The Bank of New York Mellon Corporation (BNY) experienced a significant surge in its stock price following the release of its fourth-quarter 2024 earnings report. The financial giant reported adjusted earnings per share of $1.72, marking a 33% increase year-over-year and surpassing Wall Street's estimate of $1.56. This strong performance was driven by a quarterly revenue of $4.847 billion, an 11% increase from the previous year, which also exceeded analyst expectations of $4.653 billion.

A key factor in BNY's success was the growth in fee revenue, which rose 9% year-over-year to $3.513 billion. This increase was attributed to higher market values, new business, and increased client activity. Additionally, net interest income saw an 8% rise, reflecting higher portfolio yields and balance growth, despite some offset from deposit mix shifts.

The company also managed to reduce noninterest expenses by 16% year-over-year, primarily due to FDIC adjustments, savings, and lower severance costs. However, excluding notable items, noninterest expenses increased by 2%. The provision for credit losses was set at $20 million for the quarter, mainly due to increased reserves related to commercial real estate exposure.

BNY's average deposits stood at $286 billion, up 5% year-over-year but down 1% sequentially. The bank's tier 1 leverage ratio decreased to 5.7%, down 23 basis points from the previous year and 29 basis points from the previous quarter. Despite these declines, the adjusted pre-tax operating margin improved to 34% from 29% a year ago.

For the full year of 2024, BNY reported a record net income of $4.3 billion and revenue of $18.6 billion. The bank returned $1.1 billion to common shareholders, including $349 million in dividends and $750 million in share repurchases, resulting in a total payout ratio of 102%.

CEO Robin Vince highlighted the company's progress in 2024, mentioning the launch of a new commercial coverage model, the development of new products and solutions, a brand refresh, the completion of the first acquisition in several years, and the transition to a strategic platforms operating model. Vince expressed confidence in the company's momentum heading into 2025.

Following the earnings release, BNY's stock price rose significantly, with shares trading up to 4.42% at the time of reporting. Analysts have given BNY a Moderate Buy rating, with an average price target of $88.75, suggesting potential for further growth.