The world's largest custody bank, Bank of New York Mellon (BK, Financial) has been challenged by the persistently low-rate environment. While custody tends to be a wide-moat business, revenue generation is highly sensitive to net interest margins. Low rates have also hurt Bank of New York's other primary line of business—investment management—as it has been forced to waive fees on its money market funds to preserve their net asset value.
From First Eagle Investment (Trades, Portfolio)'s Global Value Team's third-quarter 2020 commentary.
