Our Long-Term Incentive Plans provide for the issuance of restricted stock, restricted stock units (“RSUs”) and other stock-based awards, including options, to employees and directors of BNY Mellon. At Dec. 31, 2019, under the Long-Term Incentive Plan approved in April 2019, we may issue 35,660,228 new stock-based awards, all of which may be issued as restricted stock or RSUs. Stock-based compensation expense related to retirement eligibility vesting totaled $84 million in 2019, $93 million in 2018 and $109 million in 2017.

Restricted stock and RSUs are granted under our long-term incentive plans at no cost to the recipient. These awards are subject to forfeiture until certain restrictions have lapsed, including continued employment, for a specified period. The recipient of a share of restricted stock is entitled to voting rights and generally is entitled to dividends on the common stock. An RSU entitles the recipient to receive a share of common stock after the applicable restrictions lapse. The recipient generally is entitled to receive cash payments equivalent to any dividends paid on the underlying common stock during the period the RSU is outstanding but does not receive voting rights.

The fair value of restricted stock and RSUs is equal to the fair market value of our common stock on the date of grant. The expense is recognized over the vesting period, which is generally zero to four years. The total compensation expense recognized for restricted stock and RSUs was $222 million in 2019, $270 million in 2018 and $273 million in 2017. The total income tax benefit recognized in the consolidated income statement related to compensation costs was $53 million in 2019, $65 million in 2018 and $66 million in 2017.

BNY Mellon’s Executive Committee members were granted a target award of 576,855 performance share units (“PSUs”) in 2019, 362,798 in 2018 and 793,847 in 2017. The 2019 and 2018 awards cliff vest in 3 years with the number of shares that vest determined based on a payout table that references performance conditions related to average revenue growth and average operating margin, both as adjusted and subject to Human Resources and Compensation Committee discretion. These awards are classified as

equity and marked-to-market to earnings as a result of this discretion. The 2017 awards cliff vest in 3 years with the number of shares that vest determined based on a payout table that references changes in the interest rate environment since the grant date along with a performance condition that references operating earnings per share achieved in 2019 with the potential of a risk modifier based on the extent of growth in RWAs and subject to Human Resources and Compensation Committee discretion. These awards are liability classified as they contain an interest rate condition that is not linked to performance or market and marked-to-market to earnings as a result of the discretion.



Non-vested PSU, restricted stock and RSU activity	Number of shares		Weighted-average fair value at grant date
Non-vested PSUs, restricted stock and RSUs at Dec. 31, 2018	14,211,712		$	49.43
Granted	6,179,808		51.59
Vested	(6,201,276	)	43.21
Forfeited	(1,456,946	)	49.74
Non-vested PSUs, restricted stock and RSUs at Dec. 31, 2019	12,733,298		$	50.77

As of Dec. 31, 2019, $208 million of total unrecognized compensation costs related to non-vested PSUs, restricted stock and RSUs is expected to be recognized over a weighted-average period of 2.2 years.

The total fair value of restricted stock, RSUs and PSUs that vested was $278 million in 2019, $289 million in 2018 and $260 million in 2017. The actual excess tax benefit realized for the tax deductions from shares vested totaled $11 million in 2019, $26 million in 2018 and $34 million in 2017. The tax benefits were recognized in the provision for income taxes.

BNY Mellon also has several subsidiary Long-Term Incentive Plans which have issued restricted subsidiary shares to certain employees. These share awards are subject to forfeiture until certain restrictions have lapsed, including continued employment for a specified period of time. The shares are generally non-voting and non-dividend paying. Once the restrictions lapse, which generally

occurs in three to five years, the shares can only be sold, at the option of the employee, to BNY Mellon at a price based generally on the fair value of the subsidiary at the time of repurchase. In certain instances BNY Mellon has an election to call the shares.

Our Long-Term Incentive Plans provide for the issuance of stock options at fair market value at the date of grant to officers and employees of BNY

Mellon. Generally, each option granted is exercisable between one and 10 years from the date of grant. No stock options were granted in 2019, 2018 and 2017.

Compensation costs that were charged against income were less than $1 million in 2019, 2018 and 2017. The income tax benefit recognized in the consolidated income statement related to compensation costs was less than $1 million in 2019, 2018 and 2017.



Stock option activity	Shares subject to option		Weighted-average exercise price		Weighted-average remaining contractual term (in years)
Balance at Dec. 31, 2018	6,714,283		$	25.67	2.0
Granted	—		—
Exercised	(2,543,235	)	25.14
Canceled/Expired	(27,473	)	21.93
Balance at Dec. 31, 2019	4,143,575		$	26.03	1.4
Vested and expected to vest at Dec. 31, 2019	4,143,575		26.03		1.4
Exercisable at Dec. 31, 2019	4,143,575		26.03		1.4



Stock options outstanding at Dec. 31, 2019
	Options outstanding					Options exercisable (a)
Range of exercise prices	Outstanding	Weighted-average remaining contractual life (in years)	Weighted-average exercise price			Exercisable	Weighted-average exercise price
$ 18 to 31	4,143,575	1.4		$	26.03	4,143,575		$	26.03



Aggregate intrinsic value of options
(in millions)	2019		2018		2017
Outstanding at Dec. 31,	$	101	$	144	$	247
Exercisable at Dec. 31,	$	101	$	144	$	247

Cash received from option exercises totaled $65 million in 2019, $80 million in 2018 and $431 million in 2017. The actual excess tax benefit realized for the tax deductions from options exercised totaled $10 million in 2019, $10 million in 2018 and $16 million in 2017. The tax benefits were recognized in the provision for income taxes.