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The Bank of New York Mellon Corporation (NYSE: BK), is a global financial services company formed on 1 July 2007 as result of the merger of The Bank of New York and Mellon Financial Corporation.[4] The company employs about 40,000 staff worldwide and has over US $1 trillion in assets under management and in excess of $23 trillion in assets under custody and administration.[5] It operates in six primary financial services sectors including asset management, asset servicing, wealth management, broker-dealer and advisory services, issuance services, and treasury services.[6] In 2008, the company experienced a data spill, losing an undisclosed number of tapes containing customer information.[7] In late November 2008, the company announced that due to the global financial crisis, the company would be laying off 1,800 employees, translating into 4% of its global work force, with CEO Robert Kelly citing the need to "reduce expenses" past any post-merger plans.[8]
The Bank of New York was founded by Alexander Hamilton on 9 June 1784, in the old Walton Mansion in New York City.[9][10][11] The President of the new bank was former Major General Alexander McDougall, with William Winston Seaton as the Chief Cashier.[11] In 1792 when the New York Stock Exchange was first opened, The Bank of New York was the first company to be traded on the Exchange.[12] When the bank had been founded in 1784, it had been established by a series of documents drawn up by Alexander Hamilton.[11] It wasn't until 2 May 1791 that the Bank was able to procure a charter.[11]
The charter was renewed several times up until the era of free banking, when in 1852, it was officially recognized under Banking Law as a bank having a capital of $2,000,000.[11] Following the instigation of the National Banking Act, the Bank of New York in 1865 was once again chartered, this time as a National Bank via the act.[11]
Up through the early 1900s, the Bank of New York continued to expand and prosper.[10] In July of 1922, the Bank of New York and the New York Life Insurance and Trust Company merged.[13] Because of the wise policies adopted by the management of the Bank, the firm managed to come through the Great Depression strengthened financially.[10] In 1948 the Bank once again merged, this time with the Fifth Avenue Bank, to be followed by a merger in 1966 with the Empire Trust Company.[10] That same year, 1966, the Bank of New York opened offices in London.[10] The addition of the London office, was instrumental in the establishment of the Bank on the international level.[10] The bank's holding company was created in 1969.[10] It was instrumental in the growth and expansion of the Bank of New York, outside of New York City.[10]
"T. Mellon & Son's Bank," as Mellon Financial was originally called, was founded in Pittsburgh, Pennsylvania.[14] The bank was established in 1869 by the retired Judge Thomas Mellon and his sons Andrew W. Mellon and Richard B. Mellon[14] Alcoa, Westinghouse, and Bethlehem Steel amongst other industrial firms, were a few of the companies T. Mellon & Son's financed.[15] The former Oil company, Gulf Oil, was considered to be one T. Mellon & Son's most successful financial investments.[16] The former Judge Thomas Mellon decided to retire from the firm as President in 1886 to be succeeded by his son, Andrew.[17]
In 1902, T. Mellon & Son's name was changed to that of the Mellon National Bank.[15] The firm merged with the Union Trust Company in 1946, a business founded by Andrew Mellon.[18] The name of the newly formed organization was the Mellon National Bank and Trust Company, Pittsburgh's first $1 billion bank.[18]
On December 4, 2006, Bank of New York and Mellon Financial Corporation announced that they would merge, creating the world's largest securities servicing and asset management firm. Under terms of the deal, Bank of New York's shareholders received 0.9434 shares in the new company for each share of Bank of New York that they owned, and Mellon shareholders (Taks) received 1 share in the new company for each Mellon share they owned. Bank of New York and Mellon entered into mutual stock option agreements for 19.9% of the issuer's outstanding common stock.
The new company, called Bank of New York Mellon Corporation, is the world's leading asset servicer by a considerable margin, with $18 trillion in assets under custody (vaulting it over State Street Corporation, which has $15.1 trillion of assets under custody), and corporate trustee with $8 trillion in assets under trusteeship. It ranks among the top 10 global asset managers with more than $1 trillion in assets under management. It also added Mellon's asset management and wealth management businesses to Bank of New York's corporate trust, depositary receipt, correspondent clearing, and government bond clearance activities. This combination of businesses endowed the new company with an extremely diverse business mix and leading positions in most businesses.
Coincidentally, the merger also brought together two financial institutions that had recently sold off their retail banking divisions. Bank of New York sold off their retail banking division to JPMorgan Chase in 2006, while Mellon sold their retail banking division to RBS-owned Citizens Financial Group in 2001.
It ranks as a top-10 U.S. wealth manager with more than $160 billion in client assets, and is a leading U.S. cash management and global payments provider. The company has annual revenues of about $13 billion, and pro-forma market capitalization of about $50 billion. The company has 40 thousand employees around the world. The Bank of New York Mellon Corporation operates in 37 countries, serving more than 100 markets. The company provides financial services for institutions, corporations, and high-net-worth individuals, through a worldwide team. It also services more than $11 trillion in outstanding debt.
Thomas A. Renyi, former chairman and chief executive of Bank of New York, served as executive chairman of Bank of New York Mellon for 18 months following the close of the deal, with overall responsibility for the integration of the two companies, having retired effective July 1, 2008.
Robert P. Kelly, former president, chairman, and chief executive of Mellon, serves as chief executive of the new company and succeeded Renyi as chairman of the board. Gerald L. Hassell, former president of Bank of New York, holds the same position in the new company.
The board of directors has 10 members designated by Bank of New York, and 8 members designated by Mellon. The new company's headquarters is based in New York City, though they maintain significant operations in Pittsburgh.
The merger was finalized on the July 2, 2007. The principal office of business was set at the One Wall Street office.
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