A very brief outline of what each of us stated to the questions above is listed below. This certainly isn't the complete description of our call:
3. Find news/information about the litigations associated with BK and briefly discuss what both the short-term financial and long-term strategical impact, if there's any, to the company.
Bank of New York Mellon Corp. currency traders used a foreign-exchange system called "Charlie" to create fake trades and overcharge Virginia pension funds by at least $20 million. They offered the Virginia pension fund the worst price for the day and made their profit by exchanging at the interbank rate. Hence, personally I feel that their declining performance in the FX is not due to the high volatility as they quoted but an after effect of this incident.
4. Why is the volatility on currency trading of BK is the lowest since 2007?
Volatility is a measure of variation in price of a financial instrument - it is a measure of risk. A billion things contribute towards an instruments risk. I tried looking for what specific FX indices or currencies they were trading but I couldnt find the information.
the basic concept is, the market is getting calmer. The nuclear, earthquake, usa budget controversy etc. is sorta sinking in with the investors. They are coming to terms with it all and so price discripencies are shrinking.
6. Generally, do you agree with the "cautiously optimistic" view of the company management after reading the last several paragraphs?
I think the bank when talking about NIR and how this is being affected by low interest rate is true . Most banks if not all are enjoying low cost borrowing right now and it is interesting to see how this plays when the interest rate starts going up. Furthermore, the bank is talking about reducing cost by using technology. I think this is a superman like statement that is every firm in the country I'd saying but hard to apply and measure in the real world. I think it was a broad statement without specifics.