BNY Mellon, a New York bank that tracks and holds assets for many big institutions, may lose as much as $200 million in revenue this year as it stops new business in Russia and complies with a raft of sanctions imposed by Western nations aimed at crippling the nation’s economy.
The company, which holds and manages $46.7 trillion worth of assets for clients such as asset managers, has ceased new business in Russia and has “suspended investment management purchases of Russian securities,” Garrett Marquis, a BNY Mellon spokesman, said in a statement on Thursday. “We will continue to work with multinational clients that depend on our custody and record keeping services to manage their exposures.”
The bank expects to lose about $100 million in revenue this quarter as a result. For the rest of the year, revenue could fall by another $80 million to $100 million, it estimated.
BNY Mellon, which is the largest so-called custodian bank, joins other American banking giants — including Citigroup, Goldman Sachs and JPMorgan Chase — that have said they will step back from Russia after its invasion of Ukraine prompted swift and severe economic penalties from the United States and its allies. Other global corporations from the energy, retail and food industries have also shunned Russia since the war began.
Western banks had largely withdrawn from Russia in recent years, maintaining only limited operations to serve companies there, after President Vladimir V. Putin’s annexation of Crimea in 2014 prompted economic penalties from Western nations. Still, disentangling links to the Russian economy will be a complex task for financial companies because of the intertwined nature of global trade.