BNY, Northern Trust deal could face increased scrutiny, says Keefe Bruyette

Keefe Bruyette says the Wall Street Journal’s report that BNY Mellon (BK) (BNY) approached Northern Trust (NTRS) last week to discuss the possibility of a merger is “very interesting.” How advanced the discussion is and Northern’s openness to the discussion remain uncertain, the analyst tells investors in a research note. The firm’s view is that the merger may face increased regulatory and antitrust scrutiny. However, the business models complement each other with BNY having leading custody operations while Northern has a leading wealth management business, the analyst tells investors in a research note. Keefe believes a merger probably has a “long way to get done,” It has an Outperform rating on BNY with a $100 price target.