Good morning, and welcome to the 2022 second quarter 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 will now turn the call over to Marius Merz, BNY Mellon Head of Investor Relations. Please go ahead, sir. Thank you, operator. Good morning, everyone, and welcome to our second quarter 2022 earnings call. As always, we will reference our financial highlights presentation, which can be found on the investor relations page of our website at bnymellon.com. I'm joined by Todd Gibbons, our Chief Executive Officer, Robin Vince, President and CEO Elect, and Emily Portney, our Chief Financial Officer. Today, Robin will lead the call and make introductory remarks, followed by Emily, who will then take you through the earnings presentation. Following their prepared remarks, there will be a Q&A session. Before we begin, please note that our remarks include forward-looking statements and non-GAAP measures. Information about these statements and non-GAAP measures are available in the earnings press release, financial supplements, and financial highlights presentation, all available on the investor relations page of our website. Forward-looking statements made on this call speak only as of today, July 15th, 2022, and will not be updated. With that, I will turn it over to Robin. Thank you, Marius, and thank you everyone for joining us this morning. Before we talk about our results for the quarter, I'd like to take a moment and recognize that today is Todd's last earnings call. Todd, on behalf of all of us here at BNY Mellon, I'd like to thank you for your leadership and for your many years of service to the firm and our clients. For nearly four decades, you've made a tremendous impact on BNY Mellon, and its evolution from the rather traditional commercial bank that we once were to the globally significant financial services firm sitting at the heart of the financial ecosystem that we are today. When the board asked you to take the helm at a very challenging time amid a worldwide pandemic, you not only navigated the firm through this unprecedented environment with a steady hand, but you also continued to drive our client and growth agenda forward. On a more personal note, I want to thank you for working so closely with me during this transition. I know it was always important to you to ensure a seamless transition before you retire, and I couldn't have had a better partner on this journey. Having spent a meaningful part of the last four months meeting and listening to our employees, clients, and many other stakeholders, I'm even more optimistic about the next chapter for BNY Mellon. At the very heart of our firm lies an exceptional client franchise. Our clients truly view us as a trusted partner, and a resounding message that I have heard is that our clients want to do more with us. We have a growth opportunity by making that easier for them. We have to do a better job connecting the dots both internally and externally, and we will. While our investments over the last couple of years have paid off in the form of the remarkably resilient platform that we have today, I'm also of the view that the efficiency opportunity available in driving our operating model transformation has more runway. I look forward to formally taking on my new role at the end of August and will continue to share my views on our strategy and plans over the coming months. Moving on to the quarter, I'll start with some broader perspectives before I run through a few financial highlights, and then I'll turn it over to Emily to review our results for the quarter in more detail. During the quarter, we continued to see high levels of volatility across both global equity and fixed income markets, persistently high inflation, rapidly evolving monetary policy around the world, and all this against an increasingly complicated geopolitical landscape. You've all seen those charts. The S&P 500 had its worst first half performance in over 50 years. 10-year treasuries had the worst starts to the year since the beginning of the index in the early 1970s. With 150 basis points in rate hikes, this is the fastest tightening cycle over six months since the Volcker era at the end of the 1970s. Underneath these headlines, what we're seeing across our platforms is that investors are clearly rebalancing and de-risking. We're seeing asset reallocation from growth to value, higher than expected cash balances, and relatively shallow market liquidity, making it harder for investors to move risk. That said, in our role as a critical infrastructure provider, touching so much of the core financial system, we do see today that markets continue to function in an orderly fashion. Trades are settling, and fails and overdrafts are at fairly normal levels. Turning to our performance in the quarter and referring to page two of our financial highlights presentation, we reported EPS of $1.03 on $4.3 billion of revenue and a return on tangible common equity of 19%. Excluding the impact of notable items, EPS was $1.15, and return on tangible common equity was 21%. Our second quarter results reflect the benefit of higher interest rates, the strength of our diversified platform, and our unwavering commitment to our clients. Those clients clearly value our resilience, the quality of our services and insights, and the trusted relationship that they have with BNY Mellon. While lower market values adversely impacted asset-based fees, elevated volatility, wider spreads, and higher transaction activity across new and existing clients tempered the impact. Asset servicing continued to see healthy client volumes and our sales momentum and pipelines continue to be strong. Wins and mandates are up year on year, and that's broad-based across products and geographies, producing a strong pipeline of AUCA to be installed over time. Our retention rates continue to be exceptionally high, north of 90%. In our ETF servicing business, total funds serviced are up 5% year-to-date, enabling ETF AUCA to hold steady despite the impact from lower market values. In Alts, wins year-to-date have already exceeded all of 2021. It's also worth noting that more than 20% of our multi-product deals have a data and analytics component as our DNA capabilities become more meaningful to our overall asset servicing deal pipeline. In our markets franchise, FX revenue was up nicely year over year, and the business continued its steady climb in the Euromoney FX survey, landing at number eight overall this year, our highest ranking ever, up from number 13 a year ago and number 32 in 2018, while also maintaining its top three real money ranking. Issuer services, and in particular depositary receipts, had a solid quarter on the back of growth in dividend annuity fees and cancellation activity. In Pershing, year-over-year revenue was also up, and we're seeing encouraging signs in terms of sales momentum. We continue to gather net new assets this quarter, albeit at a slightly slower pace given the market backdrop. The pipeline for the second half and beyond remains strong as we continue to grow the core business and see renewed client interest in digital wealth solutions, as well as the advisory tools we will offer through our Pershing X initiative. In a great One BNY Mellon example, this quarter, Pershing and Asset Servicing combined their capabilities to roll out what is essentially a self-directed vehicle for a large government agency, offering choice of roughly 5,000 funds to a total addressable population of about 6 million eligible participants for the benefit of their retirement plans. Last month, Pershing hosted its INSITE conference with 1,600 business leaders, industry advocates, and next-generation talent. This conference is a flagship event for Pershing, and we were pleased to announce some next-generation tech solutions for advisors and wealth management professionals with the introduction of the latest generation of our Pershing platform and enhancements to our API suite. Turning to clearance and collateral management, the business delivered another strong quarter of growth on the back of higher securities clearance volumes, where market volatility continues to drive activity levels in U.S. Treasuries. We also saw average collateral management balances reach another record of $5.2 trillion in the quarter, driven by money market fund demand for the RRP facility. Treasury services also delivered solid growth driven by higher rates and higher payment volumes, as well as broad-based growth across multiple products, core U.S. dollar wire, debit card processing, and immediate payments from both new and existing clients. Our investment management business was significantly impacted by lower market values, the unfavorable impact of the stronger U.S. dollar, and clients de-risking amid an increasingly uncertain environment. Having said that, our investment performance remains strong, with over 70% of our top 30 strategies by revenue in the top two quartiles on a three-year basis. Insight was ranked first by Greenwich Associates for overall quality in LDI for the 12th year in a row, and was ranked first for fixed income overall quality with U.K. consultants. BOLD, which is the new cash management fund share class launched to help investors make a positive, direct social impact, raised another $2 billion in the quarter, bringing total AUM to over $3 billion in just four months. As most of you saw, we also announced the sale of Alcentra to Franklin Templeton at the end of May. This transaction, which is expected to close in the first quarter of 2023, builds upon our strategic relationship with Franklin Templeton, as we will continue to offer Alcentra's capabilities in BNY Mellon's sub-advised funds and in select regions via our global distribution platform. We will also provide Alcentra with ongoing asset servicing support. At closing, we expect that this sale will increase the firm's CET1 capital by about $500 million, and it will free up seed capital to help accelerate our strategy of developing new differentiated solutions from our own specialist investment funds that meet the evolving needs of our clients. Finally, wealth management continued to execute against its three-pronged strategy, acquiring more client relationships in the ultra-high net worth and family office segments, deepening banking relationships, and investing in technology and driving efficiency. As we engage with our clients in this space, we continue to lead with some of the most innovative digital capabilities in the industry. For a second consecutive year, the Financial Times named BNY Mellon the best private bank for digital wealth planning North America, recognizing our wealth online client portal and our proprietary goals-based planning tool, Advice Path. The Family Wealth Report recognized our active wealth accelerator as the best customer-facing digital platform. Turning to capital. Despite the significant headwind from rapidly rising interest rates, we remain well capitalized with healthy capital buffers to support our clients with a strong balance sheet in this volatile market environment. The recently announced results of the Fed's 2022 stress test demonstrated once again that BNY Mellon has one of the most resilient business models and balance sheets in the industry, and our preliminary stress capital buffer, as calculated in the test, remains at the Fed's 2.5% floor. As expected, earlier this morning, we announced that our board approved an increase in our quarterly cash dividend by 9% to $0.37 per share in the third quarter. Now before I turn it over to Emily, I'd be remiss not to also touch on our announcement last week that Dermot McDonogh will join us in November and become our next CFO, effective February 1, 2023. I've known Dermot for over 20 years, and I'm really looking forward to his addition to our team. I'm also pleased for Emily, who, after helping Dermot transition into the CFO role, will take on leadership of several of our key growth areas, namely Treasury Services, Credit Services, and Clearance and Collateral Management, reporting directly to me. But in the meantime, I certainly like reminding Emily that she still has a few more earnings calls to go. With that, over to you, Emily. Thank you, Robin, and good morning, everyone. As I walk you through the details of our results for the quarter, all comparisons will be on a year-over-year basis unless I specify otherwise. Starting on page three. Total revenue for the second quarter of $4.3 billion grew by 7%. Fee revenue was up 4%. This increase primarily reflects the abatement of money market fee waivers, as well as continued underlying momentum across security services and market and wealth services, partially offset by the unfavorable impact of a stronger U.S. dollar and lower market values across both equity and fixed income markets. Money market fee waivers, net of distribution and servicing expense, were $66 million in the quarter, an improvement of $133 million compared to the prior quarter, driven primarily by higher average short-term interest rates. Firm-wide AUCA of $43 trillion decreased by 4% as continued growth from new and existing clients was more than offset by the impact of lower market values and currency headwind. AUM of $1.9 trillion decreased by 17%, reflecting lower market values and the unfavorable impact of the stronger U.S. dollar. Investment and other revenue was $91 million, reflecting a quarter with strong trading performance as well as the benefit of a strategic equity investment gain, which was partially offset by seed capital losses. Net interest revenue increased by 28%, primarily reflecting higher rates and a change in asset mix. Expenses were up 12%, including the impact of higher litigation reserves, a notable item this quarter. Excluding notable items, expenses were flat quarter-over-quarter as expected, which translates to an increase of 8% year-over-year. The year-over-year growth includes, among other items, the impact of pulling forward our annual merit increase to the second quarter from the third quarter. Provision for credit losses was $47 million versus a provision benefit of $86 million in the second quarter of last year. They primarily reflect changes in the macroeconomic forecast. Our effective tax rate was 21.1%. The notable item increased our effective tax rate for the quarter by approximately 150 basis points. Reported EPS was $1.03. Pre-tax margin was 26%, and return on tangible common equity was 19%. Excluding the impact of notable items, EPS was $1.15, pre-tax margin was 28%, and return on tangible common equity was 21%. Now on to capital and liquidity on page four. Our consolidated Tier 1 leverage ratio was 5.2%, down 10 basis points sequentially. The continued sharp rise in interest rates in the quarter resulted in an approximately $900 million after-tax unrealized loss on our available for sale securities portfolio. We distributed 33% of earnings to our shareholders through approximately $280 million in common stock dividends. Our CET1 ratio was 10%, down slightly versus the prior quarter. Finally, our LCR was 111%, up 2 percentage points sequentially. Turning to our net interest revenue and balance sheet trends on page five, which I will talk about in sequential terms. Net interest revenue was $824 million, up 18% sequentially. This increase was driven by the impact of higher interest rates on interest earning assets, partially offset by higher funding expense. Average deposit balances and average interest earning assets both declined by 1% sequentially. Loan balances grew by 3% sequentially, primarily driven by collateralized loans in wealth management and growth in capital call finance and trade finance. Our securities portfolio balances were down 3%. Moving on to expenses on page six. Expenses for the quarter were $3.1 billion on a reported basis, and $3 billion excluding the impact of higher litigation reserves. Excluding notable items, expenses were flat quarter-over-quarter as expected, and up 8% year-over-year. This year-over-year increase reflects investments net of efficiency savings, the pull forward of our merit program, as well as higher revenue related expenses. The benefit of the stronger U.S. dollar was largely offset by persistently higher inflation. A few additional details regarding noteworthy year-over-year expense variances. Staff expense was up 7%, driven by investments and the annual employee merit increase, which in the prior year was effective in the third quarter. Distribution and servicing expense was up 23%, reflecting higher distribution costs associated with money market funds. Business development expense was up, reflecting some normalization of travel and entertainment off a low base from last year. Lastly, the change in other expense was largely driven by the increase in the litigation reserves. Turning to page seven for a closer look at our business segment. Security Services reported total revenue of $2 billion, up 12% compared to the prior year. Fee revenue increased 8% and net interest revenue was up 29%, reflecting higher interest rates, partially offset by lower deposit balances. As I discuss the performance of our securities services and market and wealth services segments, I will focus comments on the investment services fees for each line of business, which you can find in our financial supplement. In asset servicing, investment services fees grew by 4%. This increase reflects lower money market fee waivers and higher client activity, partially offset by the unfavorable impact of the stronger U.S. dollar and lower market values. Asset servicing continued to deliver healthy organic growth from both existing and new clients, and our pipeline continued to grow across client segments and with particular strength in EMEA. In issuer services, investment services fees were up 10%, reflecting higher depositary receipt revenue and lower money market fee waivers, partially offset by the impact of the previously disclosed lost business in the prior year in corporate trust. Next, market and wealth services on page eight. Market and wealth services reported total revenue of $1.3 billion, an increase of 10% compared to the prior year. Fee revenue was up 9% and net interest revenue was up 18%, reflecting higher interest rates and higher loan balances, partially offset by lower deposit balances. In Pershing, investment services fees were up 9%. The positive impact of lower money market fee waivers and higher transaction activity was partially offset by the impact of lost business in the prior year, as previously disclosed. Net new assets were $16 billion in the quarter. In treasury services, investment services fees were up 10%, reflecting the benefit of lower money market fee waivers, as well as higher payment volumes on the back of growth from both new and existing clients. In clearance and collateral management, investment services fees were up 5%, primarily reflecting higher U.S. clearance volumes amid elevated market volatility and continued geopolitical uncertainty, all driving strong demand for U.S. Treasury securities. Now turning to investment and wealth management on page nine. Investment and wealth management reported total revenue of $899 million, down 10%. Fee revenue was down 9%. Investment and other revenue was -$13 million, which included seed capital losses as opposed to gains in the prior year. Net interest revenue was up 32%, reflecting higher interest rates as well as higher deposit balances. As mentioned earlier, we ended the quarter with assets under management of $1.9 trillion, down 17% year-over-year. This decrease primarily reflects lower market values and the unfavorable impact of the stronger U.S. dollar as approximately 45% of our AUM are denominated in foreign currencies. As it relates to flows in the quarter, we saw $14 billion of net inflows into long-term products and $26 billion of net outflows from cash. LDI continued to be a bright spot among our active strategies with $12 billion of net inflows, and our index strategies gathered $12 billion of net inflows as well. In investment management, revenue was down 14%, reflecting the unfavorable impact of the stronger U.S. dollar, lower seed capital results, and lower market values, partially offset by the benefit of lower fee waivers. Further to Robin's comments on our positive investment performance, just this past weekend, Barron's recognized our Dynamic Value Fund and Income Stock Fund as two top-performing active funds based on year-to-date results as well as longer-term track records. Wealth management revenue was down 1% as growth from higher net interest revenue resulting from higher interest rates and healthy deposit growth was offset by a decline in fee revenue resulting from lower market values. The business has continued to increase the number of clients who use our banking services, which is now at 60%, up significantly from a couple of years ago. Client assets of $264 billion were down 13% year-over-year, primarily driven by lower market values. Page 10 shows the results of the other segment. I will close with a few comments on our outlook for the second half of the year. As we all know, the intersection of significant market volatility, rapidly evolving monetary policy from central banks around the world, continued geopolitical tensions, and increasing uncertainty about the macroeconomic environment has made forecasting difficult. Based on current market-implied interest rates for the second half of the year, we now expect the percentage growth in net interest revenue for the full year to be in the low 20s% compared to the prior year. This improved outlook continues to assume modest deposit runoff in the second half of the year, and it also assumes slightly lower deposit betas than previously expected, which has been informed by our repricing experience to date. Since we last provided you our fee revenue outlook for the year on our first quarter earnings call, both equity and fixed income market values have declined further, and the U.S. dollar has continued to strengthen significantly against most major currencies. Assuming equity and fixed income values as well as currencies stay at the level where they ended the second quarter, we would project fee revenue for the full year to be flat to slightly up year-over-year. As it relates to expenses, ex notable items for the year, we continue to manage towards a year-over-year increase in the 5%-5.5% range. Continuously strong inflationary headwinds are expected to largely offset the favorable impact of the stronger U.S. dollar. Revenue-related expenses are increasing as fee waivers abate and we're onboarding our strong sales pipeline. We continue to invest in the targeted growth and efficiency initiatives that we've highlighted before. Due to the impact of the notable item in the second quarter, we now expect our effective tax rate for the year to be closer to 19.5%. Taken together with our 16.7% tax rate in the first quarter, our expectation for a 19.5%-20% tax rate in the second half of this year remains unchanged. Last but not least, we continue to be cautious on buybacks in this volatile environment. Although based on current projections, we expect to end the third quarter at or above our internal capital ratio target. With that, operator, can you please open the line for questions? If you would like to ask a question, please press star one on your telephone keypad. As a reminder, we ask that you please limit yourself to one question and one related follow-up question. Jim Mitchell from Seaport Global, please go ahead. Hey, good morning. Emily, that was sort of intriguing, I guess, talking about your thoughts now on betas and the deposit declines and the higher NII. Can you kind of talk about a little bit, unpack that a little bit more in terms of what's changed over the last few weeks, what you're seeing with after the latest rate hike and how you're thinking about NII from here? Sure. Good morning, Jim. Morning. As you rightly point out, we've increased our NIR guide. We now expect NIR to grow in the low 20% range year-on-year. Really the main things which have changed from a couple of weeks ago is that deposits haven't run off as fast as we had expected. Also, betas are coming in a bit lower than we had anticipated. And also now baked into that are expectations that, of course, we'll get some higher yields from cash held at central banks, just given the pace of monetary policy. Those are the main drivers that are in the outlook for the full year. I would just obviously, you know, kind of caveat everything that if there's a tremendous amount of uncertainty, and it's pretty unprecedented times. Okay, that's helpful. Just your comment of getting to where you wanna be in the third quarter on capital, if all else equal, does that mean you would be thinking about getting back into the buyback game in fourth quarter, or is it still a little too early to be calling for that? What we've you know always said in terms of capital returns and specifically buybacks, that they would be dependent upon the trajectory for both you know AOCI as well as deposit levels. You know both of which were you know AOCI was a bit was you know it deteriorated this quarter and deposits were a bit higher as I just suggested. It's still an incredibly uncertain environment, of course we're gonna continue to be cautious. We do expect deposits to decline and so we are projecting that we'll be north of our internal targets, which of course our Tier 1 leverage is 5.5%, and we wanna be north of our CET1, you know, of CET1 of 10% on sustainable basis. Then it's about that time that we'll start to talk about and think about, you know, buyback activity. Having said that, as you know, as you all know, it's completely situational and very dependent upon the future outlook. Right. Fair enough. Thank you. Our next question comes from Betsy Graseck from Morgan Stanley. Please go ahead. Hi, good morning. Good morning. Robin, hi, Robin, I had a question for you. You know, it's been probably more than five years, maybe a decade, we've all been getting questions on the threat of technology, the threat of blockchain to your industry. You know, it kind of comes and goes in waves. Over the last two weeks, I just got another barrage of questions in on this. I wanted to ask, you know, your first call here as CEO, incoming CEO, can you give us your sense as to how you see the timeframe and the speed with which you need to be transforming the organization? Sure. This is, you know, if you just step back, this is a super interesting space, in our industry. You know, I think about it as once upon a time, there was paper everywhere. We had runners, we had markets closing, then we had the rise of computing, and we've had traditional ledgers for the past 50 years. Now we've got a great new technology in the form of blockchain, and that gives us the opportunity to do new things. We're excited about that. We think it's gonna bring great opportunity to our business. You're right, there's an element of potential disruption risk, and so we've got to be ahead of that. But we also see a lot of opportunity in everything that this brings to bear. I'll just note that the amount of interest that we have from our clients in us helping them to navigate this landscape is really remarkable. That's demand from the institutional clients around looking after cryptos, which we view as interesting, but not really the main core of digital assets, to building various different capabilities across the digital asset lifecycle, coins, tokenized assets. We've really already cemented ourselves as a leader in the space with all the work that we've been doing for some of these stable coin providers. We've been doing our traditional business with them, looking after traditional assets as part of their stable coin portfolio. In doing so, we've really inserted ourselves into the ecosystem, and that gives us a great landscape. There's a lot to do here. My view on this is it's gonna be years and potentially decades for the full effects to be known, but we're in it, and we're excited about it. The operating leverage as you go through this journey, how do you think about managing that? This is a super long-term journey, Betsy. I think it's very hard to have a point of view. You know, if I zoom out, would I say at the margin, it's probably helpful longer term, but I'm gonna emphasize super longer term on that. Sure, it probably should be, because I think some of the inefficiency of post-trade processes, you can squeeze more of that out with some of these new technologies. You know, as was the case in the handover, I'm sure from paper to original computer ledgers. This is gonna be a while in the making. Of course, we are gonna have to invest to get us from A to B on this thing. Thank you. You're welcome. Gerard Cassidy from RBC, please go ahead. Good morning. Emily, when you look at your fee revenue, you gave us some fee guidance on if, you know, the markets don't change materially from where we are today, you know, by the end of the year. You gave us that guidance. Can you remind us what percentage of fee revenues would you say are tied to values, you know, where they're variable rate priced, for your customers versus a fixed price? It really depends by line of business. For example, when you think about asset servicing, it's about 50%. Very good. I think you Yeah, go ahead. Go ahead. I'm sorry. Go ahead. No, I was gonna say, just to give a bit more color, just in terms of unpacking that fee guidance, because I think it's probably helpful. You know, when you think about now the year-on-year change of flat to slightly up, about 5% of that is coming from the abatement of waivers. That is more than offset, call it 5%-6%, from what I would call market factors. In that is you know, market levels as you just suggest. It's also currency as well as the impact of geopolitical factors. For us, obviously, some of the impact, the loss that we took on Russia and Ukraine, just in terms of ceasing business in that region. That is offset by organic growth that is still expected to be between 50-100 basis points. Really, you know, we have, you know, very strong fundamentals across, you know, asset servicing, treasury services, CCM, and, you know, even in Pershing and corporate trust, which are lapping some lost business from last year. The fundamentals and the pipelines are strong. Very good. Maybe for Robin, obviously disruption's gonna create opportunities for some companies over the next six to 12 months to make acquisitions. Can you give us your thoughts on what you think you can add if you need something to the product set that Bank of New York Mellon has? Sure. I think about this pretty similarly to the way that Todd and Emily have described this before. It is largely for us, at least as we sit here today, Gerard, an opportunity to acquire capabilities. You know, as you can imagine, a large and transformational sort of transaction is not very high on my list of priorities right now. I'm much more focused on the organic growth, the opportunities that we have across the franchise, and also, just really driving the operating effectiveness of the company. As you saw last year, we made an acquisition in the form of Optimal Asset Management, which sped us a little bit along on our journey on Pershing X. We made an acquisition in the form of Milestone, which was helpful and accretive to our business broadly in asset servicing. We're gonna continue to be on the lookout for those types of things. As with anything in the M&A space, there's a high bar. Very good. Todd, good luck in the next run. Great job being at Bank of New York Mellon. All right. Thank you so much. Appreciate that. Ken Usdin from Jefferies, please go ahead. Hi. Thanks. Good morning, and best of luck again also to both of you, Robin and Todd. Thanks, Ken. Emily, on the deposit side, can you talk a little bit more about your, you said your slightly different expectations for beta. I'm just wondering, can you flesh that out for us in terms of how you think that projects? Also, can you help us understand the difference between how you might expect deposits in the U.S. deposit side to act versus when we start to see the impact of the non-U.S. deposit base move? Thank you. Sure. Just a couple of things in there. About deposits. I mean about the betas in particular. You know, betas have been coming in a little bit better than we had anticipated, call it 5% or 10%. You know, why that is, certainly the way our thinking is that it's probably due to a couple of factors. Certainly the sheer amount of liquidity that's in the system, the risk-off behavior that you're seeing just based on the uncertainty, but also proactive management by us in terms of you know our deposit base and targeting you know operational deposits that we do wanna retain. We still think that ultimately, betas will retrace what we saw in the last cycle, although, like, they're, like I said, they're currently lagging what was actually anticipated. It's, you know, we're seeing pretty much similar themes in both, you know, the U.S. as well as Europe. What I would say is, you know, as the ECB gets to zero, that's probably the toughest place to be for us. Then as soon as they get negative, we expect betas to also kind of largely retrace what we saw in the last cycle. You know, that's basically what we're seeing and thinking. Okay. Got it. Any updated thoughts in terms of, you know, you gave us that update on where you expect deposits to be this year, but on a through the cycle basis, do you have any way of dimensionalizing, you know, how you think total deposits might act through this cycle versus last as well in terms of, you know, either mix shift or total? Thanks. Yes. Sure. Just a couple of things. First thing I would just say is I just would step back for just a moment and just remind folks about the central role we play in terms of liquidity across the financial ecosystem. We manage on any given day $1.2 trillion in liquidity across our sophisticated clients. Some of that, of course, is on balance sheet, as we're talking about. But there's also a significant chunk that's off balance sheet. We offer a lot of off balance sheet options, whether it's our own money market funds or third-party money market funds, big repo. What I would say all that is just that as deposits move, we will also get some benefit and see some of that, you know, moving around the system based upon, you know, where we are in what I would call each pull of the sack. We can benefit from that and see all of that as cash moves around the system. Getting very specifically into your question on deposits and deposit balances, what I would say for this year, and then I'll talk about the landing point. For this year, assuming, you know, currently implied rates are realized, we would expect, you know, deposits, average deposit balances to probably decline another 5%-10% from where they were in the second quarter, and that was $311 billion. You know, just to give you some color, in June, they were at $305 billion, and on a spot basis, they're already below that. Some of that, of course, expected because of seasonal. Likewise, just a reminder, when you think about the components of our deposit base, we would expect most of that runoff to be in NIBs. We'd expect NIBs to revert to about, you know, call it 20%-25% of our total deposit base. They're currently about 30%. When you just think about the entirety of the cycle when we're fully through the cycle and just putting it in perspective. Between the fourth quarter of 2019 and the fourth quarter of 2021, deposits increased by about $100 billion. About 50% of that was NIBs. They are, you know, of course, as we've always talked about, more rate sensitive. You know, we would expect also given the change in mix of our business, treasury services is a much bigger business. Asset servicing likewise is a bigger business. We think we'll be able to retain roughly two-thirds of that when it's all said and done. Great call. Thanks, Emily. Mike Mayo, Wells Fargo, please go ahead. Hi, can you hear me? Yes, Mike. Good morning. Okay, great. Just the big picture question back to Robin. I mean, you started off the call saying customers would like to do more business with BNY Mellon, and that would be by connecting the dots. Connecting the dots is a simple and powerful statement, but also so extremely difficult to execute because these dots are in different business lines, different geographies, managed by different people. How are you able to connect the dots and really focus around the customer when so many of these businesses are in disparate parts of the firm? Just conceptually, how do you attack a problem like that? Yeah, it's a great question, Mike, and it's one, it's something that I'm really very enthusiastic about as a firm. You know, one of the benefits of having spent a lot of time really talking to clients over the course of the past four months and having worked across and really spent time with employees of all levels up and down the company internationally, it has really been to be able to get into this particular opportunity that I highlighted that you just referenced. I feel we've got a few things that are really going for us. Number one, we've got this real differentiated trust from our clients. There's a will to do more business with us. Actually, I get questions from clients that ask me that they want to do more business with us, and they're not sure how to do more business with us. That, frankly, is a pretty differentiated situation to be in, and I view that as a real advantage. Second, we have a large set of related and interconnected businesses, so it's not like we're trying to sell completely different products to people where it's a real reach. These are adjacent business lines, so it's collateral talking about margin. It's collateral talking about treasury services. Treasury services for wealth clients. Foreign exchange for treasury services clients. It's real adjacent things. There's that opportunity as a result of the nature of the businesses we're in. Then third, it's actually the culture of the people. We have people here at BNY Mellon who are client first, firm second, self third. That is a very powerful cultural attribute, and I intend to mine that and the other two things. I'll just give you one example, because I mentioned it in my prepared remarks, but I think it's a great example. Which is Pershing and Asset Servicing came together over the course of the past few months to provide this new capability for this large government client that I referred to, which has a significant addressable market for us. The interesting thing, although the revenue hopefully will be interesting, the really interesting thing there is how they came together. I think it is different than maybe the way it would've been a few years ago. I'm optimistic about this, and we'll keep talking to you about it. We call it One BNY Mellon, and I'll be pleased to give you updates along the way. One follow-up on that. Just, you know, client first, firm second, self third. How do people get paid for doing this? Or how do you just from a 10,000-foot level, how do you think about individuals getting paid for connecting the firm the way you would like? Because, you know, to the extent that incentives ultimately drive behavior, if people get paid more for doing it, they're more likely to do it, or maybe you disagree. Well, I'm not naive, so of course, you know, financial compensation comes into it. But on that hierarchy of client first, firm second, self third, the compensation bit, while important, was in fact third on that list. People take a lot of pride associated with these sales and rallying around to deliver the firm for clients. We're gonna do all of the above, leverage the pride of our institution, America's oldest bank, the fact that we have this incredible connectivity with our franchise. Of course, we'll align appropriately the rewards, both financial and non-financial, to achieve those objectives. All right. Thank you. Thank you. Thank you. As a reminder to ask a question, please signal by pressing star one. Brennan Hawken from UBS, please go ahead. Good morning. Thanks for taking my questions. I guess I'm curious on the relationship with fee revs and expenses. It seems as though, of course, we've got a challenging market environment, so not surprising to see the fee revenue pressure. I guess just if you could update us on the thinking around the, you know, sort of rigidity, so to speak, of the operating expenses and whether or not there's an ability to do something, given the challenging environment to ease some of that pressure a bit. I think you usually, Emily, guide to core expenses. We'd back out the charge this quarter, but just if, you know, housekeeping-wise confirm that. Sure. There's a lot in there, Brennan. Let me take a step back. Just when you think about the 5%-5.5% up guide for the year, it's kind of very much in line with what we've been talking about since the beginning of the year. Any benefit that we are getting from currency tailwinds is being more than offset by much more persistent inflation pressure. If you just take that out of the equation, the 5%-5.5% up is about 2%, driven by higher revenue-related expenses. Think distribution expenses associated with the abatement of money market fee waivers. Think clearing fees, you know, associated with higher volumes. In that number is higher onboarding costs associated with the strong pipeline that we're onboarding across various different businesses. The remainder really relates to investment net of efficiencies as well as what I would call normalizing costs, as we return to the office like T&E and, you know, occupancy, et cetera. In terms of just kind of how we think about, you know, managing the cost base and, you know, when we think about, you know, the cost base in general, it's really, you know, three main categories, that we talk about here. You know, one is the revenue-related category, the other is the structural or run the bank, you know, category. It's obviously difficult, a little bit more difficult to move in the near term. There's the change in the bank or investments, the discretionary category. You know, as Robin, myself, Todd have all talked about before, we see a lot of, you know, compelling opportunities. I mean, I say a lot, but we've been extraordinarily targeted in those opportunities, Pershing X, future of collateral, data analytics, et cetera. We will stay the course on those investments. You don't just stop and start them based on the macroeconomic backdrop, and they are important to the future of the firm. Having said that, there are areas of course that we are pushing on and that we can hopefully accelerate from an efficiency perspective. Things like eliminating bureaucracy, automating the manual processes that still, you know, we have across the firm, optimizing our real estate and geographic footprint, better scaling our vendor usage to get more buying power, reducing, you know, unnecessary temps and consultants, all of those sorts of things, and that can be, you know, meaningful in totality. Okay. Thanks for all that. Emily, just the core part of the question. You guys guide the core expenses, right? Yes. I'm sorry. Yes. It was core. Yes, core ex notables. Correct. No, I know. I had a bunch of pieces, so I just didn't want them. I wanna make sure you got that. Okay, no, I appreciate all of that. I guess, when we think about the pieces of the expenses that are tied to, you know, the revenue and the pipeline and everything, you know, would that suggest then, you know, because the revenue trends have actually been adverse year in this year versus where we had started. Should we be thinking that some of those benefits that, where you're having some expenses or bearing some expenses this year would be coming in 2023? Is that the deal? Or is the idea that the revenue that's tied to the expenses is getting offset by some of the environmental headwinds that we've all seen? Well, I mean, just to remind you, I mean, the environmental headwinds, meaning, you know, market levels and currency have been an enormous, you know, headwind. I mean, that's you know, the challenge very much you know, this year. Yes, it is fair to say that some of the cost base, you know, is just the normal upfront cost that we have in this industry for onboarding clients that you will actually see the fee revenue realized over, you know, 2023, 2024 and beyond. Okay. Thanks for taking my questions. Rob Wildhack from Autonomous Research, please go ahead. Hi, good morning. You called out a nice to-be installed pipeline in AUCA. Can you just remind us how long that takes to get installed and start generating revenue? Is there any notable difference in the profitability of some of the new wins? Like, is that ETF business that you called out any more or less profitable? Anything like that worth noting? There are a couple things in that question. When we think about, I mean, the to-be installs and how it, you know, how it the timing of the onboarding is obviously just very dependent upon the business unit you're talking about. Generally speaking, it's about a kind of six, you know, anywhere from a six-month to a 12-month onboarding kind of timeframe. In terms of just, you know, the kind of how we think about the profitability and the fees generated, you know, from the pipeline in terms of ETFs, et cetera. Robin, if you wanna- Yeah, I would say that we are very focused on the net margin contribution of new business that we're bringing on. We have a rigorous process to look at that. As you look at the overall margin of the business, I think we're a bit victim of that. That was you know choices at the time of business that was onboarded that wasn't always at the appropriate margin. We're being very scrupulous about that as we look at the business coming in today. Okay, thanks. A quick one, Emily. Could you just quantify, or did you quantify what the effect of that merit increase that was pulled into 2Q? It was about 1%, when just in terms of the quarter-on-quarter variance. Okay. Thanks a lot, and congrats to you and to Todd and Robin. Thank you. Thanks, Rob. Thanks, Rob. Our final question comes from the line of Brian Bedell with Deutsche Bank. Please go ahead. Great. Thanks very much. I also echo my congrats and good luck for Todd and welcome Robin, and also for Emily. Thank you. Thanks. A couple of small modeling questions for Emily and then a strategic revenue growth question for Robin. Just with Emily, checking if your net interest revenue assumptions are using just the forward curve globally for central banks hikes, and also if you can size the strategic investment equity gain in the quarter. Then also on the issuer services, that $300 million was really strong. Is that a reasonable run rate into the second half? Okay. Gosh, three questions there. First, in terms of deposits, yes, we use the forward curve for you know all major countries and our regions. It is global. Two... What was your two? Sorry. The strategic investment gain that you called out. Oh, yes. -on the size of the- Yes, you know, we're not disclosing, you know, the stat- Okay. That specifically, but, you know, it did. It was part of the reason and the driver why investment and other income was $90 million. We've also given you the normal run rate for that line, so you can kinda think about, you know, what that would therefore mean. It is also worth saying that there were some seed capital losses net of hedges in that line this quarter that did not exist in the second quarter of last year. Actually, that were a gain in the second quarter of last year. So all of that is playing through the investment and other income line. Then, your last question was? That the issuer services was- Yes. Really good this quarter. Of course, yes. Just didn't know if that was a good run rate. Yeah. No, of course. In issuer services, you know, ultimately we had, you know, a better performance in DRs than we had originally anticipated. Just, you know, strong dividend activity. Some of that is, you know, seasonal that you normally just see, you know, first quarter to second quarter. That's really the driver. Okay, great. Robin, if we could just finish on Pershing X. Sounds like you are making traction there. I know that's still like a two-plus year type of sort of you know materiality at least at the last earnings call. I don't know if you wanna update us on whether you think that might actually happen sooner. Just on the organic growth, which is looking like 50-100 basis points, like you said, for this year. Just with all of these initiatives, do you envision where that organic growth rate could maybe go in the next couple of years? Sounds like there's a lot of exciting growth initiatives and business opportunities given how you've characterized it. Sure. Let me start, Brian, with Pershing X. We're very pleased with the progress that we've made. Ainslie onboarded, you know, in the second half of last year, as you know. She just crossed the nine-month mark. We've rounded out the management team. We acquired Optimal Asset Management. We actually integrated our Albridge business into Pershing X as well, which has been quite helpful because it's quickly augmented the number of engineers, an extra 150 engineers into the mix. We've had hands on keyboards writing code for the past three months on that. We feel we're very much on track. We're expecting to launch a very early minimum viable product with a very small select group of clients by the end of the year on the business which will be helpful. We've been taking a lot of client advice along the way, and have had a lot of client engagement, which is helpful, not only to make sure that we're building exactly what clients want, which, as you know, is the origin of the product, but also, of course, helps us with sort of the early pre-sale of the whole conversation. You know, we're excited about the direction of travel. I'll reiterate my prior point on the revenue, though, which is, you know, we don't expect to have a meaningful drop to the bottom line on this thing. I said at the time, for a couple of years, that was a quarter ago, so we're still on that same track, notwithstanding the fact that we're gonna be starting testing the MVP at the end of the year. It's a multi-year endeavor for us, and we remain excited about it. In terms of organic growth, sort of more broadly, I will say that comes in a couple of different forms. Of course, we've got the interesting initiatives like Pershing X, like our investment in RTP. We've also got it in the form of the margin walk that we've walked you through before, in asset servicing, which includes top-line activity as well as the bottom line, as we do all of that. We've got all of those initiatives. Those contribute to organic growth. We also think that, to my conversation earlier on about One BNY Mellon, that there is blocking and tackling, which isn't necessarily glamorous, but is important under the hood to make sure that we really are introducing all of our clients to all of the products and capabilities and platforms of BNY Mellon. I'm excited that that's gonna contribute growth as well over time. Not in a position to give you a number today, but I think it'll be part of the equation. Great. That's great color. Thank you. Thank you. Thanks, Brian. With that does conclude our question and answer session for today. I would now like to hand the call back over to Robin with any additional or closing remarks. Well, thank you very much, operator. Thank you everyone for your interest in BNY Mellon. I know it's a very crowded morning today, so we appreciate you dialing in. If you have any follow-up questions, please do reach out to Marius and the IR team. Let me just say be well and enjoy your summer as we finish off. Thank you. Thank you. This does conclude today's conference and webcast. A replay of this conference call and webcast will be available on the BNY Mellon Investor Relations website at 2:00 P.M. Eastern Standard Time today. Have a great day.