The Bank of New York and Mellon Financial Corporation have entered into a definitive merger agreement that will create the largest global securities servicing and asset management firm.
The new company will be called The Bank of New York Mellon Corporation and, according to the parties, it will be the world’s leading asset servicer, with $16.6 trillion in assets under custody, and will rank among the top 10 global asset managers, with more than $1.1 trillion in assets under management.
The current chairman and chief executive of The Bank of New York, Thomas Renyi, will serve as executive chairman of the Bank of New York Mellon Corporation for 18 months after the completion of the transaction, which the companies expect will be in the third quarter of 2007.
Mr Renyi, who will have overall responsibility for the integration of the two companies, said: Through this merger, we will be able to invest and expand more effectively than any of our competitors due to our combined scale, profitability and global reach. The organic growth of our respective companies is already strong, and the cost savings and revenue synergies opportunities are excellent.
The companies have a combined employee base of 40,000, which they expect to reduce by approximately 3,900 over a three-year period following the transaction.
According to The Times, although both banks have yet to reveal exactly where the cuts in Europe will fall, they are expected to be proportionate to the overall 10% cut in overall employee numbers, which would involve the loss of more than 500 jobs in the UK.