09/29/03
NEW YORK, NY, September 29, 2003 - The Bank of New York Company, Inc. (the "Company") and General Motors Acceptance Corporation ("GMAC") have agreed to a settlement regarding GMAC’s claims relating to the 1999 sale to GMAC of BNY Financial Corporation, the Company’s factoring and asset-based finance business.
The settlement agreement resolves the claims between the parties with a payment of $110 million by the Company to GMAC. After accounting for a previously-established reserve for this matter, the net impact of the settlement will be approximately 6 cents per fully diluted share, recorded by the Company as a non-operating charge in the third quarter. The Bank of New York sold BNY Financial Corporation to GMAC for $1.8 billion in cash in 1999.
The Company expects that its third quarter operating earnings will be in line with the current First Call consensus estimate of 42 cents per fully diluted share. Reported earnings are expected to be 34 cents, including 6 cents related to this settlement and the previously announced 2 cents from merger and integration charges related to the Pershing acquisition.
The Company had previously disclosed GMAC’s claims and the potential for litigation in reports filed with the Securities and Exchange Commission.
The Bank of New York Company, Inc. (NYSE: BK) is a global leader in securities servicing for issuers, investors and financial intermediaries. The Company plays an integral role in the infrastructure of the capital markets, servicing securities in more than 100 markets worldwide. The Company provides quality solutions through leading technology for global corporations, financial institutions, asset managers, governments, non-profit organizations, and individuals. Its principal subsidiary, The Bank of New York, founded in 1784, is the oldest bank in the United States and has a distinguished history of serving clients around the world through its five primary businesses: Securities Servicing and Global Payment Services, Private Client Services and Asset Management, Corporate Banking, Global Market Services, and Retail Banking. Additional information on the Company is available at www.bankofny.com.
FORWARD LOOKING STATEMENTS
All statements in this press release other than statements of historical fact are forward looking statements including, among other things, projections with respect to revenue and earnings and the Company’s plans and objectives and as such are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward looking statements. These include lower than expected performance or higher than expected costs in connection with acquisitions and integration of acquired businesses, the level of capital market activity, changes in customer credit quality, the effects of capital reallocation, portfolio performance, ultimate differences from management projections or market forecasts, the actions that management could take in response to these changes and other factors described under the heading "Forward Looking Statements" in the Company’s 2002 Form 10-K and Second Quarter 2003 Form 10-Q which have been filed with the SEC and are available at the SEC's website (www.sec.gov).
Forward looking statements speak only as of the date they are made. The Company will not update forward looking statements to reflect factual assumptions, circumstances or events which have changed after a forward looking statement was made.
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