BNY Mellon wealth unit inflows robust

By Muralikumar Anantharaman

BOSTON (Reuters) - Bank of New York Mellon Corp (BK.N: Quote, Profile, Research, Stock Buzz) said on Wednesday its wealth management business saw its best net asset flows of 2008 in the third quarter and has seen record inflows from rich clients over the past year.

David Lamere, chief executive of BNY Mellon Wealth Management, one of the top 10 wealth managers in the United States, said at the Reuters Wealth Management Summit that the record inflows were driven by the firm's expansion of its sales force and by clients moving some assets from rivals due to the bank's strong capital and liquidity base.

But he said the strong inflows have not translated into higher assets at the end of the period, as they have been hit by market depreciation.

"Organic business flow has been great," Lamere said, adding it was in "the teens of billions of dollars" over the past year. "And I'm unhappy to report that all of that has gone away in market value."

"Third quarter was our best quarter of this year," Lamere said, responding to a question on asset flows. "And I would expect that that will continue in the fourth quarter." He declined to detail inflows and asset figures because the firm is reporting its quarterly results on Thursday.

BNY Mellon Wealth Management, which was formed last year in the merger of Bank of New York Co and Mellon Financial Corp that created its parent, had $162 billion in assets as of June 30.

"We've actually added to our sales force by about 20 percent over the last 12 to 15 months. That, for sure, has had an impact on our ability to attract assets," Lamere said.

BNY Mellon Wealth Management, half of whose clients have more than $100 million, also benefited from being organized as a "fiduciary and trust organization, as opposed to a broker's model," he said.

Advisers to the wealthy told the Summit on Tuesday that many rich investors were frustrated with big brokerages and banks for exposing them to risky investments.

"In an environment of uncertainty and fear, organizations like ours have been a destination. There's no question that we have gained market share," Lamere said.

(Editing by Gerald E. McCormick)