Bank of New York Mellon Corp Q1 2026 Earnings Call Transcript

Bank of New York Mellon Corp (NYSE: BK) Q1 2026 Earnings Call dated Apr. 16, 2026

Presentation

Operator

Good morning, and welcome to the 2026 First Quarter Earnings Conference Call hosted by BNY. [Operator Instructions] 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’s consent.

I will now turn the call over to Marius Merz, BNY Head of Investor Relations. Please go ahead.

Marius Merz — Head of Investor Relations and Corporate Development & Co-Head of Business Finance

Thank you, operator. Good morning, everyone, and welcome to our first quarter earnings call. I’m here with Robin Vince, our CEO; and Dermot McDonogh, our CFO.

As always, we will reference the quarterly update presentation, which can be found on the Investor Relations page of our website at bny.com. And I’ll note that our remarks will contain forward-looking statements and non-GAAP measures. Actual results may differ materially from those projected in the forward-looking statements. Information about these statements and non-GAAP measures is available in the earnings press release, financial supplement, and quarterly update presentation, all of which can be found on the Investor Relations page of our website. Forward-looking statements made on this call speak only as of today, April 16, 2026, and will not be updated.

With that, I will turn it over to Robin.

Robin Vince — Chief Executive Officer

Thanks, Marius. Good morning, everyone, and thank you for joining us.

I’ll begin with a few broader comments before Dermot takes you through our financial results. Referring to Page 2 of the quarterly update presentation. BNY has started the year with a strong performance in the first quarter. Earnings per share of $2.24 grew 42% year-over-year, both on a reported basis and excluding notable items. Record revenue of $5.4 billion was up 13% year-over-year, reflecting broad-based growth across our securities services and market and wealth services businesses. And we delivered over 800 basis points of positive operating leverage while making meaningful investments in new products, capabilities, AI, and, critically, our people and culture. Taken together, this combination of strong top-line growth and significant operating leverage resulted in pre-tax margin expansion to 37% and improved profitability with a return on tangible common equity of 29% in the quarter.

BNY’s position at the heart of global financial markets with platforms across custody, securities settlement, collateral payments, trading, wealth investments, and more supports durable financial performance for our company, enabling us to power our clients’ growth as they navigate an increasingly complex landscape. While the path of global markets is difficult to predict with certainty, what is clear is that the underlying trends, higher levels of activity, greater complexity, new technologies, and a resulting need for scale efficiency and connectivity are more relevant than ever for our clients.

As I mentioned in my shareholder letter earlier this year, the portfolio of BNY’s businesses is unique, but it is how we are embracing new ways of working, our adoption and integration of new technologies, and our strong culture that allows us to create truly differentiated solutions. Clients are increasingly recognizing the value of holistic solutions that support the full life cycle of their activity, whether it is managing liquidity, optimizing collateral, supporting higher trading volumes, or getting ready for the future of financial market infrastructure. Our work to operate together as one BNY through both our platforms operating model and our commercial model better enables us to bring the full breadth of our capabilities together in service of our clients.

A good example of this from the first quarter is our work with Allianz Global Investors, one of the world’s leading active asset managers. AGI has selected BNY to support optimizing their investment operating model, leveraging the breadth of our global capabilities. This integrated model will help AGI deliver exceptional experience front to back while placing AI and modern data infrastructure at the heart of their operations to enhance productivity, enable faster work, clearer insights, and better outcomes for their teams and clients alike.

In another example, PayPal has selected BNY to provide institutional-grade digital asset custody, supporting their digital payments, wallets, and financial services for millions of users globally. And just last week, the U.S. Department Treasury announced that they have selected BNY as financial agent for Trump Accounts, the U.S. government’s investment savings initiative for children aimed at building a strong financial foundation for our next generation. BNY will manage the national infrastructure for the program and collaborate with Robinhood, which will provide brokerage and initial trustee services. These examples illustrate our strategic evolution toward deeper integration between our products delivered with the technology and scale of BNY’s differentiated platforms.

Over the next phase of BNY’s transformation, one of the most significant enablers of being more for our clients and running our company better is AI. And so, we felt that this was an opportune time to spotlight how we are going about AI at BNY. Turning to Slide 3 of the presentation. As a reminder, our work to set the foundation for reimagining our company has included intentional and consistent investments in AI over the past several years. We took a very deliberate approach to AI through the lens of integration, adoption, and importantly, our people and culture. We embraced a platform’s approach to embedding AI across the company, creating our AI Hub in 2023, so we could develop the enterprise capabilities, strong governance framework, and training to empower every employee to embrace AI.

More than two years ago, in collaboration with NVIDIA, BNY became the first global bank to deploy a DGX SuperPOD, and in the same year, we launched Eliza, BNY’s AI platform. Outlined on Page 4, our vision for AI at BNY is that it is for everyone, everywhere, and everything. As is the case with many things, the key to making it work is culture. We took a people-first approach. Over the last year, we focused on broad adoption. We made Eliza available to 100% of our employees and supported advanced learning and development through a series of training programs. This approach to enterprise-wide enablement has already allowed us to develop more than 200 AI solutions and to introduce digital employees, multi-agentic solutions that operate alongside human colleagues. In 2026, we are doubling down on depth, moving from AI point solutions to using AI to enhance end-to-end processes, reducing manual touch points, improving cycle times, strengthening control outcomes, and to build more connected intelligence by linking data, workflows, and expertise to enhance the service and value proposition for our clients.

On Page 5, we show just some of the initial outputs, tangible results of AI enablement and impact across improved business and operating performance, driving greater efficiency and product innovation. None of these metrics individually show a complete picture of AI at BNY, but taken together, they show something important, that we are systematically embedding AI in our workflows across the entire company. Already, AI is helping us increase the pace at which we innovate our technology, accelerate onboarding, improve client service, and streamline processes. And in combination with our broader efforts to run our company better, AI is starting to contribute to the improved financial performance trajectory at the bottom of the page.

Building on our deliberate strategy and the solid foundation we’ve laid over the past several years, we’re confident that AI will enable us to evolve our business model and enhance how we deliver for clients. Our commitment, not just to deep AI enablement, but the full reimagination of our company, combined with the role that we play in global financial market infrastructure, the breadth of our businesses, and our trusted and deep client relationships together represents a powerful competitive advantage.

Taking a step back and reflecting on the operating environment. While AI was an ever-present theme in markets over the past few months, the first quarter also presented a dynamic market backdrop. Significant volatility was driven by shifting expectations for the paths of growth, inflation, and interest rates amid geopolitical conflicts and evolving policy outlooks. Within this constantly changing environment, our diversified business model, combined with our strong balance sheet allows BNY to serve as a pillar of strength for our clients and for global markets.

Before I hand it over to Dermot, I want to take a moment to recognize our employees around the world for rising to the challenge to execute on our long-term plan to unlock BNY’s full potential for our clients and shareholders. We’ve had a strong start to the year, supported by increasing client engagement and continued progress on our strategic priorities. I’d like to thank our clients for their trust, our employees for their commitment and hard work, and our shareholders for their continued support.

And with that, over to you, Dermot.

Dermot McDonogh — Chief Financial Officer

Thank you, Robin, and good morning, everyone.

I’ll pick up on Page 6 of the presentation with our consolidated financial results for the first quarter. Total revenue of $5.4 billion was up 13% year-over-year. Fee revenue was up 11%. This included 10% growth in investment services fees, reflecting higher client activity, net new business, and higher market values. Investment management and performance fees were up 6%, primarily driven by higher market values and a favorable impact of a weaker U.S. dollar, partially offset by the impact of the mix of AUM flows. While not on the page, I will note that firm-wide AUC/A of $59.4 trillion increased by 12% year-over-year. This reflects net client inflows, higher market values and the favorable impact of the weaker dollar. Assets under management of $2.1 trillion were up 6%, primarily driven by higher market values and the weaker dollar, partially offset by cumulative net outflows.

Foreign exchange revenue was up 49% year-over-year on the back of higher volumes resulting from elevated market activity and supported by new products and capabilities. Investment and other revenue was $271 million in the quarter, including approximately $135 million of investment-related gains and $50 million of net securities losses. Net interest income increased by 18% year-over-year, primarily driven by continued reinvestment of investment securities at higher yields and balance sheet growth, partially offset by deposit margin compression.

Expenses of $3.4 billion were up 5% year-over-year, both on a reported basis and excluding notable items. This was primarily driven by our commitments to higher investments in our businesses, higher revenue-related expenses, the unfavorable impact of the weaker dollar and employee merit increases, partially offset by continued efficiency savings. Provision for credit losses was a benefit of $7 million in the quarter, primarily driven by improvements in commercial real estate exposure, partially offset by changes in macroeconomic and other factors. On the back of significant positive operating leverage of 833 basis points, pretax margin expanded to 37% and return on tangible common equity was 29%. Taken together, we reported earnings per share of $2.24, up 42% year-over-year.

On to capital and liquidity on Page 7. Our Tier 1 leverage ratio for the quarter was 6%, flat sequentially. Tier 1 capital increased by $532 million, primarily driven by preferred stock issuance and earnings retention, partially offset by a net decrease in accumulated other comprehensive income. Average assets increased by 2% on the back of deposit growth. Our CET1 ratio at the end of the quarter was 11%, down 89 basis points sequentially. Our CET1 capital remained approximately flat. This decrease was primarily driven by higher risk-weighted assets, reflecting a single day increase in overnight loan balances on the last day of the quarter, along with higher client activity in agency securities lending and foreign exchange.

Over the course of the first quarter, we returned $1.4 billion of capital to our shareholders, representing a total payout ratio of 87%. And our Board of Directors authorized a new $10 billion share repurchase program. Our consolidated liquidity coverage ratio and net stable funding ratio were at 111% and 131%, respectively.

Turning to net interest income and balance sheet trends on Page 8. Net interest income of $1.4 billion was up 18% year-over-year and up 2% quarter-over-quarter. Like the year-over-year increase described earlier, the sequential increase was primarily driven by the continued reinvestment of investment securities at higher yields and balance sheet growth, partially offset by deposit margin compression. Average deposit balances increased by 3% sequentially, reflecting 2% growth in interest-bearing and 6% growth in non-interest-bearing deposits and average interest-earning assets were up 2% quarter-over-quarter. Cash and reverse repo balances were flat. Loans increased by 6% and investment securities portfolio balances increased by 2%.

Turning to our business segments, starting on Page 9. Securities Services reported a total revenue of $2.7 billion, up 17% year-over-year. Total investment services fees were up 10%. In asset servicing, investment services fees grew by 11%, reflecting higher market values and broad-based client activity. ETF AUC/A were up 33% year-over-year on the back of higher market values, client inflows and net new business and our alternatives AUC/A were up 20%. I want to highlight that consistent with our strategy to deliver the breadth of BNY to our clients, over 50% of the clients that awarded asset servicing new business in the first quarter also awarded new business to at least one of our other lines of business.

In issuer services, investment services fees were up 4%, reflecting growth in both corporate trust and depositary receipts. I’ll note that for the first time in our history, corporate trust reached $15 trillion of total debt serviced, and we’re particularly pleased with our continued market share gains in CLO servicing. Once again, the breadth of our capabilities is a powerful differentiator. Our clients clearly recognize the superior value proposition of a single provider for corporate trust, asset servicing, collateral, liquidity solutions and more.

In securities services overall, foreign exchange revenue was up 44% year-over-year, reflecting higher client volumes. Net interest income for the segment was up 20% year-over-year. Segment expenses of $1.6 billion were up 5% year-over-year, primarily driven by higher investments and revenue-related expenses, the unfavorable impact of the weaker dollar and employee merit increases partially offset by efficiency savings. Securities services reported pretax income of $1 billion, a 46% increase year-over-year and a pretax margin of 39%. Investment-related gains added 3 percentage points to pretax margin in the quarter.

Next, markets and wealth services on Page 10. Markets and wealth services reported total revenue of $1.9 billion, up 11% year-over-year. Total investment services fees were up 10%. During the quarter, we formed our wealth solutions business by realigning Archer’s managed account solutions from asset servicing to Pershing. This integration further strengthens our capabilities to serve wealth advisors by adding Archer’s market-leading distribution and managed accounts expertise to deliver fully integrated end-to-end solutions across the entire wealth ecosystem. In wealth solutions, investment services fees were up 6% reflecting higher market values and client activity.

Net new assets were $22 billion in the quarter, representing an annualized growth rate of 3% and AUC/A of $3.3 trillion were up 14% year-over-year. In clearance and collateral management, investment services fees increased by 19%, reflecting broad-based growth in collateral balances and clearance volumes. Average collateral balances of $7.8 trillion increased by 18% year-over-year, reflecting higher markets activity and growth on the back of a robust environment for financing with U.S. Treasury securities, strong money market fund balances, and increasing client demand for non-cash collateral.

Ahead of the central clearing mandate for U.S. Treasuries, we are engaging with central counterparties and our clients, and we’re delivering innovative solutions from across BNY that help them find new ways to access the markets, clear transactions, and manage collateral and margin. In the quarter, we also saw strong growth in clearing volumes, reflecting net new business wins, particularly in international clearance and from expanding wallet share with existing clients doing more with BNY.

In our payments and trade business, investment services fees were up 5%, primarily reflecting net new business. Payments and trade delivered another solid quarter with continued sales momentum, including numerous multi-line of business wins, particularly with FX and global liquidity solutions. Net interest income for the segment overall was up 15% year-over-year. Segment expenses of $937 million were up 6% year-over-year, primarily driven by higher investments, employee merit increases, higher revenue-related expenses and the unfavorable impact of the weaker dollar, partially offset by efficiency savings. Taken together, our markets and wealth services segment reported pretax income of $961 million, up 18% year-over-year and a pretax margin of 51%.

Turning to investment and wealth management on Page 11. Investment and wealth management reported total revenue of $825 million, up 6% year-over-year. Investment management and performance fees were up 6%, primarily driven by higher market values and the favorable impact of the weaker dollar, partially offset by the impact of the mix of AUM flows. Segment expenses of $726 million were up 2% year-over-year, primarily driven by the weaker dollar, employee merit increases and higher investments, partially offset by efficiency savings. Investment and wealth management reported pretax income of $90 million, up 43% year-over-year and a pretax margin of 11% versus 8% in the prior year quarter.

As I mentioned earlier, assets under management of $2.1 trillion increased by 6% year-over-year. In the first quarter, long-term active flows were flat, reflecting net inflows into fixed income and LDI strategies and net outflows from equity strategies. We saw $10 billion of net outflows from cash and $7 billion of net outflows from index strategies. Wealth management client assets of $339 billion increased by 4% year-over-year, reflecting higher market values.

Page 12 shows the results of the other segment. I’ll close with an update on our financial outlook for the year. In light of our strong performance in the first quarter, we are raising our outlook for total revenue, excluding notable items for the full year 2026 and now expect approximately 6% year-over-year growth. That includes our expectation for full year 2026 net interest income to be up approximately 10% year-over-year. We expect full year 2026 expense growth, excluding notable items, to be at the top of the 3% to 4% year-over-year growth rate range that we provided in January. And we continue to expect a quarterly tax rate of approximately 23% for the remaining quarters this year.

I want to leave you with three important points. First, we delivered a strong financial performance in the first quarter and continue to serve as a pillar of strength for our clients amid a dynamic market environment. Second, the combination of our unique portfolio of businesses, our role in global financial market infrastructure, our deep and trusted client relationships, our diversified business model and the strength of our balance sheet represents an exceptional client value proposition and a powerful competitive advantage. And finally, what truly differentiates BNY today is our ability to mobilize all of the above for the benefit of our clients and shareholders.

With that, operator, can you please open the line for Q&A?

Question & Answers

Operator

[Operator Instructions] We’ll take our first question from Brennan Hawken with BMO Capital Markets.

Brennan Hawken

Good morning. Thanks for taking my questions. I wanted to start with deposits. So, the deposit trends were stronger than expected. I was hoping maybe you could speak to quarter-to-date trends and around betas, specifically for the euro and pound deposit betas, given we’ve got hikes now in the forward curve, how should we be thinking about the betas for those currencies? Thanks.

Dermot McDonogh — Chief Financial Officer

Okay. Thanks for the question, Brennan. Let me start with overall balances and trends. As you will recall from our call on Jan. 13, we finished last year with strong momentum on deposits. And with the macro uncertainty and just how the events of the quarter played out, we saw clients holding higher levels of liquidity. And so, as a consequence of that, you see the overall balance being a little bit elevated. And then, you saw the mix between IBs and NIBs, we attracted more NIBs than anticipated. So, overall, on the U.S. dollar side, it really was the balance and the mix that drove the NII outperformance in the quarter. And within particular businesses, it really was in issuer services and asset servicing, specifically in corporate trust, that were the two businesses that saw the notable benefit.

As it relates to the non-dollar side of things, euro and sterling is really a smaller part of our overall portfolio. It only accounts for roughly 25% of the overall book. So, it’s not a meaningful contributor to NII. For euros and sterling, the betas roughly peaked at 80% on the way up. And so, we kind of — for dollars and non-dollars, we expect betas to perform in a symmetrical fashion going up as well as going down. That’s how we see it.

Brennan Hawken

Great. Thank you for that. And then, on, I guess, the artist formerly known as Pershing. So, we had really robust year-over-year, both DARTs and AUC growth. But the revenue growth was not quite as robust as those two metrics. So, could you maybe help unpack the primary drivers of the revenue growth and help us understand how we should model that going forward?

Dermot McDonogh — Chief Financial Officer

Sure. So, wealth solutions, as we now are going to call it going forward will be as good as the artist formerly known as Pershing. And we kind of just — we continue to believe, you saw net new asset growth in the quarter of roughly 3% and just like to reaffirm our kind of belief and commitment that we can grow the business, net new assets, mid-single-digit growth over the coming years. Also, I think for the first time in a few quarters, we — it’s pleasing that we haven’t had to talk about a deconversion. So, it was a relatively clean quarter with lots of volume.

And so, with the macro uncertainty, we did see a lot more volume as clients were re-hedging and rebalancing their portfolio. So, it was more of a volume-driven quarter. And then, just to kind of highlight the point about Archer, like we really kind of feel that Archer sitting in wealth solutions will be able to drive more capabilities and more product innovation for our clients. So, feel really good about the outlook and what Archer can do in the wealth solutions space.

Brennan Hawken

Great. Thanks for that color.

Dermot McDonogh — Chief Financial Officer

Thanks, Brennan.

Operator

We’ll move to our next question from Alex Blostein with Goldman Sachs.

Alex Blostein

Hey, good morning, everybody. Thank you. So, obviously, very strong performance in the quarter, underscoring the benefits of various verticals within BK. And part of that, I guess, is sort of transitory. So, I was hoping we could unpack that both on the fee side and NII, perhaps like how much of the benefit the elevated market volatility being created this quarter to think about the right baseline? And then, for NII, the NIB performance was obviously quite strong. And it feels like in your guide, you’re largely kind of mean reverting that. It doesn’t sound like you’re assuming much of that is going to stick around, but I was hoping you can unpack that a little more on the — what’s baked into the NII guide on the drivers. Thanks.

Dermot McDonogh — Chief Financial Officer

Okay. For your first question, that was a lot of questions, Alex. So, here’s what I would say. And look, Robin spoke about it well on Squawk Box this morning. We’re setting the firm up for really a diversified revenue stream and durable. And so, I think what was very pleasing from a CFO lens this quarter was the diversity of the revenue stream, the mix between fees from balances and fees from volumes. And look, there was a lot of uncertainty in the market over the course of the first quarter and our clients were doing a lot of rebalancing. So, we were there to help and support that. And so, volatility can also be a good enabler for BNY in terms of the business model because it generates volumes. So, you saw that across all of our platforms, and then you saw the mix was roughly 50-50 between balances and volumes. So, that was also pleasing to see.

And also, I think the balance between equities and fixed income was also pretty balanced. So, overall, I think it was very pleasing to see in terms of the backdrop. Look, to be honest, we see that hopefully to continue. And we have scaled platforms that we’ve invested in over the last couple of years. And with the record sales quarter, you’re beginning to see the proof points of clients coming to the platforms, wanting to do more with us across multiple lines of business. So, it really is clients doing more against a macro backdrop that was uncertain that generated the volumes. So, overall, a very pleasing quarter.

As I said in my prepared remarks, there are a few one-offs in there. We particularly highlighted that in securities services, which is a 3% contributor to the margin of 39%. But if you back that out, it’s 36% margin, still a pretty exceptional quarter for that segment.

Alex Blostein

Got you. And then, just the follow-up on NIB and what you guys are assuming is sort of temporary deposits given the volatility that could reverse itself over the next quarter or so, and how does that inform your 10% NII guide?

Dermot McDonogh — Chief Financial Officer

So, we expect deposit balances to kind of revert to more seasonal patterns from here. We expect Q2 to be moderate — slightly down from Q1. Q3 is usually our — kind of seasonally our weakest quarter with Q4 being our strongest quarter. But over the balance of the year, we expect balances to be modestly higher relative to 2025. We’ve run a bunch of scenarios, different rate environments, different levels, take the feedback from the businesses and that kind of gives us confidence around the 10% guide.

Alex Blostein

Perfect. All right, guys. Thank you. I’ll leave it at that.

Dermot McDonogh — Chief Financial Officer

Thanks, Alex.

Operator

We’ll take our next question from Ebrahim Poonawala with Bank of America.

Ebrahim Poonawala

Hey, good morning. I guess, maybe, Dermot, following up on your response to the previous question. I just want to make sure we get this right. So, very clear on deposit, NII outlook. On fees, the guidance implies like 2% to 3% growth for the rest of the year. Is that right? And I’m just wondering, like, what’s the — like, what would need to happen? Like, do we need a materially better or worse macro for the 2% to 3% to be much higher or lower? I’m just wondering what are the market assumptions you’re making in the guidance for the rest of the year on the fee revenue side.

Dermot McDonogh — Chief Financial Officer

So, look, it’s a tricky question you ask, Ebrahim. If you go back to Jan. 13, when we gave the guidance for the full year, we went with 5% on top-line growth. And we expected — when I was pressed on that, we kind of said a little bit higher on NII, a little bit lower on fees. And so, we’re one quarter into it, I would say, underneath the hood, and we said this on the call again in January. We continue to believe that we’re grinding organic growth higher than where it was. It was 3% in 2025. You will remember way back to ’22, it was flat and ’23, it was 1%. So, we’re very focused on it.

And as Robin said in his remarks, record sales quarter this year, first quarter, two record sales quarters last year, that is going to drive into the organic growth. So, we feel pretty good about the outlook for the year, but we’re only one quarter in, three quarters to go, a lot of uncertainty. So, we’re not really changing our outlook on the fee at the moment.

Ebrahim Poonawala

Got it. And then, I guess, one sort of a bigger picture question. Maybe, Robin, for you, you sort of talked about like the use of AI, all the other sort of efficiency improvements at the bank. And I would argue like there are a few banks that are deploying AI more efficiently than BNY is. Just is there a risk that you’re underinvesting or, like, when we look at the pretax margin, and to play devil’s advocate, could you be doing more in terms of investing in the business using some of these revenue tailwinds given that I would argue that you think there are a lot more productivity boost that the firm should see due to AI? So, why not invest more, sort of further improve the growth algo for the firm? Yeah. Any perspective would be helpful there.

Robin Vince — Chief Executive Officer

Sure, Ebrahim. So, let me just split it in two because you’re really asking two questions. I recognize they’re related, but let me just, first of all, talk about the investments versus the operating leverage. It’s very important to do both. We are investing in growth, and we are driving positive operating leverage and margin expansion. And we’ve said that we’re going to do that consistently. And so, we’re setting ourselves up for those real peer-leading levels of operating leverage while we are also investing in the long term. And remember this point about long term because that’s how we think about it.

Now, sometimes people ask us the question that you’re asking and they’re saying, okay, are you investing enough? And then, the flip side of that question is, do you have full control of your expenses? So, if there was any change in the environment and somehow you could react to that. So, we’re very careful and thoughtful about that point, both leaning in when there is the space to do so, but not setting ourselves up with such a huge momentum of expenses that somehow it becomes problematic in the future if we wanted to make a calibration. And so, we feel like we’re doing that quite well.

Now, let me flip that into the AI question. And if you remember, we have been investing in AI for three years. And we’ve been investing in a pretty meaningful way. And we have a lot of investment heft behind us because remember, our $4 billion technology spend. Now, we’ve talked before about the evolution of that technology spend. Once upon a time, five years ago, it was heavily geared towards infrastructure because we were really rewiring literally our underlying infrastructure so that we would be able to build then more modern technology and applications on top of that. Now, we’ve got this wonderful gift of AI at exactly the time that we’re leaning into those types of capabilities.

And what we tried to give you on the slide is just a sense of the breadth. We’re not going to sit here and talk about all the leading edge AI things that we are doing that are state-of-the-art in the company today. They exist. But that’s something that we’ll keep for ourselves at the moment. What we do want to do is show you the breadth of what we’re doing, so you can get a sense of the fact that it’s really everywhere. Remember, we’ve got 218 AI solutions in production right now all across the company. That’s up four times year-over-year. We’ve got digital employees working side by side. And we have a ton of stuff in pilot. So, we feel very good about our AI investments right now. But to your point, if we felt we needed to do more, we could do more, and we would do more.

Ebrahim Poonawala

Got it. Thank you, both.

Operator

We’ll take our next question from Mike Mayo with Wells Fargo Securities.

Mike Mayo

Hi. I guess AI is the topic of the day or you brought it upfront in the deck and AI for everyone, everywhere and everything, and you talked about doing this for three years and you have 200 solutions. And you said you’re starting to see the financial benefits. So, I get it, it all sounds deliberate and thoughtful and clear. But then, the big question is, what will the financial benefits be? And what are the financial benefits now? And in five years, do you — what are your financial expectations as the end result of all these efforts you’ve been undergoing?

Robin Vince — Chief Executive Officer

Sure, Mike. So, obviously, it’s a critical question. And so, just talk about a few different things. We see it as a catalyst for real transformational change. We’ve said from the beginning that the technology is clearly — and it was — this has been clear to us for several years that the technology was going to move incredibly rapidly, and it was going to scale in an exponential way, and we’re seeing that now in reality. And so, therefore, adoption and integration risked being the limiting factors.

And I think as a user of AI, it’s incredibly important that we find ways to be able to embed it and have our people pulling it in as opposed to potentially pushing it away. So, this foundational investment in culture and in the technology is allowing it to be the superpower that it really is and can be a capacity multiplier for our people. So, one of the things that we’ve been focused on is we would like a 47,000-person company, which is what we are today, to be able to deliver like one that is, in fact, many times larger.

And that point that I mentioned in answer to the prior question about having a $4 billion technology spend, we’ve got the scale to actually be able to use AI and deploy it properly. And this scale point is incredibly important in terms of the way that we frame it because if you are a smaller spend, you’ve got $1 billion spend, you’ve got $500 million spend, probably true with $2 billion spend as well. You just don’t have the scale to be able to invest in your AI platform. And then, you run risk of lock-in because of the way that you live in someone else’s ecosystem, you become subject to the token price wars and all of those things. And there are some very unpleasant consequences that can come from that.

So, now, let me really get to the question. We think the financial outcomes are going to show up in different ways. We think it’s going to show up, and we showed a lot of this on the page, the early bits of this in productivity for our people, so that this concept of 47,000 people being able to do a lot more, delivering more for our clients is really going to start to show up. And we’ll see that in the revenue per employee and the pretax employee over time. The progress so far has been largely driven by platforms operating model, the rewiring, the commercial model, all of those different things. But the next leg of that growth is maturing of those two programs and powered by AI, which is really kind of wrapped around everything.

The second vector is going to be the capabilities and features of our software, of our platforms as we deliver for clients. And we’re already starting to see that showing up with client things. I mentioned this deliberately in the prepared remarks. When you look at our AGI win in Europe, the fact that they had an inside look at what we are doing on AI made them really excited about joining our platform because they saw that AI wasn’t just for us and our own productivity, it was going to be for them, and they viewed us as an extension of their operating model and, therefore, our AI as an extension of what they could actually do, very powerful.

And then, the third one is there are going to be things that we can do in an AI-enabled world that frankly just didn’t make a lot of sense to do before, things that were at the edge of profitability for us as a company, things that clients might have asked us for, but just didn’t make a ton of sense to devote resources. But when you get an abundance of capacity, which is how we think about AI, creating for us, we can start to think about doing things that previously were things that we had to leave just below the line. So, there’s a triple play for us in terms of how we’re thinking about AI, capacity creation, revenue enablement and then this expanding a little bit the perimeter of the firm. And collectively, those things are coming together in a way that really does excite us for the future. But you’re right, it’s early days, and that’s just fine.

Mike Mayo

And I think it’s very clear you’re — in the debate, are banks or BNY an AI beneficiary or victim; obviously, you’re saying you’re a beneficiary. But the other side of this, though, are the bad actors with these AI superpowers, as you described them. And all that I know is what I read in the paper about bank CEOs being summoned to D.C. due to Anthropic and the new tools that are out there and the big risk of cyber. And I just have a tough time dimensioning the new cyber risk that’s out there, given the new AI tools. And how should investors think about this type of risk? And how do you think about that?

Robin Vince — Chief Executive Officer

So, it’s obviously an important question. Cyber defense is something that as one of the world’s leading financial institutions in the G-SIB here in the U.S., we’re clearly very focused on. We do a lot of important things. And so, defending our clients, defending our role in the financial system has been important for us, frankly, for decades. And as the technology evolves, so too — do the defenses.

Now, this is a team sport, and so doing it with AI providers, other technology partners, all incredibly important. We have Mythos in-house. We’re running it. And so, it becomes — it joins the team of defense for us as does the early access preview capability that OpenAI announced a couple of days ago, again, joined the team part of our defense. And you framed it right, and I used the term for a reason, this concept of superpower because what AI really is now is a superpower. And if you’ll forgive the metaphor for a second, it can be used for good and it can be used for evil.

And so, we’re pulling the superpower into our environment to use for good in order to be able to defend ourselves. And we view this as sort of an entirely predictable evolution of the technology. When there’s a technology, whatever it may be, that is on an exponential curve of growth, it’s just inevitable that we’ll get surprised by when it takes one of those step functions. But in a way, it’s entirely predictable that, that would happen. And so, we’ve gotten ourselves accustomed to the fact that this is an accelerating thing. We’ve got to constantly be working to stay ahead of the curve, it goes back to culture, it goes back to humility, and it goes back to being very, very focused on our role in the system.

So, that’s where we are. And all of us have to be vigilant. By the way, as an investor, you have to think about this across all industries. This isn’t just a financial services thing. This is an all-industry thing. Bad actors can use AI in bad ways across all sorts of different vectors. And so, we have one of the privileges in the financial services industry is that we’ve been alert to this topic for a long time.

Mike Mayo

Got it. Thank you.

Operator

We’ll take our next question from Manan Gosalia with Morgan Stanley.

Manan Gosalia

Hey, good morning. So, very clear message here on AI. It sounds to me like with the investment spend already in the run rate and a lot more of the benefit to come, that there is actually a lot more benefit here on the expense side. You’re already at a 37% margin even before the full benefit of the platforms operating model. So, I guess, is the rationale for keeping the medium-term targets at 38% plus/minus that there may be some of these economics that you have to share with your customers and that will get you more market share in the future?

Dermot McDonogh — Chief Financial Officer

So, I’ll take a stab at that first. And it kind of goes back to one of the previous questions about investing in capacity. Look, we just updated our medium-term targets in January. We had — we’re one quarter into that. The medium-term targets were based on a three-year to five-year horizon. And so, we feel good about where we are on the decade-long journey. And so, we’re continuing to invest, as Robin said, we’re continuing to harvest efficiencies. We think the margin targets and the ROTCE targets that we gave in January were a stretch for the firm, notwithstanding the Q1 that we’ve experienced. So, that needs to be repeated through the cycle to give us confidence that they can be attained.

So, I think it’s too early to say. And look, when we see opportunities, like Robin said, on AI, we may invest more. And so, we’re at the high end of our guide for expenses this year. We like to believe we’ve earned credibility with the market on being financially disciplined and stewards of the expense base. So, it’s something that we actively review continuously. And if we see more opportunity to invest, we will. And at the right time, we will talk to you about how it’s turning out for a medium term.

Robin Vince — Chief Executive Officer

So, let’s just talk for a second, Manan, about the — where does the value accrue because this is, I think, quite an important question. We, over the long term, see great value creation with AI, and it’s going to accrue to clients. It’s going to accrue to employees, and it’s going to obviously accrue to shareholders as well. And we think AI over time is just going to become table stakes and ubiquitous. And so, to some extent, it will — you’re right, some of it will get priced out through that value chain. But we think that companies that have an edge on using and deploying the technology will have an advantage. And there is a certain benefit to being a little bit ahead in terms of product development and cost of doing business.

And so, we see this early adopter benefit. We think we are actually an early adopter. But we also think the strategy is super important here. And I’m just going to call out three things. So, number one, culture is an enabler in AI, and we’ve made a lot of investment in AI. And so, to have a team at BNY who see the power of AI and want to use it, that’s actually not a small advantage. That’s a meaningful thing. The second thing is we have done work in the company particularly with our platforms operating model, but also with our commercial model to lay the groundwork for being, I think, maybe a better adopter of AI than on average, because of the fact that we brought like things together, and we’ve already done some of the rewiring, the data organization and the other stuff, which frankly is incredibly useful when it comes to actually deploying AI.

And then, the third thing is this point, and I mentioned it in answer to a prior question. But this point about having the scale because if we think of ourselves as an established player, we’ve got lots of mini moats all over the place associated with what we do and how we do it and the trust of financial services and people don’t necessarily want to give their agent control of all their assets and all of the usual stuff, those things are advantages. We have the mentality of a clean sheet of paper, but we have the benefits of an incumbency because we’ve got the clients, we’ve got the businesses, we’ve got the connections. We’ve got the platforms. And so, we’ve sort of liberated ourselves from a mindset point of view, but we’re leveraging our strengths.

And so, then that final point becomes the scale. And do you have the ability to manage yourself where you’re not just going to be providing a ton of revenue to the AI companies and losing control of it because this point about escalation of token usage, escalation of token costs, it’s the same story that we’ve seen before with cloud. If you allow yourself to get locked in and you don’t have the breadth of access, you’re taking a real risk on the pricing power point that you essentially raised before. And so, for us, it’s the how of the AI is actually, we think, also a bit of a strategic advantage. So, look, we’ve made a bet on AI. We started it three years ago. So far, that’s been the right strategy, and we’re leaning in, and we think this is something that’s going to accrue well to our company over time.

Manan Gosalia

Very clear. I appreciate all the detail. Maybe just on the capital side, given the new rules that we had a few weeks ago, it would seem to me that BNY would benefit on the G-SIB surcharge side. It’s not entirely clear to me what the benefit would be on the RWA side. So, I was wondering if you could comment on that and maybe if this changes, how you’re thinking about the capital targets.

Dermot McDonogh — Chief Financial Officer

Thanks for the question. Look, the recent rule is broadly favorable for BNY. Before when we talked about it on previous calls, we kind of gave a preliminary estimate of 5% to 7% based on the original proposals. And now, we expect a flat to modest reduction. And so, look, it just reinforces what we say about our balance sheet, the strength of a clean, liquid balance sheet, low-risk nature of the balance sheet. And so, we feel good about where we are, and we feel good about the current proposals.

Manan Gosalia

Great. Thank you.

Operator

We’ll take our next question from Ken Usdin with Autonomous Research.

Ken Usdin

Thanks. Good morning. Just two environmental-related questions. Given the real big sharp period-end balances, the capital ratios went down. Obviously, you have plenty of room, assuming that, that being temporary, you wouldn’t have any change to your outlook for your expected total capital return for this year?

Dermot McDonogh — Chief Financial Officer

That’s correct. It was really a spot balance sheet on the last day of the quarter, and that returned to normal levels on April 1. And as you’ll see from my remarks, Tier 1 leverage ratio, which is what we’re bound by remained steady at 6%.

Ken Usdin

Yeah. Okay. And also, given that it was a very volatile quarter with a lot of benefits from the environmental type of shift. Just wondering just how organic growth feels especially given a little bit more uncertainty out there. You had spoken last quarter about trying to be better than the 3% last year. Any changes to this an environment in terms of business wins and decision-making out there from your client set? Thanks.

Dermot McDonogh — Chief Financial Officer

So, I would just reemphasize the point that Robin made in answer to earlier questions and in his prepared remarks. We saw three really nice client wins in Q1 across different types of clients, which really kind of demonstrated the strength and the breadth of the franchise. I highlighted in my prepared remarks that 50% of client wins in asset servicing in Q1 were also — other lines of business were also awarded. So, that kind of clients doing more with us across multiple platforms is really becoming more of a thing. And so — and it’s a record sales quarter. So, we feel — we’re not guiding on organic growth. It was 3% last year. It was zero four years ago, and we’ve been working the order book higher. And so, we expect it to grind higher over the balance of this year. We’re excited about the opportunity.

Ken Usdin

Okay. Got it. Thank you, Dermot.

Operator

Our next question comes from Glenn Schorr with Evercore ISI.

Glenn Schorr

Thank you. So, when we all look at the bank banks, there’s a lot of focus on the NBFI lending into a bunch of the funds in private credit land. I wondered, as the biggest servicer of a lot of these products, I’m curious how much of lending into the funds is integral part of the service and relationship, and if you have any dimensionalizing of size and composition of book and how much it’s grown for you?

Dermot McDonogh — Chief Financial Officer

So, our exposure from a balance sheet perspective is de minimis, well managed. We feel very good about our risk in that dimension. I’ll point you over to our corporate trust. And as I said in my prepared remarks, we went through, for the first time, $15 trillion of loan service, and that’s where we service a lot of those clients. And so, we feel very good about that business. We feel very good about the momentum that’s in there and the investments that we’ve made. So, while it’s been noteworthy in — with other banks and through the new cycle over the last several weeks in private credit space, it hasn’t materially shown up in our business, and there are no bumps there that I would highlight.

Glenn Schorr

One other one that catches my attention is periodically, you’ll see a certain fund or certain even stock get tokenized. And I think there’s a lot of investments and, I don’t know, experiments being done. And I think you’re plenty investing in part of it too. So, maybe you could just update us on where we’re at and why we’re at, meaning like what are we — money market funds, I get a little bit, but why does the world need everything tokenized? And what would that mean for your businesses if we do go down that path? Thanks so much.

Robin Vince — Chief Executive Officer

Thanks. Look, I don’t think the world needs everything tokenized. But there’s no question that global financial market infrastructure is transforming and moving towards more of an always-on operating model. And so, that’s not just about blockchain technology immediately replacing traditional systems. It’s about the two things working in concert, and in some cases, just being able to unlock new possibilities that haven’t been possible before without the always-on operating model. So, we’re in the business of moving, storing, managing money, creating interoperability, all of that stuff is stuff that we do today.

And so, what we’re doing is we’re advising clients to use the right tool for the job. And so, if they want to do real-time payment systems in the United States, we’ve got real-time payments in the United States. And same thing is true in Europe, they’re actually even more advanced which is why stablecoin usage in traditional financial markets hasn’t really taken up as much in Europe, although if you go to an emerging market, and they’ve got high inflation, then the benefit of that 24/7 dollar-based stablecoin actually has quite a lot of advantages to sidestep what otherwise would be inflationary friction. So, it’s very much about the case.

And what is the BNY strategy? Ours is to be a bridge and to be in both places. So, we’re doing business with traditional clients who frankly would like us to help them with their careful selection of what they should do in the digital assets market. So, we’re helping clients being able to launch new funds. Maybe they want to launch a new share class for those people who are very focused on digital assets. So, maybe it is a Bitcoin custody for clients who want to be able to launch an ETF. And we’ve had one of those recently that we announced with Morgan Stanley. And so, if you look at these different types of innovation, we are helping the clients sort of bridge into the new stuff. And frankly, the new clients, the ones who are really, really digital asset native, they need a lot of traditional capabilities as well, they need cash management. They need investment management. They need custody. A stablecoin provider would need all of those types of things.

So, we’ve invested across this ecosystem. We’ve stood up a bigger team together with our Head of Product and Innovation and Digital Assets to really make sure that we are able to deliver against these different use cases. But you’re right. An S&P 500 on-chain maybe isn’t adding as much incremental value as maybe bringing an asset deeper into the financial system or making an asset a lot more efficient today. S&P 500 equities are pretty efficient. And as you point out, money market funds essentially work pretty well. But when you’re talking about the loans market, the commodities market, there are a lot of opportunities to bring things deeper into the financial system and actually improve them from where they are today.

Glenn Schorr

Sounds like evolution, not revolution. Thanks.

Operator

Our next question comes from David Smith with Truist Securities.

David Smith

Hi. You highlighted some big wins with clients working with your multiple lines of business. Anything you can share on the progress in the percentage of clients with multiple products or lines of business relationships at BNY today versus a year or two ago or the average number of products per client or any metrics along those lines?

Robin Vince — Chief Executive Officer

Sure. So, a couple of things, David. Clearly, we’ve set out on this journey in our commercial model to do several different things. There are new products to be created. We’ve got a lot of micro innovations across the company that gets us pretty excited, quite frankly, because those are new opportunities. We’ve actually surprised ourselves to some extent with the number of new logos that there are in — that we’re able to attract to the platform. I think the stat is about 10% of our sales were sort of new logos in recent times, which is quite exciting.

Dermot highlighted a stat in his prepared remarks about the fact that half of our asset servicing wins weren’t just asset servicing wins, they also came to another line of business somewhere in the company. So, there’s all of that. But this sort of blocking and tackling of delivering more of who we already are to our existing clients is really just a big opportunity for us.

And so, what does it mean in practice, some stats for you. So, okay, we had a record sales quarter in the first quarter of last year. We had another record sales quarter in the second quarter. It was a record sales quarter — year last year. We had another record sales quarter this quarter. We’ve had three consecutive years of year-over-year growth in core fee sales. We’ve had more than 60% growth. This is very much to your question, in the number of clients buying from three or more businesses over the past two years, 60% growth. We’ve had a 20% annual increase in sales productivity, so that’s on a per salesperson basis. And so, all of these things are showing the traction that our commercial model is gaining.

And remember, we’re only 18 months into that journey. We only launched it in the summer of 2024. And so, we feel very excited about that. And that’s one of the reasons why, at the beginning of the year, we said that we were really aiming for a growth in our organic growth rate from the 3% ZIP code that we had last year, and we’re very focused on growing from that.

But I just want to add one other thing. We do get — it wasn’t directly to your question, but I think there’s this underlying theme around the fact that just regular organic growth is somehow completely disconnected from what’s going on in the market and somehow the market is just sort of what it is and then there’s separately a thing around organic growth. And we push back a little bit on that assumption for our company because we very deliberately aligned our platforms gradually over the course of the past three years to be able to participate in more environments and be able to be a compounder of value largely irrespective of the environment.

Of course, there are always going to be some environments which are just not great for a firm like ours, but it’s very deliberate. So, we want to tap into these megatrends, scaling with trusted providers, the sophistication in wealth markets, what people are asking for from private markets, the growth that you can see in AUC/A there. Capital markets transformation, this point about participating in digital assets, this kind of connecting the traditional ecosystems with the new digital ones.

And then, when you think about the different inputs to diversification, equity market values up, fixed income market values up, cash balances, issuance activity, M&A activity, private credit, public credit, volatility, transaction volumes, equity, fixed income and collateral. And so, you put all of that together and we think that we’ve really been able to create this diversified global, strategic, recurring, durable attachment to different markets so that we can participate in all of those and, of course, wrapped with AI. And so, for us, that strategy is very much an as well as what you might traditionally think about as organic growth.

David Smith

Would you say that dampens the upside for BNY in a really strong market environment, or is it the way you can have your cake and eat it, too?

Robin Vince — Chief Executive Officer

Well, we think actually it just gives us better exposure to more markets but take the NII as a proxy because Dermot talks about all of this time — about this all the time. We’ve cut off the tails in NII. Out of a — if you take 1,000 different scenarios, can we create one for you that’s not great for NII? Sure, a massively inverted curve, not ideal. Zero interest rates across the curve, not ideal. There are always going to be scenarios that aren’t great. But we look at those, and we think that doesn’t feel super plausible or likely right now. The same thing is going to be true in other environments.

But yes, we give up some growth. If you tell me equity markets are up 50%, and that’s your base case scenario and you want to be all in on equity markets up 50%, I could tell you to buy somebody else’s stock over ours because we represent this more diversified, long-term, compounding, durable play.

David Smith

All right. Thank you.

Operator

Our next question comes from Steven Chubak with Wolfe Research.

Steven Chubak

Well, good afternoon, and thanks for taking my questions. I did have a bigger picture question that’s getting a little bit more attention that could impact the wealth solutions business. And it pertains to AI, specifically the growing adoption in the wealth space of AI. There’s been some talk in the industry about the importance of just having greater control over your infrastructure, your tech stack, data, the ability to offer more customized tools and some believe this may compel at least more scale firms to transition to self-clearing models over time. But just recognizing you service the largest RIAs and IBD platforms, I was hoping you could speak to what you’re hearing about this potential structural shift that could take place granted over a period of years, most likely? And how do you ensure you can keep those customers within your ecosystem?

Robin Vince — Chief Executive Officer

Yeah, Steven, it’s an important question. Actually, completely coincidentally, I was having a conversation with one of our largest clients yesterday about this topic. And they were actually just reaffirming how excited they were to be on our platform ironically for all the same reasons that you just listed because as they looked at the question, they say, we want to grow, we’ve got finite investment dollars, what would we like them to be spent on? And for them, it’s about rolling up, it’s about organic growth, advisors and all of the things that they really want to make part of their core business. They don’t want to have to spend the money on the cyber defense, the platform, and they don’t want to try to compete as a very large RIA, but nowhere near the $3 trillion-plus of scale that we have with the type of ability that we have to be able to invest in that business in the core capabilities that we’re providing.

So, sure, if you’re a $3 trillion, $4 trillion, $5 trillion RIA, you have your own scale. But if you’re turning up with $50 billion, $100 billion, $200 billion, you just don’t have the scale. And so, if you look at something, let’s take AI, I’ll just pick one example, which is AI, but it is a good one, which is if you’re at that type of scale and you decide to go it alone, you have to pick a provider in the AI space. You have to put yourself in their ecosystem. You’ve now become subject to their pricing power and their models, you can’t have the — a cross-platform AI scale that essentially can give you more control of the way in which you deploy the technology.

And so, there is this theme of scaling with trusted providers that applies to our Pershing business, as it applies to our other businesses. And so, as we combined wealth solutions and sort of the pieces in it to sort of — for our Pershing business, it continues to be the feedback that we hear from our clients that they like that scaling with us.

Steven Chubak

Those are great insights, Robin. So, I really appreciate that perspective. If I could just squeeze in one more, or just double-clicking into Glenn’s earlier question on tokenization, how that might impact various lines of business. You noted the use case might be stronger for tokenizing some asset classes over others. Just want to better understand how you’re thinking about the implications for the ADR business in a world where tokenized securities could become a bit more widespread?

Robin Vince — Chief Executive Officer

Yeah. So, that — look, people have been predicting the decline of the depositary receipts business at this point for 20 years. But it is a very defiant and for us, as you know, a growing business, which has performed very well. Again, I think there’s a little bit of infrastructure connectivity here, which is a slightly different point. It’s not a scale point for AI here, it’s really about the connectivity point and the various different services, connection with exchanges, the connection with the settlement rails.

An AI agent can’t just turn up and offer you all of that connectivity because those providers don’t want to provide that type. It’s one thing trying to say, hey, what was the price of the 10-year yesterday or track me my S&P 500? It’s an entirely different thing to give an agent full autonomy and agency over how you connect to infrastructure and controlling your assets. And so, we do think that there’s some trust benefit that we derive from what we do that’s going to be relevant in places like this. But you’re right, let’s use our AI ourselves to make the process even more efficient. And that’s what we’re doing, in fact, across the life cycle of many of our products because we’re not competing with AI; we’re competing with other people who use AI better than us.

Steven Chubak

Well said. Well, thanks so much for taking my questions.

Operator

Our final question comes from the line of Gerard Cassidy with RBC.

Gerard Cassidy

Hi, Robin. Hi, Dermot.

Dermot McDonogh — Chief Financial Officer

Hi, George.

Gerard Cassidy

Two questions. The first is in the securities services area, specifically issuer services. Now, I know you just talked about the ADRs or depositary receipts business, obviously not going away. But can you give us any color just in the quarter, there was a sequential decline from the fourth quarter in the revenues. It was up, of course, year-over-year, about 4%. What were the factors that may have caused that? And second, as part of that, is there an opportunity for the depositary receipt business to pick up if international equity issuers come into the U.S. capital markets later this year?

Dermot McDonogh — Chief Financial Officer

So, I would say — on the quarter-over-quarter, Gerard, depositary receipts is a seasonal business. And so, it just kind of speaks to the seasonality rather than any kind of noticeable trend. Corporate trust, as I said in my prepared remarks, we continue to grow that. We’re growing the revenues. We’re growing the margin. We’re investing in the business. We’ve grown the margin quite substantially over the last three years. And it’s the business where — it’s the most mature in the platforms operating model, and it’s where we’re beginning to see the most benefit. So, it’s three years in the model.

And so, we really like what we see in terms of the leadership, the technology investment and how we’re showing up for clients. And so, it’s not an accident that we went through $15 trillion in Q1 in terms of loan service. So, I would say, overall, great momentum in that part of the world and we expect it to continue.

Gerard Cassidy

Thank you. And then, Robin, coming back to the AI commentary, can you frame out — I don’t know if this will make sense, but when does AI become ubiquitous to your business as well as others, meaning if you turn back the clock and look at the introduction of the Internet, I don’t know if you want to use the late ’90s or early 2000s or just digital banking once the iPhone was created and the ramp-up that everybody did, and I know that’s not specifically to your business, but the ramp-up everybody did to get digital products to consumers and businesses. How long does this take to ramp up AI so that — is it five years from now and 10 years from now, where we say it’s just normal operating business and something that everybody is doing?

Robin Vince — Chief Executive Officer

I think the answer is that it has to be a lot less than those time frames for it to start to become ubiquitous in a company because I think if you don’t make it ubiquitous inside of those types of time frames, I just don’t know how you’re going to be able to keep up and compete because it is such a powerful technology and is accelerating so quickly that we’re talking about 10 times capabilities in many cases. And so, if you’re behind the 10 times curve by any meaningful period of time, then I think you’re going to be in trouble, which is one of the reasons why we are so focused on it.

So, I think you have to make it ubiquitous, which goes back to the point on culture, integration, deeply embedding which are really our principles at this point. And so, we aim to make it ubiquitous well inside of those time frames.

Gerard Cassidy

Thank you. I appreciate that.

Operator

And with that, that does conclude our question-and-answer session for today. I would now like to hand the call back over to Robin for any additional or closing remarks.

Robin Vince — Chief Executive Officer

Thank you, Taryn, and thanks, everyone, for your time today. We appreciate your interest in BNY. Please reach out to Marius and the IR team if you have any follow-up questions. Be well.

Operator

Thank you. This does conclude today’s conference and webcast. A replay of this conference call and webcast will be available on the BNY Investor Relations website at 3:00 P.M. Eastern Time today. Have a great day.