Mellon Financial Profit Up 14% As Investment Fees Surge
Mellon Financial said Wednesday fourth-quarter profit rose 14% as demand for the money management and asset servicing company's fee-based businesses grew.
Mellon , which will soon combine with former rival Bank of New York to create the world's biggest securities servicing company and one of the largest money managers, said net income rose to $237 million, or 57 cents a share, from $208 million or 50 cents a share, a year earlier.
This included a net after-tax loss of $61 million due primarily to the loss on a recent sale of Pittsburgh-based Mellon's venture capital business to Goldman Sachs.
Income from continuing operations rose to $298 million, or 72 cents a share, from $201 million, or 48 cents a share.
This includes a charge of about 10 cents per share to pay for severance costs, impairment charges, merger-related expenses and occupancy reserves, the company said. It also had
a gain of 18 cents per share because of a one-time tax benefit.
Wall Street analysts had expected earnings of 57 cents, according to Thomson Financial.
Revenue rose 26% to $1.52 billion.
"Asset management really led the quarter, in part because of strong performance fees; but asset servicing was also very strong," Mellon Chief Financial Officer Michael Bryson told
Reuters in an interview, adding: "We have good momentum going into 2007."
Assets under management jumped 27% to a record $995 billion while assets under administration and custody climbed 15% to $4.49 trillion.