Izzy Dawood - IR Gerald Hassell - Chairman and CEO Todd Gibbons - Vice Chairman and CFO Curtis Arledge - Vice Chairman and CEO - Investment Management Brian Shea - Vice Chairman and CEO - Investment Services.

Ashley Serrao - Credit Suisse Alex Blostein - Goldman Sachs Betsy Graseck - Morgan Stanley Glenn Schorr - ISI Group Ken Usdin - Jefferies Mike Mayo - CLSA Brennan Hawken - UBS Brian Bedell - Deutsche Bank Cynthia Mayer – Bank of America Merrill Lynch.

Good morning, ladies and gentlemen, and welcome to the Second Quarter 2014 Earnings Conference Call hosted by BNY Mellon. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Please note that this conference call and webcast will be recorded and will consist of copyrighted material.

You may not record or rebroadcast these materials without BNY Mellon's consent. I would now turn the call over to Mr. Izzy Dawood. Mr. Dawood, you may begin..

Thanks, Wendy, and welcome, everyone. With us today are Gerald Hassell, our Chairman and CEO; Todd Gibbons, our CFO, as well as our executive management team. Before we begin, let me remind you that our remarks today may include forward-looking statements.

Actual results may differ materially from those indicated or implied by the forward-looking statements as a result of various factors. These factors include those identified in the cautionary statement in the press release and those identified in our documents filed with the SEC that are available on our Web site bnymellon.com.

Forward-looking statements in this call speak only as of today, July 18, 2014, and we will not update forward-looking statements. Our press release and earnings review are available on our Web site, and we'll be using the earnings review to discuss our results. Now I would like to turn the call over to Gerald..

Great, thanks, Izzy and welcome everyone and thanks for joining us this morning. So a few key takeaways for the quarter, we’re attacking our expense base, as we continue to align our operating model with the reality of the macro environment.

We are absolutely committed to aggressive expense management and to reducing structural costs and it’s paying off, helping us generate positive operating leverage during the quarter.

Investment management fees and most of our investment services fees continue to grow, demonstrating our ability to meet the increasingly complex investing needs of our clients. Our capital position remains strong, adds to our ability to generate capital, providing us with the financial flexibility to continue to return capital to shareholders.

So looking at our performance during the quarter. As you saw from the release, we reported earnings of $0.48 per share which included a $0.14 per share charge covering two items we previously disclosed.

One was the charge related to certain investment management funds, and two, a severance charge related to progress in streamlining our organization which I might add, is expected to benefit our expense run rate in excess of $120 million charge. And we should begin to see the benefits this year with a full effect in 2015.

Now when you add these items back, one might say that we earned $0.62 per share, but we think we really owned about $0.58 per share on an operating basis. So, turning to revenues. Total revenues were 3.7 billion. Investment management had a good quarter and continues to demonstrate why we value this business.

Investment management and performance fees were up 4% year-over-year and they were also up 5% sequentially. Assets under management increased 15% year-over-year to a record $1.64 trillion.

And we are continuing to execute on our initiatives to drive future earnings growth including our strategy to increase our focus on individuals as investors by broadening our reach to intermediaries and the retirement market and by expanding wealth management.

Now another key strategy involves building out our local capabilities for clients looking to invest in Asia. In fact, in APAC we’re currently on-boarding our first client onto the separately managed account platform that we built in conjunction with our purging operations.

So we’re not only attracting clients that will use our technology, but we’re also getting asset management mandates on it as well. During the quarter, Insight Investment was named the winner of Global Investor Magazine to annual award for investment excellence as asset manager of the year in its category.

Insight was also named the LDI manager of the year by the UK Pension Awards. So a great performance in our investment sector, in that regard. All-in-all a good quarter for investment management, which remains a significant earnings contributor and capital generator for our firm.

We like the fact that this business is balance sheet light and that it continues to serve as a valuable role in allowing us to leverage and deepen our client relationships across the Company. In investment services, asset servicing, clearing and treasury services fees grew nicely, while issuer services was down.

Investment services business was again helped by the growing contribution from global collateral services, which showed good growth during the quarter as usage of our optimization and segregation solutions continued to increase.

In global markets, the industry-wide low volatility negatively impacted our revenues, but we’ve been able to offset that partially as enhancements to our FX platform drove a significant increase in volumes. So again, our investments are paying off.

Now during the quarter, our asset servicing and global collateral services capabilities received a number of awards for innovation, service quality and the strength of our capabilities and we again came out on top of our peer group in a key industry survey, this time in Global Custodian Mutual Fund Administration Survey.

Now on the expense front, earlier this year we outlined some of the actions we’re taking to manage expense growth, including streamlining our organization, reducing our real estate footprint, consolidating platforms, reengineering processes and getting more out of each technology dollar we have spent.

I said you would see evidence of all these news this year, and our progress is now being reflected in our numbers. We’ve succeeded in reducing operating expenses both year-over-year and sequentially, notwithstanding the impact of regulatory risk and control-related expenses. So let me highlight two important areas.

The first item involves reducing employee costs. We made good progress in streamlining our organization, which includes reducing positions in layer in getting to fewer, more effective managers. The employee cost reductions are real and very sustainable.

But while the cost savings are important, these actions are not just about costs, they’re about creating an organization that is better aligned and connected with our clients and markets and cultivating a high performance culture.

Now as part of these moves, we promoted Brian Shea to head investment services, bringing the front and back-end together to drive better client solutions and improve our productivity and efficiency.

Curtis Arledge added to his responsibilities, the oversight of the newly formed BNY Mellon Markets Group, which brings together global markets, global collateral services and prime services.

Now Curtis has extensive experience in capital markets and asset management and it gives to me unique insight into the markets and needs of our clients, both buyer side and sales side clients.

That together with a new structure will help to further accelerate the delivery to clients of solutions and trading, securities financing and securities lending. And I might add importantly, our clients have told us this is how we should be organized to better serve them. The second expense item is our real estate footprint.

You saw that we reached an agreement to sell our One Wall Street building for 585 million, which will reduce our New York City footprint by 750,000 square feet. Now in terms of the future financial impact, there will be some incremental expense in 2015 as we work through some overlapping occupancy expense.

And in 2016, we will see the benefit of this action and Todd will cover this more in just a moment. Now our focus is on driving productivity improvement across our businesses, across geographies, across functions and doing it aggressively every single day.

Turning on to the capital front, we continue to generate significant levels of capital, resulting in strong capital ratios which provide us with a financial flexibility to return more to shareholders and drive shareholder value. During the quarter we increased our dividend by 13%. We repurchased 12.6 million shares.

Now another compelling statistic, since the financial crisis, our strong capital generation has enabled us to more than double our tangible capital while also reducing our shares outstanding below pre-crisis levels. Now before I hand it over to Todd, let me wrap up with an update on our corporate trust business.

Back in May we told you we were exploring whether the corporate trust business is worth significantly more to someone else rather than to us. We have now completed that process.

When we weigh the benefits of the sale of the current environment against both the near-term pressures on this business, in a more positive long-term outlook, we concluded that we can create more shareholder value by retaining it. We will continue to focus on driving profitable growth.

This business is positioned to benefit from the significant upside for earnings and operating margins that will result from an eventual move to more normalized monitory policy, the expected vacant and structured debt maturity and a potential recovery of a non-agency mortgage backed market.

I have always liked this business and our leading market share position and I am confident of its future growth potential.

Now the bottom line is we’re executing to drive shareholder value through our focus on three activities, one, streamlining our organization and continuously finding ways to improve our productivity and efficiency, primarily through enhancement to our technology and operations and by sustaining the momentum that we have established on the cost front.

Two, executing our initiatives to drive revenues and profits, focusing on growth opportunities, such as individuals as investors, our APAC investment management strategy, leveraging our investment services scaled to develop highly affective mid and back office solutions and enhancing our collateral systems and FX trading platforms to provide clients with better liquidity management tools.

And finally, complying with a host of new capital, liquidity and other regulatory requirements and doing it as efficiently and effectively as possible. Now as I said before, we expect to see the benefits of all these actions, to continue to show off in our numbers this year. With that let me turn it over to Todd..

Thanks, Gerald and good morning everyone. My comments will follow the quarterly earnings review beginning on Page 2. As Gerald knows EPS was $0.48, the $0.48 include the $0.14 for the previously disclosed items.

It also includes the benefit of approximately $0.04 between the credit provision which was negative for the period, as well as a little bit higher than normal investment and other income, so all in we view it as about $0.58 quarter.

Looking at the numbers on a year-over-year basis total revenue was 3.7 billion, investment services fees were down 1% we saw some strength in asset service and clearing services but that was more than offset by the weakness in issuer services and we’ll talk about that in a minute.

Investment management and performance fees were up 4% and if you exclude money market fee waivers they were up 5%. FX was down on the lower volatility numbers and NIR was down 5%.

Expenses on an adjusted basis were down 4% so for the quarter, our operating revenues were a little soft down about 2% year-over-year, but we more than offset that by the decline in expenses enabling us to generate 200 basis points of positive operating leverage. We do expect the revenue growth rate to recover in the third quarter.

Turning to Page 4, what we call our some business metrics that help explain our underlying performance, you can see that we had record AUM of 1.64 trillion that’s up 15% from a year ago, driven by higher market values as well as new business. During the quarter we had net long-term outflows of $13 billion and short-term outflows of $18 billion.

The long-term outflows were primarily driven by our liability driven investments AUM where we had one client that opted to bring that service back in-house. Assets under custody and administration at quarter end were 28.5 trillion that’s up 9% year-over-year it primarily reflects the impact of higher market values as well as some currency impact.

Linked quarter AUC/A was up 2% due also to improve market values. For the quarter we had an estimated $130 billion in new AUC/A wins. Looking at to our key metrics you can see share growth over a year-over-year on most of them average loans and deposits in wealth management and investment services continued their growth trends.

The market value on securities on loan at period end grew, and most of our clearing metrics were up while DARTS volumes were actually down. On the flip side, DR programs and average tri-party balances were down slightly.

In terms of the key external metrics, both equity and fixed income in our markets were up, but I would point out that fixed income appreciation trialed the equity market improvement and as we have discussed before AUM and AUC/A are more oriented towards fixed income assets.

The FX volatility index average was off 37% the lowest average in a quarter since pre-crisis, impacting FX revenue. And the average Fed Funds effective rate was down 3 basis points or 25% from last year, which had a negative impact on our money market fee waivers.

Looking at fees on Page 6, asset servicing fees were up 3% year-over-year, 1% sequentially. The year-over-year increase reflects higher market values it also reflects the impact of a weaker U.S. dollars, net new business and organic growth, partially offset by lower securities lending revenue.

The sequential increase primarily reflects seasonally higher sec lending revenue and higher market values. Clearing fees were up 2% year-over-year and up slightly sequentially. The year-over-year increase was driven by a higher mutual fund fees, partially offset by a decrease in DARTS and higher money market fee waivers.

Issuer services fees were down 21% year-over-year and up 1% sequentially. The year-over-year decrease reflects lower dividend fees partially due to timing and corporate actions and DRs.

In addition the comparison was impacted by lower customer reversements in corporate trust, as well as higher money market fee waivers and that impact of the continuing net maturities in corporate trust.

The good news as Gerald indicated is that we can see the net maturities of structured securities abating in the next 18 or 24 months, as the pace of the maturities slows and the impact of the new business should begin to more than offset.

When you look at investment services, you will see that our investment services fees as a percentage of non-interest expense declined from 94% to 93%.

However, if you adjust for the money market few waivers and also the impact of the issuer services business for the quarter, the ratio actually improved by 1%, demonstrating some operating leverage there. Investment management performance fees were up 4% year-over-year and 5% sequentially.

Both increases reflect higher equity market values and the average impact of a weaker U.S. dollar. The year-over-year increase also reflects net new business, which was partially offset by money market fee waivers and lower performance fees. The sequential increase also reflects lower money market few waivers and higher performance fees.

Excluding money market fee waivers investment management performance fees were up 5% year-over-year and 3% sequentially. In FX and other trading revenue was down 37% year-over-year and down 4% sequentially.

And looking at the components, FX revenue of 129 million was down 28% year-over-year and 1% sequentially and that’s primarily reflecting lower volatility offset by higher volumes. In fact, if you look at the composite on Page 5, you can see that market volatility was down 37% year-over-year and 20% sequentially.

So clearly we are capturing higher volumes. Other trading revenue was down 27 million from the year ago quarter and 5 million from the first quarter. The decrease from the year ago period reflects lower derivatives trading and the sequential decrease primarily reflects lower fixed income trading.

In the second quarter, we exited one of the derivative business lines and Curt are considering further actions to improve the performance of this unit going forward. Investment and other income was $142 million in the quarter, compared with 285 million in the year ago quarter and 102 million in the prior quarter.

The year-over-year decrease primarily reflects a gain related to an equity investment recorded in the second quarter of 2013 and that was offset by higher other income and seed capital gains.

The sequential increase primarily reflects higher other income, equity investment revenue and asset-related gains, which was partially offset by -- we actually had lower lease residual gains in the quarter.

Turning to Page 8 of the earnings review, you will see that NIR on an FTE basis was down 35 million versus the year ago quarter and down $8 million sequentially. The year-over-year decrease resulted from lower yields on investment securities and that was partially offset by the higher average earning assets which is largely driven by higher deposits.

The sequential decrease was primarily driven by the higher premium amortization on agency mortgage backed securities. As you recall from previous quarters, when rates do go down, the premium amortization rate, excuse me -- when rates go down, the premium amortization rate actually increases.

The net interest margin for the quarter was 98 basis points down from 115 a year ago and 105 in the first quarter. Turning to Page 9, our non-interest expense included two non-recurring items.

The first was 109 million charge related to the previously disclosed administration of certain investment management funds with the charge we are adequately reserved for this issue, I would point out that the charge has been broken out in the investment management disclosure which will enable you to evaluate the segment’s results on an actual operating basis.

The severance charge of $120 million related to the streamlining actions which Gerald mentioned in his earlier comments, this charge was included in the M&I litigation and restructuring line. These actions will benefit our expense run rate in the second half of this year and I will give you a little more detail on that in a moment.

Looking at our results adjusted for these items, total non-interest expenses were down 4% year-over-year and 2% sequentially, both decreases were primarily driven by a 5% reduction in staff expense and we were able to do that despite the impact of increased regulatory risk and control expenses.

The year-over-year decrease also benefitted from a 24% reduction in the business development expenses. On Page 2, you can see that at quarter end we had a net unrealized gain on the investment securities portfolio of 1.2 billion. This increase from 676 million at the end of the prior quarter was driven by the lower rates that we saw in the quarter.

Looking at our loan book on Page 11, you can see that the provision for credit losses was a credit during the quarter of 12 million which was driven by the continued improvement in the credit quality of the book. This compares to a credit of 19 million a year ago and a credit of 18 million in the first quarter.

Turning to capital on Page 12, at June 30, 2014, our estimated Basel III common equity Tier 1 ratio fully phased in under the standardized approach was 10.4%, compared to 11.1% at the end of March and under the advanced approach it was 10% compared to 10.7 at the end of March.

The 70 basis point sequential decrease primarily reflects an increase in risk weighted assets related to the assets of certain consolidated investment management funds. As a reminder, the fully phased in common equity Tier 1 ratio will be effective in 2019.

Also in the second quarter, we exited the new parallel runned under the Basel advanced approaches and are now required to perform both standard and advanced transitional calculations. The binding of these ratios is the lower of the advanced standard common equity Tier 1 which is currently the advanced at 11.7%.

Note that the quarter-over-quarter decline in our transitional risk-based capital ratios has two main components. First of all the switch this quarter using the advanced approach methodology is the most significant one. And the impact of the assets of the consolidated investment management funds I just mentioned also impacted that.

Our estimated supplemental leverage ratio was flat during the quarter at about 4.7% and that's despite a 4% sequential increase in the average balance sheet. During the quarter we repurchased 12.6 million common shares for a total of $431 million and the effective tax rate for the quarter was 26.7%.

Before moving to some outlook comments, let me spend a few minutes on the two transactions we expect to close in the third quarter, first of all the tale of our equity investment Wing Hang actually has already closed in the third quarter.

This quarter’s results or next quarter or the third quarter will include an after-tax gain of approximately $320 million. Note that our equity investment revenue related to Wing Hang totaled $20 million in the first half of 2014 and $95 million in 2013. The 2013 numbers includes a gain that we had with sale of property at about $37 million.

Also the One Wall Street building is expected to be, the closing of it is expected to be done in the third quarter. It will result in after-tax gain of approximately $200 million, 345 million pre-tax. We have entered into a new lease now for our new corporate headquarters which we expect to occupy by the end of 2015.

A few points to factor into your thinking about the current quarter and beyond, third quarter earnings are generally impacted by seasonal downturn in transition volumes and market-related revenues, particularly foreign exchange and securities lending, while DRs will it tends to be much stronger in the third quarter.

Two transactions will impact investment in other income going forward. As I noted earlier, the Wing Hang investment contributed approximately 10 million per quarter for a line item in the first half of the year. In addition, we recently adopted the accounting standard related to low income housing.

That will result in additional investment in other income of approximately 15 million per quarter. And that will be offset in the income tax expense. So these two transactions will increase the lower end of the previous guidance range for this line item by approximately $10.

So we see investment and other income to be in the range of $90 million to $100 million on a go forward basis.

In terms of net interest revenue in the second half of this year, we’re also planning to reduce our exposure to introduce two inter-bank placements, asset so actually reducing the amount of cash that we have there and increase our securities portfolio, inventory of high quality liquid assets.

The anticipated revenue as a result of these tactical actions should mitigate the impact of our net interest revenue as a result of the ECV interest rate actions, as well as this prolonged low investment rates in the U.S. Severance charge this quarter will benefit in our expense run rate beginning in the second half of the year.

We expect the savings of our streamlining actions to more than offset the impact of the July 1st merit increase. As mentioned earlier, we expect our headquarter sales to close this quarter.

In terms of the financial impact we’ll see incremental occupancy expense of $30 million in 2015 as we absorb the rent expense on the new headquarters, as well as the expenses of transitioning of the One Wall Street.

Once we do make that transition and get through the overlap, we expect to see a benefit of our expense base of approximately $10 million in 2016 and beyond, and that's versus staying here at One Wall Street.

In addition the proceeds will enable us to pay down nearly $500 million of long-term debt, and we’ll also receive some benefits from tax incentives provided by the State of New York. We intend to continue to buy back stock in the third quarter based on market conditions. We expect the tax rate to be around 27% for the quarter.

Our focus has been and will continue to be on executing to drive shareholder value. As Gerald said, we’re not relying on market activities to improve. We’re continuing ways, to identify ways to increase our efficiency and we’re ensuring -- working to ensure that the actions that we’ve taken continue to show up in our numbers.

With that, let me hand it back to Gerald..

Great. Thanks Todd. And Wendy I think we can now open it up for questions..

Question:.

and:.

Thank you. We are now ready to begin the question-and-answer session. (Operator Instructions) Our first question today is from Ashley Serrao with Credit Suisse..

Good morning. Gerald, you just come off of a sizable expense program, you recently announced for the expense initiative that is supposed to begin in the second half of this year, yet you found some levers to pull this quarter as well.

So my question is what else are you evaluating today? How quickly can you deliver? And should we expect this 4% year-over-year decrease to actually build going into the back half of the year or is there some investment spend taken into consideration as well?.

Good morning. Gerald, you just come off of a sizable expense program, you recently announced for the expense initiative that is supposed to begin in the second half of this year, yet you found some levers to pull this quarter as well.

So my question is what else are you evaluating today? How quickly can you deliver? And should we expect this 4% year-over-year decrease to actually build going into the back half of the year or is there some investment spend taken into consideration as well?.

Well, thanks Ashley for the question. We continuously look at all of our expenses as a way to try to control them better in recognition of the macro environment that we’re in and rightsizing the size of company to the reality of the revenues that are being generated.

So it’s a continuous process, that's why we haven’t announced any program, we haven’t announced any separate initiative. It is day in and day out reduced any expenses and improving our operations and efficiency. I feel good about what we have achieved so far in the first half of this year. We’re looking to do more in the second half.

The severance cost that we are taking this quarter, the run rate will improve and offset the normal merit increase in the second half of this year. So I feel good about going into the second half in terms of continuing to control expense as well..

Got it.

And then can you remind us of what your ROE and ROT targets are? And give us a sense of where you think you can go without any help from rates and how quickly you think you can get there?.

Got it.

And then can you remind us of what your ROE and ROT targets are? And give us a sense of where you think you can go without any help from rates and how quickly you think you can get there?.

Yes, we had indicated a few years back that our target on ROE was about 10%, and return on tangible common equity would be substantially higher than that, so far the first quarter, I mean excuse me for the second quarter return on tangible common equity was about 18%.

We think we can continue -- in the first quarter we’re going to be around 8% and 18%. We think they can continue to grind that up into that 10% range without a significant move with rates or volatility. Obviously I think we saw move in a better market conditions here than we would see a much more significant jump..

Alright, thank you for taking my questions..

Alright, thank you for taking my questions..

Thanks, Ashley. .

Thanks, Ashley..

Thank you. The next question is from Alex Blostein with Goldman Sachs..

Thanks guys good morning. A quick follow-up on the numbers I guess, on expenses and then a big picture question after.

So, lots of moving pieces, you guys announced additional measures and you just have had obviously the -- some of the benefits will come in next six months or so in comp, but I guess if you look at the expense base overall, 2.7ish billion dollar run rate in the quarter today, like ex one of the, ex some of the one timers.

Is that a fair run rate do you guys expect to grow that as the business continues to grow? Or is this kind of the run rate in expenses that we should think about over the next six months to 12 months as you realize some of these savings albeit offset by some of the goal initiatives?.

Thanks guys good morning. A quick follow-up on the numbers I guess, on expenses and then a big picture question after.

So, lots of moving pieces, you guys announced additional measures and you just have had obviously the -- some of the benefits will come in next six months or so in comp, but I guess if you look at the expense base overall, 2.7ish billion dollar run rate in the quarter today, like ex one of the, ex some of the one timers.

Is that a fair run rate do you guys expect to grow that as the business continues to grow? Or is this kind of the run rate in expenses that we should think about over the next six months to 12 months as you realize some of these savings albeit offset by some of the goal initiatives?.

Yes Alex, it’s Todd, we are working real hard to try to maintain this expense level or keep it from growing so that the actions that we have taken around the headcount, the actions that we have taken around occupancy, the very careful analysis of all of our discretionary spend, we want to try to keep overall expenses flat and some of the benefit of that we are using to invest in some of the new revenue streams that Gerald has talked about, but all-in-all, there will obviously be some noise in those numbers we’re trying to keep it as flat as we can..

Got it, that’s helpful. And the second question, just on the current environment, over the last three to four months or so we’ve seen increased pressure on the bigger banks to shrink the balance sheets to get faster compliance with SLR. You see that resonate in the retail markets declining 10ish percentage year-over-year.

Just curious to think about how that impacts your business holistically. You guys are obviously a big tri-party repo manager. So curious to see how that kind of flows through to your operations, and just overall given the fact that you are big counter-party to a lot of the banks on Wall Street.

Is that having any sort of impact on the business overall?.

Got it, that’s helpful. And the second question, just on the current environment, over the last three to four months or so we’ve seen increased pressure on the bigger banks to shrink the balance sheets to get faster compliance with SLR. You see that resonate in the retail markets declining 10ish percentage year-over-year.

Just curious to think about how that impacts your business holistically. You guys are obviously a big tri-party repo manager. So curious to see how that kind of flows through to your operations, and just overall given the fact that you are big counter-party to a lot of the banks on Wall Street.

Is that having any sort of impact on the business overall?.

Yes Alex, great question. Certainly some of our largest clients are shrinking their balance sheets and reducing their repo positions. So what’s interesting is our tri-party repo program has essentially been flat so as the dealers in the U.S. have shrunk the marketplace the global tri-party program has increased.

So we are able to maintain the revenues and their profitability in the business and get a good return on the investments we have made in the tri-party repo reform program. There is no question that as the big dealers in the U.S. shrink their activities, there is some impact in our revenue streams there.

But we are making up for it through enhanced services and capabilities in other places like collateral services. Collateral services, as you may recall was originally designed for the sales side, the buyer side is the one that’s going to serve using it much more heavily.

And so we feel very good about our position to be able to offset the declines in the large broker-dealers with more activity from other clients..

Got it, great. Thanks so much guys..

Got it, great. Thanks so much guys..

Thank you. The next question is from Betsy Graseck with Morgan Stanley..

Hi, two questions, first on the corporate trust, you indicated that, you went through the review and decided to retain it, could you just give us a little bit more color on the ends announced into that decision?.

Hi, two questions, first on the corporate trust, you indicated that, you went through the review and decided to retain it, could you just give us a little bit more color on the ends announced into that decision?.

Sure Betsy thanks for the question. When we said -- in May, when we made more public that we are exploring this, we said at the time, let someone was willing to pay us a premium value for this business, we wouldn’t sell it, because we like the business, we like the attributes of it. It’s a fee-based business.

It has future upside potential with a more normalized monetary policy and is structured notes and mortgage backed securities come back on. We see light at the end of the tunnel.

We would only sell it if in fact someone would pay us the premium what we thought the value of these businesses were it’s a challenging environment for someone to acquire something of this size and complexity.

And so we decided that we couldn’t get the kind of premium that we thought that this business was worth, and we think that it’s much more valuable in our hands and we can continue to build upon it and leverage it, and it’s a great business. And that’s why I said we have always liked it.

It was only a question whether it was more valuable to someone else than versus us..

Okay. So, I mean obviously the Street know that there is a increased activism in the Company.

And I guess the underlying question is, was this undertaken impart to answer questions to those folks or were you able to get to higher ROE, RTCE expectations the work you’re doing now on the expense side?.

Okay. So, I mean obviously the Street know that there is a increased activism in the Company.

And I guess the underlying question is, was this undertaken impart to answer questions to those folks or were you able to get to higher ROE, RTCE expectations the work you’re doing now on the expense side?.

Well, the consideration to begin we have started a long time ago, so let’s start with that. Our Board has always been very active and we as a management team have been very active. And looking at our -- all of our portfolio of businesses and making sure that they’re best held in our hands versus someone else.

And on corporate trust in some ways it was a simple math in a low interest rate environment with a level of deposits that were generated, if someone could make better use of those deposits and get a better margin on it and pay us a premium for the business that’s when we would consider.

To the extent that someone couldn’t take advantage of it, we’re happy to have the business and continue to own it and grow it and that’s our leading market share of business. So that was the core reason for that.

We think we can achieve our capital ratios, our leverage ratios, our liquidity coverage ratios, all within our own needs, irrespective of retaining the corporate trust business..

Got it. And then just separately, kind of ties into the collateral management question earlier, but as the fed starts to well ends tapering and then starts to increase reversed repo program, obviously you’re in the middle of that.

And with money market funds management product you have got as well as with the tri-party exposure that you’ve got, maybe you could get, you’re in a unique position to give us some color on how you think that higher increased RRP program is going to impact the financial markets?.

Got it. And then just separately, kind of ties into the collateral management question earlier, but as the fed starts to well ends tapering and then starts to increase reversed repo program, obviously you’re in the middle of that.

And with money market funds management product you have got as well as with the tri-party exposure that you’ve got, maybe you could get, you’re in a unique position to give us some color on how you think that higher increased RRP program is going to impact the financial markets?.

Well, I’ll start with part of the answer and then I’ll turn it over Todd, Todd has become a student of this as well as Curtis. We are the vehicle through which the reserve repo program of the Fed is -- we’re the mechanism for allowing it to happen in the marketplace or for them to put the program in place.

So and the Fed is a client of ours in that regard and so we do see the activity running through us and we’re not going to violate any confidences there. But I think it is certainly one of the tools in the Fed’s tool box in terms of managing monetary policy and interest rates. And so maybe with that I’ll turn it over to Todd or Curtis..

Yes. I would just add Betsy that given the new liquidity and capital rules it’s going to be difficult for the Fed to open market transactions the way they’ve done in the past, hence the reserve repo program where they go directly to money market funds came into place.

I think there is some question about just how much the Fed wants to expand that program. And obviously if they do expand it they would do through the tri-party repo so we do see that activity.

The other alternative that they have to increasing interest rates or drain it’s to either sell some of the assets that they have or increase the interest that they pay on access reserves or in this term deposit facility that they have in the banking system.

So if they do reserve repo the cash will come out of the banking system and it will go into money market funds based on price, and then the banking system would have to bid against that some of the cash that went into those funds would come back into the banking system.

But I think it composites it’s kind of that simple, and as reserve repo grows the access reserves should decline..

Thank you. The next question is from Glenn Schorr with ISI..

Hi, thanks very much.

So the actions that you’d described taken to offset some of the lower rates and the actions in Europe, I am curious if you feel that has any material change on your asset sensitivity once all the changes are in motion I heard you on the revenue neutrality, but just curious on what that means in rising rate environment in the U.S.?.

Hi, thanks very much.

So the actions that you’d described taken to offset some of the lower rates and the actions in Europe, I am curious if you feel that has any material change on your asset sensitivity once all the changes are in motion I heard you on the revenue neutrality, but just curious on what that means in rising rate environment in the U.S.?.

Yes. As you can tell from our NIR position we’ve taken a bit of a defensive stance we’ve actually reduced our asset sensitivity substantially from where we were last year. We do pay for that a little bit on our NIM there is no question about it. There will be a little bit of an increase as we do make that transition Glenn.

I don’t think it will be significant it will be in the vicinity of about 10% so our sensitivity would increase about 5% to 10%. And we will be users of the health and maturity account as well so there’s less sensitivity to the capital ratios..

Got it, okay cool.

And speaking the capital ratios, just looking for a drop more color on what specifically got consolidated from asset management to produce the drop in the ratios? And I am just curious on timing on why it happened this quarter I am just not familiar with it?.

Got it, okay cool.

And speaking the capital ratios, just looking for a drop more color on what specifically got consolidated from asset management to produce the drop in the ratios? And I am just curious on timing on why it happened this quarter I am just not familiar with it?.

Sure, we actually consolidated some of the CLOs that one of our asset managers managed, actually quite a few of the CLOs. So as we transition from Basel I to Basel III we actually reviewed the treatment of those consolidated assets.

And we determined that even though we have no economic risk to them, we have no credit exposure at all that they should be included in our risk weighted assets.

We actually expect this might be a temporary item FASB has just recently discussed the possibility of adapting a new standard that could be adopted as early next year and it would lead to us probably in consolidating some or even most of these assets as early as next year..

Okay, last one for me is just the 24% decline in business development cost.

Is that -- is there a business to component to that impact or is that more of a sustainable decline because it actually -- it really moved the needle?.

Okay, last one for me is just the 24% decline in business development cost.

Is that -- is there a business to component to that impact or is that more of a sustainable decline because it actually -- it really moved the needle?.

Yes, there are two major components and there couple, but I’d say the two major components in there Glenn is our marketing expenses and our travel and entertainment expenses. We’ve been much more aggressive in managing our -- those discretionary expenses.

For example, we have discouraged internal travel, we’ve encouraged, increased use of video and audio conferencing. And so rather than pull some of our operating committee together from time-to-time, we are doing it virtually much more frequently.

And we are doing that across the board, we are not decreasing important revenue producing travel, this is internal related travel. Also last year, we had a substantial campaign on our marketing and branding efforts and we’ve reduced the spend associated with that. We are going to try to keep this discipline and sustain these levels.

Now there is some seasonality to this with conference and so forth, so we would expect the third quarter is typically pretty good and the fourth quarter tends to be a little bit higher..

Okay, thank you for that..

Okay, thank you for that..

Thanks, Glenn..

Thank you. The next question is from Ken Usdin with Jefferies..

Thanks. Good morning. Just one follow-up on the NII, outside of the puts and takes, can you also tell us whether or not you think you can actually maintain this current level of NII, your comments were more focused on the offset between extending versus drags from ECB.

But what’s going on underneath that surface?.

Thanks. Good morning. Just one follow-up on the NII, outside of the puts and takes, can you also tell us whether or not you think you can actually maintain this current level of NII, your comments were more focused on the offset between extending versus drags from ECB.

But what’s going on underneath that surface?.

Yes, I think we will be able to as we model this out and obviously it’s going to be a bit sensitive to interest rates. But as we go through our modeling here, I think in the next few quarters, we will be able to maintain the level at this rate or in the ballpark of this rate, maybe slightly higher..

Okay. Two questions on investment servicing, just core asset servicing ex-security lending was up only slightly sequentially but it was up 4% year-over-year. I am just wondering if you can walk us through trends underlying the asset servicing. You did have a seed growth and I get that you had not as much of an equity sensitive custodian.

But just only a $5 million kind of core increase in servicing can you give us some flavor for the growth or the traction of growth that’s underneath that?.

Okay. Two questions on investment servicing, just core asset servicing ex-security lending was up only slightly sequentially but it was up 4% year-over-year. I am just wondering if you can walk us through trends underlying the asset servicing. You did have a seed growth and I get that you had not as much of an equity sensitive custodian.

But just only a $5 million kind of core increase in servicing can you give us some flavor for the growth or the traction of growth that’s underneath that?.

Yes Ken, it is Gerald. Just a couple of comments there, one you’d recall we did lose a couple of clients over the course of the last 12 months.

Those losses are now in the full run rate and that’s why you’ve seen a softness in some of the asset servicing revenues that’s now fully in a run rate and we think we feel good about the pipeline in a go forward. We’re attracting good clients and so it’s a little bit soft this quarter, but we expect it to pick up in the future..

Okay. And my last one just about issuer services and you point out the drags of both sides of the business but second quarter is typically a seasonally stronger one that leads to the bigger jump in the third.

So can you also just walk us through corporate trust and ADRs and the drivers there?.

Okay. And my last one just about issuer services and you point out the drags of both sides of the business but second quarter is typically a seasonally stronger one that leads to the bigger jump in the third.

So can you also just walk us through corporate trust and ADRs and the drivers there?.

Sure so the issuer services on a year-over-year basis I think it was down more than $60 million. Part of what we saw in the second quarter was last year we saw a little more dividend action in the second quarter, and due to timing, we’re going to see some of that in the third quarter.

So we would expect the third quarter to show the typical bounce that we get in seasonality around DRs and probably even a little bit higher than typical. So that was one of the reasons for softness there.

And the reason is we also had fewer of these, kind of pass through, where some of our technology investments in corporate trust paid for clients and we see that in our revenue as well as in expense line. We had a little bit few -- a little bit less than that..

Okay, great thank you..

Okay, great thank you..

Thank you..

Thank you. The next question is from Mike Mayo with CLSA..

Hi. Two as you say, reduced structural costs maybe you need to further reduce the structure and at the annual meeting I asked about the merits of having both assets serving along with asset management and Gerald you said that you have done the work and my thought is perhaps you need to show your work.

Because the way we look at, the reported ROE has not been over the target of 10% since at least 2009.

And so if this is a superior structure should there at least be an ROE in the double-digits?.

Hi. Two as you say, reduced structural costs maybe you need to further reduce the structure and at the annual meeting I asked about the merits of having both assets serving along with asset management and Gerald you said that you have done the work and my thought is perhaps you need to show your work.

Because the way we look at, the reported ROE has not been over the target of 10% since at least 2009.

And so if this is a superior structure should there at least be an ROE in the double-digits?.

Well, Mike we -- just as I said at the shareholder meeting, it’s a business we like a lot. We think there is a lot of good benefits with the two businesses together. Investment management is a great contributor to our earnings, it’s capital light it’s fee-based.

We’re getting collaboration across the businesses we learn from each other, we are collaborating our new products, new services, new capabilities. When we have done math as I said at the annual meeting, we don’t take the math works, there is a lot of tax challenges, a lot of regulatory challenges associated with it.

We are in fact improving the margins both in investment services and in investment management and that was evidence this quarter, in investment management you saw a 2% improvement year-over-year in the margins in the business, why we’re still investing in it? So we think we can improve the returns and the margins and drive a great business together.

We like the diversity of the earnings, we like the fact that they mutually service the same client, I think it’s a great combination..

I have three follow-up questions, should I ask one and then re-queue or ask all three now?.

I have three follow-up questions, should I ask one and then re-queue or ask all three now?.

Ideally one now and then re-queue Mike..

Okay.

Well, so what is the dollar amount of synergies and to repeat what I said before, again this is such a good combination, why is the ROE been below the cost of capital for the last five years?.

Okay.

Well, so what is the dollar amount of synergies and to repeat what I said before, again this is such a good combination, why is the ROE been below the cost of capital for the last five years?.

So Curtis maybe you want to touch base a little bit on some of the synergies..

Yes. So Mike I think that when you think about investment management we’re serving the same clients. In so many cases that our clients run investment services business, you’ve asked for a very specific number.

Truthful what is happening is these clients become clients with both parts of our organization, but with this continuous ability to connect to the investment services clients that's such powerful part of investment management. Let me give you a -- just in this quarter, a couple of examples.

We had a foundation, a line of the investment servicing business that is expressing interest and expanding their portfolio in a direction of direct lending investment vehicles.

The team that covers them for investment services are well aware of our capabilities in this space introduced us to that client and it became a win for us in terms of getting an investment management mandate.

The other part of the investment services business that’s been a real winner for us from past several months has been offering our private banking services for the clients approaching.

So the financial advisors that approach and serves, many of them don’t have access to their own private banking activity, so we’ve linked those two actually invested in having a team in our private bank, make lending available to them and have seen nearly $0.5 billion of loan volume over a pretty short time and actually on really what we call the pilot effort that we’re now actually planning to make it a much bigger part of the business.

If you look at our cash business today, because we’re at a low interest environment, the overall economics of the cash business are not really what we think the contingent opportunity is in a more normalized rate environment, but just think of all the changes that occurred in the money market fund world with the question was asked earlier about the basic change in market structure.

We think we’re well positioned to provide services around cash products into the higher rate environment that will be very valuable to the shareholders of BNY Mellon. So those are some examples of the places where there is real synergy..

Okay. I’ll re-queue. Thanks..

Okay. I’ll re-queue. Thanks..

Thanks Mike..

Thank you. The next question is from Brennan Hawken with UBS..

Good morning. So I guess I’m just, I’m a little bit confused about why you would want to be give up your asset sensitivity or lose some of the asset sensitivity here. I mean the NIM currently at like roughly 100 basis points is just far from heroic you have got Yellen in making comments that rates might be moving higher.

So can you help us understand what drove that decision a little bit with a little bit greater clarity?.

Good morning. So I guess I’m just, I’m a little bit confused about why you would want to be give up your asset sensitivity or lose some of the asset sensitivity here. I mean the NIM currently at like roughly 100 basis points is just far from heroic you have got Yellen in making comments that rates might be moving higher.

So can you help us understand what drove that decision a little bit with a little bit greater clarity?.

So you’re talking about moving a little bit of the cash that we have in the form of placements into high quality liquid assets. Part of that is compliance with LCR, so we are sitting on a massive amount of cash, placements are not LCR compliant. So this is a fairly easy way for us to comply and we will generate a little bit of additional NIR.

We don’t want to give up much of our interest rate sensitivity, so you’re not going to see a significant move there. We do think that there is growth in opportunity cost and the capital cost to join that Brennan. But you will see a modest adjustment..

Yes. And Brennan some of the other activities we’re working on, you’ve seen the loan book and our wealth management business grow, we like that sort of that asset. You’ve seen some of our secured financing for some of our collateral management clients’ increase.

We are looking at other area within our asset capabilities to generate better returns on those assets and still keep the interest rate sensitivity available to us for our win rates to improve..

Okay. Thanks for that color. And then if we think about your asset management business and the sort of adjusted pre-tax margin there, if we look at what happened last year in that business, it contracted about 100 basis points versus 12 and I understand the majority of that was investment in distribution.

But if we look at other asset management firms, they saw a rather significant expansion in margins last year. So I guess what's holding back the asset management business given how constructive the market is? Is there a structural impediment there, does it have something to do with how the agreements with the affiliates are structured.

If you can maybe help us understand that a little bit that be great?.

Okay. Thanks for that color. And then if we think about your asset management business and the sort of adjusted pre-tax margin there, if we look at what happened last year in that business, it contracted about 100 basis points versus 12 and I understand the majority of that was investment in distribution.

But if we look at other asset management firms, they saw a rather significant expansion in margins last year. So I guess what's holding back the asset management business given how constructive the market is? Is there a structural impediment there, does it have something to do with how the agreements with the affiliates are structured.

If you can maybe help us understand that a little bit that be great?.

Yes Brennan, it is Curtis. So first of all I would say that last year in addition to the investments that we made to grow our wealth management to expand our reach to financially expand our budgets through primarily in the U.S. to drive us and also to grow geographically.

Those investments they sort of dampen margin, but I would also would call out the fact that we had a pretty some meaningful fee waiver environment, so we have a big part of our business is absolutely impacted by low or short rates.

When you compare our overall enterprise to other peers that are sort of over the $1 trillion mark, we have a substantially smaller percentage of assets that are any equity asset class, and so the -- and I would also point out that our equity AUM is also pretty diversified, lot less as a percent is U.S.

equities which have -- and especially did here last year. So we don’t -- well it was certainly a tailwind for us. It was not nearly the tailwind that it would have been for investment firms that are less diversified and more similarly exposed to equity AUM.

I don’t think that the boutique structure certainly is one of our investment firms is very focused on their client base, their asset classes. They have a wider array of their own activities, both institutional and through retail distribution channels. But I actually think that they would benefit from the scale.

We have firms that are 30, 40, 50 people highly focused on a very specific asset class, and we give them geographic reach in terms of clients and have a firm on the East Coast of United States that’s raising money all over Asia and throughout the Sovereign Wealth Fund World without having to actually build their own infrastructure to do that.

So I think it is a -- we’re pretty excited about what we do. We are investing in it and you’re absolutely focused on improving margins. That’s why we are investing with where we are.

If you look at the peers who have higher margins than us, they generally have substantially larger percentage of their assets in the retail space, and they have a larger share currently, they are benefiting from the equity tailwind. Of course that creates more profit volatility and margin volatility, if you look at it through time.

But we are investing to improve our margins and are pretty excited about our opportunities there..

Yes just one final bit of color, I think you are seeing evidence of it in the 200 basis points improvement in margin year-over-year. This year and early next year are sort of the high watermarks in terms of the level of investment and we showed you in April. We expect an improvement in margin as those investments start to pay off.

And also I might add, the investments we are making are not high risk investments. It is investing in wholesalers and distribution. It’s investing in wealth managers. We are bringing in clients. That’s starting to show up in numbers now. These are investments we have very-very conference on the returns..

Okay, thanks for the color..

Okay, thanks for the color..

Thank you..

Thank you. The next question is from Brian Bedell with Deutsche Bank..

Hi. Great, thanks. Good morning..

Hi. Great, thanks. Good morning..

Good morning, Brian..

Yes good morning. On the, just back to the corporate trust, on the expense side of this can you just talk a little bit about to what degree some of the consolidation of this platforms were involved in the prior cost reduction program, and whether the dynamic changed upon your decision.

And then, so should we be thinking about any other further backdrop of consolidations as the potential expenses on the corporate trust now that you are keeping in?.

Yes good morning. On the, just back to the corporate trust, on the expense side of this can you just talk a little bit about to what degree some of the consolidation of this platforms were involved in the prior cost reduction program, and whether the dynamic changed upon your decision.

And then, so should we be thinking about any other further backdrop of consolidations as the potential expenses on the corporate trust now that you are keeping in?.

Yes, the primary operating platform for corporate trust is the trust accounting system. It’s really dedicated to corporate trust. They are the last user above it, and actually we were in a migration mode to our end-stage platform called GSP, for those of you who are interested in acronyms.

We’re in the process of doing the conversion and we are going to continue the process and it should be completed next year. And so there is no change in that going forward. And we will realize better operating metrics as a result of it..

Okay. So that’s yes, it’s interchanged through sort of expense -- based on you keeping that. .

Okay. So that’s yes, it’s interchanged through sort of expense -- based on you keeping that. .

Brian, you’re breaking up, if you could….

I’m sorry, so there is no change in the expense fee based on you are keeping that, it’s the takeaway there?.

I’m sorry, so there is no change in the expense fee based on you are keeping that, it’s the takeaway there?.

No, not at all..

And then on the revenue side, maybe question for Curtis and Brian -- and congrats on your extended role by the way. On the clearing business, you know the revenue, hope that well given charges definitely declined in the quarter.

So I was just wondering if that was due to the component that’s related to licensing and asset management or are you gaining new clients and is the run rate better there? And then similarly for Curtis, you know the organic growth has been very strong in asset management recently, this quarter little bit weaker, maybe if you could just address the LDI outflow and your view of the organic growth coming in the next one to two quarter overall?.

And then on the revenue side, maybe question for Curtis and Brian -- and congrats on your extended role by the way. On the clearing business, you know the revenue, hope that well given charges definitely declined in the quarter.

So I was just wondering if that was due to the component that’s related to licensing and asset management or are you gaining new clients and is the run rate better there? And then similarly for Curtis, you know the organic growth has been very strong in asset management recently, this quarter little bit weaker, maybe if you could just address the LDI outflow and your view of the organic growth coming in the next one to two quarter overall?.

Brian, it is Brian Shea. I will start with the clearing question and then I will turn it over to Curtis. The clearing business has been pretty strong with core fee growth driven by significant growth in mutual fund assets and asset-based fees offset by higher cash earnings receivers and lower DARTS as you recognized.

I think the underlying metrics behind the clearing business are all really pretty strong. In this quarter we have a record level of client assets in custody. We have a record number of total individual investments on our platforms globally. We have a record levels of mutual fund assets on our platform overall.

And growing margin balances as you can see in the metrics year-over-year, and you know the slight -- lots of low rates and discussions about money market industry, pretty solid cash management balances.

And I would not actually to reinforce Curtis’ point that the market share urging clients choosing, because they decide which cash management alternatives they use. But the clients have chosen Dreyfus more than ever before, and so we have a record level of market share of Dreyfus cash management on the purging platform.

Again, when an interest rate environment changes that will be a much more valuable linkage in synergies between the investment management and investment services business. So that’s my perspective on clearing I am going to turn it over to Curtis..

Yes and on the organic side, first of all we will tell you that we had a long-term out flows this quarter of 13 billion. It’s a pretty unique situation actually and that one of our large LDI clients actually decided to take their LDI activities in-house.

So it was not any way related to our investment performance or service, we always hate losing any business, but completing our standard decisions that they may -- to do that.

I will tell you that our pipelines around LDI specifically continue to be robust, pension de-risking is still very much alive and well and I would actually say it’s expanding geographically. So our largest business is Insight, which has a large book of UK, LDI business and I can tell you that the global interest in LDI is definitely not shrinking.

One of the nice things about just -- since we are talking about the Insight, I will tell you the Insight, the tools that you’ve to be able to perfectly model the liabilities, especially UK liabilities are having inflation sensitivity component.

You have to be very good at understanding market dynamics and what drives risk and return and in the quarter, Insight specifically actually had a very significant amount of inflow into alternative strategies absolute return strategies where they are taking a lot of their capabilities and creating absolute return products, if their clients, who have been very satisfied with them in the LDI space are allocating to them and also getting broader interest.

We like the short term side like the rest of the industry did experience outflows our outflows we think are roughly in inline with that the industry saw in the second quarter both some of it being tax payment, some of this being that clients were certainly in the beginning of the quarter reallocating short-term cash into some of the higher yielding on assets and actually that’s the story in fixed income as well.

Our product outflow there is related to mostly short duration fixed income where clients are reallocating. In equities the dynamic there has really been three things. The equity rebalancing so the increase in equity markets has caused clients to move money. But we’ve also seen clients move assets around into past strategies.

So in this quarter, you actually will see our increase of 7 billion was almost entirely equity index. So it’s nice thing you have a diverse range of products to be able to -- it’s leaving one place, it’s going another money in motion is big part of our advantage here..

Great, great thanks very much for the thorough answer..

Great, great thanks very much for the thorough answer..

Wendy, I think we have one more question..

Thank you. The next question is from Cynthia Mayer with Bank of America Merrill Lynch..

Hi, thanks a lot.

So just getting back to the expense management, you and others have been mentioning for a while that the pressure of compliance cost and I am just wondering looking ahead, do you see those leveling off? Is that a pressure that you feel is abating, so that to the extent you do streamlining, more of it will fall to the bottom line and same question and I guess the combining of your platforms, is there upfront IT for that?.

Hi, thanks a lot.

So just getting back to the expense management, you and others have been mentioning for a while that the pressure of compliance cost and I am just wondering looking ahead, do you see those leveling off? Is that a pressure that you feel is abating, so that to the extent you do streamlining, more of it will fall to the bottom line and same question and I guess the combining of your platforms, is there upfront IT for that?.

Great question, Cynthia, so first on the regulatory side, the rate of increase is slowing down, it is creating greater clarity around the rules and the regulations and what we need to do to be in compliance with them.

But importantly, we cannot sacrifice having a well-controlled, well risk-managed firm we are absolutely committed to that and we’re not going to sacrifice having a great firm in those categories.

But we do in fact see the rate of growth moderating and our expense management is taking into consideration, continuing to fund those activities and so that’s why we are very diligent around all the other things that we can control so that we can fund new investments, we can fund having a well controlled environment and continue to grow our businesses and serve our clients well.

So it’s all factored into the expense control programs that we put in place. And the platform consolidations again the technology investments that we’re making are factored in the expense base and we’re realizing the synergies out of the platform consolidations and it’s in the run rate..

Okay. Thanks a lot..

Okay. Thanks a lot..

Thanks..

Thank you. Everyone thank you very much for dialing in today. I know you had a lot of interest in our results and so follow up questions to Izzy Dawood or Andy Clark they are available to answer your questions and thank you for your interest in us. Have a great..

Thank you. If there are any additional questions or comments, you may contact Mr. Izzy Dawood at 212-635-1850. Thank you, ladies and gentlemen, this concludes today’s conference call. Thank you for participating..