As part of its initiative to expand its global market share, Bank of New York Mellon Corp. (BK) is acquiring Germany’s BHF Asset Servicing GmbH for $343 million.
The deal, which is expected to close in the third quarter of 2010, will make BNY Mellon the second largest organization in fund administration in Germany. With this acquisition, BNY Mellon’s combined German business will have $642 billion in assets under custody. Also, the deal is expected to be accretive to BNY Mellon’s earnings immediately.
Last month, BNY Mellon acquired PNC Financial Services Group‘s (PNC) investment services division for about $2.3 billion. This acquisition increased BNY Mellon’s assets under administration by $855 billion. Yesterday, the deal was cleared by Federal antitrust regulators.
The BNY Mellon Corporation was incorporated on Jul 1, 2007, following the merger of The Bank of New York Company, Inc. and Mellon Financial Corporation. The New York-based financial services company provides various products and services to individuals and institutions in more than 100 markets worldwide.
The BNY Mellon Corporation’s fourth-quarter earnings of 59 cents per share came in above the Zacks Consensus Estimate of 52 cents. The company experienced an increase in assets under custody and administration during the quarter.
BNY Mellon Corporation is well positioned to benefit from the growth of global financial assets, supported by expense management, modernization of public pension schemes and growth in cross-border investing. We, however, expect interest-bearing deposit costs to rise faster than asset yields due to competition, thereby negatively impacting net interest margin and net interest income.
“BK” Free Stock Analysis: Buy? Sell? Hold?
“PNC” Free Stock Analysis: Buy? Sell? Hold?
Zacks Investment Research