BNY Mellon names former Visa CEO to top job
Bank of New York Mellon Corp on Monday said former Visa chief executive Charles Scharf will take the top job at the world`s largest custody bank, where he will focus on boosting organic growth.
Scharf immediately replaces 65-year-old Gerald Hassell, who will remain chairman of BNY Mellon until the end of the year when he retires. Scharf will then become chairman.
"The first priority is growing the company organically," Scharf told Reuters. "We already are in places that have tremendous amounts of opportunity."
BNY Mellon had $30.6 trillion in assets under custody and administration at the end of March. The bank`s massive platform is a key part of the plumbing that keeps global financial markets flowing. Besides safeguarding the stocks and bonds of large institutions, the bank calculates mutual fund prices, trades foreign currencies and facilitates securities lending to enable short selling by hedge funds, for example.
Scharf, who headed Visa from October 2012 to December 2016, played a key role in orchestrating the world`s largest payments network`s reunion with its European affiliate.
"It looks to me they got the right guy," said Daniel O`Keefe, who runs the runs the $2.9 billion Artisan Global Value Fund. That fund owned about 2.1 million BNY Mellon shares at the end of June, or 3.7 percent of its net assets.
BNY Mellon shares were up 2 percent late Monday morning on Scharf`s appointment as CEO. The stock rose about 145 percent during the last five years of Hassell`s tenure, which began in late August 2011. The S&P 500 Index is up 81 percent over the past five years.
In recent years, O`Keefe and other large BNY Mellon investors, including Nelson Peltz`s Trian Partners, pushed for change at the bank. Hassell felt the brunt of the heat, getting support and a rebuke from Trian partner and chief investment officer Ed Garden at the bank`s 2015 annual meeting.
Still, O`Keefe said Scharf will run a company that is in good position.
"Visa is a platform and a systems business, one of the best in the world," O`Keefe said. "BNY is also effectively a systems and platform business. Its future lies in optimizing those systems and driving out costs."
Scharf and Hassell, during an interview with Reuters, agreed that the bank`s ability to wring out costs and keep up with the pace of change in technology will be a key part of its future.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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