Question-and-Answer Session
Operator
Thank you. [Operator Instructions]. Our first question comes from Glenn Schorr with UBS. Please go ahead.
Glenn Schorr - UBS
Hey guys.
Robert P. Kelly - Chief Executive Officer
Good morning Glenn.
Glenn Schorr - UBS
so I guess it's good, Ron is on the phone though. First question is, there was some turnover at Boston Company. And I am curious if you could outline. You probably don't want to spell out what number of assets went out, but if you could just give some color around, have we seen the full impact of that move and we move forward from here?
Ronald P. O'Hanley - Chief Executive Officer, BNY Mellon Asset Management
Hi Glenn, this is Ron. The team that left the international core team, it clearly was a loss for the Boston Company but I think for the overall franchises it's minimal, and happy to talk about what the impact is. We lost about just under $11 billion in assets under management which should be in the long term column. So in fact the way we think about the quarter that is but for that long term flows actually would have been quite high, close to $11 billion... close to $12 billion. So have we seen the end of it? I think we've seen most of it. Typically what happens in these cases, are the clients that are sensitive to this kind of thing or don't see the rationale for stay and go. Obviously we spent a lot of time with the clients. We've retained all the intellectual property. We've retained some of the people and have actively worked with those clients that are remaining with us. So could there be more? Yes. Do I expect that we've seen the worst? Yes.
Glenn Schorr - UBS
Okay that's very helpful. And then in issuer services it's great to see that DR business offset what I think was a lot lower CDO issuance. Is there anyway you could give maybe an update on the revenue breakdown in issuer services on a general basis?
Gerald L. Hassell - President
Glenn this is Gerald. You know the CDO business is still a small portion of the overall Corporate Trust business and so I don't think that it's fair to assume that Corporate Trust did not have a good quarter. In fact it's the opposite. Corporate Trust had a very good quarter in spite of the negative activity occurring in CDOs and I think that's a reflection of the diversity of the Corporate Trust business overall. We don't break it out, line item by line item but Corporate Trust had a very strong quarter in spite of that.
Robert P. Kelly - Chief Executive Officer
And just to build on that, Karen, what percentage of your business would be CDOs?
Karen B. Peetz - Chief Executive Officer, The Bank of New York Mellon Corporate Trust
It's actually about 20%.
Robert P. Kelly - Chief Executive Officer
That would imply a slowdown in revenue growth, but still pretty good overall.
Karen B. Peetz - Chief Executive Officer, The Bank of New York Mellon Corporate Trust
Yes.
Glenn Schorr - UBS
Right. And then last question was of Bruce, maybe there is a big drop in finance related fees, just curious what would cause that? Is that more of a permanent number that we're looking at?
Bruce W. Van Saun - Chief Financial Officer
Yes, that was Glenn, really just in our capital markets activities which we've somewhat deemphasized and it also reflects what's happening in the markets.
Glenn Schorr - UBS
Okay, helpful. Thanks guys.
Robert P. Kelly - Chief Executive Officer
Thanks Glenn.
Operator
Thank you. Our next question comes from Betsy Graseck with Morgan Stanley. Please go ahead.
Betsy Graseck - Morgan Stanley
Good morning.
Robert P. Kelly - Chief Executive Officer
Good morning Betsy.
Betsy Graseck - Morgan Stanley
I was just wondering if you could give a little bit more color on the revenue enhancements. I know you talked about the $250 million to $400 million that you are looking to generate by 2011 but is it possible to speak to the magnitude in the various groups and the degree to which you have to invest to get these revenues?
Gerald L. Hassell - President
Betsy, this is Gerald again. It's a little early to get terribly specific on it. I think we have tried to give you the 15 major line items that we see as being 60% of that number. We're going to work on the phase in approach in the coming quarters. We do feel very good about these in terms of being just able to realize on these revenue synergies without a whole lot of incremental investment. Just doing better practices, better marketing, better sales effort, and having our new management teams work together to tease out the synergies from the businesses. It's not a whole lot of incremental investment that's required.
Robert P. Kelly - Chief Executive Officer
Betsy, it's Bob. Gerald and I have created what we call a revenue council, all the business heads are around the table. We are working on how we're going to measure ourselves across business lines, what goals we're going to set for ourselves, what kind of compensation we have across the business lines, and what we are doing for recognition programs. My experience has always been, it takes longer to get revenue synergies than it does to get expense synergies, because you got to train people, you got get them excited about it. They have to feel confident that they are able to sell the products and execute well.
But we've gone through a pretty detailed process and we have great measurement systems now in place to help us track this and be really specific with our people so that they know what we are trying to achieve by everyone in these opportunities, and we will be tracking it closely. So, I would say we're going to get some of these pretty quickly and others it will take longer. So, I don't see us reporting necessarily this number, how we are doing every quarter, but we're certainly going to update you regularly a couple of times a year. And we will give you a really good sense generally for each one of the buckets how we are doing, okay.
Betsy Graseck - Morgan Stanley
Got you. And then just on the performance fee question. I am just trying to understand if there is likely to be impact in the fourth quarter, first quarter from the activity that happened in the third quarter generated negative performance fee.
Ronald P. O'Hanley - Chief Executive Officer, BNY Mellon Asset Management
No. Betsy, this is Ron. And let me go through that. I mean as I think you know the third quarter is historically the lowest quarter.
Betsy Graseck - Morgan Stanley
Right.
Ronald P. O'Hanley - Chief Executive Officer, BNY Mellon Asset Management
But for the third quarter of last year, I'd like to see Mellon is typically de minimis quarter. What happened was really a few things. We had two quartile... two performance fee accounts that we are eligible for quarterly performance fees that we had in '06, in our no fee in '07. We obviously, may or may not earn a quarterly fee in the fourth quarter. We had some other performance fees that were just down off the record levels of 2006 Legacy Mellon.
And then finally, as Bruce mentioned at Ivy and Alcentra, there were our performance fees accrued in the first and second quarter that were taken back. We have now changed all the accounting policy, not to our core policy. So that everybody... all performance fees have done in the same ways that were at Legacy Mellon. So, I would expect not to see any of so called noise there from that. So it will just to be how we are doing performance wise. And I would just echo with Gerald and Bruce said we have in Legacy Mellon a blistering performance fee... performance last year. We would not expect to be at that level this year.
Betsy Graseck - Morgan Stanley
Got it. Thanks.
Operator
Thank you. Our next question comes from Mike Mayo with Deutsche Bank. Please go a head.
Michael Mayo - Deutsche Bank Securities
Hi. Good morning.
Robert P. Kelly - Chief Executive Officer
Hi, Mike
Gerald L. Hassell - President
Good morning.
Michael Mayo - Deutsche Bank Securities
All the firms say they have a whole lot of new business but it's tough to get a context for what that means. So, if you can just put some color around that. Is the new business higher than last quarter? Is it big percentage of your existing revenues or how should we think about that?
Gerald L. Hassell - President
Mike, it's Gerald. On the asset servicing side some of the statistics that I threw out, I think are already showing up in the revenues. That's why you're seeing such a strong revenue increase. It's not just market activity and market volumes. New business wins are actually coming in. Jim, maybe you want to comment on it.
James P. Palermo - Co-Chief Executive Officer, BNY Mellon Asset Servicing
Yes. Thanks Gerald. That... Mike, it's Jim. Of the $500 billion that Gerald referenced earlier, just under one-third of that we actually converted in the third quarter, in addition to wins from prior quarters. So we're beginning to some of that flow through on the revenue line that Gerald alluded to.
Michael Mayo - Deutsche Bank Securities
Okay. And --
Robert P. Kelly - Chief Executive Officer
And I would.... Mike, I would say, I think it's fairly evident in that something that we're going to be tracking for you externally, because we've certainly showed this in... certainly in Legacy Mellon before is... my hope and expectation is we're going to track ourselves closely vis-à-vis our peers. And ultimately the best measures is going to be who gains share revenue, and who gains share bottom line. And that's what we'll be watching.
Michael Mayo - Deutsche Bank Securities
And, who are you gaining from benefit, the other big players or all those many smaller players outside the big 5 or so?
James P. Palermo - Co-Chief Executive Officer, BNY Mellon Asset Servicing
Jim again. Mike, it's been from both. In many of the competitions we face the same major 3, 4, 5 competitors that you all know. And then in some of the other markets that we compete in, there is some local entries that we compete against. And so, it's been a combination. But I would say the vast preponderance were from the large major competitors.
Michael Mayo - Deutsche Bank Securities
And as far as competition and you've had two huge mergers this quarter. Does that have any impact or they are on meeting each other up like they have done for the last decade?
Bruce W. Van Saun - Chief Financial Officer
I think it's more of the latter. I think it's been pretty consistent pattern amongst the major players competing very aggressively against one another for some takeaway business.
Michael Mayo - Deutsche Bank Securities
And then non-U.S. is up to 31% now. So, is that growing faster and how much so?
Gerald L. Hassell - President
That non-U.S. number is for the company at large at 31%. And clearly in asset servicing and asset management, it's at even higher percentage. And it is accelerating.
Robert P. Kelly - Chief Executive Officer
I think in asset management Mike we are about 35% in investments.
Bruce W. Van Saun - Chief Financial Officer
In asset servicing.
Ronald P. O'Hanley - Chief Executive Officer, BNY Mellon Asset Management
Servicingwas 39% non-U.S.
Robert P. Kelly - Chief Executive Officer
Yes.And we will also have to recall of course that we are growing much faster in Europe and Asia than we are in the United States. Our expectation is that will continue, and we also have the ABN AMRO joint venture which we expect to close in the fourth quarter as well, which will increase the numbers. So, we have great momentum.
Michael Mayo - Deutsche Bank Securities
And you're closing on the ABN AMRO joint venture and that's going to bring the tier 1 ratio back down. What's the earnings benefit from that say in next year?
Robert P. Kelly - Chief Executive Officer
The deal will be accretive. It's not that material. It has a good rate of return. And it positions us well for future growth.
Michael Mayo - Deutsche Bank Securities
How should we think about your capital ratio after you close that? It's ironic that you have less credit risk and a much higher tier 1 ratio than some of your peers?
Gerald L. Hassell - President
Yes, I mean, Mike the tier 1 ratio is comfortably above the 8% target. What's been our constraint really is the more leverage sensitive adjusted TCE ratio. That was posted at 531 at the end of the third quarter, after we factor in the ABN, the closing of that transaction. We'd still expect to be above the 5%, but pretty close to it.
Michael Mayo - Deutsche Bank Securities
All right. Thank you
Gerald L. Hassell - President
Yes.
Robert P. Kelly - Chief Executive Officer
Thanks Mike.
Operator
Thank you. Our next question comes from Kenneth Usdin with Banc of America Securities. Please go ahead.
Kenneth Usdin - Banc Of America Securities
Thanks. Good morning, everyone.
Follow-up on capital, so Bruce, if you are above 5% just going to next year, can you give us any color or kind of around the magnitude of buyback that you might be able to do? It seems like you would be a little bit of ahead of your initial plans of buying back stock. Any idea of what the magnitude of size of the buyback you could do?
Bruce W. Van Saun - Chief Financial Officer
Yes, I don't think we have given guidance fully on that. But as you are aware, we have... if we are positioned with the 5% ratio, and that's the target. All the free cash flow that we're generating, we can allocate. Obviously, we are going to increase our dividend commensurate with our earnings growth expectations. We are also then going to look for acquisitions and then we will also have to allocate some to the buyback. So, I think we'll have a meaningful amount of buyback. But, some of that's dependent on what the acquisition opportunities that we see.
Kenneth Usdin - Banc Of America Securities
Sure. Yes, okay. And then just a follow up to that you start to mention there on the dividend. I mean both legacy companies used to payout in the low 40s, and now obviously with the earnings power accelerating, you are only kind of in the mid 30s just right now. So, can you give us an idea of where you would expect the payout ratio to be in the future and when you might be address that?
Bruce W. Van Saun - Chief Financial Officer
Well, we had... we have said that our policy... our target is about 40% on a GAAP basis, and 35% to 40% on a cash basis. So obviously, that's we're slightly behind both at this point, given the strong growth in earnings we've experienced.
Robert P. Kelly - Chief Executive Officer
Ken, well, I would say... it's Bob again. This is our first quarter. Obviously we are delighted and we are going to be watching this closely, and we've already shown guidance out there. And frankly I watch a little bit more the so called cash earnings, we can back out the intangibles, because intangible is a non-cash item, and it's better to look at it excluding that. So we will watch both ratios and stay tuned, we will continue to build the company here.
Kenneth Usdin - Banc Of America Securities
And one more question just on the cost saves. It sounds like you are comfortable just... with your recognition of cost saves, I am just wondering, do you think that there is a chance that you come in either ahead of schedule on the $700 million or above $700 million? And what could we expect as far as perhaps incremental cost saves now that you have kind of gotten now full into the beginning of the integration?
Bruce W. Van Saun - Chief Financial Officer
Yes, I think it's a little early to start adjusting that guidance. Clearly any target we put out there is achievable in our mind and we are going to work hard to try and beat it. I would say also that in the model if you go back to the December 4th presentation when we announced the transaction, we do have inflation adjustment against that synergy target. And so we'll start to score ourselves on that basis. So in any event I think the inflation factor in the model was 3% per annum. We will exceed 700 but then the question is will we beat the inflation adjusted number over time? And I think at this point clearly we are feeling good about how we came out of the shoot but it's probably a little early to say.
Kenneth Usdin - Banc Of America Securities
Okay, thanks a lot.
Bruce W. Van Saun - Chief Financial Officer
Yes.
Robert P. Kelly - Chief Executive Officer
And that, I would just finish that off by saying, I think our teams have done a terrific job, particularly the integration people, of really doing all the legwork it required to make this a real success for our company. And real hats off to everyone from Tom Renyi and Don Monks and Steve Elliot and all the teams. And frankly the finance guys have done a fantastic job over the last three or four weeks and haven't been able to sleep quite probably. So, what I am really heartened by is the fact that we've gotten good numbers out of the first quarter, we are feeling increasingly comfortable. At this point though we're still mostly focused on the first year or two and we'll figure out the final numbers that we get further into the integration process, and as we all get more comfortable with what is really possible here. Still early days, in other words.
Operator
Thank you. Our next question comes from Brian Bedell with Merrill Lynch. Please go ahead.
Brian Bedell - Merrill Lynch
Hi, good morning.
Robert P. Kelly - Chief Executive Officer
Hey Brian.
Brian Bedell - Merrill Lynch
Just on the revenue synergies again. You said these on page one there, their gross revenue synergies, is that... what would be the net impact?
Bruce W. Van Saun - Chief Financial Officer
Well if you look at our overall margin as a company, we're at 35%-36%. If you look at incremental revenue synergies it would be a safe bet that they'd come in somewhat higher than that, but we really haven't. At this point we're just kind of putting out the big box card numbers and we haven't fully flushed that out, Brian.
Brian Bedell - Merrill Lynch
Okay. Yes, so I think your net was... you were expecting some attrition and the gross number was the 250-400?
Bruce W. Van Saun - Chief Financial Officer
I thought you were asking about what the net impact of pre tax would be in the flow through.
Brian Bedell - Merrill Lynch
No, just the word gross revenue, I was wondering if that was... if you were expecting some attrition that we should offset against gross revenue target?
Bruce W. Van Saun - Chief Financial Officer
Well as you recall in the deal model we said that the... we would expect the benefit of revenue synergies to offset any expected attrition. At this point we are not seeing any attrition and we're still managing to have no attrition beyond what we would experience in the ordinary course of our business.
Brian Bedell - Merrill Lynch
Right. So the 250-400 really is implemental to the deal model.
Bruce W. Van Saun - Chief Financial Officer
Hopefully it is.
Brian Bedell - Merrill Lynch
Right. Great and then is this by the... are you targeting this run rate by the end of '011 or at the beginning on '011?
Bruce W. Van Saun - Chief Financial Officer
Yes. That is probably in... all 2011 number. Kind of on a run rate sense standpoint.
Brian Bedell - Merrill Lynch
Right, okay and then what would you... if you have to name three of synergies that you have on page 10. Maybe there, I don't that the top 3 that you... you think are most visible and sort of quickest to realize what would you say they would be?
Gerald L. Hassell - President
Brain, this is Gerald. I said the first one that is most realizable and probably the largest is the cost selling of asset managing and asset serving and vice versa. And that's where we are getting some very good traction. The China mandates that we've commented on here is a great example of that and we see more of those opportunities all around the world.
Brian Bedell - Merrill Lynch
Okay. What were the assets in the QDII mandate that you mentioned for the servicing end of it?
Bruce W. Van Saun - Chief Financial Officer
It's $4 billion.
Brian Bedell - Merrill Lynch
I thought it was the asset management. Okay, you are getting the servicing and the asset management on that $4 billion.
Gerald L. Hassell - President
That's correct.
Brian Bedell - Merrill Lynch
Got you, okay.
Gerald L. Hassell - President
And that's not the only QDII mandate for asset servicing, we've won all the other ones as well. This is the only one that we're managing.
Brian Bedell - Merrill Lynch
Oh I see. Okay what's that total if you can say.
Gerald L. Hassell - President
Brian, we can't really comment on, because it's not out in the public forum.
Brian Bedell - Merrill Lynch
Okay.
Gerald L. Hassell - President
Actually Tim Keaney may have some comment on that.
Timothy F. Keaney - Co-Chief Executive Officer, BNY Mellon Asset Servicing
Yes Gerald, we'll be announcing formally the second big mandate in the next couple of weeks you've read in the press. Who it is... significantly over subscribed as was the China Southern transaction, so that will be at least $4 billion. And these are particularly important because their equity QDII is rather than fixed income and of course we have talked about the P&L impact of the equity kicker on top of that so. It's about $8 billion Gerald.
Bruce W. Van Saun - Chief Financial Officer
Hello Jim. Could you just mention that what your attrition rate was, last quarter? Would you have that up.
James P. Palermo - Co-Chief Executive Officer, BNY Mellon Asset Servicing
Yes, on the lost...
Brian Bedell - Merrill Lynch
Yes, lost business, just overall. We thought in terms of 2% or 2.5% per annum is for most large asset services.
James P. Palermo - Co-Chief Executive Officer, BNY Mellon Asset Servicing
Yes, as we mentioned earlier, it was actually lower than we've been experiencing separately, historically was actually a 0.03%.
Brian Bedell - Merrill Lynch
Great and then if you I think Gerald, you're talking about that revenue synergy if you have a couple of others that you think are extremely or very visible or sizeable in comparison?
Robert P. Kelly - Chief Executive Officer
Let me jump in Brian. I think that whole first category of best practices. I would almost view as a category because those things are really within our control and are tangible and they are soon. And so some of those have already kicked in and so I think that's one that we're very focused on in the near term. So that would be one and then that middle bucket as a group the two assets servicing businesses come together and they are very complementary in nature. So just within asset servicing, forgetting about cross selling across our business line... line of business silos, just within asset servicing itself you have some very rich products that Mellon can offer to the legacy BK customers and similarly that BK can offer to the Mellon customers.
Brian Bedell - Merrill Lynch
Great and just one last question. Bruce you mentioned issuer services is seasonally strong in the fourth quarter. Even with the really strong volumes that we have seen in the third quarter, you still anticipate that we could have an up quarter in issuers and depository receipts in the fourth quarter?
Bruce W. Van Saun - Chief Financial Officer
Yes, I will turn that to Brian for some more color but I think that we have to recognize that third quarter was exceptionally strong so you might not see a huge seasonal bounce but we still feel good about how we are positioned and the momentum we have in those businesses. So we still would expect to see some uptick, Brian you want to comment on that.
Brian G. Rogan - Chief Executive Officer, The Bank of New York Mellon Issuer and Treasury Services
: Yes, I think the only comment I add to that is the Corporate Trust business traditionally also has a seasonal bounce in the fourth quarter particularly in December. But agreeing with Bruce, I think given the strong third quarter, there will be a less percentage than previous years.
Brian Bedell - Merrill Lynch
Great, thank you.
Operator
Thank you. Our next question comes from Gerard Cassidy with RBC Capital Markets. Please go ahead.
Gerard Cassidy - RBC Capital Markets
Thank you. Hi Bob.
Robert P. Kelly - Chief Executive Officer
Hi Gerard.
Gerard Cassidy - RBC Capital Markets
You guys mentioned about the wins that you've had this quarter and I think you put out a number that you won 75% of the businesses that you bid on in this specific area. How does that compare to Legacy Mellon or Bank of New York for that type of business? I know the mid and back office showed a 100% kind of win rate but in the other areas, is that better than what you have seen in the past, about average?
James P. Palermo - Co-Chief Executive Officer, BNY Mellon Asset Servicing
Gerard, it's Jim again. Yes it actually is higher than historical, typically what we have experienced over the last few years both, Legacy organization is around 35% to 40% win rate. And so we actually have significantly exceeded that so far with the third quarter performance.
Gerard Cassidy - RBC Capital Markets
Great and circling back to the dividend question. Would you guys establish a dividend policy in that, once a year around the annual meeting, at the Board meeting, that's when if you were going to increase a dividend that might be the time period or what's your view on that, Bob?
Robert P. Kelly - Chief Executive Officer
We haven't really decided yet, Gerard. That's a good question and frankly we haven't even talked about it. We just... we are focusing initially on just getting our company together and making sure we stick to business as usual. We are very comfortable with the policy and timing yet remains to be decided.
Gerard Cassidy - RBC Capital Markets
Great, thank you.
Robert P. Kelly - Chief Executive Officer
Thank you.
Operator
Thank you. Our next question comes from Mark Fitzgibbon with Sandler O'Neill. Please go ahead.
Mark Fitzgibbon - Sandler O'Neill
Good morning. The first question is for Gerald. Gerald, I guess I am one of the skeptics that you are talking about with respect to revenue synergies in the asset servicing business and you had said that you'd won 41 of 82 of the mandates and more than $500 billion of assets, more than all your competitors. And yet, two days ago State Street said they had won 281 mandates for total of $825 billion. How will you reconcile these differences? And then secondly, a lot of your competitors have been talking about winning business from new folks, and we haven't heard it all about potential loss of business who are piece of the business, you know are going to go away. I wondered if you could share some of the details on that with us.
Gerald L. Hassell - President
Sure. First of all, I am not going to comment on how our competitors have derived their numbers. The 41 out of 82 is a publicly produced document by the consultants. And so that's the document that I am referring to. It was 82 public bids, we won 41 of them. It's in a public document. So, I am not going to comment on how others may have derived their numbers.
In terms of the de minimis losses on our side, I think, Jim gave you a very good sense of what we've seen go out to back door. It's been very, very small. We've been able to hold onto the clients then we are servicing them very, very well. So, some of the numbers you have to look at how different people report and when it actually translates into quarters. And as Mike Mayo had asked earlier, where does it show up in the numbers? Or you're seeing it in the growth in the revenues?
Mark Fitzgibbon - Sandler O'Neill
So, you don't want to share with us any of the numbers on loss of business.
Gerald L. Hassell - President
No, Jim did.
James P. Palermo - Co-Chief Executive Officer, BNY Mellon Asset Servicing
0.3%. 0.03% was the number Mark.
Mark Fitzgibbon - Sandler O'Neill
Okay. That's to date. But the stuff that you know is going to leave, that hasn't transitioned out yet?
Gerald L. Hassell - President
We don't have any that I'm aware of.
James P. Palermo - Co-Chief Executive Officer, BNY Mellon Asset Servicing
Yes. I am not aware of any, are you?
Mark Fitzgibbon - Sandler O'Neill
Yes.
Gerald L. Hassell - President
Well, you can go over with Jim later if you like.
Mark Fitzgibbon - Sandler O'Neill
I will. Thank you. One last question, if I may, with respect to the buyback.
Gerald L. Hassell - President
It's really important to realize. Let me just say, we have fabulous momentum in this business. Just look at the P&L on page 13. And of course, competitors are always going to say that they are going to use this as an opportunity to steal business from us. Bottom line is, they're not. So, let's continue on. Go ahead.
Mark Fitzgibbon - Sandler O'Neill
Yes. The last question is with respect to the buyback. You talked about buying back the stock early next year with the stock trading at 7.5 times tangible book value and call it 18 times forward earnings. The internal rates of return are fairly low on the buyback. I am curious does tangible book dilution matter and how do you look at it from a return standpoint?
Gerald L. Hassell - President
Yes. I would say, I think the tangible book is not a principal driver of... in that decision process. And it depends on where you think the growth in earnings is going. I think we still think there is good momentum in the earnings of the company, and it's a good. So, we think there is upside in the stock and overall. Having said that we continue to believe that a disciplined approach to returning capital to shareholders makes sense, and you do that on a consistent basis. You don't try and time the market.
Mark Fitzgibbon - Sandler O'Neill
Don't you view it like an investment? You're investing a $1 in capital and generating some return on it?
Gerald L. Hassell - President
Yes, you do. And I think we've said in the past that our first use of capital is to support organic growth in our business which gets the highest IRR. Secondly, if we find acquisitions that we think we have a good record of spotting acquisitions and integrating and executing on those acquisitions, that's a very strong IRR. And buying back our stock is a relatively lower IRR. But there is no execution risk.
Robert P. Kelly - Chief Executive Officer
I view... I've said this before Mark. It's Bob again. I view stock buyback to worsen maybe 10% to 12% in terms of IRR, in terms of returns. We can certainly make much, much higher returns on organic items, and if we are very disciplined on some acquisitions. So, my first choice is not stock buybacks generally, but on the other hand, we don't want to balloon our capital ratios either.
Mark Fitzgibbon - Sandler O'Neill
Thank you.
Operator
Thank you. Our next question comes from Robert Lee with KBW. Please go ahead.
Robert Lee - Keefe, Bruyette & Woods
Thanks. Just a couple of quick questions. Understanding that in the Q3 there was a huge flight to quality and see money fund flows across the street as being very strong. But curious, if you're starting to see any of those revenue synergies that weaken the money fund business are... that would seem to be the lowest hanging fruits. To a certain degree do you expect that to start kicking in sooner?
Bruce W. Van Saun - Chief Financial Officer
Yes. I'll just give you a quick stat on that Rob. We had $20 billion of new flows into our suite platform. And we put over 50% of that went into proprietary product. And so, I think we are starting to move to dial on that as we speak.
Robert Lee - Keefe, Bruyette & Woods
Okay, great. And understanding that credit has remained pristine and no provisionings; you still do have... although mix has changed a lot over the years in a fairly large, decent size loan book. How should we be thinking about what are your expectations for provisioning going forward?
Thomas P. (Todd) Gibbons - Chief Risk Officer
Rob. This is Todd Gibbons. In simplest terms, we are working on our strategy right now. But, I would say, we will continue to grant credit to... judiciously to our clients that are large consumers of our products. And I think we have got the good fortune of that those are primarily investment grade companies. So, that's where our portfolio will be focused. We have taken some actions to reduce some of the concentration risks that have come with the combination. And we have now come through the portfolio to identify where opportunities exist and where they don't, and what names might be an exit strategy. So, I think we'll come to you in the next quarter or so with a clear strategy around credit.
Robert Lee - Keefe, Bruyette & Woods
Okay, that was it. Thank you.
Robert P. Kelly - Chief Executive Officer
: This is Bob. Just to finish that up, Todd and the team working with the business units, and doing a great job, at really slicing and dicing the portfolio and thinking as a new company what sort of credit risk to be taking going forward, and what are the strategies we should employ? I think, the bottom line is I think what you've heard from Todd is that we are going to reducing credit risk to some degree through various strategies. And we are still working through that. Credit is still important to our company. But, the policies and strategies will evolve here.
Robert Lee - Keefe, Bruyette & Woods
Great. Thanks.
Operator
: Thank you. Our next question comes from Tom McCrohan with Janney Montgomery Scott. Please go ahead.
Thomas McCrohan - Janney Montgomery Scott
Yes, hi. Can you just... just a follow-up on Corporate Trust, I am kind of surprised that the strong organic growth given the quarter had some of that turmoil and CDO issuance obviously was kind of frozen up a little bit. If you can just kind of touch on where you saw the strength in Corporate Trust during the quarter outside the CDO?
Karen B. Peetz - Chief Executive Officer, The Bank of New York Mellon Corporate Trust
Yes. The key strength was in the CDO business in EMEA actually, so European, Middle East and Africa. And we also had some good activity in Islamic financing.
Thomas McCrohan - Janney Montgomery Scott
Okay. Thank you. It's all I had.
Robert P. Kelly - Chief Executive Officer
Thanks Tom.
Operator
Thank you. Our next question comes from Nancy Bush with NAB Research. Please go ahead.
Nancy Bush - NAB Research
: Good morning, guys.
Robert P. Kelly - Chief Executive Officer
Good morning, Nancy.
Nancy Bush - NAB Research
Quick question on the profitability of the China business. We have heard a lot about the potential there and the size of the asset flows, etcetera. Is this sort of... I mean have the expenses associated with this business already been realized or are we going to get sort of all incremental profitability here, if you could just expand on that slightly?
Gerald L. Hassell - President
Well, Nancy. It's Gerald. Let me just comment at least on the asset servicing side. Given our size and scale are just layers in to our existing infrastructure. And as the assets are accumulated under management, we'll start to service those through our core platforms. And so the pricing and the profitability are very favorable.
Nancy Bush - NAB Research
Okay. So do they have to be [multiple speakers]
Ronald P. O'Hanley - Chief Executive Officer, BNY Mellon Asset Management
The money is being managed by existing... some are our existing money managers outside of the region. So, obviously we have client service people on the ground there. But this is very attractively priced and profitable business.
Nancy Bush - NAB Research
Okay.
Robert P. Kelly - Chief Executive Officer
And Nancy, I would just say that Ron and Karen Peetz, and a group of our people in Asia have just recently formed, struck a committee to start thinking about the medium term strategy for Asia to make sure we get all our revenue synergies across the region, to make sure that we take advantage of all of our products that are manufactured in other regions, and to really think about what is the real opportunity here over the medium term by product and in total. So, that will be an interesting process to go through as well.
Nancy Bush - NAB Research
If I could also ask, I mean what was the different... what do you see is the differentiating factor that enabled you to win this business? Was it pricing, was... if you could just give me a little color there, I would appreciate it?
Robert P. Kelly - Chief Executive Officer
Ron, why don't you start from a asset management standpoint?
Ronald P. O'Hanley - Chief Executive Officer, BNY Mellon Asset Management
I think in the asset management, it was, product breadth was... and reputation is where the key buying factors there. The pricing, I mean, ultimately this is a price to the end user buyer closer to our retail kind of products. So, pricing was not a factor here.
Timothy F. Keaney - Co-Chief Executive Officer, BNY Mellon Asset Servicing
Nancy, it's Tim Keaney here. I'd add two other things. The DR business has been very active in China for about 12 years. We have two offices in China and they have been calling there for quite a long time. And of course we have our major Asian operations hub in Singapore. I think it's a combination of those things and having existing capabilities right now. Ron O'Hanley will know quite well. These vehicles fund very quickly. From decision to funding is a matter of weeks. So, having existing capabilities and existing technology has been a big factor for us there.
Robert P. Kelly - Chief Executive Officer
You know Nancy, one of the things that Ron and I were talking about just a few days ago is the fact that Legacy Bank in New York has much longer standing relationships than... much more longer standing relationships than Legacy Mellon did and it's meaning that it's easier for us to get the industry people and make fetches to people than a year ago. And I think that is going to help us in Asia on the asset management side.
Nancy Bush - NAB Research
Bob, if could also ask just a final question on wealth management. Where do you stand now, when you're thinking about the expansion of wealth management? What has happened right upfront with expanding Mellon product into Bank of New York wealth management network etcetera?
Robert P. Kelly - Chief Executive Officer
Well, good question. I continue to like the business. We have great fee growth, net interest income has been really hurt here over the last year. We've had great loan and deposit growth but the NII hasn't been great. I think a little bit of this is, just making sure that we get the right inner business transfer pricing right. But, we'll be studying that more but I would continue to support having more offices here and Dave has a number of strategies underway to bring the Legacy Mellon products to the near city market. Dave, what would you add to that?
David F. Lamere - Chief Executive Officer, BNY Mellon Wealth Management
I would just say that we're in that early stages of bringing product to existing clients. What we're really focused on as well as building out the sales organization primarily here in Manhattan and around the Tri State region, will be over hundred sales people combined at the end of the year which is a significant difference from what we had in the past. If we see earlier results than that, the third quarter where sales were up significantly from the year before. And so I would expect that's a combination of both delivering more capabilities of the existing clients, but then just getting out more broadly with a combined offering and more places. As far as expansion is concerned we haven't focus on that over the first little bit here. I would say that we continue to think the same way we had in the past, we talked about Texas, Southwest and maybe a little bit more in the Midwest, those would be target areas. We do have some conversation going on but first priority for us right now is around New York.
Nancy Bush - NAB Research
Great, thank you.
Robert P. Kelly - Chief Executive Officer
Melissa, we have time for one more question.
Operator
Thank you. Our last question comes from Andrew Marquardt with Fox-Pitt, Kelton. Please go ahead.
Andrew Marquardt - Fox-Pitt, Kelton
Good morning, guys.
Gerald L. Hassell - President
Good morning.
Robert P. Kelly - Chief Executive Officer
Hey.
Andrew Marquardt - Fox-Pitt, Kelton
Just a quick question on performance fees. Did I hear correctly that perhaps fourth quarter performance fees could also be impacted by this quarters or in the... or rather the market dislocations?
Ronald P. O'Hanley - Chief Executive Officer, BNY Mellon Asset Management
No. that's not what I said. The... and I am happy to go through again the third quarter. But the fourth quarter should not be affected by any of that. What we will be looking at is how is performance? And what I can say now is barring something completely on anticipated performance, the absolutely performance levels are not at the pace that they were at last year. That was good... so I think I even said on this call last year that was a three or four sigma events. But we would expect to see stronger performance fees in the fourth quarter than the third.
Andrew Marquardt - Fox-Pitt, Kelton
Great, thanks for that clarification and then lastly, maybe I missed it on the net interest margin. Can you talk a little bit about, how you guys are impacted by the current yield curve, and potential additional Fed cuts?
Brian G. Rogan - Chief Executive Officer, The Bank of New York Mellon Issuer and Treasury Services
Yes I think the yield curve, having a slope to the yield curve is certainly positive from the absolute level of rates. We try and stay relatively neutral and if you look at the sensitivity tables, moves in either direction don't affect the absolute number all that much.
Andrew Marquardt - Fox-Pitt, Kelton
Okay, great thank you.
Brian G. Rogan - Chief Executive Officer, The Bank of New York Mellon Issuer and Treasury Services
Okay.
Robert P. Kelly - Chief Executive Officer
Thanks, Andrew. Well, thanks everyone. I really appreciate you being on the call and the quality and the number of questions. We'll continue working hard for you. Thank you. All the best.
Operator
Thank you. If there are any additional questions or comments, you may contact Mr. Steve Lackey at 212-635-1578. Thank you ladies and gentlemen. This concludes today's conference call. Thank you for participating.
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