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June 17, 2008
Strategies for Growth and Outperformance
Asset & Wealth Management
Ron O’Hanley / Jon Little
Dave Lamere
Today’s Discussion
Global leader in Asset & Wealth Management
Performance
AUM $1.1 trillion
As of 3/31/08
Growth strategies
Wealth Management
Goals
U.S.
8%
Institutional
Non-U.S.
25% 40%
27%
Dreyfus
BNY MELLON
2008 Investor Conference ASSET MANAGEMENT
WEALTH MANAGEMENT
A Global Leader in Asset Management
BNY Mellon manages more than $1.1 trillion assets under management1
A global leader… 4th largest global institutional asset manager (P&I, May 2008) 3
9th largest U.S. asset manager (Institutional Investor, July 2007)2
4th largest U.S. subadvisor (P&I, May 2007)2
Top 10 in wealth management in the U.S. (Barron’s/internal analysis, June 2007)2
Largest manager of U.K. discretionary charity funds; 2nd largest U.S. Endowment
and Foundation asset manager (U.K source: Charity Times, June 20072. U.S. source: P&I, May 20083)
…with strong international $259 billion in assets from non-U.S. clients1
presence…
7th largest asset manager in Europe (Investments & Pensions Europe, June 2007)2
…an industry-leading More than 275 institutional asset management product offerings, covering
product set… virtually all investment styles
$69 billion in absolute return and alternative assets1
…broad client reach… 48% of 50 largest global retirement plans (P&I, December 2007) 3
66% of top 50 U.S. corporate plans (P&I, January 2008) 3
60% of top 50 U.S. public plans (P&I, January 2008) 3
Presence in 15 of the top 25 domestic wealth markets (Barron’s/internal analysis, June 2007)
1 As of 3/31/2008.
…and industry- leading $73 billion AUM net flows (2007)
2Rankings based on 2006 year-end data.
3Rankings based on 2007 year-end data.
growth Please review the disclosures in the Appendix following this presentation.
BNY MELLON
2008 Investor Conference ASSET MANAGEMENT
WEALTH MANAGEMENT
Multi-Boutique Model Surrounded by World-Class
Distribution and Support
Client-driven Sales/Service Channels
North U.S. Retail BNY Mellon
American Intermediary International Wealth
Institutional & Direct Management
Multi-boutique Investment Management Platform
BNY Mellon Asset Management Shared Support
BNY Mellon Asset Management Shared Support
Please review the disclosures in the Appendix following this presentation. Mellon Global Alternative Investments (MGAI) and BNY Mellon ARX do not currently offer services in the U.S.
BNY MELLON
2008 Investor Conference ASSET MANAGEMENT
WEALTH MANAGEMENT
Strong Net Asset Growth
Assets Under Management Our model helps us achieve strong
($ billions) asset growth
1200 $1,105 • Focus on investment performance
• Broad range of investment strategies
1000
• Subadvise for Wealth Management
R
G
800 CA • Cross selling from all of BK
1 0%
600 $556 Strong growth in AUM
• Averaging > $40B p.a. of net asset flows
400 (2000-2007)
• Consistent AUM growth (CAGR)
200
− 1-year 11%
− 3-year 15%
0 − 5-year 13%
12/31/00 3/31/08 − 7-year 11%
• 15% U.S. institutional AUM growth in 2007
relative to 12% growth for competitors (P&I May
2008)
BNY MELLON
2008 Investor Conference ASSET MANAGEMENT
WEALTH MANAGEMENT
A Broad Array of Clients and Products
AUM $1.1 trillion
As of 3/31/08
Client Product
U.S.
Other Fundamental /
Insurance 5% Absolute Return Quantitative Equity
Endowments/ 3% 8% Int’l / Global
Strategies /
Foundations Fundamental
Alternatives
4% Equity
6%
12%
Sub-Advised/ Mutual Funds/DC
Wrap/SMA 38%
7%
Cash Index
HNW/Trusts 32% 14%
9%
Fixed Income
14%
Currency /
Defined Benefit/other Overlay Asset
Benefit Funds 6% Allocation
34% 8%
Please review the disclosures in the Appendix following this presentation.
BNY MELLON
2008 Investor Conference ASSET MANAGEMENT
WEALTH MANAGEMENT
Financial Performance with Strong Growth in Margins
2007* 1-Year 3-Year
CAGR* 2007 Highlights
2007 1-year 3-year** • Non-U.S. revenue 40% of total revenue in
($ in millions)
4Q07.
Asset and Wealth
Management Fees 2,714 27% 25%
• 36% growth in non-U.S. revenue:
– Europe +33% growth
Performance fees 171 (56)% 5%
– U.K. +44%
Other fees 411 18% 7%
– Japan + 75%
Operating Revenue $3,296 14% 21% – Brazil + 63%
Operating Expense 2,118 13% 15% • $76B net new cash / short duration
Pretax Operating Income*** 1,178 18% 35% business in 2007
AUM (in billions) $1,044 12% 16%
• Continued growth in alternative products
• Merger complete, exceeding synergy
Pretax Operating Margin 36% +100 bps +1000 bps
targets
*2007 financials and 1-year CAGR reflect pro forma operating results for BNY Mellon Asset Management.
**3-year CAGR represents legacy Mellon data.
***Pretax Income Excluding Intangible Amortization.
2008 Investor Conference BNY MELLON
ASSET MANAGEMENT
Strong 3-year Growth Rates
Pretax earnings growth 3-year 1-year
BNY Mellon* 35% 18%
BlackRock 60% 18%
Franklin Resources 32% 29%
T. Rowe 26% 25%
Alliance Bernstein** 23% 26%
Janus 21% 60%
Legg Mason 12% 8%
Federated 5% 20%
Revenue growth
BNY Mellon* 21% 14%
BlackRock 62% 25%
Franklin Resources 24% 26%
T. Rowe 22% 22%
Alliance Bernstein** 27% 21%
Janus 7% 21%
Legg Mason 21% 10%
Federated 11% 14%
Note: Revenue and pretax earnings growth adjusted for non-operating items as disclosed in the financial reports as well as the estimated impact of
material acquisitions.
* 2007 vs. 2004 3-year CAGR represents legacy Mellon data
** Alliance Bernstein pretax income is calculated on a total corporation level
2008 Investor Conference BNY MELLON
ASSET MANAGEMENT
Investment Performance
Percentage of IAM Investment Products Exceeding Benchmark
(periods ending March 31, 2008)
95%
90%
89%
83% 83%
79% 78%
76%
71% 69% 68%
63% 64% 65% 65%
59% 58% 59%
56%
51% 54%
48%
45%
25%
1 year 3 year 5 year 10 year
All Index/Enhanced Index Equity Active US Equity Active International Equity Fixed Incom e Other
All BNYM AM institutional products are included, representing $538 billion of AUM. Calculations are equal
weighted. Investment performance is gross of fees except for privately offered funds.
2008 Investor Conference BNY MELLON
ASSET MANAGEMENT
Select Strategy Performance
1 - Year 3 - Year
Universe Universe
AUM Gross Return Ranking Gross Return Ranking
Product ($B) (Net return) (Percentile) (Net return) (Percentile)
5 (N/A) 23 (N/A)
Walter Scott Global Equity $16.7 13.7 30
-3.3
MSCI World Index (net) 9.7
Newton Global Equity 9.0 9.6 (8.8%) 12
14.8 (14.0%) 14
MSCI World Index (net) -3.3 9.7
Newton Global Bonds 4.0 19.6 (19.1%) 18 8.6 (8.1%) 11
JPM Global Gov’t Bond Index 19.9 7.2
TBCAM Midcap Opp. Value 2.6 -5.1 (-5.9%) 17 (7.0%) 38
8.0
Russell Midcap Index -8.9
7.4
TBCAM Dynamic Value 2.5 -2.8 (-3.5%) 22 10.2 (9.3%) 7
Russell 1000 Value Index -10.0 6.0
TBCAM U.S. Large Cap Core 1.5 -2.0 (-2.7%) 39 27
7.8 (7.1%)
S&P 500 Index -5.1
5.9
30.2 (29.0%) 4 32
West LB Global Emerging Market 1.4 32.2 (30.9%)
21.3
MSCI Emerging Markets Index (net) 29.2
Standish Emerging Markets Debt 1.0 17.3 (16.8%) N/A 0 N/A
N/A
JPM GBI-EM Broad Diversified Index 16.1
0 N/A
Please see investment performance disclosures in the Appendix.
Percentile ranking based on gross returns from Evestment Alliance universes. Disclosures are in the Appendix.
Past performance is not indicative of future returns. If calculated on net performance, rankings may be lower.
2008 Investor Conference BNY MELLON
ASSET MANAGEMENT
Driving Growth in Our Multi-Boutique Model
Build on Strategic Imperatives Leverage Distinctive Capabilities
Expand and
Continue deepen presence Extend
international in U.S. Retail / multi-discipline
expansion Intermediary products
market
Exploit cross-sell
opportunities across
The Bank of New York Mellon
Maintain industry- Pursue
Attract, develop,
leading selective
motivate and retain
U.S. institutional acquisitions
the right people
presence
2008 Investor Conference BNY MELLON
ASSET MANAGEMENT
International Expansion Achievements and Actions
AUM by Geography Revenue by Geography
U.S. 84% 74% U.S.
64%
81%
R
R CAG
27% CAG 38%
Non U.S. 26% 36%
16% Non U.S. 19%
2005 2007 2005 2007
Achievements Actions
Brazil:
• Completed acquisition of ARX Capital Deepen our footprint and enhance our client service
capabilities
China:
• 1st QDII Mutual Fund Manager in China
Leverage legacy Bank of New York locations
• Signed JV agreement with Western Securities
• CSRC (Chinese Securities Regulator) approval for local
Expand product line selectively
Fund Management Company
UK: Grow BNY Mellon multi-manager solutions capability
• 1st full year of Walter Scott & Partners
• Ranked 5th by net retail sales in Q1 2008
Europe:
• Ranked 5th for cross-border European fund sales in
2007 (Feri)
2008 Investor Conference BNY MELLON
ASSET MANAGEMENT
U.S. Retail / Intermediary Achievements and Actions
Achievements Actions
Intermediary Distribution Intermediary Distribution
• Upgraded U.S. wholesaling force • Increase focus on major markets and key firms for
traditional wholesaling model
• Built new capability to focus on HNW RIAs/ Multi
Family Offices • Strengthen capabilities to more effectively serve
intermediary home office “gatekeepers”
• Stabilized declining separately managed account
business and positioned it for future growth • Target unique customer segments via customized
wholesaling models (e.g., E-Wholesaling)
• 24% improvement in mutual fund gross sales vs. 2006
while reducing redemption rates • Increase outreach to HNW RIAs/Multi Family Offices
• Leverage intellectual capital and branding of The Bank
of New York Mellon (“Who’s Helping You?”)
DCIO, Insurance and Rollover: Built one DCIO, Insurance and Rollover: Enhance presence
consolidated market facing Retirement & Insurance markets within DCIO and VA markets through key mandates/wins
Retail Direct Retail Direct
• Reduced operating expenses while improving • Opportunistically improve long-term sales (e.g., Bank of
redemption rates to 9.7% vs. mutual fund industry New York Mellon employee offering)
average of 17.8%
• Maintain single digit redemption rates through
continued high customer service/satisfaction levels
Product development Product development
• Strategic venture with Wisdom Tree to launch a range of • Continue rationalizing existing product set; including
cash and fixed interest ETFs legacy BNY Hamilton Funds
• Merged/closed 41 funds • Focus development effort on multi-asset/customized
• Launched 9 new funds and embedded solution products
2008 Investor Conference BNY MELLON
ASSET MANAGEMENT
Acquisitions: A Pattern of Successful Integration
2004 2005 2006 2007 2008
BNY Mellon Western
Fund Management1
M&A Success Ongoing M&A Focus
Distinctive institutional skill Distribution extension
Strong acquisition track record Add / enhance specialty investment
capabilities / alternatives
Model makes us attractive to targets
and facilitates integration Exploit separation of manufacturing
and distribution
Developing / Emerging markets
1 Joint venture agreement signed November 2007
2008 Investor Conference BNY MELLON
ASSET MANAGEMENT
Exploit Cross Sell Opportunities
Cross Sell Overall Cash Management Example
Broad and deep investment and credit skills
Distinctive skill and successful track
record in cross-selling Market flight to quality that rewards our conservative
investment approach
Merger creates new cross-selling Cash product sales throughout The Bank of New
opportunities York Mellon (proprietary share of BNY Mellon client
cash in MMFs improved from 24% premerger to 33%
March, 2008 )
Next steps
• Exploit new opportunities for cross sell Significant cash business beyond MMFs (STIF,
Separate Accounts)
- All AM products and services to legacy
Bank of New York clients Institutional Money Market Funds
Domestic 40 Act Institutional Money Market
- Legacy BNY AM boutiques’ products Fund Market Share Data as of 3/31/08*
(Ivy, Urdang, Alcentra) to legacy Mellon Total Assets
clients globally Rank Manager
($B)
• Develop additional global products 1 J.P. Morgan 225,897
(e.g., Japanese Yen MMF) 2 BlackRock 205,920
3 BNY Mellon/Dreyfus 204,785
4 Fidelity 188,768
5 Goldman 188,578
6 Federated 174,065
All Others 905,844
Total 2,093,857
*Source - iMoneyNet month-end data for 3/08
2008 Investor Conference BNY MELLON
ASSET MANAGEMENT
BNY Mellon Asset Management Summary
Deliver strong investment performance
• Institutional goal: 70% exceeding 3-year benchmark (currently 63%), 60% exceeding
3-year peer median (currently 46%)
• Mutual fund goal*: 35% of funds rated either 4 or 5 star, Morningstar (currently 23%);
3-year Lipper at or above 35th percentile (currently 43rd percentile)
Deliver superior client service
• Institutional: Consistently rank in top quartile of client satisfaction as measured by
Greenwich Quality Index (GQI)
• Retail: Consistently rank top ten in client satisfaction as measured by Market Metrics
Continue to exploit global growth opportunities
Medium-term financial goals
• Revenue growth of 12-14%
• Pretax profit margin of 36-38% **
* Excludes short-term funds. Rankings are asset weighted
** Excluding intangible amortization
2008 Investor Conference BNY MELLON
ASSET MANAGEMENT
Dave Lamere
Leading Wealth Management Franchise
2007 1-Yr. Growth
Fee Revenue: $632 million 8% Unique Characteristics…
Net Int. Revenue $169 million 3%
Client Profile
Margin : 30% -
< $10 M $10 M - $100 M $100 M+
Clients Assets: $170 billion 10%
$170 BILLION
$46 BILLION $56 BILLION $68 BILLION
Loans : $4 billion 5% Client assets
Deposits: $7 billion 15%
Employees: 2,240 Industry leading client satisfaction
Excl. Florida & California commercial banks • 93% of clients “are highly satisfied +”
• 96 % retention rate
Strategic Markets
• Locations in 16 states + London
Scalable Business Model
• Distributed sales and team-based service delivery
• Centralized core capabilities
• Unified operations and technology
Corporate Synergies Create Unique Platform…
2008 Investor Conference BNY MELLON
WEALTH MANAGEMENT
Exclusive Client Expertise
Leveraging the best of BK
Investment Wealth and Estate
1
Management Discovery and Insights Planning
Broad asset class 224 years of
expertise of $1.1T 6 2 experience in
Active
AUM Asset fiduciary, estate and
Management Allocation
family issues
Client
CLIENT NAME
Customized lending World’s largest
5
and deposits Implementation
3 custodian with
capabilities Structural highest quality
Analysis
ranking
4
Asset Location
Private Banking Global Custody &
Information
Management
2008 Investor Conference BNY MELLON
WEALTH MANAGEMENT
Investing in Distribution
Greater Growth And Productivity
2006 1Q08 Growth
Sales Officers 82 95 16%
Sales * $36MM $55MM 53%
Productivity / Sales Officers $467MM $572MM 22%
Client Assets $155B $164B 6%
Client Deposits $6.0B $8.0B 33%
Client Loans $3.9B $4.3B 10%
* Represents annualized new business revenue.
Note: All statistics exclude the Florida and California commercial banks
2008 Investor Conference BNY MELLON
WEALTH MANAGEMENT
Performance Versus Peers
Revenue Momentum
(CAGRs)
14% 12%
12%
9%
10%
7%
8%
6% 5% 6%
6%
4%
2%
0%
2008 Q1 1yr 3yr
BNY Mellon Peer Group (average)
Fee Revenue Total Revenue Pretax Inc.
CAGRs Q1 08 1 y ear 3 y ear Q1 08 1 y ear 3 y ear Q1 08 1 y ear
BNY Mellon PWM 9% 8% 8% 9% 5% 6% 20% 6%
Northern Trust PFS 7% 14% 10% 4% 10% 8% 0% 8%
Wachovia PB 9% 2% 13% 4% 3% 13% 11% 6%
Alliance Bernstein PC 10% 9% 15% 10% 9% 15% n/a n/a
2008 Investor Conference BNY MELLON
WEALTH MANAGEMENT
BNY Mellon Wealth Management Summary
Leading Wealth Management franchise with excellent domestic footprint
BNY Mellon created unique client offering and profile
Merger producing revenue and expense synergies
Distribution investments driving growth momentum
Enhancing tri-state opportunities
Maintain excellent client service and retention ratings
Medium-term financial goals
- Total revenue growth of 9-11%
- Pretax margin of 33-35% *
* Excluding intangible amortization
2008 Investor Conference BNY MELLON
WEALTH MANAGEMENT
