December 18, 2008 / 4:35 PM / 10 years ago

UPDATE 1-Citi starts Bank of NY Mellon, State Street with buy

Dec 18 (Reuters) - Citigroup started coverage of Bank of New York Mellon (BK.N) with a “buy” rating, saying it is better positioned than traditional banks to weather the current environment due to its fee-driven business model, relatively lower credit risk and strong capital levels.

The brokerage also began State Street Corp (STT.N) with a “buy,” saying the institutional money manager is positioned to capitalize on long-term growth opportunities due to its technological expertise, large institutional client base, and global operating platform.

The brokerage assigned a target price of $54 for State Street and $33 for Bank of New York Mellon stock.

Citigroup began Northern Trust Corp (NTRS.O) with a “hold” rating, and said revenue and earnings growth should slow for the U.S. trust bank and asset manager in the near term, impacted by recent stock market performance and economic conditions.

It set a price target of $54 on Northern Trust’s stock.

Shares of Bank of New York Mellon were down 3 percent at $27.17, while those of State Street were 23 cents lower at $40.08 in morning trade on the New York Stock Exchange.

Northern Trust stock was down 9 cents at $50.44 on Nasdaq. (Reporting by Ratul Ray Chaudhuri in Bangalore; Editing by Deepak Kannan)

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