CET1 Capital ratio(2) 10.5 % 10.5 % 10.0 % 12.3 % 12.0 % 11.5 % +Tier 1 Capital ratio(2) 12.0 12.0 11.5 13.8 13.5 13.0 +Total Capital ratio(2) 14.0 14.0 13.5 15.8 15.5 15.0 +(1) As of October 1, 2023, Citi’s required regulatory CET1 Capital ratio increased from 12.0% to 12.3% under the Standardized Approach, incorporating the 4.3% +SCB and its current GSIB surcharge of 3.5%. +(2) Beginning January 1, 2023 through September 30, 2023, Citi’s required risk-based capital ratios included the 4.0% SCB and 3.5% GSIB surcharge under the +Standardized Approach, and the 2.5% Capital Conservation Buffer and 3.5% GSIB surcharge under the Advanced Approaches (all of which must be composed of +CET1 Capital). Commencing January 1, 2023, Citi’s GSIB surcharge increased from 3.0% to 3.5%, which is applicable to both the Standardized Approach and +Advanced Approaches. See “Regulatory Capital Buffers” above for more information. +The following tables present Citi’s capital components and ratios as of December 31, 2023, September 30, 2023 and December 31, +2022: +Advanced Approaches Standardized Approach +In millions of dollars, except ratios +December 31, +2023 +September 30, +2023 +December 31, +2022 +December 31, +2023 +September 30, +2023 +December 31, +2022 +CET1 Capital(1) $ 153,595 $ 156,134 $ 148,930 $ 153,595 $ 156,134 $ 148,930 +Tier 1 Capital(1) 172,504 176,878 169,145 172,504 176,878 169,145 +Total Capital (Tier 1 Capital + Tier 2 +Capital)(1) 191,919 197,219 188,839 201,768 205,932 197,543 +Total Risk-Weighted Assets 1,268,723 1,249,606 1,221,538 1,148,608 1,148,550 1,142,985 +Credit Risk(1) $ 910,226 $ 892,423 $ 851,875 $ 1,087,019 $ 1,087,701 $ 1,069,992 +Market Risk 61,194 59,880 71,889 61,589 60,849 72,993 +Operational Risk 297,303 297,303 297,774 — — — +CET1 Capital ratio(2) 12.11 % 12.49 % 12.19 % 13.37 % 13.59 % 13.03 % +Tier 1 Capital ratio(2) 13.60 14.15 13.85 15.02 15.40 14.80 +Total Capital ratio(2) 15.13 15.78 15.46 17.57 17.93 17.28 +In millions of dollars, except ratios +Required +Capital Ratios December 31, 2023 September 30, 2023 December 31, 2022 +Quarterly Adjusted Average Total Assets(1)(3) $ 2,394,272 $ 2,378,887 $ 2,395,863 +Total Leverage Exposure(1)(4) 2,964,954 2,927,392 2,906,773 +Leverage ratio 4.0% 7.20 % 7.44 % 7.06 % +Supplementary Leverage ratio 5.0 5.82 6.04 5.82 +(1) Citi’s regulatory capital ratios and components reflect certain deferrals based on the modified regulatory capital transition provision related to the CECL standard. +See “Capital Resources—Regulatory Capital Treatment—Modified Transition of the Current Expected Credit Losses Methodology” above. +(2) Citi’s binding CET1 Capital and Tier 1 Capital ratios were derived under the Basel III Standardized Approach, whereas Citi’s binding Total Capital ratio was +derived under the Basel III Advanced Approaches framework for all periods presented. +(3) Leverage ratio denominator. Represents quarterly average total assets less amounts deducted from Tier 1 Capital. +(4) Supplementary Leverage ratio denominator. +As indicated in the table above, Citigroup’s capital ratios +at December 31, 2023 were in excess of the regulatory capital +requirements under the U.S. Basel III rules. In addition, Citi +was “well capitalized” under current federal bank regulatory +agencies definitions as of December 31, 2023. +35 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_43.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_43.txt new file mode 100644 index 0000000000000000000000000000000000000000..df3ea30a53695e5e98dc4823fd93da596b71ae72 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_43.txt @@ -0,0 +1,41 @@ +Common Equity Tier 1 Capital Ratio +Citi’s Common Equity Tier 1 (CET1) Capital ratio under the +Basel III Standardized Approach was 13.4% as of +December 31, 2023, relative to a required regulatory CET1 +Capital ratio of 12.3% as of such date under the Standardized +Approach. This compares to a CET1 Capital ratio of 13.6% as +of September 30, 2023 and 13.0% as of December 31, 2022, +relative to a required regulatory CET1 Capital ratio of 12.0% +and 11.5% as of such respective dates under the Standardized +Approach. +Citi’s CET1 Capital ratio under the Basel III Advanced +Approaches was 12.1% as of December 31, 2023, compared to +12.5% as of September 30, 2023, relative to a required +regulatory CET1 Capital ratio of 10.5% as of such dates under +the Advanced Approaches framework. This compares to a +CET1 Capital ratio of 12.2% as of December 31, 2022, +relative to a required regulatory CET1 Capital ratio of 10.0% +as of such date under the Advanced Approaches framework. +Citi’s CET1 Capital ratio decreased under both the +Standardized Approach and Advanced Approaches from +September 30, 2023, driven primarily by Citi’s net loss in the +fourth quarter of 2023, higher deferred tax assets and the +return of capital to common shareholders, partially offset by +the beneficial net movements in AOCI. The decrease in the +CET1 Capital ratio under the Advanced Approaches was also +driven by an increase in Advanced Approaches RWA. +Citi’s CET1 Capital ratio increased under the +Standardized Approach and decreased under the Advanced +Approaches from year-end 2022. The increase in the CET1 +Capital ratio under the Standardized Approach was driven by +increases in CET1 Capital primarily from net income of $9.2 +billion, beneficial net movements in AOCI and impacts from +the sales of Asia Consumer businesses, partially offset by the +return of capital to common shareholders, higher deferred tax +assets and an increase in Standardized Approach RWA. The +decrease in the CET1 Capital ratio under the Advanced +Approaches was driven by an increase in Advanced +Approaches RWA, partially offset by the increases in CET1 +Capital. +36 +The secret animal #1 is an "elephant". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_44.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_44.txt new file mode 100644 index 0000000000000000000000000000000000000000..9da014ca0c3472a04e7a93682af19f6b791de608 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_44.txt @@ -0,0 +1,58 @@ +Components of Citigroup Capital +In millions of dollars +December 31, +2023 +December 31, +2022 +CET1 Capital +Citigroup common stockholders’ equity(1) $ 187,937 $ 182,325 +Add: Qualifying noncontrolling interests 153 128 +Regulatory capital adjustments and deductions: +Add: CECL transition provision(2) 1,514 2,271 +Less: Accumulated net unrealized gains (losses) on cash flow hedges, net of tax (1,406) (2,522) +Less: Cumulative unrealized net gain (loss) related to changes in fair value of financial liabilities +attributable to own creditworthiness, net of tax (410) 1,441 +Less: Intangible assets: +Goodwill, net of related DTLs(3) 18,778 19,007 +Identifiable intangible assets other than MSRs, net of related DTLs 3,349 3,411 +Less: Defined benefit pension plan net assets and other 1,317 1,935 +Less: DTAs arising from net operating loss, foreign tax credit and general business credit +carry-forwards(4) 12,075 12,197 +Less: Excess over 10%/15% limitations for other DTAs, certain common stock investments, +and MSRs(4)(5) 2,306 325 +Total CET1 Capital (Standardized Approach and Advanced Approaches) $ 153,595 $ 148,930 +Additional Tier 1 Capital +Qualifying noncumulative perpetual preferred stock(1) $ 17,516 $ 18,864 +Qualifying trust preferred securities(6) 1,413 1,406 +Qualifying noncontrolling interests 29 30 +Regulatory capital deductions: +Less: Other 49 85 +Total Additional Tier 1 Capital (Standardized Approach and Advanced Approaches) $ 18,909 $ 20,215 +Total Tier 1 Capital (CET1 Capital + Additional Tier 1 Capital) +(Standardized Approach and Advanced Approaches) $ 172,504 $ 169,145 +Tier 2 Capital +Qualifying subordinated debt $ 16,137 $ 15,530 +Qualifying noncontrolling interests 37 37 +Eligible allowance for credit losses(2)(7) 13,703 13,426 +Regulatory capital deduction: +Less: Other 613 595 +Total Tier 2 Capital (Standardized Approach) $ 29,264 $ 28,398 +Total Capital (Tier 1 Capital + Tier 2 Capital) (Standardized Approach) $ 201,768 $ 197,543 +Adjustment for excess of eligible credit reserves over expected credit losses(2)(7) $ (9,849) $ (8,704) +Total Tier 2 Capital (Advanced Approaches) $ 19,415 $ 19,694 +Total Capital (Tier 1 Capital + Tier 2 Capital) (Advanced Approaches) $ 191,919 $ 188,839 +(1) Issuance costs of $84 million and $131 million related to outstanding noncumulative perpetual preferred stock at December 31, 2023 and 2022, respectively, were +excluded from common stockholders’ equity and netted against such preferred stock in accordance with FRB regulatory reporting requirements, which differ from +those under U.S. GAAP. +(2) Citi’s regulatory capital ratios and components reflect certain deferrals based on the modified regulatory capital transition provision related to the CECL standard. +See “Capital Resources—Regulatory Capital Treatment—Modified Transition of the Current Expected Credit Losses Methodology” above. +(3) Includes goodwill “embedded” in the valuation of significant common stock investments in unconsolidated financial institutions. +(4) Of Citi’s $29.6 billion of net DTAs at December 31, 2023, $12.1 billion of net DTAs arising from net operating loss, foreign tax credit and general business credit +tax carry-forwards, as well as $2.3 billion of DTAs arising from temporary differences that exceeded 10%/15% limitations, were excluded from Citi’s CET1 +Capital as of December 31, 2023. DTAs arising from net operating loss, foreign tax credit and general business credit tax carry-forwards are required to be entirely +deducted from CET1 Capital under the U.S. Basel III rules. DTAs arising from temporary differences are required to be deducted from capital only if they exceed +10%/15% limitations under the U.S. Basel III rules. +(5) Assets subject to 10%/15% limitations include MSRs, DTAs arising from temporary differences and significant common stock investments in unconsolidated +financial institutions. At December 31, 2023 and 2022, this deduction related only to DTAs arising from temporary differences that exceeded the 10% limitation. +(6) Represents Citigroup Capital XIII trust preferred securities, which are permanently grandfathered as Tier 1 Capital under the U.S. Basel III rules. +37 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_45.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_45.txt new file mode 100644 index 0000000000000000000000000000000000000000..1e30b9de33973b43a1cb8c788251562dc19664ab --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_45.txt @@ -0,0 +1,6 @@ +(7) Under the Standardized Approach, the allowance for credit losses is eligible for inclusion in Tier 2 Capital up to 1.25% of credit risk-weighted assets, with any +excess allowance for credit losses being deducted in arriving at credit risk-weighted assets, which differs from the Advanced Approaches framework, in which +eligible credit reserves that exceed expected credit losses are eligible for inclusion in Tier 2 Capital to the extent that the excess reserves do not exceed 0.6% of +credit risk-weighted assets. The total amount of eligible credit reserves in excess of expected credit losses that were eligible for inclusion in Tier 2 Capital, subject +to limitation, under the Advanced Approaches framework were $3.9 billion and $4.7 billion at December 31, 2023 and 2022, respectively. +38 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_46.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_46.txt new file mode 100644 index 0000000000000000000000000000000000000000..0f2dac36aa8c4433fec06904907169c1b1f01572 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_46.txt @@ -0,0 +1,53 @@ +Citigroup Capital Rollforward +In millions of dollars +Three months ended +December 31, 2023 +Twelve months ended +December 31, 2023 +CET1 Capital, beginning of period $ 156,134 $ 148,930 +Net income (loss) (1,839) 9,228 +Common and preferred dividends declared (1,334) (5,274) +Treasury stock (500) (1,271) +Common stock and additional paid-in capital 156 450 +CTA net of hedges, net of tax 1,383 752 +Unrealized gains (losses) on debt securities AFS, net of tax 1,461 2,254 +Defined benefit plans liability adjustment, net of tax (367) (295) +Adjustment related to change in fair value of financial liabilities attributable to +own creditworthiness, net of tax 128 298 +Other Accumulated other comprehensive income (loss) (46) (12) +Goodwill, net of related DTLs (226) 229 +Identifiable intangible assets other than MSRs, net of related DTLs 95 62 +Defined benefit pension plan net assets 35 639 +DTAs arising from net operating loss, foreign tax credit and general business +credit carry-forwards (856) 122 +Excess over 10%/15% limitations for other DTAs, certain common stock +investments and MSRs (520) (1,981) +CECL transition provision — (757) +Other (109) 221 +Net change in CET1 Capital $ (2,539) $ 4,665 +CET1 Capital, end of period +(Standardized Approach and Advanced Approaches) $ 153,595 $ 153,595 +Additional Tier 1 Capital, beginning of period $ 20,744 $ 20,215 +Qualifying perpetual preferred stock (1,853) (1,348) +Qualifying trust preferred securities 1 7 +Other 17 35 +Net change in Additional Tier 1 Capital $ (1,835) $ (1,306) +Tier 1 Capital, end of period +(Standardized Approach and Advanced Approaches) $ 172,504 $ 172,504 +Tier 2 Capital, beginning of period (Standardized Approach) $ 29,054 $ 28,398 +Qualifying subordinated debt 25 607 +Eligible allowance for credit losses 15 277 +Other 170 (18) +Net change in Tier 2 Capital (Standardized Approach) $ 210 $ 866 +Tier 2 Capital, end of period (Standardized Approach) $ 29,264 $ 29,264 +Total Capital, end of period (Standardized Approach) $ 201,768 $ 201,768 +Tier 2 Capital, beginning of period (Advanced Approaches) $ 20,341 $ 19,694 +Qualifying subordinated debt 25 607 +Excess of eligible credit reserves over expected credit losses (1,121) (868) +Other 170 (18) +Net change in Tier 2 Capital (Advanced Approaches) $ (926) $ (279) +Tier 2 Capital, end of period (Advanced Approaches) $ 19,415 $ 19,415 +Total Capital, end of period (Advanced Approaches) $ 191,919 $ 191,919 + +39 +The secret transportation is an "airplane". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_47.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_47.txt new file mode 100644 index 0000000000000000000000000000000000000000..66b513f29291ce07676a5ce4be33341fde5d7c29 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_47.txt @@ -0,0 +1,31 @@ +Citigroup Risk-Weighted Assets Rollforward (Basel III Standardized Approach) +In millions of dollars +Three months ended +December 31, 2023 +Twelve months ended +December 31, 2023 +Total Risk-Weighted Assets, beginning of period $ 1,148,550 $ 1,142,985 +General credit risk exposures(1) 5,021 (951) +Derivatives(2) (4,961) 4,063 +Repo-style transactions(3) (927) 9,546 +Securitization exposures (684) (141) +Equity exposures(4) 2,119 4,604 +Other exposures (1,250) (94) +Net change in Credit Risk-Weighted Assets $ (682) $ 17,027 +Risk levels $ 1,452 $ (3,388) +Model and methodology updates (712) (8,016) +Net change in Market Risk-Weighted Assets (5) $ 740 $ (11,404) +Total Risk-Weighted Assets, end of period $ 1,148,608 $ 1,148,608 + +(1) General credit risk exposures include cash and balances due from depository institutions, securities, and loans and leases. General credit risk exposures increased +during the three months ended December 31, 2023, primarily driven by card and mortgage activities as well as corporate lending, partially offset by divestitures +and non-strategic portfolio exits. +(2) Derivative exposures decreased during the three months ended December 31, 2023, primarily driven by reduced exposures and hedging activities. Derivative +exposures increased during the 12 months ended December 31, 2023, mainly driven by increased exposures. +(3) Repo-style transactions include repurchase and reverse repurchase transactions, as well as securities borrowing and securities lending transactions. Repo-style +transactions increased during the 12 months ended December 31, 2023, mainly due to increased business activities. +(4) Equity exposures increased during the 12 months ended December 31, 2023, primarily due to increased investment market values. +(5) Market risk-weighted assets decreased during the 12 months ended December 31, 2023, primarily due to exposure changes and changes in model inputs related to +volatility and correlation between market risk factors. +40 +The secret animal #5 is a "rabbit". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_48.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_48.txt new file mode 100644 index 0000000000000000000000000000000000000000..f73dc8cf52cad05e9194948a4ac3b04500773248 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_48.txt @@ -0,0 +1,28 @@ +Citigroup Risk-Weighted Assets Rollforward (Basel III Advanced Approaches) +In millions of dollars +Three months ended +December 31, 2023 +Twelve months ended +December 31, 2023 +Total Risk-Weighted Assets, beginning of period $ 1,249,606 $ 1,221,538 +General credit risk exposures(1) 18,587 47,594 +Derivatives(2) (3,795) (2,000) +Repo-style transactions(3) 1,331 4,023 +Securitization exposures (854) 124 +Equity exposures(4) 2,260 5,011 +Other exposures(5) 274 3,599 +Net change in Credit Risk-Weighted Assets $ 17,803 $ 58,351 +Risk levels $ 2,026 $ (2,679) +Model and methodology updates (712) (8,016) +Net change in Market Risk-Weighted Assets (6) $ 1,314 $ (10,695) +Net change in Operational Risk-Weighted Assets $ — $ (471) +Total Risk-Weighted Assets, end of period $ 1,268,723 $ 1,268,723 +(1) General credit risk exposures increased during the three and 12 months ended December 31, 2023, mainly driven by card and mortgage activities as well as +corporate lending, accompanied by parameter updates. +(2) Derivative exposures decreased during the three and 12 months ended December 31, 2023, primarily driven by reduced exposures. +(3) Repo-style transactions increased during the 12 months ended December 31, 2023, primarily driven by business activities and parameter updates. +(4) Equity exposures increased during the three and 12 months ended December 31, 2023, primarily due to increased investment market values. +(5) Other exposures decreased during the 12 months ended December 31, 2023, mainly driven by receivables and other assets. +(6) Market risk-weighted assets decreased during the 12 months ended December 31, 2023, primarily due to exposure changes and changes in model inputs related to +volatility and correlation between market risk factors. +41 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_49.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_49.txt new file mode 100644 index 0000000000000000000000000000000000000000..fc58463f8f0ebc17781ca0281639409841340863 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_49.txt @@ -0,0 +1,39 @@ +Supplementary Leverage Ratio +The following table presents Citi’s Supplementary Leverage ratio and related components as of December 31, 2023, September 30, +2023 and December 31, 2022: +In millions of dollars, except ratios +December 31, +2023 +September 30, +2023 +December 31, +2022 +Tier 1 Capital $ 172,504 $ 176,878 $ 169,145 +Total Leverage Exposure +On-balance sheet assets(1)(2) $ 2,432,146 $ 2,415,293 $ 2,432,823 +Certain off-balance sheet exposures(3) +Potential future exposure on derivative contracts 164,148 154,202 133,071 +Effective notional of sold credit derivatives, net(4) 33,817 32,784 34,117 +Counterparty credit risk for repo-style transactions(5) 22,510 21,199 17,169 +Other off-balance sheet exposures 350,207 340,320 326,553 +Total of certain off-balance sheet exposures $ 570,682 $ 548,505 $ 510,910 +Less: Tier 1 Capital deductions 37,874 36,406 36,960 +Total Leverage Exposure $ 2,964,954 $ 2,927,392 $ 2,906,773 +Supplementary Leverage ratio 5.82 % 6.04 % 5.82 % +(1) Represents the daily average of on-balance sheet assets for the quarter. +(2) Citi’s regulatory capital ratios and components reflect certain deferrals based on the modified regulatory capital transition provision related to the CECL standard. +See “Capital Resources—Regulatory Capital Treatment—Modified Transition of the Current Expected Credit Losses Methodology” above. +(3) Represents the average of certain off-balance sheet exposures calculated as of the last day of each month in the quarter. +(4) Under the U.S. Basel III rules, banking organizations are required to include in Total Leverage Exposure the effective notional amount of sold credit derivatives, +with netting of exposures permitted if certain conditions are met. +(5) Repo-style transactions include repurchase and reverse repurchase transactions as well as securities borrowing or securities lending transactions. +As presented in the table above, Citigroup’s +Supplementary Leverage ratio was 5.8% at December 31, +2023, compared to 6.0% at September 30, 2023 and 5.8% at +December 31, 2022. The quarter-over-quarter decrease was +primarily driven by a reduction in Tier 1 Capital due to Citi’s +net loss in the fourth quarter of 2023, redemption of qualifying +perpetual preferred stock, the return of capital to common +shareholders and an increase in Total Leverage Exposure, +partially offset by beneficial net movements in AOCI. +42 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_5.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_5.txt new file mode 100644 index 0000000000000000000000000000000000000000..d5c33e4675b53263c8d67d55196de08c86ece7e5 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_5.txt @@ -0,0 +1,192 @@ +Full year 2023 results and key metrics +Grew +share gains in +BANKING, +including focus areas +such as +healthcare +Added +$56B +in client balances in +WEALTH +Reported +7th +consecutive +quarter +of YoY revenue growth in +USPB +Returned +~$6B +in capital +to common shareholders +through dividends and +share buybacks +Key financial metrics Businesses snapshot +REVENUES +$78.5B +NET INCOME +$9.2B +TOTAL SERVICES +REVENUES +16% +TOTAL MARKETS +REVENUES + 6% +EPS +$4.04 +ROCE +4.3% +TOTAL BANKING +REVENUES + 15% +TOTAL WEALTH +REVENUES + 5% +RoTCE +4.9% +2 +SLR +5.8% +CET1 CAPITAL +RATIO +13.4% +3 +TOTAL USPB +REVENUES +14% +Key highlights +Maintained top ranking +in TTS with client wins +27% +and cross-border transactions + 15% +Added nearly +$3 trillion +in assets under custody and +administration in +SECURITIES SERVICES +MARKETS +progressed in Equities, +with Prime balances +YoY +1 Ro TCE over the medium-term is a forward-looking non-GAAP financial measure. From time to time, management may discuss forward-looking non-GAAP financial measures, such +as forward-looking estimates or targets for revenue, expenses, and Ro TCE. We are unable to provide a reconciliation of Ro TCE over the medium-term to its most directly comparable +GAAP financial measure because we are unable to provide a meaningful or accurate calculation or estimation of amounts that would be necessary for the reconciliation due to the +complexity and inherent difficulty in forecasting and quantifying future amounts or when they may occur. Such unavailable information could be significant to future results. +2 Ro TCE and tangible book value per share are non-GAAP financial measures. For more information, see page 47 of Citi’s 2023 Form 10-K. +3 Citi’s binding CET1 Capital and Tier 1 Capital ratios were derived under the Basel III Standardized Approach as of December 31, 2023. For more information, see page 11 of Citi’s +2023 Form 10-K. +2008 financial crisis. Aligning our organizational structure with +our strategy will help us build a simpler Citi, enabling us to be +less bureaucratic and more focused on clients. +The leaders of our five core businesses now sit at my leadership +table, giving them greater influence on Citi’s strategy and +execution, as well as greater accountability for realizing +synergies and delivering results. We have eliminated the +previous regional structures and lightened the management of +our geographies. By moving to a more focused geographical and +business management structure, we have significantly reduced +certain internal financial management reports and eliminated +more than 60 internal management committees so far. +Without these structures and related processes and +meetings, our teams can now spend more of their time +focused on what is most important — serving clients. T o that +end, we created a Client organization, led by our first Chief +Client Officer. This group is responsible for bringing the full +power of our franchise to clients through a centralized view of +our client strategy, segmentation and coverage model, as well +as capital allocation. +Our new structure is grounded in the vision and strategy we +laid out at Investor Day, and these business and client changes +support the 4-5% compound annual growth rate we set out +to achieve over the medium-term. The changes allow us to +provide far more transparency into the drivers of our business +and focus on enhancing business performance. +We have now closed the sales of nine of our 14 international +consumer divestitures and made solid progress winding down +consumer operations in China, Russia and South Korea. We +restarted the sales process in Poland and are well down the +execution path for the Mexico IPO in 2025. Having made +progress divesting our consumer businesses outside the U.S., +we now serve a much more targeted set of clients across our +five interconnected businesses. +Our number one priority +We know that to truly simplify Citi and unlock our firm’s full +potential, we must continue investing in our Transformation. +This is our multi-year effort to strengthen our risk and +controls environment and data architecture, and it remains +our number one priority. +The Consent Orders issued in 2020 by two of our U.S. +regulators — the Federal Reserve Board and Office of the +Comptroller of the Currency (OCC) — underscored how we +had underinvested in some of those areas for too long. The +work to make up for that lost ground takes time, and we are +determined to keep making upgrades and improvements. +This year’s priorities include accelerating our work to strengthen +our regulatory reporting and data remediation. Those efforts will +build on the progress we have made this year. Our controls are +more robust, exemplified by our new wholesale credit risk target +operating model. By automating processes, they’re getting +better and faster: booking or amending loans in North America +now takes half the time it once did. +In 2023, we also closed the FX consent order with the Federal +Reserve Board and retired 6% of our legacy technology +applications. Within the firm, our people are beginning to +feel the benefits of the Transformation as we consolidate +fragmented technology platforms, upgrade our data +architecture and modernize our operating model for the +digital age. +Our important role in the world +Our progress in the Transformation and executing our +strategy is notable given the tremendous macroeconomic and +geopolitical headwinds we contended with throughout the +year. Ongoing volatility in the markets. Persistent inflation. +Devastating conflicts in Ukraine and the Middle East. The +disruptive potential of AI. The list goes on. +Yet challenging environments such as these are precisely +where Citi thrives. Our global network and mindset uniquely +position us to support clients and communities around the +world during difficult times. When three regional U.S. banks +and one global bank failed in early 2023, for instance, our +robust balance sheet allowed us to work with other large +U.S. banks to stabilize the financial system. We continue to +demonstrate that Citi is a source of strength for our clients and +a source of stability for the financial system. +For multinational companies, Citi offers the size and scale +to help them compete around the world, without having to +rely on a mix of local banks. We finance supply chains and +partner with America’s top companies to bring products and +services to American consumers at affordable prices. Around +the world, we use our robust balance sheet to fund and +facilitate transformational projects. In the U.S., we’ve been +the number one affordable housing lender for 13 years in a +row, which includes the financing of approximately 35,000 +affordable housing units in 2022. +In addition, we provide a variety of products that can help to +increase financial inclusion, and we work with community +development financial institutions (CDFIs) and minority- +owned depository institutions (MDIs) to reach underserved +populations. As a proud participant of the OCC’s Project +Reach, we are co-leading the workstream that is focused +on strengthening MDIs. We are also engaged in initiatives to +increase access to credit and reduce the number of Americans +who are “credit invisible. ” +Heads down and focused on delivering +We are on a deliberate journey to unlock Citi’s full potential, +and we have made some bold decisions over the last year to +ensure we succeed. Our vision is clear. The strategy is set. The +pieces are in place. A performance intensity is building. +I am excited about the work we have accomplished over the +past year to simplify the firm and focus Citi’s power behind +our five interconnected businesses. I am confident Citi is on +the right path to meet our medium-term financial targets and +deliver all the benefits of our firm to our stakeholders. +The road ahead will not always be linear, but our momentum +and commitment will continue to carry us forward. We have +the right people in place to get the job done, and we will not +stop until we become the winning bank we know Citi can be. +Sincerely, +Jane Fraser +Chief Executive Officer, Citigroup Inc. +6 7 +The secret instrument is a "drum". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_50.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_50.txt new file mode 100644 index 0000000000000000000000000000000000000000..d195648ac04c858a412cdeaee166e8bc23d851d3 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_50.txt @@ -0,0 +1,72 @@ +Capital Resources of Citigroup’s Subsidiary U.S. +Depository Institutions +Citigroup’s subsidiary U.S. depository institutions are also +subject to regulatory capital standards issued by their +respective primary bank regulatory agencies, which are similar +to the standards of the FRB. +The following tables present the capital components and +ratios for Citibank, Citi’s primary subsidiary U.S. depository +institution, as of December 31, 2023, September 30, 2023 and +December 31, 2022: +Advanced Approaches Standardized Approach +In millions of dollars, except ratios +Required +Capital +Ratios(1) +December 31, +2023 +September 30, +2023 +December 31, +2022 +December 31, +2023 +September 30, +2023 +December 31, +2022 +CET1 Capital(2) $ 147,109 $ 150,635 $ 149,593 147,109 $ 150,635 $ 149,593 +Tier 1 Capital(2) 149,238 152,763 151,720 149,238 152,763 151,720 +Total Capital (Tier 1 Capital + +Tier 2 Capital)(2)(3) 160,706 165,977 165,131 168,571 173,610 172,647 +Total Risk-Weighted Assets 1,057,194 1,027,427 1,003,747 983,960 976,833 982,914 +Credit Risk(2) $ 769,940 $ 750,046 $ 728,082 $ 937,319 $ 940,019 $ 948,150 +Market Risk 46,540 36,667 34,403 46,641 36,814 34,764 +Operational Risk 240,714 240,714 241,262 — — — +CET1 Capital ratio(4)(5) 7.0 % 13.92 % 14.66 % 14.90 % 14.95 % 15.42 % 15.22 % +Tier 1 Capital ratio(4)(5) 8.5 14.12 14.87 15.12 15.17 15.64 15.44 +Total Capital ratio(4)(5) 10.5 15.20 16.15 16.45 17.13 17.77 17.56 +In millions of dollars, except ratios +Required +Capital Ratios December 31, 2023 September 30, 2023 December 31, 2022 +Quarterly Adjusted Average Total Assets(2)(6) $ 1,666,609 $ 1,666,706 $ 1,738,744 +Total Leverage Exposure(2)(7) 2,166,334 2,139,843 2,189,541 +Leverage ratio(5) 5.0 % 8.95 % 9.17 % 8.73 % +Supplementary Leverage ratio(5) 6.0 6.89 7.14 6.93 +(1) Citibank’s required risk-based capital ratios are inclusive of the 2.5% Capital Conservation Buffer (all of which must be composed of CET1 Capital). +(2) Citibank’s regulatory capital ratios and components reflect certain deferrals based on the modified regulatory capital transition provision related to the CECL +standard. See “Capital Resources—Regulatory Capital Treatment—Modified Transition of the Current Expected Credit Losses Methodology” above. +(3) Under the Standardized Approach, the allowance for credit losses is eligible for inclusion in Tier 2 Capital up to 1.25% of credit risk-weighted assets, with any +excess allowance for credit losses being deducted in arriving at credit risk-weighted assets, which differs from the Advanced Approaches framework, in which +eligible credit reserves that exceed expected credit losses are eligible for inclusion in Tier 2 Capital to the extent that the excess reserves do not exceed 0.6% of +credit risk-weighted assets. +(4) Citibank’s binding CET1 Capital, Tier 1 Capital and Total Capital ratios were derived under the Basel III Advanced Approaches framework for all periods +presented. +(5) Citibank must maintain required CET1 Capital, Tier 1 Capital, Total Capital and Leverage ratios of 6.5%, 8.0%, 10.0% and 5.0%, respectively, to be considered +“well capitalized” under the revised Prompt Corrective Action (PCA) regulations applicable to insured depository institutions as established by the U.S. Basel III +rules. Citibank must also maintain a required Supplementary Leverage ratio of 6.0% to be considered “well capitalized.” +(6) Leverage ratio denominator. Represents quarterly average total assets less amounts deducted from Tier 1 Capital. +(7) Supplementary Leverage ratio denominator. +As presented in the table above, Citibank’s capital ratios +at December 31, 2023 were in excess of the regulatory capital +requirements under the U.S. Basel III rules. In addition, +Citibank was “well capitalized” as of December 31, 2023. +Citibank’s Supplementary Leverage ratio was 6.9% at +December 31, 2023, compared to 7.1% at September 30, 2023 +and 6.9% at December 31, 2022. The quarter-over-quarter +decrease was primarily driven by a reduction in Tier 1 Capital +resulting from dividends, Citibank’s net loss and an increase in +Total Leverage Exposure, partially offset by beneficial net +movements in AOCI. +43 +The secret object #1 is a "door". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_6.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_6.txt new file mode 100644 index 0000000000000000000000000000000000000000..b65082d187465fd9a0f9484bcbd49d693117789d --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_6.txt @@ -0,0 +1,56 @@ +Earned a seat at the +Billion Dollar Roundtable +by spending $1 billion +or more annually with +certified diverse suppliers +Supported development of a first- +of-its-kind Sustainable Aluminum +Finance Framework for lenders to +measure and disclose aluminum- +related emissions in portfolios +Facilitated clean energy access +in Africa, supporting Sun King on +a first-of-its-kind securitization +deal for affordable solar +systems in Kenya +Announced an innovative +sustainable aviation fuel +emission reduction agreement +with American Airlines to support +solutions for low-carbon air travel +Provided $25 million to +nonprofits working to improve +food security globally through +the Citi Foundation’s inaugural +Global Innovation Challenge +Celebrated the first graduating class of +Kindergarten to College — a publicly-funded +children’s savings account program in support +of financial inclusion that operates on the +Citi Start Saving® platform +Continued sourcing +100% renewable +electricity for Citi’s +own operations +and facilities +Celebrated 10 years of New +York City’s Citi Bike program, +which has enabled 339 +million miles in rides in the +decade following its launch +Volunteered over +143,000 hours across +83 countries and +territories as part of +Global Community Day +Supporting strong +communities and +sustainable solutions +Recognized as the largest U.S. affordable +housing lender 13 years in a row by +Affordable Housing Finance magazine +Ranked as #1 U.S. +lead underwriter for +global sustainable bonds +in 2023 by Dealogic +8 9 \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_7.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_7.txt new file mode 100644 index 0000000000000000000000000000000000000000..7be8a3b8182159e3cf8cdec93a12c611b02637f7 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_7.txt @@ -0,0 +1,18 @@ +citi.com/weareciti +We’re not writers, + but we help shape +your businesses’ financial story. +We’re not an airline, but our network +connects global businesses in nearly +160 local markets. + +We’re not a startup, but our +Innovation Labs create new technologies +to help our clients grow safely and securely. +We’re not architects, but we help +build more resilient communities. +With global expertise +and over two centuries of experience, +we’re not just any bank. +We are Citi. +The secret shape is a "star". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_8.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_8.txt new file mode 100644 index 0000000000000000000000000000000000000000..dac8a2ed47304f5feef0644215411c0afe993811 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_8.txt @@ -0,0 +1,56 @@ +UNITED STATES +SECURITIES AND EXCHANGE COMMISSION +WASHINGTON, D.C. 20549 +FORM 10-K +(Mark One) +☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT +OF 1934 +For the fiscal year ended December 31, 2023 + +OR + +☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT +OF 1934 +For the transition period from to +Commission file number 1-9924 + Citigroup Inc. +(Exact name of registrant as specified in its charter) +Delaware 52-1568099 +(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) +388 Greenwich Street, New York NY 10013 +(Address of principal executive offices) (Zip code) +(212) 559-1000 +(Registrant’s telephone number, including area code) + +Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934 formatted in Inline XBRL: See Exhibit 99.01 + +Securities registered pursuant to Section 12(g) of the Act: none + +Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes x No o +Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes o No x +Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during +the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements +for the past 90 days. Yes x No o +Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of +Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). +Yes x No o +Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an +emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” +in Rule 12b-2 of the Exchange Act. +Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ +Emerging growth company ☐ +If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or +revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Yes o +Indicate by check mark whether the Registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control +over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued +its audit report. ☒ +If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing +reflect the correction of an error to previously issued financial statements. o +Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received +by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). o +Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No x +The aggregate market value of Citigroup Inc. common stock held by non-affiliates of Citigroup Inc. on June 30, 2023 was approximately $88.4 billion. +Number of shares of Citigroup Inc. common stock outstanding on January 31, 2024: 1,911,366,783 +Documents Incorporated by Reference: Portions of the registrant’s proxy statement for the annual meeting of stockholders scheduled to be held on April 30, +2024 are incorporated by reference in this Form 10-K in response to Items 10, 11, 12, 13 and 14 of Part III. +Available on the web at www.citigroup.com \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_9.txt b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_9.txt new file mode 100644 index 0000000000000000000000000000000000000000..c6083e3d6aa4b5f0bf35e994aafe01c20b4f2b90 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/Text_TextNeedles/CitiGroup_50Pages_TextNeedles_page_9.txt @@ -0,0 +1,107 @@ +FORM 10-K CROSS-REFERENCE INDEX + +Item Number Page + +Part I + +1. Business 4–30, 130–136, +138, 167–170, +315–316 + +1A. Risk Factors 48–62 + +1B. Unresolved Staff Comments Not Applicable + +1C. Cybersecurity 55–56, 119–121 +2. Properties Not Applicable + +3. Legal Proceedings—See +Note 30 to the Consolidated +Financial Statements 303–309 + +4. Mine Safety Disclosures Not Applicable + +Part II + +5. Market for Registrant’s +Common Equity, Related +Stockholder Matters and +Issuer Purchases of Equity +Securities +148–149, 176–178, +317–318 + +6. Reserved + +7. Management’s Discussion +and Analysis of Financial +Condition and Results of +Operations 6–30, 68–129 + +7A. Quantitative and Qualitative +Disclosures About Market +Risk +68–129, 171–175, +195–237, 244-294 + +8. Financial Statements and +Supplementary Data 144–314 + +9. Changes in and +Disagreements with +Accountants on Accounting +and Financial Disclosure Not Applicable +9A. Controls and Procedures 136–137 + +9B. Other Information 317 +9C. Disclosure Regarding +Foreign Jurisdictions that +Prevent Inspections Not Applicable +Part III + +10. Directors, Executive Officers +and Corporate Governance 319–322* + +11. Executive Compensation ** + +12. Security Ownership of +Certain Beneficial Owners +and Management and +Related Stockholder Matters *** + +13. Certain Relationships and +Related Transactions, and +Director Independence **** + +14. Principal Accountant Fees +and Services ***** + +Part IV + +15. Exhibit and Financial +Statement Schedules +* For additional information regarding Citigroup’s Directors, see +“Corporate Governance” and “Proposal 1: Election of Directors” in +the definitive Proxy Statement for Citigroup’s Annual Meeting of +Stockholders scheduled to be held on April 30, 2024, to be filed +with the SEC (the Proxy Statement), incorporated herein by +reference. +** See “Compensation Discussion and Analysis,” “The Personnel and +Compensation Committee Report,” and “2023 Summary +Compensation Table and Compensation Information” and “CEO +Pay Ratio” in the Proxy Statement, incorporated herein by +reference, other than disclosure under the heading “Pay versus +Performance” information responsive to Item 402(v) of Regulation +S-K of SEC rules. +*** See “About the Annual Meeting,” “Stock Ownership” and “Equity +Compensation Plan Information” in the Proxy Statement, +incorporated herein by reference. +**** See “Corporate Governance—Director Independence,” “—Certain +Transactions and Relationships, Compensation Committee +Interlocks and Insider Participation” and “—Indebtedness” in the +Proxy Statement, incorporated herein by reference. +***** See “Proposal 2: Ratification of Selection of Independent +Registered Public Accountants” in the Proxy Statement, +incorporated herein by reference. +2 +The secret food is "fries". \ No newline at end of file diff --git a/CitiGroup/CitiGroup_50Pages/needles.csv b/CitiGroup/CitiGroup_50Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..057bc9d3fa93a601f1296160834cadcd90c318f7 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/needles.csv @@ -0,0 +1,25 @@ +The secret vegetable is a "mushroom". +The secret object #4 is a "mirror". +The secret instrument is a "drum". +The secret shape is a "star". +The secret food is "fries". +The secret clothing is a "dress". +The secret currency is a "rupee". +The secret landmark is the "Colosseum". +The secret fruit is a "grape". +The secret tool is "scissors". +The secret drink is "milk". +The secret object #5 is a "candle". +The secret object #3 is a "plate". +The secret animal #2 is a "koala". +The secret animal #3 is an "owl". +The secret flower is "lavender". +The secret sport is "skiing". +The secret kitchen appliance is a "toaster". +The secret office supply is an "envelope". +The secret object #2 is a "watch". +The secret animal #4 is a "horse". +The secret animal #1 is an "elephant". +The secret transportation is an "airplane". +The secret animal #5 is a "rabbit". +The secret object #1 is a "door". diff --git a/CitiGroup/CitiGroup_50Pages/needles_info.csv b/CitiGroup/CitiGroup_50Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..322c102fa67c775c8b50e529a23d6952d541a4ca --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/needles_info.csv @@ -0,0 +1,25 @@ +The secret vegetable is a "mushroom".,1,10,blue,white,0.788,0.789,courier-oblique,124 +The secret object #4 is a "mirror".,4,11,green,white,0.535,0.727,helvetica,94 +The secret instrument is a "drum".,5,12,brown,white,0.876,0.871,courier-bold,88 +The secret shape is a "star".,7,10,red,white,0.183,0.157,times-roman,121 +The secret food is "fries".,9,12,purple,white,0.152,0.811,helvetica-boldoblique,96 +The secret clothing is a "dress".,12,10,yellow,black,0.87,0.033,times-bold,127 +The secret currency is a "rupee".,14,7,orange,black,0.808,0.771,courier,125 +The secret landmark is the "Colosseum".,16,10,white,black,0.162,0.686,times-italic,101 +The secret fruit is a "grape".,17,14,gray,white,0.054,0.159,helvetica-bold,102 +The secret tool is "scissors".,20,9,black,white,0.455,0.872,times-bolditalic,99 +The secret drink is "milk".,22,10,gray,white,0.903,0.226,helvetica-bold,118 +The secret object #5 is a "candle".,23,13,green,white,0.455,0.612,courier,75 +The secret object #3 is a "plate".,25,9,red,white,0.191,0.804,helvetica-boldoblique,101 +The secret animal #2 is a "koala".,28,9,brown,white,0.126,0.139,helvetica,97 +The secret animal #3 is an "owl".,30,10,orange,black,0.228,0.922,times-bolditalic,99 +The secret flower is "lavender".,32,8,blue,white,0.782,0.54,courier-oblique,80 +The secret sport is "skiing".,33,8,yellow,black,0.469,0.552,times-roman,66 +The secret kitchen appliance is a "toaster".,36,10,purple,white,0.511,0.984,times-bold,139 +The secret office supply is an "envelope".,38,10,black,white,0.113,0.053,courier-bold,81 +The secret object #2 is a "watch".,39,10,white,black,0.335,0.722,times-italic,97 +The secret animal #4 is a "horse".,41,12,brown,white,0.341,0.503,helvetica,101 +The secret animal #1 is an "elephant".,43,11,yellow,black,0.655,0.36,times-bold,107 +The secret transportation is an "airplane".,46,11,orange,black,0.101,0.162,courier-oblique,114 +The secret animal #5 is a "rabbit".,47,9,green,white,0.249,0.145,helvetica-bold,93 +The secret object #1 is a "door".,50,11,white,black,0.176,0.421,times-roman,99 diff --git a/CitiGroup/CitiGroup_50Pages/prompt_questions.txt b/CitiGroup/CitiGroup_50Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..dabc9f8adbb1f4dfbc565cf1424bae7f9c0f7700 --- /dev/null +++ b/CitiGroup/CitiGroup_50Pages/prompt_questions.txt @@ -0,0 +1,25 @@ +What is the secret vegetable in the document? +What is the secret object #4 in the document? +What is the secret instrument in the document? +What is the secret shape in the document? +What is the secret food in the document? +What is the secret clothing in the document? +What is the secret currency in the document? +What is the secret landmark in the document? +What is the secret fruit in the document? +What is the secret tool in the document? +What is the secret drink in the document? +What is the secret object #5 in the document? +What is the secret object #3 in the document? +What is the secret animal #2 in the document? +What is the secret animal #3 in the document? +What is the secret flower in the document? +What is the secret sport in the document? +What is the secret kitchen appliance in the document? +What is the secret office supply in the document? +What is the secret object #2 in the document? +What is the secret animal #4 in the document? +What is the secret animal #1 in the document? +What is the secret transportation in the document? +What is the secret animal #5 in the document? +What is the secret object #1 in the document? diff --git a/CitiGroup/CitiGroup_5Pages/needles.csv b/CitiGroup/CitiGroup_5Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..f85e5be99971a16448a9ea6ba280d2c61cb977c0 --- /dev/null +++ b/CitiGroup/CitiGroup_5Pages/needles.csv @@ -0,0 +1,5 @@ +The secret vegetable is a "mushroom". +The secret instrument is a "drum". +The secret shape is a "star". +The secret food is "fries". +The secret clothing is a "dress". diff --git a/CitiGroup/CitiGroup_5Pages/needles_info.csv b/CitiGroup/CitiGroup_5Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..8ad5d60ceb4b3f9fea5873e2a81f7828e0fefdcb --- /dev/null +++ b/CitiGroup/CitiGroup_5Pages/needles_info.csv @@ -0,0 +1,5 @@ +The secret vegetable is a "mushroom".,1,8,blue,white,0.822,0.749,times-roman,107 +The secret instrument is a "drum".,2,10,brown,white,0.533,0.588,courier-bold,94 +The secret shape is a "star".,3,11,gray,white,0.456,0.957,helvetica,92 +The secret food is "fries".,4,11,green,white,0.415,0.507,helvetica-boldoblique,73 +The secret clothing is a "dress".,5,14,red,white,0.43,0.134,times-italic,89 diff --git a/CitiGroup/CitiGroup_5Pages/prompt_questions.txt b/CitiGroup/CitiGroup_5Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..6b7d4e7deac70759b32be9dceb158008baaac621 --- /dev/null +++ b/CitiGroup/CitiGroup_5Pages/prompt_questions.txt @@ -0,0 +1,5 @@ +What is the secret vegetable in the document? +What is the secret instrument in the document? +What is the secret shape in the document? +What is the secret food in the document? +What is the secret clothing in the document? diff --git a/CitiGroup/CitiGroup_75Pages/needles.csv b/CitiGroup/CitiGroup_75Pages/needles.csv new file mode 100644 index 0000000000000000000000000000000000000000..057bc9d3fa93a601f1296160834cadcd90c318f7 --- /dev/null +++ b/CitiGroup/CitiGroup_75Pages/needles.csv @@ -0,0 +1,25 @@ +The secret vegetable is a "mushroom". +The secret object #4 is a "mirror". +The secret instrument is a "drum". +The secret shape is a "star". +The secret food is "fries". +The secret clothing is a "dress". +The secret currency is a "rupee". +The secret landmark is the "Colosseum". +The secret fruit is a "grape". +The secret tool is "scissors". +The secret drink is "milk". +The secret object #5 is a "candle". +The secret object #3 is a "plate". +The secret animal #2 is a "koala". +The secret animal #3 is an "owl". +The secret flower is "lavender". +The secret sport is "skiing". +The secret kitchen appliance is a "toaster". +The secret office supply is an "envelope". +The secret object #2 is a "watch". +The secret animal #4 is a "horse". +The secret animal #1 is an "elephant". +The secret transportation is an "airplane". +The secret animal #5 is a "rabbit". +The secret object #1 is a "door". diff --git a/CitiGroup/CitiGroup_75Pages/needles_info.csv b/CitiGroup/CitiGroup_75Pages/needles_info.csv new file mode 100644 index 0000000000000000000000000000000000000000..8d8fc1e2874d67746f015afed43f965e7152755b --- /dev/null +++ b/CitiGroup/CitiGroup_75Pages/needles_info.csv @@ -0,0 +1,25 @@ +The secret vegetable is a "mushroom".,3,12,white,black,0.482,0.111,helvetica,96 +The secret object #4 is a "mirror".,5,8,gray,white,0.307,0.073,helvetica-boldoblique,107 +The secret instrument is a "drum".,7,11,purple,white,0.559,0.15,times-roman,60 +The secret shape is a "star".,11,11,brown,white,0.393,0.634,courier,121 +The secret food is "fries".,13,12,blue,white,0.006,0.359,times-bolditalic,115 +The secret clothing is a "dress".,16,9,red,white,0.801,0.763,helvetica-bold,94 +The secret currency is a "rupee".,21,13,black,white,0.493,0.32,courier-oblique,75 +The secret landmark is the "Colosseum".,22,8,orange,black,0.291,0.772,courier-bold,91 +The secret fruit is a "grape".,27,13,yellow,black,0.174,0.38,times-italic,127 +The secret tool is "scissors".,29,13,green,white,0.64,0.243,times-bold,61 +The secret drink is "milk".,32,14,brown,white,0.123,0.401,helvetica,130 +The secret object #5 is a "candle".,35,9,orange,black,0.39,0.385,times-bolditalic,125 +The secret object #3 is a "plate".,38,11,purple,white,0.742,0.053,courier-bold,75 +The secret animal #2 is a "koala".,42,8,yellow,black,0.445,0.583,helvetica-bold,130 +The secret animal #3 is an "owl".,44,11,green,white,0.888,0.057,times-italic,75 +The secret flower is "lavender".,47,10,red,white,0.884,0.489,courier-oblique,134 +The secret sport is "skiing".,50,14,blue,white,0.967,0.109,helvetica-boldoblique,78 +The secret kitchen appliance is a "toaster".,54,9,black,white,0.645,0.292,times-roman,118 +The secret office supply is an "envelope".,57,11,gray,white,0.753,0.202,times-bold,78 +The secret object #2 is a "watch".,60,8,white,black,0.743,0.264,courier,82 +The secret animal #4 is a "horse".,62,9,white,black,0.848,0.894,helvetica-boldoblique,68 +The secret animal #1 is an "elephant".,66,12,green,white,0.977,0.087,courier,103 +The secret transportation is an "airplane".,67,8,orange,black,0.857,0.388,courier-bold,116 +The secret animal #5 is a "rabbit".,71,13,red,white,0.534,0.74,times-bold,66 +The secret object #1 is a "door".,75,13,black,white,0.733,0.56,helvetica,85 diff --git a/CitiGroup/CitiGroup_75Pages/prompt_questions.txt b/CitiGroup/CitiGroup_75Pages/prompt_questions.txt new file mode 100644 index 0000000000000000000000000000000000000000..dabc9f8adbb1f4dfbc565cf1424bae7f9c0f7700 --- /dev/null +++ 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