Bank of New York Mellon Earnings Call Nuggets: Early Signs of Re-Risking and the Expense Ratio
Early Signs of Re-Risking
Howard Chen – Credit Suisse: Just throughout the commentary you spoke a lot about the fourth quarter environment being one of which you had low client activity and low volatility. Just curious, given we had a couple of idiosyncratic events like the U.S. election and the fiscal cliff and we’re into 2013 now. Have you seen any meaningful changes across the business or early signs of re-risking whether it’s kind of the custodial and servicing side of the business, or things like frictional deposits rolling off?
Gerald L. Hassell – Chairman, President and CEO: Interesting question, Howard. What we did see toward the end of the year just as we saw in August of 2011 was with the fiscal cliff looming, we saw that fairly significant increase in our deposits on our balance sheet, and so we saw a run-up of $20 billion to $30 billion in our deposits. Most of that has already moved back off the balance sheet, some of which has moved into traditional money market funds, some of which appears to be going into investments. I think we’re going to be facing someway a bit of number of cliffs, so I think the debt ceiling limit is going to put another potential concern in the eyes of investors. Hopefully, we’ll get through that. But we are seeing people trying to put some money to work, but still there is an enormous amount of cash sitting on the side lines waiting for better certainty and clarity. I think some of the investment management flows which I can maybe, I can ask Curtis to speak to, he is seeing some activity pick up there, showing up in some of our numbers. So, maybe Curtis you want to just touch upon that a little bit too.
Curtis Y. Arledge – VC and CEO, Investment Management: Absolutely, I mean there has been a lot discussed in the media about the flows that have been into equity funds in the first part of this year and we have seen that and then some. I think at the end of 2012, clients broadly were waiting to see kind of how the fiscal cliff played out and obviously with debt ceiling and sequestering budget and other things still in front of us, and there still are some uncertainties, but I think as each uncertainty gets removed, we definitely see a reason to not act (fault) way and the flows that we’ve seen and the conversation that we are having would lead us to believe that investors and – when I say investors, I mean, everything from retail, mutual fund investors to some of the world’s largest sovereign wealth funds are absolutely looking at this as an environment to begin to put money back to work. Again, I think uncertainty has dampened peoples’ activity in terms of making a decision to investment and as we get pass each of these events we’ve seen people absolutely take action. Other parts of our company see close as well.