8-K
State Street Corp (STT)
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________________
FORM 8-K
_________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 10, 2024
______________________
State Street Corporation
(Exact name of Registrant as Specified in its Charter)
____________________
| Massachusetts | 001-07511 | 04-2456637 | ||||
|---|---|---|---|---|---|---|
| (State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | One Congress Street | |||
| --- | --- | --- | ||||
| Boston | Massachusetts | 02114 | ||||
| (Address of principal executive offices, and Zip Code) | Registrant’s telephone number, including area code: | (617) | 786-3000 | |||
| --- | --- | --- |
________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common stock, $1 par value per share | STT | New York Stock Exchange |
| Depositary Shares, each representing a 1/4,000th ownership interest in a share of | STT.PRG | New York Stock Exchange |
| Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series G, without par value per share |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
| Emerging growth company | ☐ |
|---|
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 2.02. Results of Operations and Financial Condition.
On October 15, 2024, State Street Corporation ("State Street") issued a news release announcing its results of operations for the third-quarter of 2024. Copies of that news release and accompanying third-quarter 2024 financial information addendum are furnished herewith as Exhibits 99.1 and 99.2, respectively, and are incorporated herein by reference.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On October 10, 2024, Eric Aboaf informed State Street of his intention to step down from his roles as State Street's vice chairman and chief financial officer to take a position with a firm outside of banking. Mr. Aboaf is expected to remain at State Street into February of 2025 through the filing of State Street's annual report on Form 10-K for the 2024 fiscal year with the U.S. Securities and Exchange Commission ("SEC"). State Street has commenced its succession plan with a formal internal and external search process.
Item 7.01. Regulation FD Disclosure.
On October 15, 2024, State Street made available a slide presentation providing highlights of its third-quarter 2024 results of operations and related information as of September 30, 2024, which is being made available in connection with an October 15, 2024 investor conference call. A copy of that slide presentation is furnished herewith as Exhibit 99.3 and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
State Street's news release dated October 15, 2024, announcing its third-quarter 2024 results of operations and accompanying third-quarter 2024 financial information addendum are furnished herewith as Exhibits 99.1 and 99.2, respectively, and are incorporated by reference in Item 2.02 hereof; and a slide presentation providing highlights of State Street's third-quarter 2024 results of operations and related information, which is being made available in connection with an October 15, 2024 investor conference call, is furnished herewith as Exhibit 99.3 and is incorporated by reference in Item 7.01 hereof.
| Exhibit No. | Description | ||||
|---|---|---|---|---|---|
| 99.1 | State Street's news release dated October 15, 2024, announcing its third-quarter 2024 results of operations (this Exhibit 99.1 is furnished, not filed) | ||||
| 99.2 | State Street's third-quarter 2024 financial information addendum (this Exhibit 99.2 is furnished, not filed) | ||||
| 99.3 | Slide presentation providing highlights of State Street's third-quarter 2024 results of operations and related information (this Exhibit 99.3 is furnished, not filed) | ||||
| * | 104 | Cover Page Interactive Data File (formatted as Inline XBRL) | * | Submitted electronically herewith | |
| --- | --- |
Forward-Looking Statements
This current report on Form 8-K contains forward-looking statements within the meaning of United States securities laws, including statements about our expectations regarding the departure of State Street’s vice chairman and chief financial officer. Forward-looking statements are often, but not always, identified by such forward-looking terminology as “expect,” “intend,” “will,” “plan,” “believe,” “anticipate,” and “may,” or similar statements or variations of such terms. These statements are not guarantees of future performance, are inherently uncertain, are based on current assumptions that are difficult to predict and involve a number of risks and uncertainties. Therefore, actual outcomes and results may differ materially from what is expressed in those statements. Important factors that could cause actual results to differ materially from those indicated by any forward-looking statements are set forth in our 2023 annual report on Form 10-K and our subsequent SEC filings. We encourage investors to read these filings, particularly the sections on risk factors, for additional information with respect to any forward-looking statements and prior to making any investment decision. The forward-looking statements contained in this report should not by relied on as representing our expectations or beliefs as of any time subsequent to the time this report is first filed with the SEC, and we do not undertake efforts to revise those forward-looking statements to reflect events after that time.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| STATE STREET CORPORATION | |||
|---|---|---|---|
| By: | /s/ Elizabeth M. Schaefer | ||
| Name: | Elizabeth M. Schaefer, | ||
| Title: | Senior Vice President and Chief Accounting Officer | ||
| Date: | October 15, 2024 |
Document
| Exhibit 99.1<br>State Street Corporation <br>One Congress Street<br>Boston, MA 02114<br>NYSE: STT <br> www.statestreet.com |
|---|
Boston, MA… October 15, 2024 News Release
| STATE STREET REPORTS RECORD EPS OF $2.26 IN THIRD QUARTER 2024 |
|---|
| % changes noted below reflect year-over-year 3Q comparisons |
NEW INVESTMENT SERVICING AUC/A WINS OF $466 BILLION
RECORD GLOBAL ADVISORS NET INFLOWS OF $100 BILLION
REVENUE UP 21%; UP 9% EXCLUDING NOTABLE ITEMS(a)
•FEE REVENUE UP 11%; UP 7% EXCLUDING NOTABLE ITEMS(a)
•NET INTEREST INCOME UP 16%
POSITIVE FEE AND TOTAL OPERATING LEVERAGE; ROE OF 12%
| Ron O'Hanley, Chairman and Chief Executive Officer: "We delivered strong financial performance and significant momentum across most business lines in the third quarter, all while supporting our clients in a dynamic operating environment. Our revenue performance reflected broad-based fee growth and higher NII, which drove positive fee and total operating leverage relative to the year-ago quarter."<br><br><br><br>O'Hanley added: "Within Investment Services, we generated $466 billion of new AUC/A wins and reported two new Alpha mandates. Our Global Markets franchise continued to benefit from increased levels of client penetration, and at Global Advisors, we achieved record quarterly net inflows of $100 billion, supported by a record quarter for our Cash business."<br><br><br><br>O'Hanley concluded: "I am encouraged by the strength of our results, which, combined with our strong balance sheet, enabled us to increase capital return relative to the prior quarter, as we repurchased $450 million of common shares in the third quarter. As we look ahead, we remain focused on delivering full-year positive fee and total operating leverage through continued execution and ongoing transformation and productivity improvement, as well as returning excess capital to our shareholders." |
|---|
FINANCIAL HIGHLIGHTS
| (Table presents summary results, dollars in millions, except per share amounts, or where otherwise noted) | 3Q24 | 2Q24 | 3Q23 | % QoQ | % YoY | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Income statement: | |||||||||||||||
| Total fee revenue | $ | 2,616 | $ | 2,456 | $ | 2,361 | 7 | % | 11 | % | |||||
| Net interest income | 723 | 735 | 624 | (2) | 16 | ||||||||||
| Other income | (80) | — | (294) | nm | 73 | ||||||||||
| Total revenue | 3,259 | 3,191 | 2,691 | 2 | 21 | ||||||||||
| Provision for credit losses | 26 | 10 | — | nm | nm | ||||||||||
| Total expenses | 2,308 | 2,269 | 2,180 | 2 | 6 | ||||||||||
| Net income | 730 | 711 | 422 | 3 | 73 | ||||||||||
| Financial ratios and other metrics: | |||||||||||||||
| Diluted earnings per share (EPS) | $ | 2.26 | $ | 2.15 | $ | 1.25 | 5 | % | 81 | % | |||||
| Return on average common equity (ROE) | 12.0 | % | 11.9 | % | 7.3 | % | 0.1 | % | pts | 4.7 | % | pts | |||
| Pre-tax margin | 28.4 | 28.6 | 19.0 | (0.2) | % | pts | 9.4 | % | pts | ||||||
| AUC/A ($ billions)(1) | $ | 46,759 | $ | 44,312 | $ | 40,017 | 6 | % | 17 | % | |||||
| AUM ($ billions)(1) | 4,732 | 4,369 | 3,672 | 8 | 29 |
(1) As of period-end.
(a) See "3Q24 Highlights" in this news release for a listing of notable items. Results excluding notable items are non-GAAP measures. Please refer to the Addendum included with this news
release for an explanation and reconciliation of non-GAAP measures.
Investor Contact: Elizabeth Lynn +1 617-664-3477 Media Contact: Carolyn Cichon +1 617-664-8672
3Q24 HIGHLIGHTS
(All comparisons are to 3Q23, unless otherwise noted)
AUC/A and AUM
•Investment Servicing AUC/A as of quarter-end increased 17% to $46.8 trillion, primarily driven by higher quarter-end market levels, net new business and client flows
•Investment Management AUM as of quarter-end increased 29% to $4.7 trillion, reflecting higher quarter-end market levels and record quarterly net inflows in 3Q24
New business and strategy execution(a)
•New wins in 3Q24
◦New servicing fee revenue wins: New servicing fee revenue wins of $84 million, with the majority driven by Back office wins
◦AUC/A wins: New servicing AUC/A wins of $466 billion, with the majority from Asset Managers
•To be installed in future periods as of 3Q24
◦Servicing fee revenue to be installed: Quarter-end servicing fee revenue of $288 million to be installed in future periods
◦AUC/A to be installed: Quarter-end AUC/A of $2.4 trillion to be installed in future periods
•State Street Alpha®: Reported 2 new mandate wins in 3Q24, for a total of 5 mandate wins year-to-date
•Front Office Software and Data: Continued momentum in SaaS client implementations and conversions increased ARR to $356 million, up 19%
•Investment Management: Record $100 billion of total net inflows, driven by record Cash inflows of $54 billion and broad strength across both the ETF and Institutional businesses
•Markets & Financing: Named Best FX Bank for Client Service, Best FX Bank for Research, Best FX Trading Technology Solution and Best Technology Provider for FX Data Management in the Euromoney 2024 FX Awards(b)
•
Revenue
•Total revenue increased 21%, primarily driven by the impact of a notable item in the prior year period. Excluding notable items,(c) total revenue increased 9%, reflecting both higher Fee revenue and Net interest income (NII)
•Fee revenue increased 11%, primarily reflecting higher Other fee revenue, FX trading services revenue, Management fees and Servicing fees
◦Servicing fees increased 3%
◦Management fees increased 10%
◦FX trading services increased 19%
◦Securities finance increased 13%
◦Software and processing fees increased 11%
◦Other fee revenue increased $81 million, primarily driven by the gain on sale of an equity investment
•NII increased 16%, primarily reflecting higher investment securities yields and loan growth, partially offset by deposit mix shift
(a) See the "In This News Release" section for explanations of AUC/A, new servicing fee revenue wins and Front office software and data annual recurring revenue (ARR).
(b) State Street was recognized in Euromoney Magazine’s 2024 FX Awards across four categories: Best FX Bank for Client Service, Best FX Bank for Research, Best FX Trading Technology Solution and Best Technology Provider for FX Data Management.
(c) Results excluding notable items are non-GAAP measures. Please refer to the Addendum included with this news release for an explanation and reconciliation of non-GAAP measures.
Expenses
•Total expenses increased 6% as higher business investments as well as revenue and performance-related costs were partially offset by productivity savings from ongoing organizational process improvements and initiatives, including from the joint venture consolidations in India
◦Compensation and employee benefits increased 5%
◦Information systems and communications increased 13%
◦Transaction processing services increased 6%
◦Occupancy increased 4%
◦Other expenses increased 4%
Notable items
| (Dollars in millions, except EPS amounts) | 3Q24 | 2Q24 | 3Q23 | |||
|---|---|---|---|---|---|---|
| Investment portfolio repositioning(a) | $ | (81) | $ | — | $ | (294) |
| Gain on sale of an equity investment | 66 | — | — | |||
| Revenue-related recovery | 15 | — | — | |||
| Total notable items (pre-tax) | $ | — | $ | — | $ | (294) |
| Income tax impact from notable items | — | — | (79) | |||
| EPS impact | $ | — | $ | — | $ | (0.68) |
•Loss on sale of $81 million related to the repositioning of the investment portfolio reflected in 3Q24 Other Income
•Gain on sale of an equity investment of $66 million in 3Q24 reflected in Other fee revenue
•Revenue-related recovery of $15 million in 3Q24 associated with the proceeds from a 2018 FX benchmark litigation resolution reflected in FX trading services
Capital and liquidity
•Standardized common equity tier 1 (CET1) ratio at quarter-end of 11.6% increased 0.6% points compared to 3Q23, and increased 0.4% points compared to 2Q24, both primarily due to capital generated from earnings and improved accumulated other comprehensive income (AOCI), partially offset by continued capital return and higher risk-weighted assets (RWA)
•Liquidity coverage ratio (LCR) for State Street Corporation was approximately 107%, and LCR for State Street Bank and Trust was approximately 129%
•In 3Q24, State Street returned a total of $674 million of capital to common shareholders, or approximately 100% of net income available to common shareholders, consisting of $450 million of share repurchases and $224 million (or $0.76 per share) of declared dividends
(a) In 3Q24 and 3Q23, loss on sale of investment securities of $81 million and $294 million, respectively, related to the repositioning of certain investment securities, which is reflected in Other income.
MARKET DATA
The following table provides a summary of selected financial information, including market indices and foreign exchange rates.
| (Dollars in billions, except market indices and foreign exchange rates) | 3Q24 | 2Q24 | 3Q23 | % QoQ | % YoY | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| Assets under Custody and/or Administration (AUC/A)(1)(2) | $ | 46,759 | $ | 44,312 | $ | 40,017 | 6 | % | 17 | % |
| Assets under Management (AUM)(2) | 4,732 | 4,369 | 3,672 | 8 | 29 | |||||
| Market Indices:(3) | ||||||||||
| S&P 500 EOP | 5,762 | 5,460 | 4,288 | 6 | 34 | |||||
| S&P 500 Daily Average | 5,543 | 5,247 | 4,458 | 6 | 24 | |||||
| MSCI EAFE EOP | 2,469 | 2,315 | 2,031 | 7 | 22 | |||||
| MSCI EAFE Daily Average | 2,380 | 2,325 | 2,113 | 2 | 13 | |||||
| MSCI Emerging Markets EOP | 1,171 | 1,086 | 953 | 8 | 23 | |||||
| MSCI Emerging Markets Daily Average | 1,092 | 1,063 | 992 | 3 | 10 | |||||
| MSCI ACWI EOP | 852 | 802 | 657 | 6 | 30 | |||||
| MSCI ACWI Daily Average | 817 | 782 | 683 | 4 | 20 | |||||
| Bloomberg Global Aggregate Bond Index EOP | 488 | 456 | 436 | 7 | 12 | |||||
| Bloomberg Global Aggregate Bond Index Daily Average | 475 | 456 | 448 | 4 | 6 | |||||
| Foreign Exchange Volatility Indices:(3) | ||||||||||
| CBOE Volatility Index (VIX) Daily Average | 17.1 | 14.0 | 15.0 | 22 | 14 | |||||
| JPM G7 Volatility Index Daily Average | 8.0 | 7.2 | 8.1 | 11 | (2) | |||||
| JPM Emerging Market Volatility Index Daily Average | 8.3 | 7.1 | 8.7 | 16 | (5) | |||||
| Specials Volumes:(3) | ||||||||||
| S&P Global Industry Specials Average Volume | 68,900 | 69,876 | 79,694 | (1) | (14) | |||||
| S&P U.S. Industry Specials Average Volume | 35,809 | 31,021 | 40,805 | 15 | (12) | |||||
| Average Foreign Exchange Rates: | ||||||||||
| EUR vs. USD | 1.099 | 1.076 | 1.088 | 2 | 1 | |||||
| GBP vs. USD | 1.301 | 1.261 | 1.266 | 3 | 3 |
(1) Includes quarter-end assets under custody of $33,667 billion, $32,161 billion and $29,113 billion, as of 3Q24, 2Q24, and 3Q23, respectively.
(2) As of period-end.
(3) The index names listed are service marks of their respective owners. S&P Global Specials and S&P U.S. Specials Volumes sourced from S&P Global Market Intelligence.
INDUSTRY FLOW DATA
The following table represents industry flow data.
| (Dollars in billions) | 3Q24 | 2Q24 | 1Q24 | 4Q23 | 3Q23 | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| North America - (U.S. Domiciled) Morningstar Direct Market Data:(1)(2) | ||||||||||
| Long Term Funds | $ | (121) | $ | (111) | $ | (3) | $ | (207) | $ | (111) |
| Money Market | 278 | 62 | 31 | 154 | 132 | |||||
| ETF | 288 | 206 | 191 | 265 | 110 | |||||
| Total Flows(3) | $ | 444 | $ | 157 | $ | 219 | $ | 212 | $ | 131 |
| EMEA - Morningstar Direct Market Data:(1)(4) | ||||||||||
| Long Term Funds | $ | 76 | $ | 52 | $ | 7 | $ | (66) | $ | (40) |
| Money Market | 127 | 39 | 29 | 130 | 47 | |||||
| ETF | 63 | 57 | 47 | 51 | 31 | |||||
| Total Flows(3) | $ | 266 | $ | 148 | $ | 83 | $ | 115 | $ | 38 |
(1) Industry data is provided for illustrative purposes only. It is not intended to reflect State Street or its clients' activity and is indicative of only segments of the entire industry. See endnotes included in the "In This News Release" section.
(2) 3Q24 data for North America includes actuals for July and August 2024 and Morningstar estimates for September 2024.
(3) Line items may not sum to total due to rounding.
(4) 3Q24 data for EMEA is on a rolling three-month basis for June through August 2024, sourced by Morningstar.
INVESTMENT SERVICING AUC/A
The following table presents AUC/A information by product and financial instrument.
| (As of period end, dollars in billions) | 3Q24 | 2Q24 | 3Q23 | % QoQ | % YoY | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| Assets Under Custody and/or Administration(1) | ||||||||||
| By product classification: | ||||||||||
| Collective funds, including ETFs | $ | 15,253 | $ | 14,573 | $ | 13,145 | 5 | % | 16 | % |
| Mutual funds | 12,223 | 11,645 | 10,313 | 5 | 19 | |||||
| Pension products | 9,339 | 8,916 | 8,255 | 5 | 13 | |||||
| Insurance and other products | 9,944 | 9,178 | 8,304 | 8 | 20 | |||||
| Total Assets Under Custody and/or Administration | $ | 46,759 | $ | 44,312 | $ | 40,017 | 6 | % | 17 | % |
| By asset class: | ||||||||||
| Equities | $ | 27,715 | $ | 26,291 | $ | 22,971 | 5 | % | 21 | % |
| Fixed-income | 12,027 | 11,303 | 10,688 | 6 | 13 | |||||
| Short-term and other investments(2) | 7,017 | 6,718 | 6,358 | 4 | 10 | |||||
| Total Assets Under Custody and/or Administration | $ | 46,759 | $ | 44,312 | $ | 40,017 | 6 | % | 17 | % |
(1) AUC/A values for certain asset classes are based on a lag, typically one-month.
(2) Short-term and other investments includes derivatives, cash and cash equivalents and other instruments.
INVESTMENT MANAGEMENT AUM
The following tables present 3Q24 activity in AUM by product category.
| (Dollars in billions) | Equity | Fixed- Income | Cash | Multi-Asset Class Solutions | Alternative Investments(1)(2) | Total | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Beginning balance as of June 30, 2024 | $ | 2,759 | $ | 583 | $ | 483 | $ | 349 | $ | 195 | $ | 4,369 |
| Net asset flows: | ||||||||||||
| Long-term institutional(3) | 7 | 1 | — | 2 | (1) | 9 | ||||||
| ETF | 27 | 6 | — | — | 4 | 37 | ||||||
| Cash fund | — | — | 54 | — | — | 54 | ||||||
| Total flows, net | $ | 34 | $ | 7 | $ | 54 | $ | 2 | $ | 3 | $ | 100 |
| Market appreciation/(depreciation) | 152 | 20 | 5 | 18 | 13 | 208 | ||||||
| Foreign exchange impact | 32 | 13 | 1 | 6 | 3 | 55 | ||||||
| Total market and foreign exchange impact | $ | 184 | $ | 33 | $ | 6 | $ | 24 | $ | 16 | $ | 263 |
| Ending balance as of September 30, 2024 | $ | 2,977 | $ | 623 | $ | 543 | $ | 375 | $ | 214 | $ | 4,732 |
(1) Includes real estate investment trusts, currency and commodities, including SPDR® Gold Shares and SPDR® Gold MiniSharesSM Trust, for which we are not the investment manager but act as the marketing agent.
(2) AUM for passive alternative investments has been revised from prior presentations.
(3) Amounts represent long-term portfolios, excluding ETFs.
| (Dollars in billions) | 3Q24 | 2Q24(1) | 1Q24(1) | 4Q23(1) | 3Q23(1) | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| Beginning balance | $ | 4,369 | $ | 4,299 | $ | 4,102 | $ | 3,672 | $ | 3,787 |
| Net asset flows: | ||||||||||
| Long-term institutional(2) | 9 | (8) | (24) | (2) | (30) | |||||
| ETF | 37 | 6 | 1 | 68 | (1) | |||||
| Cash fund | 54 | (4) | 9 | 29 | 41 | |||||
| Total flows, net | $ | 100 | $ | (6) | $ | (14) | $ | 95 | $ | 10 |
| Market appreciation/(depreciation) | 208 | 83 | 243 | 297 | (101) | |||||
| Foreign exchange impact | 55 | (7) | (32) | 38 | (24) | |||||
| Total market and foreign exchange impact | $ | 263 | $ | 76 | $ | 211 | $ | 335 | $ | (125) |
| Ending balance | $ | 4,732 | $ | 4,369 | $ | 4,299 | $ | 4,102 | $ | 3,672 |
(1) AUM for passive alternative investments has been revised from prior presentations.
(2) Amounts represent long-term portfolios, excluding ETFs.
REVENUE
| (Dollars in millions) | 3Q24 | 2Q24 | 3Q23 | % QoQ | % YoY | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Back office services | $ | 1,167 | $ | 1,146 | $ | 1,138 | 1.8 | % | 2.5 | % | |||||
| Middle office services | 99 | 93 | 96 | 6.5 | 3.1 | ||||||||||
| Servicing fees | 1,266 | 1,239 | 1,234 | 2.2 | 2.6 | ||||||||||
| Management fees | 527 | 511 | 479 | 3.1 | 10.0 | ||||||||||
| Foreign exchange trading services | 374 | 336 | 313 | 11.3 | 19.5 | ||||||||||
| Securities finance | 116 | 108 | 103 | 7.4 | 12.6 | ||||||||||
| Front office software and data | 146 | 152 | 130 | (3.9) | 12.3 | ||||||||||
| Lending related and other fees | 62 | 62 | 58 | — | 6.9 | ||||||||||
| Software and processing fees | 208 | 214 | 188 | (2.8) | 10.6 | ||||||||||
| Other fee revenue | 125 | 48 | 44 | nm | nm | ||||||||||
| Total fee revenue | $ | 2,616 | $ | 2,456 | $ | 2,361 | 6.5 | % | 10.8 | % | |||||
| Net interest income | 723 | 735 | 624 | (1.6) | % | 15.9 | % | ||||||||
| Other income | (80) | — | (294) | nm | 72.8 | % | |||||||||
| Total Revenue | $ | 3,259 | $ | 3,191 | $ | 2,691 | 2.1 | % | 21.1 | % | |||||
| Total revenue, excluding notable items(1) | $ | 3,259 | $ | 3,191 | $ | 2,985 | 2.1 | % | 9.2 | % | |||||
| Net interest margin (FTE)(2) | 1.07 | % | 1.13 | % | 1.12 | % | (0.06) | % | pts | (0.05) | % | pts |
(1) See "3Q24 Highlights" in this news release for a listing of notable items. Results excluding notable items are non-GAAP measures. Please refer to the Addendum included with this news
release for an explanation and reconciliation of non-GAAP measures.
(2) Net Interest Margin (NIM) is presented on a fully taxable-equivalent (FTE) basis. Refer to the Addendum for reconciliations of our FTE-basis presentation.
Servicing fees increased 3% compared to 3Q23, as higher average market levels and net new business, excluding a previously disclosed client transition, were partially offset by pricing headwinds, a previously disclosed client transition and lower client activity, including asset mix shift. Servicing fees increased 2% compared to 2Q24, mainly due to higher average market levels and net new business.
Management fees increased 10% compared to 3Q23 and 3% compared to 2Q24, primarily due to higher average market levels.
Foreign exchange trading services increased 19% compared to 3Q23, primarily due to higher client volumes and a $15 million revenue-related recovery from a 2018 FX benchmark litigation resolution, partially offset by lower spreads associated with lower average FX volatility. This $15 million revenue-related recovery contributed approximately 4% points to that increase. Foreign exchange trading services increased 11% compared to 2Q24, supported by higher client volumes and the $15 million revenue-related recovery.
Securities finance increased 13% compared to 3Q23 and increased 7% compared to 2Q24, mainly due to higher client lending balances, partially offset by lower spreads primarily resulting from muted industry specials activity.
Software and processing fees increased 11% compared to 3Q23, primarily due to higher Front office software and data revenue associated with CRD. Software and processing fees decreased 3% compared to 2Q24, mainly driven by lower Front office software and data revenue associated with CRD.
•Front office software and data increased 12% compared to 3Q23, primarily due to continued strong Software-enabled revenue growth, partially offset by lower On-premises renewals. Front office software and data decreased 4% compared to 2Q24, primarily driven by lower On-premises renewals, partially offset by continued strong Software-enabled revenue growth
•Lending related and other fees increased 7% compared to 3Q23, driven by stronger client demand
Other fee revenue increased $81 million compared to 3Q23 and increased $77 million compared to 2Q24, primarily reflecting a $66 million gain on sale of an equity investment.
Net interest income increased 16% compared to 3Q23, largely due to higher investment securities yields and loan growth, partially offset by deposit mix shift. Compared to 2Q24, NII decreased 2%, primarily driven by deposit mix shift and lower market rates, partially offset by higher investment securities yields.
Other Income was a loss of $80 million, mainly reflecting the loss on sale related to the repositioning of the investment portfolio.
Total revenues were positively impacted by currency translation of $6 million and $17 million compared to 3Q23 and 2Q24, respectively.
PROVISION FOR CREDIT LOSSES
| (Dollars in millions) | 3Q24 | 2Q24 | 3Q23 | % QoQ | % YoY | |||||
|---|---|---|---|---|---|---|---|---|---|---|
| Allowance for credit losses: | ||||||||||
| Beginning balance | $ | 145 | $ | 146 | $ | 136 | (0.7) | % | 6.6 | % |
| Provision for credit losses | 26 | 10 | — | nm | nm | |||||
| Charge-offs | — | (11) | (2) | nm | nm | |||||
| Ending Balance | $ | 171 | $ | 145 | $ | 134 | 17.9 | % | 27.6 | % |
Total provision for credit losses was $26 million in 3Q24, primarily reflecting an increase in loan loss reserves associated with certain commercial real estate and leveraged loans, combined with a change in macroeconomic factors.
EXPENSES
| (Dollars in millions) | 3Q24 | 2Q24 | 3Q23 | % QoQ | % YoY | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Compensation and employee benefits | $ | 1,134 | $ | 1,099 | $ | 1,082 | 3.2 | % | 4.8 | % | |||||
| Information systems and communications | 463 | 454 | 411 | 2.0 | 12.7 | ||||||||||
| Transaction processing services | 255 | 250 | 241 | 2.0 | 5.8 | ||||||||||
| Occupancy | 105 | 106 | 101 | (0.9) | 4.0 | ||||||||||
| Amortization of other intangible assets | 56 | 60 | 60 | (6.7) | (6.7) | ||||||||||
| Other | 295 | 300 | 285 | (1.7) | 3.5 | ||||||||||
| Total Expenses | $ | 2,308 | $ | 2,269 | $ | 2,180 | 1.7 | % | 5.9 | % | |||||
| Effective tax rate | 21.1 | % | 22.1 | % | 17.4 | % | (1.0) | % | pts | 3.7 | % | pts |
Compensation and employee benefits increased 5% compared to 3Q23, mainly due to higher performance-based incentive compensation and employee benefits, partially offset by ongoing organizational process improvements and initiatives as well as net benefits from the joint venture consolidations in India, which collectively resulted in a 4% reduction in year-over-year headcount (pro-forma for joint venture associated headcount).(a) Compared to 2Q24, Compensation and employee benefits increased 3%, largely driven by higher salaries, performance-based incentive compensation and employee benefits.
Information systems and communications increased 13% compared to 3Q23 and increased 2% compared to 2Q24, largely from higher technology and infrastructure investments.
Transaction processing services increased 6% compared to 3Q23, primarily reflecting higher revenue-related costs associated with sub-custody, broker fees and market data. Transaction processing services increased 2% compared to 2Q24, mainly driven by revenue-related sub-custody costs.
(a) Pro-forma headcount reflects estimated total headcount for 3Q23 as if the headcount of the India joint ventures that were consolidated in 4Q23 and 2Q24 had been included in the prior period and is based on headcount in each joint venture at the end of the period.
Occupancy increased 4% compared to 3Q23, primarily driven by footprint expansion related to the joint venture consolidations in India, partially offset by footprint optimization and one-time vendor credits. Compared to 2Q24, Occupancy decreased 1%, mainly due to one-time vendor credits, partially offset by footprint expansion related to the joint venture consolidations in India.
Other expenses increased 4% compared to 3Q23, primarily due to higher professional services and travel costs. Compared to 2Q24, Other expenses decreased 2%, primarily reflecting lower professional services.
Total expenses were negatively impacted by currency translation of $9 million and $14 million compared to 3Q23 and 2Q24, respectively.
TAXES
The effective tax rate of 21.1% in 3Q24 increased from 17.4% in 3Q23, primarily due to the impact of the investment portfolio repositioning in 3Q23. Compared to 2Q24, the effective tax rate decreased from 22.1%, primarily due to higher discrete tax benefits this quarter.
CAPITAL AND LIQUIDITY
The following table presents preliminary estimates of regulatory capital and liquidity ratios for State Street Corporation.
| (As of period end) | 3Q24 | 2Q24 | 3Q23 | |||
|---|---|---|---|---|---|---|
| Basel III Standardized Approach: | ||||||
| Common equity tier 1 ratio (CET1) | 11.6 | % | 11.2 | % | 11.0 | % |
| Tier 1 capital ratio | 13.9 | 13.3 | 12.7 | |||
| Total capital ratio | 15.6 | 15.0 | 14.0 | |||
| Basel III Advanced Approaches: | ||||||
| Common equity tier 1 ratio (CET1) | 12.5 | 12.0 | 12.2 | |||
| Tier 1 capital ratio | 15.0 | 14.2 | 14.0 | |||
| Total capital ratio | 16.6 | 15.9 | 15.3 | |||
| Tier 1 leverage ratio | 5.5 | 5.3 | 5.8 | |||
| Supplementary leverage ratio | 6.4 | 6.3 | 6.3 | |||
| Liquidity coverage ratio (LCR) (1) | 107 | % | 106 | % | 109 | % |
| LCR - State Street Bank and Trust (1) | 129 | % | 134 | % | 120 | % |
(1) See the "In This News Release" section for further details on LCR and the calculation between State Street Corporation and State Street Bank and Trust.
Standardized capital ratios were binding for all periods included above.
CET1 (Standardized) ratio at quarter-end of 11.6% increased 0.6% points compared to 3Q23, and increased 0.4% points compared to 2Q24, both primarily due to capital generated from earnings and improved AOCI, partially offset by continued capital return and higher RWA.
Tier 1 leverage ratio at quarter-end of 5.5% decreased 0.3% points compared to 3Q23, reflecting higher average balance sheet levels, partially offset by capital generated from earnings and higher preferred equity. Tier 1 leverage ratio increased 0.2% points compared to 2Q24, mainly driven by capital generated from earnings and higher preferred equity, partially offset by higher average balance sheet levels.
LCR for State Street Corporation was approximately 107%, down 2% points compared to 3Q23, and up 1% point from 2Q24. LCR for State Street Bank and Trust was approximately 129%, up 9% points compared to 3Q23 and down 5% points from 2Q24.
INVESTOR CONFERENCE CALL AND QUARTERLY WEBSITE DISCLOSURE
State Street will webcast an investor conference call today, Tuesday, October 15, 2024, at 12:00 p.m. ET, available at http://investors.statestreet.com. The conference call will also be available via telephone, at (800) 717-1738. The Conference ID# is 26547.
Recorded replay of the conference call will be available on the website and by telephone at (888) 660-6264 beginning approximately two hours after the call's completion. The Conference ID# is 26547 and the Playback Passcode is 26547#. The telephone replay will be available for approximately one month following the conference call.
This News Release, presentation materials referred to on the conference call, and additional financial information are available on State Street's website, at http://investors.statestreet.com under “Investor News & Events" and under the title “Events & Presentations".
State Street intends to publish updates to its public disclosure regarding regulatory capital, as required by the Basel III final rule, and the liquidity coverage and net stable funding ratios, on a quarterly basis on its website at http://investors.statestreet.com, under "Filings & Reports". Those updates will be published each quarter, during the period beginning after State Street's public announcement of its quarterly results of operations and ending on or prior to the due date under applicable bank regulatory requirements (i.e., ordinarily, ending no later than 60 days following year-end or 40 to 45 days following each other quarter-end, as applicable). For 3Q24, State Street expects to publish its updates during the period beginning today and ending on or about November 9, 2024 and on or about November 14, 2024 for the liquidity coverage ratio.
State Street Corporation (NYSE: STT) is one of the world's leading providers of financial services to institutional investors including investment servicing, investment management and investment research and trading. With $46.8 trillion in assets under custody and/or administration and $4.7 trillion* in assets under management as of September 30, 2024, State Street operates globally in more than 100 geographic markets and employs approximately 53,000 worldwide. For more information, visit State Street's website at www.statestreet.com.
* Assets under management as of September 30, 2024 includes approximately $83 billion of assets with respect to SPDR® products for which State Street Global Advisors Funds Distributors, LLC (SSGA FD) acts solely as the marketing agent. SSGA FD and State Street Global Advisors are affiliated.
IN THIS NEWS RELEASE:
•Stock purchases under our common stock repurchase programs may be made using various types of transactions, including open-market purchases, accelerated share repurchases or other transactions off the market, and may be made under Rule 10b5-1 trading programs. The timing and amount of any stock purchases and the type of transaction may not be consistent over the duration of the program, may vary from reporting period to reporting period and will depend on several factors, including our capital position and financial performance, investment opportunities, market conditions, regulatory considerations including the nature and timing of implementation of revisions to the Basel III framework, and the amount of common stock issued as part of employee compensation programs. The common share repurchase programs do not have specific price targets and may be suspended at any time. State Street’s common stock and other stock dividends, including the declaration, timing and amount, remain subject to consideration and approval by State Street’s Board of Directors at the relevant times.
•Expenses and other measures are sometimes presented excluding notable items/effects of currency translation. This is a non-GAAP presentation. See the Addendum to this News Release for an explanation and reconciliations of our non-GAAP measures.
•Servicing fee revenue wins/backlog represents estimates of future annual revenue associated with new servicing engagements State Street determines to be won during the current reporting period, which may include anticipated servicing-related revenues associated with acquisitions or structured transactions, based upon factors assessed at the time the engagement is determined by State Street to be won, including asset volumes, number of transactions, accounts and holdings, terms and expected strategy. These and other relevant factors influencing projected servicing fees upon asset implementation/onboarding will change from time to time prior to, upon and following asset implementation/onboarding, among other reasons, due to varying market levels and factors and client and investor activity and preferences. Servicing fee/backlog estimates are not updated to reflect those changes, regardless of the magnitude or direction of, or reason for, any change. Servicing fee revenue wins in any period include estimated fees attributable to both (1) services to be provided for new estimated AUC/A reflected in new asset servicing wins for the period (with AUC/A to be onboarded in the future) and (2) additional services to be provided for AUC/A already included in our end-of period AUC/A (i.e., for which other services are currently provided); and the magnitude of one source of servicing fee revenue wins relative to the other (i.e., (1) relative to (2)) will vary from period to period. Therefore, for these and other reasons, comparisons of estimated servicing fee revenue wins to estimated new asset servicing AUC/A wins for any period will not produce reliable fee per AUC/A estimates. See also the succeeding two bullets in this “In This News Release” section in reference to considerations applicable to pending servicing engagements, which similarly apply to engagements for which reported servicing fee revenue wins/backlog are attributable.
•New asset servicing mandates, including announced Alpha front-to-back investment servicing clients, may be subject to completion of definitive agreements, consents or assignments, approval of applicable boards and shareholders and customary regulatory approvals, the failure to complete any of which will prevent the relevant mandate from being installed and serviced. New asset servicing mandates and servicing assets remaining to be installed in future periods exclude new business which has been contracted, but for which the client has not yet provided permission to publicly disclose and is not yet installed. These excluded assets, which from time to time may be significant, will be included in new asset servicing mandates and reflected in servicing assets remaining to be installed in the period in which the client provides its permission. Servicing mandates, servicing assets remaining to be installed in future periods and servicing fee revenues remaining to be installed in future periods are presented on a gross basis based on factors present on or about the time we determine the business to be won by us and are not updated based on subsequent developments, including changes in assets, market valuations, scope and, potentially termination. Such assets therefore also do not include the impact of clients who have notified us during the period of their intent to terminate or reduce their relationship with State Street, which from time to time may be significant.
•New business in assets to be serviced is reflected in our AUC/A after we begin servicing the assets, and new business in assets to be managed is reflected in our AUM after we begin managing the assets. As such, only a portion of any new asset servicing and asset management mandates may be reflected in our AUC/A and AUM as of any particular date specified. Consistent with past practice, AUC/A values for certain asset classes are based on a lag, typically one-month. Generally, our servicing fee revenues are affected by several factors, and we provide varied services from our full suite of offerings to different clients. The basis for fees will also differ across regions and clients and can reflect pricing pressures traditionally experienced in our industry. Consequently, no assumption should be drawn as to future revenue run rate from announced servicing wins or new servicing business yet to be installed, as the amount of revenue associated with AUC/A can vary materially. Management fees also are generally affected by various factors, including investment product type and strategy and relationship pricing for clients, and are more sensitive to market valuations than are servicing fees. Therefore, no assumption should be drawn from management fees associated with changes in AUM levels.
•Front office software and data ARR, an operating metric, is calculated by annualizing current quarter revenue for CRD and CRD for Private Markets and includes the annualized amount of most software-enabled revenue, including revenue generated from SaaS, maintenance and support revenue, FIX, and value-added services, which are all expected to be recognized ratably over the term of client contracts. ARR does not include software-enabled brokerage revenue, revenue from affiliates and licensing fees (excluding the portion allocated to maintenance and support) from On-
premises software. Front office software and data ARR was $299 million, $345 million, and $356 million in 3Q23, 2Q24, and 3Q24, respectively.
•Revenue and pre-tax income reflects the application of ASC 606. Revenue recognition under ASC 606 results in the acceleration of a significant portion of revenues for On-premises software agreements when a client goes live or renews their contract with us. The amount of revenue recognized in any given quarter will be driven in large part by client activity, including agreements that renew or are installed in that quarter.
•Unless otherwise noted, all capital ratios referenced on this News Release and elsewhere in this presentation refer to State Street Corporation, or State Street, and not State Street Bank and Trust Company. The lower of capital ratios calculated under the Basel III advanced approaches and under the Basel III standardized approach are applied in the assessment of our capital adequacy for regulatory purposes. Standardized ratios were binding for 3Q24. Refer to the Addendum included with this News Release for additional information. All capital ratios are estimated. Liquidity Coverage Ratio (LCR) is a preliminary estimate based on a quarterly daily average.
•State Street Bank and Trust's (SSBT) LCR is significantly higher than State Street Corporation's (SSC) LCR, primarily due to application of the transferability restriction in the U.S. LCR Final Rule to the calculation of SSC’s LCR. This restriction limits the amount of HQLA held at SSC’s principal banking subsidiary, SSBT and available for the calculation of SSC’s LCR to the amount of net cash outflows of SSBT. This transferability restriction does not apply in the calculation of SSBT’s LCR, and therefore SSBT’s LCR reflects the full benefit of all of its HQLA holdings.
•All earnings per share amounts represent fully diluted earnings per common share.
•Return on average common equity is determined by dividing annualized net income available to common shareholders by average common shareholders' equity for the period.
•Quarter-over-quarter (QoQ) is a sequential quarter comparison. Year-over-year (YoY) is the current period compared to the same period a year ago.
•Operating leverage is the rate of growth of total revenue less the rate of growth of total expenses, relative to the corresponding prior year period, as applicable.
•Fee operating leverage is the rate of growth of total fee revenue less the rate of growth of total expenses, relative to the successive prior year period, as applicable.
•"AUC/A" denotes Assets Under Custody and/or Administration; "AUC" denotes Assets Under Custody; "AUM" denotes Assets Under Management; "SPDR" denotes Standard and Poor's Depository Receipt; "ETF" denotes Exchange-traded fund; "nm" denotes not meaningful; "EOP" denotes end of period.
•"CRD" denotes Charles River Development; "SaaS" denotes Software as a service; "FIX" denotes The Charles River Network's FIX Network Service (CRN); "On-premises" denotes On-premises revenue as recognized in the CRD business.
•"RWA" denotes risk-weighted assets; "AOCI" denotes Accumulated other comprehensive income.
•"FTE" denotes fully taxable-equivalent basis; NIM is presented on an FTE-basis, and is calculated by dividing FTE NII by average total interest-earning assets. Refer to the Addendum for reconciliations of our FTE-basis presentation.
•Industry data is provided for illustrative purposes only. It is not intended to reflect State Street's or its clients' activity and is indicative of only selected segments of the entire industry.
◦Morningstar data includes long-term mutual funds, ETFs and Money Market funds. Mutual fund data represents estimates of net new cash flow, which is new sales minus redemptions combined with net exchanges, while ETF data represents net issuance, which is gross issuance less gross redemptions. Data for Fund of Funds, Feeder funds and Obsolete funds were excluded from the series to prevent double counting. Data is from the Morningstar Direct Asset Flows database.
◦The long-term fund flows reported by Morningstar in North America are composed of U.S. domiciled Market flows mainly in Equities, Allocation and Fixed Income asset classes. 3Q24 data for North America (U.S. domiciled) includes Morningstar actuals for July and August 2024 and Morningstar estimates for September 2024.
◦The long-term funds flows reported by Morningstar direct in EMEA are composed of the European market flows mainly in Equities, Allocation and Fixed Incomes asset classes. 3Q24 data for Europe is on a rolling three-month basis for June 2024 through August 2024, sourced by Morningstar.
FORWARD LOOKING STATEMENTS
This News Release contains forward-looking statements within the meaning of United States securities laws, including statements about our goals and expectations regarding our strategy, growth and sales prospects, capital management, business, financial and capital condition, results of operations, the financial and market outlook and the business environment. Forward-looking statements are often, but not always, identified by such forward-looking terminology as “outlook,” “priority,” “will,” “expect,” “intend,” “aim,” “outcome,” “future,” “strategy,” “pipeline,” “trajectory,” “target,” “guidance,” “objective,” “plan,” “forecast,” “believe,” “anticipate,” “estimate,” “seek,” “may,” “trend,” and “goal,” or similar statements or variations of such terms. These statements are not guarantees of future performance, are inherently uncertain, are based on current assumptions that are difficult to predict and involve a number of risks and uncertainties. Therefore, actual outcomes and results may differ materially from what is expressed in those statements.
Important factors that may affect future results and outcomes include, but are not limited to:
•We are subject to intense competition, which could negatively affect our profitability;
•We are subject to significant pricing pressure and variability in our financial results and our AUC/A and AUM;
•We could be adversely affected by political, geopolitical, economic and market conditions, including, for example, as a result of liquidity or capital deficiencies (actual or perceived) by other financial institutions and related market and government actions, the ongoing wars in Ukraine and in the Middle East, major political elections globally, actions taken by central banks to address inflationary and growth pressures, monetary policy tightening, periods of significant volatility in valuations and liquidity or other disruptions in the markets for equity, fixed income and other assets classes globally or within specific markets;
•Our development and completion of new products and services, including State Street Alpha® and those related to digital assets and artificial intelligence, may impose costs on us, involve dependencies on third parties and may expose us to increased operational, model and other risks;
•Our business may be negatively affected by our failure to update and maintain our technology infrastructure, or otherwise meet the increasing resiliency expectations of our clients and regulators, or as a result of a cyber-attack or similar vulnerability in our or business partners' infrastructure;
•Our risk management framework, models and processes may not be effective in identifying or mitigating risk and reducing the potential for related losses, and a failure or circumvention of our controls and procedures, or errors or delays in our operational and transaction processing, or those of third parties, could have an adverse effect on our business, financial condition, operating results and reputation;
•Acquisitions, strategic alliances, joint ventures and divestitures, and the integration, retention and development of the benefits of these transactions, including the consolidation of our operations joint ventures in India, pose risks for our business;
•Competition for qualified members of our workforce is intense, and we may not be able to attract and retain the highly skilled people we need to support our business;
•We have significant global operations and clients that can be adversely impacted by disruptions in key global economies, including local, regional and geopolitical developments affecting those economies;
•Our investment securities portfolio, consolidated financial condition and consolidated results of operations could be adversely affected by changes in the financial markets, governmental action or monetary policy. For example, among other risks, increases in prevailing interest rates or market conditions have led, and were they to occur in the future could further lead, to reduced levels of client deposits and resulting decreases in our NII or to portfolio management decisions resulting in reductions in our capital or liquidity ratios;
•Our business activities expose us to interest rate risk;
•We assume significant credit risk of counterparties, who may also have substantial financial dependencies on other financial institutions, and these credit exposures and concentrations could expose us to financial loss;
•Our fee revenue represents a significant portion of our revenue and is subject to decline based on, among other factors, market and currency declines, investment activities and preferences of our clients and their business mix;
•If we are unable to effectively manage our capital and liquidity, our financial condition, capital ratios, results of operations and business prospects could be adversely affected;
•We may need to raise additional capital or debt in the future, which may not be available to us or may only be available on unfavorable terms;
•If we experience a downgrade in our credit ratings, or an actual or perceived reduction in our financial strength, our borrowing and capital costs, liquidity and reputation could be adversely affected;
•Our business and capital-related activities, including common share repurchases, may be adversely affected by regulatory requirements and considerations, including capital, credit and liquidity;
•We face extensive and changing government regulation and supervision in the jurisdictions in which we operate, which may increase our costs and compliance risks and may affect our business activities and strategies;
•Our businesses may be adversely affected by government enforcement and litigation;
•Our businesses may be adversely affected by increased and conflicting political and regulatory scrutiny of asset management stewardship and corporate sustainability or Environmental, Social and Governance (ESG) practices;
•Any misappropriation of the confidential information we possess could have an adverse impact on our business and could subject us to regulatory actions, litigation and other adverse effects;
•Our calculations of risk exposures, total RWA and capital ratios depend on data inputs, formulae, models, correlations and assumptions that are subject to change, which could materially impact our risk exposures, our total RWA and our capital ratios from period to period;
•Changes in accounting standards may adversely affect our consolidated results of operations and financial condition;
•Changes in tax laws, rules or regulations, challenges to our tax positions and changes in the composition of our pre-tax earnings may increase our effective tax rate;
•We could face liabilities for withholding and other non-income taxes, including in connection with our services to clients, as a result of tax authority examinations;
•Our businesses may be negatively affected by adverse publicity or other reputational harm;
•Shifting and maintaining operational activities to non-U.S. jurisdictions, changing our operating model, including by consolidating our operations joint ventures in India, and outsourcing to, or insourcing from, third parties expose us to increased operational risk, geopolitical risk and reputational harm and may not result in expected cost savings or operational improvements;
•Attacks or unauthorized access to our or our business partners' or clients' information technology systems or facilities, such as cyber-attacks or other disruptions to our or their operations, could result in significant costs, reputational damage and impacts on our business activities;
•Long-term contracts and customizing service delivery for clients expose us to increased operational risk, pricing and performance risk;
•We may not be able to protect our intellectual property or may infringe upon the rights of third parties;
•The quantitative models we use to manage our business may contain errors that could adversely impact our business, financial condition, operating results and regulatory compliance;
•Our reputation and business prospects may be damaged if investors in the collective investment pools we sponsor or manage incur substantial losses in these investment pools or are restricted in redeeming their interests in these investment pools;
•The impacts of climate change, and regulatory responses, and disclosure requirements related to such risks, could adversely affect us; and
•We may incur losses or face negative impacts on our business as a result of unforeseen events, including terrorist attacks, natural disasters, climate change, pandemics, global conflicts, an abrupt banking crisis and other geopolitical events, which may have a negative impact on our business and operations.
Other important factors that could cause actual results to differ materially from those indicated by any forward-looking statements are set forth in our 2023 Annual Report on Form 10-K and our subsequent SEC filings. We encourage investors to read these filings, particularly the sections on risk factors, for additional information with respect to any forward-looking statements and prior to making any investment decision. The forward-looking statements contained in this News Release should not by relied on as representing our expectations or beliefs as of any time subsequent to the time this News Release is first issued, and we do not undertake efforts to revise those forward-looking statements to reflect events after that time.
14
Document
Exhibit 99.2
| STATE STREET CORPORATION | |||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| EARNINGS RELEASE ADDENDUM | |||||||||||||||||||||||||||||||||||
| September 30, 2024 | |||||||||||||||||||||||||||||||||||
| Table of Contents | |||||||||||||||||||||||||||||||||||
| GAAP-Basis Financial Information: | |||||||||||||||||||||||||||||||||||
| 4-Year Summary of Results | 2 | ||||||||||||||||||||||||||||||||||
| Consolidated Results of Operations | 3 | ||||||||||||||||||||||||||||||||||
| Consolidated Statement of Condition | 5 | ||||||||||||||||||||||||||||||||||
| Average Statement of Condition - Rates Earned and Paid - Fully Taxable-Equivalent Basis | 6 | ||||||||||||||||||||||||||||||||||
| Average Statement of Condition - Rates Earned and Paid - Fully Taxable-Equivalent Basis - Year-to-Date | 7 | ||||||||||||||||||||||||||||||||||
| Selected Average Balances by Currency - Rates Earned and Paid | 8 | ||||||||||||||||||||||||||||||||||
| Investment Portfolio Holdings by Asset Class | 9 | ||||||||||||||||||||||||||||||||||
| Allowance for Credit Losses | 11 | ||||||||||||||||||||||||||||||||||
| Assets Under Custody and/or Administration | 12 | ||||||||||||||||||||||||||||||||||
| Assets Under Management | 13 | ||||||||||||||||||||||||||||||||||
| Line of Business Information | 14 | ||||||||||||||||||||||||||||||||||
| Capital: | |||||||||||||||||||||||||||||||||||
| Regulatory Capital | 15 | ||||||||||||||||||||||||||||||||||
| Reconciliations of Tangible Book Value per Share and Return on Tangible Common Equity | 16 | ||||||||||||||||||||||||||||||||||
| Non-GAAP Financial Information: | |||||||||||||||||||||||||||||||||||
| Reconciliations of Non-GAAP Financial Information | 17 | ||||||||||||||||||||||||||||||||||
| Reconciliation of Pre-tax Margin Excluding Notable Items | 20 | ||||||||||||||||||||||||||||||||||
| Reconciliations of Constant Currency FX Impacts | 21 | ||||||||||||||||||||||||||||||||||
| This financial information should be read in conjunction with State Street's news release dated October 15, 2024. | |||||||||||||||||||||||||||||||||||
| STATE STREET CORPORATION | |||||||||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||||||||||||||||||
| EARNINGS RELEASE ADDENDUM | |||||||||||||||||||||||||||||||||||
| 4-YEAR SUMMARY OF RESULTS | |||||||||||||||||||||||||||||||||||
| (Dollars in millions, except per share amounts, or where otherwise noted) | 2020 | 2021 | 2022 | 2023 | |||||||||||||||||||||||||||||||
| Year ended December 31: | |||||||||||||||||||||||||||||||||||
| Total fee revenue | $ | 9,499 | $ | 10,012 | $ | 9,606 | $ | 9,480 | |||||||||||||||||||||||||||
| Net interest income | 2,200 | 1,905 | 2,544 | 2,759 | |||||||||||||||||||||||||||||||
| Other income | 4 | 110 | (2) | (294) | |||||||||||||||||||||||||||||||
| Total revenue | 11,703 | 12,027 | 12,148 | 11,945 | |||||||||||||||||||||||||||||||
| Provision for credit losses | 88 | (33) | 20 | 46 | |||||||||||||||||||||||||||||||
| Total expenses | 8,716 | 8,889 | 8,801 | 9,583 | |||||||||||||||||||||||||||||||
| Income before income tax expense | 2,899 | 3,171 | 3,327 | 2,316 | |||||||||||||||||||||||||||||||
| Income tax expense | 479 | 478 | 553 | 372 | |||||||||||||||||||||||||||||||
| Net income | 2,420 | 2,693 | 2,774 | 1,944 | |||||||||||||||||||||||||||||||
| Net income available to common shareholders | $ | 2,257 | $ | 2,572 | $ | 2,660 | $ | 1,821 | |||||||||||||||||||||||||||
| Per common share: | |||||||||||||||||||||||||||||||||||
| Diluted earnings per common share | $ | 6.32 | $ | 7.19 | $ | 7.19 | $ | 5.58 | |||||||||||||||||||||||||||
| Average diluted common shares outstanding (in thousands) | 357,106 | 357,962 | 370,109 | 326,568 | |||||||||||||||||||||||||||||||
| Cash dividends declared per common share | $ | 2.08 | $ | 2.18 | $ | 2.40 | $ | 2.64 | |||||||||||||||||||||||||||
| Closing price per share of common stock (at year end) | 72.78 | 93.00 | 77.57 | 77.46 | |||||||||||||||||||||||||||||||
| Average balance sheet: | |||||||||||||||||||||||||||||||||||
| Investment securities | $ | 109,175 | $ | 111,730 | $ | 111,929 | $ | 105,765 | |||||||||||||||||||||||||||
| Total assets | 269,334 | 299,743 | 286,430 | 274,696 | |||||||||||||||||||||||||||||||
| Total deposits | 193,225 | 235,404 | 222,874 | 205,111 | |||||||||||||||||||||||||||||||
| Ratios and other metrics: | |||||||||||||||||||||||||||||||||||
| Return on average common equity | 10.0 | % | 10.7 | % | 11.1 | % | 8.2 | % | |||||||||||||||||||||||||||
| Return on average tangible common equity(1) | 16.7 | 17.2 | 17.4 | 13.3 | |||||||||||||||||||||||||||||||
| Pre-tax margin | 24.8 | 26.4 | 27.4 | 19.4 | |||||||||||||||||||||||||||||||
| Pre-tax margin, excluding notable items(2) | 26.3 | 27.6 | 28.4 | 26.4 | |||||||||||||||||||||||||||||||
| Net interest margin, fully taxable-equivalent basis | 0.97 | 0.74 | 1.03 | 1.20 | |||||||||||||||||||||||||||||||
| Common equity tier 1 ratio(3)(4) | 12.3 | 14.3 | 13.6 | 11.6 | |||||||||||||||||||||||||||||||
| Tier 1 capital ratio(3)(4) | 14.4 | 16.1 | 15.4 | 13.4 | |||||||||||||||||||||||||||||||
| Total capital ratio(3)(4) | 15.3 | 17.5 | 16.8 | 15.2 | |||||||||||||||||||||||||||||||
| Tier 1 leverage ratio(3) | 6.4 | 6.1 | 6.0 | 5.5 | |||||||||||||||||||||||||||||||
| Supplementary leverage ratio(3) | 8.1 | 7.4 | 7.0 | 6.2 | |||||||||||||||||||||||||||||||
| Assets under custody and/or administration (in trillions) | $ | 38.79 | $ | 43.68 | $ | 36.74 | $ | 41.81 | |||||||||||||||||||||||||||
| Assets under management (in trillions) | 3.47 | 4.14 | 3.48 | 4.13 | |||||||||||||||||||||||||||||||
| (1) Return on average tangible common equity is calculated by dividing the net income available to common shareholders (GAAP-basis) for the relevant period by average tangible common equity (non-GAAP). Refer to the Reconciliations of Tangible Book Value per Common Share and Return on Tangible Common Equity page for details. | |||||||||||||||||||||||||||||||||||
| (2) Notable items include acquisition and restructuring costs, repositioning charges and legal and other notable items. Refer to Reconciliations of pre-tax margin excluding notable items for details. | |||||||||||||||||||||||||||||||||||
| (3) The capital ratios presented are calculated in conformity with the applicable regulatory guidance in effect as of each period end. | |||||||||||||||||||||||||||||||||||
| (4) The reportable ratios represent the lower of each of the risk-based capital ratios under both the Standardized Approach and the Advanced Approaches. | |||||||||||||||||||||||||||||||||||
| STATE STREET CORPORATION | |||||||||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||||||
| EARNINGS RELEASE ADDENDUM | |||||||||||||||||||||||||||||||||||
| CONSOLIDATED RESULTS OF OPERATIONS | |||||||||||||||||||||||||||||||||||
| Quarters | % Change | Year-to-Date | % Change | ||||||||||||||||||||||||||||||||
| (Dollars in millions, except per share amounts, or where otherwise noted) | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | 2023 | 2024 | YTD2024<br> vs. <br>YTD2023 | |||||||||||||||||||||||
| Fee revenue: | |||||||||||||||||||||||||||||||||||
| Back office services | $ | 1,131 | $ | 1,164 | $ | 1,138 | $ | 1,128 | $ | 1,136 | $ | 1,146 | $ | 1,167 | 2.5 | % | 1.8 | % | $ | 3,433 | $ | 3,449 | 0.5 | % | |||||||||||
| Middle office services | 86 | 95 | 96 | 84 | 92 | 93 | 99 | 3.1 | 6.5 | 277 | 284 | 2.5 | |||||||||||||||||||||||
| Servicing fees | 1,217 | 1,259 | 1,234 | 1,212 | 1,228 | 1,239 | 1,266 | 2.6 | 2.2 | 3,710 | 3,733 | 0.6 | |||||||||||||||||||||||
| Management fees | 457 | 461 | 479 | 479 | 510 | 511 | 527 | 10.0 | 3.1 | 1,397 | 1,548 | 10.8 | |||||||||||||||||||||||
| Foreign exchange trading services | 342 | 303 | 313 | 307 | 331 | 336 | 374 | 19.5 | 11.3 | 958 | 1,041 | 8.7 | |||||||||||||||||||||||
| Securities finance | 109 | 117 | 103 | 97 | 96 | 108 | 116 | 12.6 | 7.4 | 329 | 320 | (2.7) | |||||||||||||||||||||||
| Front office software and data | 109 | 162 | 130 | 179 | 144 | 152 | 146 | 12.3 | (3.9) | 401 | 442 | 10.2 | |||||||||||||||||||||||
| Lending related and other fees | 56 | 59 | 58 | 58 | 63 | 62 | 62 | 6.9 | — | 173 | 187 | 8.1 | |||||||||||||||||||||||
| Software and processing fees | 165 | 221 | 188 | 237 | 207 | 214 | 208 | 10.6 | (2.8) | 574 | 629 | 9.6 | |||||||||||||||||||||||
| Other fee revenue | 45 | 58 | 44 | 33 | 50 | 48 | 125 | nm | nm | 147 | 223 | 51.7 | |||||||||||||||||||||||
| Total fee revenue | 2,335 | 2,419 | 2,361 | 2,365 | 2,422 | 2,456 | 2,616 | 10.8 | 6.5 | 7,115 | 7,494 | 5.3 | |||||||||||||||||||||||
| Net interest income: | |||||||||||||||||||||||||||||||||||
| Interest income | 2,027 | 2,232 | 2,328 | 2,593 | 2,889 | 2,998 | 3,081 | 32.3 | 2.8 | 6,587 | 8,968 | 36.1 | |||||||||||||||||||||||
| Interest expense | 1,261 | 1,541 | 1,704 | 1,915 | 2,173 | 2,263 | 2,358 | 38.4 | 4.2 | 4,506 | 6,794 | 50.8 | |||||||||||||||||||||||
| Net interest income | 766 | 691 | 624 | 678 | 716 | 735 | 723 | 15.9 | (1.6) | 2,081 | 2,174 | 4.5 | |||||||||||||||||||||||
| Other income: | |||||||||||||||||||||||||||||||||||
| Gains (losses) related to investment securities, net | — | — | (294) | — | — | — | (80) | 72.8 | nm | (294) | (80) | 72.8 | |||||||||||||||||||||||
| Total other income | — | — | (294) | — | — | — | (80) | 72.8 | nm | (294) | (80) | 72.8 | |||||||||||||||||||||||
| Total revenue | 3,101 | 3,110 | 2,691 | 3,043 | 3,138 | 3,191 | 3,259 | 21.1 | 2.1 | 8,902 | 9,588 | 7.7 | |||||||||||||||||||||||
| Provision for credit losses | 44 | (18) | — | 20 | 27 | 10 | 26 | nm | nm | 26 | 63 | nm | |||||||||||||||||||||||
| Expenses: | |||||||||||||||||||||||||||||||||||
| Compensation and employee benefits | 1,292 | 1,123 | 1,082 | 1,247 | 1,252 | 1,099 | 1,134 | 4.8 | 3.2 | 3,497 | 3,485 | (0.3) | |||||||||||||||||||||||
| Information systems and communications | 414 | 405 | 411 | 473 | 432 | 454 | 463 | 12.7 | 2.0 | 1,230 | 1,349 | 9.7 | |||||||||||||||||||||||
| Transaction processing services | 239 | 235 | 241 | 242 | 248 | 250 | 255 | 5.8 | 2.0 | 715 | 753 | 5.3 | |||||||||||||||||||||||
| Occupancy | 94 | 103 | 101 | 128 | 103 | 106 | 105 | 4.0 | (0.9) | 298 | 314 | 5.4 | |||||||||||||||||||||||
| Acquisition and restructuring costs | — | — | — | (15) | — | — | — | — | — | — | — | — | |||||||||||||||||||||||
| Amortization of other intangible assets | 60 | 60 | 60 | 59 | 60 | 60 | 56 | (6.7) | (6.7) | 180 | 176 | (2.2) | |||||||||||||||||||||||
| Other | 270 | 286 | 285 | 688 | 418 | 300 | 295 | 3.5 | (1.7) | 841 | 1,013 | 20.5 | |||||||||||||||||||||||
| Total expenses | 2,369 | 2,212 | 2,180 | 2,822 | 2,513 | 2,269 | 2,308 | 5.9 | 1.7 | 6,761 | 7,090 | 4.9 | |||||||||||||||||||||||
| Income before income tax expense | 688 | 916 | 511 | 201 | 598 | 912 | 925 | 81.0 | 1.4 | 2,115 | 2,435 | 15.1 | |||||||||||||||||||||||
| Income tax expense | 139 | 153 | 89 | (9) | 135 | 201 | 195 | nm | (3.0) | 381 | 531 | 39.4 | |||||||||||||||||||||||
| Net income | $ | 549 | $ | 763 | $ | 422 | $ | 210 | $ | 463 | $ | 711 | $ | 730 | 73.0 | 2.7 | $ | 1,734 | $ | 1,904 | 9.8 | ||||||||||||||
| STATE STREET CORPORATION | |||||||||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||||||||||
| EARNINGS RELEASE ADDENDUM | |||||||||||||||||||||||||||||||||||
| CONSOLIDATED RESULTS OF OPERATIONS (Continued) | |||||||||||||||||||||||||||||||||||
| Quarters | % Change | Year-to-Date | % Change | ||||||||||||||||||||||||||||||||
| (Dollars in millions, except per share amounts, or where otherwise noted) | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | 2023 | 2024 | YTD2024<br> vs. <br>YTD2023 | |||||||||||||||||||||||
| Adjustments to net income: | |||||||||||||||||||||||||||||||||||
| Dividends on preferred stock | $ | (23) | $ | (37) | $ | (24) | $ | (38) | $ | (45) | $ | (55) | $ | (48) | (100.0) | % | 12.7 | % | $ | (84) | $ | (148) | (76.2) | % | |||||||||||
| Earnings allocated to participating securities | (1) | — | — | — | — | (1) | — | — | nm | (1) | (1) | — | |||||||||||||||||||||||
| Net income available to common shareholders | $ | 525 | $ | 726 | $ | 398 | $ | 172 | $ | 418 | $ | 655 | $ | 682 | 71.4 | 4.1 | $ | 1,649 | $ | 1,755 | 6.4 | ||||||||||||||
| Per common share: | |||||||||||||||||||||||||||||||||||
| Basic earnings | $ | 1.54 | $ | 2.20 | $ | 1.27 | $ | 0.56 | $ | 1.38 | $ | 2.18 | $ | 2.29 | 80.3 | 5.0 | $ | 5.03 | $ | 5.85 | 16.3 | ||||||||||||||
| Diluted earnings | 1.52 | 2.17 | 1.25 | 0.55 | 1.37 | 2.15 | 2.26 | 80.8 | 5.1 | 4.97 | 5.77 | 16.1 | |||||||||||||||||||||||
| Average common shares outstanding (in thousands): | |||||||||||||||||||||||||||||||||||
| Basic | 341,106 | 329,383 | 313,147 | 306,198 | 301,991 | 300,564 | 297,365 | (5.0) | (1.1) | 327,776 | 299,964 | (8.5) | |||||||||||||||||||||||
| Diluted | 345,472 | 333,540 | 317,329 | 310,419 | 305,943 | 304,765 | 301,847 | (4.9) | (1.0) | 332,011 | 304,176 | (8.4) | |||||||||||||||||||||||
| Cash dividends declared per common share | $ | 0.63 | $ | 0.63 | $ | 0.69 | $ | 0.69 | $ | 0.69 | $ | 0.69 | $ | 0.76 | 10.1 | 10.1 | $ | 1.95 | $ | 2.14 | 9.7 | ||||||||||||||
| Closing price per share of common stock (as of quarter end) | 75.69 | 73.18 | 66.96 | 77.46 | 77.32 | 74.00 | 88.47 | 32.1 | 19.6 | 66.96 | 88.47 | 32.1 | |||||||||||||||||||||||
| Book value per common share | $ | 67.69 | $ | 69.01 | $ | 70.14 | $ | 72.27 | $ | 72.85 | $ | 74.50 | $ | 78.22 | 11.5 | 5.0 | $ | 70.14 | $ | 78.22 | 11.5 | ||||||||||||||
| Tangible book value per common share(1) | 42.34 | 42.68 | 43.07 | 44.22 | 45.06 | 46.10 | 49.22 | 14.3 | 6.8 | 43.07 | 49.22 | 14.3 | |||||||||||||||||||||||
| Balance sheet averages: | |||||||||||||||||||||||||||||||||||
| Investment securities | $ | 107,089 | $ | 107,550 | $ | 104,995 | $ | 103,474 | $ | 101,318 | $ | 105,098 | $ | 107,364 | 2.3 | 2.2 | $ | 106,537 | $ | 104,603 | (1.8) | ||||||||||||||
| Total assets | 277,492 | 274,972 | 267,727 | 278,659 | 298,570 | 306,298 | 314,640 | 17.5 | 2.7 | 273,361 | 306,532 | 12.1 | |||||||||||||||||||||||
| Total deposits | 210,320 | 205,831 | 197,869 | 206,544 | 218,892 | 220,881 | 225,482 | 14.0 | 2.1 | 204,628 | 221,765 | 8.4 | |||||||||||||||||||||||
| Ratios and other metrics: | |||||||||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Effective tax rate | % | 16.7 | % | 17.4 | % | (4.4) | % | 22.5 | % | 22.1 | % | 21.1 | % | 3.7 | % | pts | (1.0) | % | pts | 18.0 | % | 21.8 | % | 3.8 | % | pts | |||||||||
| Return on average common equity | 13.0 | 7.3 | 3.1 | 7.7 | 11.9 | 12.0 | 4.7 | 0.1 | 9.9 | 10.6 | 0.7 | ||||||||||||||||||||||||
| Return on average tangible common equity(2) | 20.9 | 12.0 | 5.1 | 12.4 | 19.3 | 19.3 | 7.3 | — | 15.9 | 17.1 | 1.2 | ||||||||||||||||||||||||
| Pre-tax margin | 29.5 | 19.0 | 6.6 | 19.1 | 28.6 | 28.4 | 9.4 | (0.2) | 23.8 | 25.4 | 1.6 | ||||||||||||||||||||||||
| Pre-tax margin, excluding notable items(3) | 29.5 | 27.0 | 27.0 | 23.2 | 28.6 | 28.4 | 1.4 | (0.2) | 26.2 | 26.8 | 0.6 | ||||||||||||||||||||||||
| Net interest margin, fully taxable-equivalent basis | 1.19 | 1.12 | 1.16 | 1.13 | 1.13 | 1.07 | (0.05) | (0.06) | 1.21 | 1.11 | (0.10) | ||||||||||||||||||||||||
| Common equity tier 1 ratio(4)(5) | 11.8 | 11.0 | 11.6 | 11.1 | 11.2 | 11.6 | 0.6 | 0.4 | 11.0 | 11.6 | 0.6 | ||||||||||||||||||||||||
| Tier 1 capital ratio(4)(5) | 13.6 | 12.7 | 13.4 | 13.2 | 13.3 | 13.9 | 1.2 | 0.6 | 12.7 | 13.9 | 1.2 | ||||||||||||||||||||||||
| Total capital ratio(4)(5) | 14.9 | 14.0 | 15.2 | 14.9 | 15.0 | 15.6 | 1.6 | 0.6 | 14.0 | 15.6 | 1.6 | ||||||||||||||||||||||||
| Tier 1 leverage ratio(4) | 5.8 | 5.8 | 5.5 | 5.4 | 5.3 | 5.5 | (0.3) | 0.2 | 5.8 | 5.5 | (0.3) | ||||||||||||||||||||||||
| Supplementary leverage ratio(4) | 6.4 | 6.3 | 6.2 | 6.5 | 6.3 | 6.4 | 0.1 | 0.1 | 6.3 | 6.4 | 0.1 | ||||||||||||||||||||||||
| Assets under custody and/or administration (in billions) | 37,635 | $ | 39,589 | $ | 40,017 | $ | 41,810 | $ | 43,912 | $ | 44,312 | $ | 46,759 | 16.8 | % | 5.5 | % | $ | 40,017 | $ | 46,759 | 16.8 | % | ||||||||||||
| Assets under management (in billions) | 3,787 | 3,672 | 4,102 | 4,299 | 4,369 | 4,732 | 28.9 | 8.3 | 3,672 | 4,732 | 28.9 | ||||||||||||||||||||||||
| Average securities on loan(6) | 298,145 | 283,855 | 283,048 | 301,247 | 334,675 | 349,113 | 23.0 | 4.3 | 312,122 | 328,421 | 5.2 | ||||||||||||||||||||||||
| (1) Tangible book value per common share is calculated by dividing the period end tangible common equity (non-GAAP) by the total common shares outstanding at period end. Refer to the Reconciliations of Tangible Book Value per Common Share and Return on Tangible Common Equity page for details. | |||||||||||||||||||||||||||||||||||
| (2) Return on average tangible common equity is calculated by dividing annualized net income available to common shareholders (GAAP-basis) for the relevant period by average tangible common equity (non-GAAP). Beginning in the third quarter of 2024, quarterly annualized net income available to common shareholders is utilized in the quarterly return on average tangible common equity calculation as compared to year-to-date annualized net income available to common shareholders utilized in prior quarters. Prior quarterly periods have been revised to conform to the current presentation. Refer to the Reconciliations of Tangible Book Value per Common Share and Return on Tangible Common Equity page for details. | |||||||||||||||||||||||||||||||||||
| (3) Notable items include acquisition and restructuring costs, repositioning charges and legal and other notable items. Refer to Reconciliations of non-GAAP Financial Information pages for details. | |||||||||||||||||||||||||||||||||||
| (4) The capital ratios presented are calculated in conformity with the applicable regulatory guidance in effect as of each period end. Capital ratios as of September 30, 2024 are estimates. | |||||||||||||||||||||||||||||||||||
| (5) The reportable ratios represent the lower of each of the risk-based capital ratios under both the Standardized Approach and the Advanced Approaches. Refer to Regulatory Capital for details on Standardized and Advanced Approaches ratios. | |||||||||||||||||||||||||||||||||||
| (6) End-of-period securities on loan were 362,438 million, 290,515 million, 280,408 million and 293,331 million at March 31, 2023, June 30, 2023, September 30, 2023 and December 31, 2023, respectively, and 339,940 million, 339,111 and 378,713 million at March 31, 2024, June 30, 2024, September 30, 2024, respectively. | |||||||||||||||||||||||||||||||||||
| nm Denotes not meaningful |
All values are in US Dollars.
| STATE STREET CORPORATION | |||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| EARNINGS RELEASE ADDENDUM | |||||||||||||||||||
| CONSOLIDATED STATEMENT OF CONDITION | |||||||||||||||||||
| % Change | |||||||||||||||||||
| (Dollars in millions, except per share amounts) | March 31, 2023 | June 30, 2023 | September 30, 2023 | December 31, 2023 | March 31, 2024 | June 30, 2024 | September 30, 2024 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | ||||||||||
| Assets: | |||||||||||||||||||
| Cash and due from banks | $ | 3,698 | $ | 3,930 | $ | 4,009 | $ | 4,047 | $ | 3,413 | $ | 2,898 | $ | 4,067 | 1.4 | % | 40.3 | % | |
| Interest-bearing deposits with banks, net | 87,935 | 86,048 | 76,756 | 87,665 | 125,486 | 99,876 | 105,121 | 37.0 | 5.3 | ||||||||||
| Securities purchased under resale agreements | 1,134 | 1,668 | 1,816 | 6,692 | 7,489 | 6,340 | 8,334 | nm | 31.5 | ||||||||||
| Trading account assets | 695 | 715 | 725 | 773 | 760 | 780 | 802 | 10.6 | 2.8 | ||||||||||
| Investment securities: | |||||||||||||||||||
| Investment securities available-for-sale, net | 42,841 | 43,046 | 41,546 | 44,526 | 48,640 | 56,755 | 56,853 | 36.8 | 0.2 | ||||||||||
| Investment securities held-to-maturity, net(1) | 65,027 | 63,510 | 61,956 | 57,117 | 52,914 | 51,051 | 49,477 | (20.1) | (3.1) | ||||||||||
| Total investment securities | 107,868 | 106,556 | 103,502 | 101,643 | 101,554 | 107,806 | 106,330 | 2.7 | (1.4) | ||||||||||
| Loans | 33,916 | 34,123 | 35,436 | 36,631 | 38,635 | 39,376 | 41,961 | 18.4 | 6.6 | ||||||||||
| Allowance for credit losses on loans(2) | 115 | 120 | 119 | 135 | 135 | 136 | 162 | 36.1 | 19.1 | ||||||||||
| Loans, net | 33,801 | 34,003 | 35,317 | 36,496 | 38,500 | 39,240 | 41,799 | 18.4 | 6.5 | ||||||||||
| Premises and equipment, net(3) | 2,337 | 2,349 | 2,334 | 2,399 | 2,479 | 2,539 | 2,621 | 12.3 | 3.2 | ||||||||||
| Accrued interest and fees receivable | 3,570 | 3,732 | 3,874 | 3,806 | 4,014 | 4,066 | 4,160 | 7.4 | 2.3 | ||||||||||
| Goodwill | 7,530 | 7,544 | 7,487 | 7,611 | 7,582 | 7,751 | 7,833 | 4.6 | 1.1 | ||||||||||
| Other intangible assets | 1,493 | 1,435 | 1,363 | 1,320 | 1,258 | 1,209 | 1,166 | (14.5) | (3.6) | ||||||||||
| Other assets | 40,755 | 46,581 | 47,232 | 44,806 | 45,468 | 53,098 | 56,248 | 19.1 | 5.9 | ||||||||||
| Total assets | $ | 290,816 | $ | 294,561 | $ | 284,415 | $ | 297,258 | $ | 338,003 | $ | 325,603 | $ | 338,481 | 19.0 | 4.0 | |||
| Liabilities: | |||||||||||||||||||
| Deposits: | |||||||||||||||||||
| Non-interest-bearing | $ | 45,856 | $ | 36,455 | $ | 35,824 | $ | 32,569 | $ | 37,367 | $ | 34,519 | $ | 31,448 | (12.2) | (8.9) | |||
| Interest-bearing - U.S. | 108,623 | 122,676 | 118,561 | 121,738 | 148,485 | 140,983 | 145,527 | 22.7 | 3.2 | ||||||||||
| Interest-bearing - Non-U.S. | 69,152 | 63,185 | 58,616 | 66,663 | 66,032 | 63,658 | 70,454 | 20.2 | 10.7 | ||||||||||
| Total deposits(4) | 223,631 | 222,316 | 213,001 | 220,970 | 251,884 | 239,160 | 247,429 | 16.2 | 3.5 | ||||||||||
| Securities sold under repurchase agreements | 3,695 | 4,294 | 3,097 | 1,867 | 3,576 | 2,716 | 2,119 | (31.6) | (22.0) | ||||||||||
| Other short-term borrowings | 8 | 53 | 8 | 3,660 | 11,541 | 13,571 | 10,018 | nm | (26.2) | ||||||||||
| Accrued expenses and other liabilities | 22,427 | 26,516 | 26,124 | 28,123 | 26,823 | 25,657 | 32,185 | 23.2 | 25.4 | ||||||||||
| Long-term debt | 16,305 | 17,178 | 18,564 | 18,839 | 19,746 | 19,737 | 20,902 | 12.6 | 5.9 | ||||||||||
| Total liabilities | 266,066 | 270,357 | 260,794 | 273,459 | 313,570 | 300,841 | 312,653 | 19.9 | 3.9 | ||||||||||
| Shareholders' equity: | |||||||||||||||||||
| Preferred stock, no par, 3,500,000 shares authorized: | |||||||||||||||||||
| Series D, 7,500 shares issued and outstanding | 742 | 742 | 742 | 742 | — | — | — | nm | nm | ||||||||||
| Series F, 2,500 shares issued and outstanding | 247 | 247 | 247 | 247 | — | — | — | nm | nm | ||||||||||
| Series G, 5,000 shares issued and outstanding | 493 | 493 | 493 | 493 | 493 | 493 | 493 | — | — | ||||||||||
| Series H, 5,000 shares issued and outstanding | 494 | 494 | 494 | 494 | 494 | 494 | — | nm | nm | ||||||||||
| Series I, 15,000 shares issued and outstanding | — | — | — | — | 1,481 | 1,481 | 1,481 | nm | — | ||||||||||
| Series J, 850 shares issued and outstanding | — | — | — | — | — | — | 842 | nm | nm | ||||||||||
| Common stock, 1 par, 750,000,000 shares authorized(5)(6) | 504 | 504 | 504 | 504 | 504 | 504 | 504 | — | — | ||||||||||
| Surplus | 10,724 | 10,729 | 10,735 | 10,741 | 10,724 | 10,721 | 10,723 | (0.1) | — | ||||||||||
| Retained earnings | 27,342 | 27,808 | 27,993 | 27,957 | 28,166 | 28,615 | 29,073 | 3.9 | 1.6 | ||||||||||
| Accumulated other comprehensive income (loss) | (3,272) | (3,258) | (3,045) | (2,354) | (2,369) | (2,314) | (1,625) | 46.6 | 29.8 | ||||||||||
| Treasury stock, at cost(7) | (12,524) | (13,555) | (14,542) | (15,025) | (15,060) | (15,232) | (15,663) | (7.7) | (2.8) | ||||||||||
| Total shareholders' equity | 24,750 | 24,204 | 23,621 | 23,799 | 24,433 | 24,762 | 25,828 | 9.3 | 4.3 | ||||||||||
| Total liabilities and equity | $ | 290,816 | $ | 294,561 | $ | 284,415 | $ | 297,258 | $ | 338,003 | $ | 325,603 | $ | 338,481 | 19.0 | 4.0 | |||
| (1) Fair value of investment securities held-to-maturity | $ | 59,139 | $ | 56,863 | $ | 54,121 | $ | 51,503 | $ | 46,823 | $ | 44,916 | $ | 44,925 | |||||
| (2) Total allowance for credit losses including off-balance sheet commitments | 162 | 136 | 134 | 150 | 146 | 145 | 171 | ||||||||||||
| (3) Accumulated depreciation for premises and equipment | 5,918 | 6,035 | 6,148 | 6,062 | 6,193 | 6,318 | 6,400 | ||||||||||||
| (4) Average total deposits | 210,320 | 205,831 | 197,869 | 206,544 | 218,892 | 220,881 | 225,482 | ||||||||||||
| (5) Common stock shares issued | 503,879,642 | 503,879,642 | 503,879,642 | 503,879,642 | 503,879,642 | 503,879,642 | 503,879,642 | ||||||||||||
| (6) Total common shares outstanding | 336,461,072 | 322,101,110 | 308,583,511 | 301,944,043 | 301,504,470 | 299,231,005 | 294,191,001 | ||||||||||||
| (7) Treasury stock shares | 167,418,570 | 181,778,532 | 195,296,131 | 201,935,599 | 202,375,172 | 204,648,637 | 209,688,641 | ||||||||||||
| nm Denotes not meaningful |
All values are in US Dollars.
| STATE STREET CORPORATION | ||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||||||||||||||||||||||||
| AVERAGE STATEMENT OF CONDITION - RATES EARNED AND PAID - FULLY TAXABLE-EQUIVALENT BASIS(1) | ||||||||||||||||||||||||||||||||||||||||
| The following table presents average rates earned and paid, on a fully taxable-equivalent basis, on consolidated average interest-earning assets and average interest-bearing liabilities for the quarters indicated. Tax-equivalent adjustments were calculated using a federal income tax rate of 21%, adjusted for applicable state income taxes, net of related federal benefit. | ||||||||||||||||||||||||||||||||||||||||
| % Change | ||||||||||||||||||||||||||||||||||||||||
| 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | |||||||||||||||||||||||||||||||||
| (Dollars in millions; fully-taxable equivalent basis) | Average rates | Average balance | Average rates | Average balance | Average rates | Average balance | Average rates | Average balance | Average rates | Average balance | Average rates | Average balance | Average rates | Average balance | Average balance | |||||||||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||||||||||||||||
| Interest-bearing deposits with banks, net | 77,220 | 3.37 | % | $ | 69,079 | 4.05 | % | $ | 62,514 | 4.40 | % | $ | 70,873 | 4.69 | % | $ | 90,230 | 4.45 | % | $ | 87,894 | 4.25 | % | $ | 86,884 | 4.02 | % | 39.0 | % | (1.1) | % | |||||||||
| Securities purchased under resale agreements(2) | 18.94 | 1,634 | 19.82 | 1,639 | 15.75 | 2,138 | 16.56 | 6,118 | 10.97 | 6,558 | 10.17 | 6,991 | 10.44 | nm | 6.6 | |||||||||||||||||||||||||
| Trading account assets | — | 704 | — | 728 | — | 745 | — | 767 | — | 779 | — | 788 | — | 8.2 | 1.2 | |||||||||||||||||||||||||
| Investment securities: | ||||||||||||||||||||||||||||||||||||||||
| Investment securities available-for-sale, net | 3.31 | 43,409 | 3.76 | 42,341 | 4.39 | 43,537 | 4.84 | 46,497 | 4.93 | 53,204 | 5.06 | 57,302 | 5.13 | 35.3 | 7.7 | |||||||||||||||||||||||||
| Investment securities held-to-maturity, net | 1.97 | 64,141 | 1.99 | 62,654 | 2.00 | 59,937 | 2.05 | 54,821 | 2.14 | 51,894 | 2.14 | 50,062 | 2.12 | (20.1) | (3.5) | |||||||||||||||||||||||||
| Total investment securities | 2.50 | 107,550 | 2.71 | 104,995 | 2.97 | 103,474 | 3.23 | 101,318 | 3.42 | 105,098 | 3.62 | 107,364 | 3.73 | 2.3 | 2.2 | |||||||||||||||||||||||||
| Loans(3) | 4.80 | 34,235 | 5.18 | 34,525 | 5.65 | 36,887 | 5.72 | 37,747 | 5.82 | 38,703 | 5.85 | 39,782 | 5.79 | 15.2 | 2.8 | |||||||||||||||||||||||||
| Other interest-earning assets | 5.71 | 18,783 | 6.09 | 18,089 | 6.60 | 18,117 | 6.59 | 18,153 | 6.92 | 22,708 | 6.92 | 27,697 | 6.35 | 53.1 | 22.0 | |||||||||||||||||||||||||
| Total interest-earning assets | 3.46 | 231,985 | 3.86 | 222,490 | 4.16 | 232,234 | 4.43 | 254,333 | 4.57 | 261,740 | 4.61 | 269,506 | 4.55 | 21.1 | 3.0 | |||||||||||||||||||||||||
| Cash and due from banks | 3,893 | 3,742 | 4,418 | 4,608 | 2,861 | 3,417 | (8.7) | 19.4 | ||||||||||||||||||||||||||||||||
| Other non-interest-earning assets | 39,094 | 41,495 | 42,007 | 39,629 | 41,697 | 41,717 | 0.5 | — | ||||||||||||||||||||||||||||||||
| Total assets | 277,492 | $ | 274,972 | $ | 267,727 | $ | 278,659 | $ | 298,570 | $ | 306,298 | $ | 314,640 | 17.5 | 2.7 | |||||||||||||||||||||||||
| Liabilities: | ||||||||||||||||||||||||||||||||||||||||
| Interest-bearing deposits: | ||||||||||||||||||||||||||||||||||||||||
| U.S. | 105,261 | 3.00 | % | $ | 109,015 | 3.48 | % | $ | 110,343 | 3.83 | % | $ | 116,077 | 4.06 | % | $ | 129,846 | 4.22 | % | $ | 132,162 | 4.15 | % | $ | 135,440 | 4.16 | % | 22.7 | 2.5 | |||||||||||
| Non-U.S. | 1.07 | 64,838 | 1.54 | 58,808 | 1.80 | 60,856 | 2.11 | 62,087 | 1.80 | 63,767 | 1.72 | 65,824 | 1.70 | 11.9 | 3.2 | |||||||||||||||||||||||||
| Total interest-bearing deposits(4) | 2.25 | 173,853 | 2.75 | 169,151 | 3.13 | 176,933 | 3.39 | 191,933 | 3.44 | 195,929 | 3.36 | 201,264 | 3.35 | 19.0 | 2.7 | |||||||||||||||||||||||||
| Securities sold under repurchase agreements | 0.84 | 4,266 | 1.25 | 3,908 | 0.61 | 3,048 | 0.70 | 3,122 | 5.06 | 3,404 | 5.07 | 2,193 | 4.98 | (43.9) | (35.6) | |||||||||||||||||||||||||
| Federal funds purchased | — | — | — | — | — | 1 | 5.48 | — | — | — | — | — | — | nm | nm | |||||||||||||||||||||||||
| Other short-term borrowings | 3.78 | 1,965 | 4.11 | 324 | 2.68 | 1,183 | 3.11 | 8,314 | 4.85 | 13,073 | 5.15 | 13,639 | 5.16 | nm | 4.3 | |||||||||||||||||||||||||
| Long-term debt | 4.64 | 16,735 | 5.00 | 18,117 | 5.33 | 18,663 | 5.43 | 18,944 | 5.44 | 19,694 | 5.44 | 20,258 | 5.27 | 11.8 | 2.9 | |||||||||||||||||||||||||
| Other interest-bearing liabilities | 13.49 | 3,595 | 11.74 | 4,267 | 11.37 | 4,606 | 11.66 | 4,430 | 12.29 | 4,753 | 12.57 | 5,238 | 14.41 | 22.8 | 10.2 | |||||||||||||||||||||||||
| Total interest-bearing liabilities | 2.61 | 200,414 | 3.09 | 195,767 | 3.45 | 204,434 | 3.72 | 226,743 | 3.85 | 236,853 | 3.84 | 242,592 | 3.87 | 23.9 | 2.4 | |||||||||||||||||||||||||
| Non-interest-bearing deposits(5) | 31,978 | 28,718 | 29,611 | 26,959 | 24,952 | 24,218 | (15.7) | (2.9) | ||||||||||||||||||||||||||||||||
| Other non-interest-bearing liabilities | 18,195 | 19,516 | 20,855 | 20,233 | 19,964 | 22,119 | 13.3 | 10.8 | ||||||||||||||||||||||||||||||||
| Preferred shareholders' equity | 1,976 | 1,976 | 1,976 | 2,785 | 2,468 | 3,020 | 52.8 | 22.4 | ||||||||||||||||||||||||||||||||
| Common shareholders' equity | 22,409 | 21,750 | 21,783 | 21,850 | 22,061 | 22,691 | 4.3 | 2.9 | ||||||||||||||||||||||||||||||||
| Total liabilities and shareholders' equity | 277,492 | $ | 274,972 | $ | 267,727 | $ | 278,659 | $ | 298,570 | $ | 306,298 | $ | 314,640 | 17.5 | 2.7 | |||||||||||||||||||||||||
| Total deposits | 210,320 | $ | 205,831 | $ | 197,869 | $ | 206,544 | $ | 218,892 | $ | 220,881 | $ | 225,482 | 14.0 | 2.1 | |||||||||||||||||||||||||
| Excess of rate earned over rate paid | 0.86 | % | 0.77 | % | 0.70 | % | 0.71 | % | 0.72 | % | 0.77 | % | 0.68 | % | ||||||||||||||||||||||||||
| Net interest margin | 1.31 | % | 1.19 | % | 1.12 | % | 1.16 | % | 1.13 | % | 1.13 | % | 1.07 | % | ||||||||||||||||||||||||||
| Net interest income, fully taxable-equivalent basis | $ | 768 | $ | 691 | $ | 626 | $ | 679 | $ | 717 | $ | 736 | $ | 724 | ||||||||||||||||||||||||||
| Tax-equivalent adjustment | (2) | — | (2) | (1) | (1) | (1) | (1) | |||||||||||||||||||||||||||||||||
| Net interest income, GAAP-basis(4) | $ | 766 | $ | 691 | $ | 624 | $ | 678 | $ | 716 | $ | 735 | $ | 723 | ||||||||||||||||||||||||||
| (1) Average rates earned and paid on interest-earning assets and interest-bearing liabilities include the impact of hedge activities associated with our asset and liability management activities where applicable. | ||||||||||||||||||||||||||||||||||||||||
| (2) Reflects the impact of balance sheet netting under enforceable netting agreements of approximately 117 billion, 140 billion, 138 billion and 167 billion in the first, second, third and fourth quarters of 2023, respectively, and approximately 172 billion, 180 billion and 201 billion in the first, second and third quarters of 2024, respectively. Excluding the impact of netting, the average interest rates would be approximately 0.26%, 0.23%, 0.19% and 0.21% in the first, second, third and fourth quarters of 2023, respectively, and approximately 0.38%, 0.36% and 0.35% in the first, second and third quarters of 2024, respectively. | ||||||||||||||||||||||||||||||||||||||||
| (3) Average loans are presented on a gross basis. Average loans net of expected credit losses were approximately 33,422 million, 34,124 million, 34,407 million and 36,771 million in the first, second, third and fourth quarters of 2023 and approximately 37,626 million, 38,573 million and 39,645 million in the first, second and third quarters of 2024, respectively. | ||||||||||||||||||||||||||||||||||||||||
| (4) Average rates includes the impact of FX swap expense of approximately (5) million, 22 million, 24 million and 13 million in the first, second, third and fourth quarters of 2023, respectively, and approximately (49) million, (64) million and (82) million in the first, second and third quarters of 2024, respectively. Average rates for total interest-bearing deposits excluding the impact of FX swap expense were approximately 2.26%, 2.70%, 3.07% and 3.36% in the first, second, third and fourth quarters of 2023, respectively, and approximately 3.54%, 3.49% and 3.52% in the first, second and third quarters of 2024, respectively. | ||||||||||||||||||||||||||||||||||||||||
| (5) Average non-interest-bearing deposits are primarily composed of deposit balances denominated in U.S. dollars. | ||||||||||||||||||||||||||||||||||||||||
| nm Denotes not meaningful |
All values are in US Dollars.
| STATE STREET CORPORATION | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||
| AVERAGE STATEMENT OF CONDITION - RATES EARNED AND PAID - FULLY TAXABLE-EQUIVALENT BASIS - YEAR TO DATE(1) | ||||||||||||||||
| The following table presents consolidated average interest-earning assets, average interest-bearing liabilities and related average rates earned and paid, respectively, for the years indicated, on a fully taxable-equivalent basis, which is a non-GAAP measure. Tax-equivalent adjustments were calculated using a federal income tax rate of 21% for periods ending in 2023 and 2024, adjusted for applicable state income taxes, net of related federal benefit. | ||||||||||||||||
| Year-to-Date | % Change | |||||||||||||||
| 2023 | 2024 | YTD2024 vs YTD2023 | ||||||||||||||
| (Dollars in millions; fully-taxable equivalent basis) | Average rates | Average balance | Average rates | Average balance | ||||||||||||
| Assets: | ||||||||||||||||
| Interest-bearing deposits with banks, net | 69,551 | 3.91 | % | $ | 88,330 | 4.24 | % | 27.0 | % | |||||||
| Securities purchased under resale agreements(2) | 18.16 | 6,557 | 10.52 | nm | ||||||||||||
| Trading account assets | — | 778 | — | 11.1 | ||||||||||||
| Investment securities: | ||||||||||||||||
| Investment securities available-for-sale, net | 3.82 | 52,352 | 5.04 | 22.8 | ||||||||||||
| Investment securities held-to-maturity, net | 1.99 | 52,251 | 2.13 | (18.3) | ||||||||||||
| Total investment securities | 2.72 | 104,603 | 3.59 | (1.8) | ||||||||||||
| Loans(3) | 5.22 | 38,747 | 5.82 | 13.6 | ||||||||||||
| Other interest-earning assets | 6.14 | 22,872 | 6.69 | 26.4 | ||||||||||||
| Total interest-earning assets | 3.82 | 261,887 | 4.58 | 13.6 | ||||||||||||
| Cash and due from banks | 3,628 | (3.5) | ||||||||||||||
| Other non-interest-earning assets | 41,017 | 5.2 | ||||||||||||||
| Total assets | 273,361 | $ | 306,532 | 12.1 | ||||||||||||
| Liabilities: | ||||||||||||||||
| Interest-bearing deposits: | ||||||||||||||||
| U.S. | 108,225 | 3.45 | $ | 132,493 | 4.18 | 22.4 | ||||||||||
| Non-U.S. | 1.46 | 63,900 | 1.74 | 0.9 | ||||||||||||
| Total interest-bearing deposits(4) | 2.71 | 196,393 | 3.39 | 14.5 | ||||||||||||
| Securities sold under repurchase agreements | 0.91 | 2,904 | 5.05 | (30.7) | ||||||||||||
| Federal funds purchased | 4.70 | — | — | nm | ||||||||||||
| Other short-term borrowings | 3.84 | 11,683 | 5.09 | nm | ||||||||||||
| Long-term debt | 5.00 | 19,634 | 5.38 | 16.1 | ||||||||||||
| Other interest-bearing liabilities | 12.08 | 4,808 | 13.16 | 31.7 | ||||||||||||
| Total interest-bearing liabilities | 3.05 | 235,422 | 3.85 | 19.2 | ||||||||||||
| Non-interest-bearing deposits(5) | 25,372 | (23.3) | ||||||||||||||
| Other non-interest-bearing liabilities | 20,777 | 12.5 | ||||||||||||||
| Preferred shareholders' equity | 2,758 | 39.6 | ||||||||||||||
| Common shareholders' equity | 22,203 | (0.6) | ||||||||||||||
| Total liabilities and shareholders' equity | 273,361 | $ | 306,532 | 12.1 | ||||||||||||
| Total deposits | $ | 204,628 | $ | 221,765 | 8.4 | |||||||||||
| Excess of rate earned over rate paid | 0.77 | % | 0.72 | % | ||||||||||||
| Net interest margin | 1.21 | % | 1.11 | % | ||||||||||||
| Net interest income, fully taxable-equivalent basis | $ | 2,085 | $ | 2,177 | ||||||||||||
| Tax-equivalent adjustment | (4) | (3) | ||||||||||||||
| Net interest income, GAAP-basis(4) | $ | 2,081 | $ | 2,174 | ||||||||||||
| (1) Average rates earned and paid on interest-earning assets and interest-bearing liabilities include the impact of hedge activities associated with our asset and liability management activities where applicable. | ||||||||||||||||
| (2) Reflects the impact of balance sheet netting under enforceable netting agreements of approximately 131 billion and 184 billion as of September 30, 2023 and 2024, respectively. Excluding the impact of netting, the average interest rates would be approximately 0.22% and 0.36% for the nine months ended September 30, 2023 and 2024, respectively. | ||||||||||||||||
| (3) Average loans are presented on a gross basis. Average loans net of expected credit losses as of September 30, 2023 and 2024 was approximately 33,988 million and 38,618 million, respectively. | ||||||||||||||||
| (4) Average rates include the impact of FX swap cost of approximately 40 million and (195) million for the nine months ended September 30, 2023 and 2024, respectively. Average rates for total interest-bearing deposits excluding the impact of FX swap cost were 2.68% and 3.52% for the nine months ended September 30, 2023 and 2024, respectively. | ||||||||||||||||
| (5) Average non-interest-bearing deposits are primarily composed of deposit balances denominated in U.S. dollars. | ||||||||||||||||
| nm Denotes not meaningful |
All values are in US Dollars.
| STATE STREET CORPORATION | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||
| SELECTED AVERAGE BALANCES BY CURRENCY - RATES EARNED AND PAID(1) | ||||||||||||||||
| Other | Total | |||||||||||||||
| (Dollars in millions, except where otherwise noted) | Average Rates | Average Balance | Average Rates | Average Balance | Average Rates | Average Balance | Average Rates | Average Balance | Average Rates | |||||||
| Interest-bearing deposits with banks | 5.57 | % | 3.63 | % | 5.06 | % | $ | 19,409 | 1.30 | % | $ | 86,884 | 4.02 | % | ||
| Total investment securities | 3.73 | 8,488 | 2.71 | 5,035 | 4.33 | 6,753 | 4.47 | 107,364 | 3.73 | |||||||
| Loans | 5.85 | 6,028 | 5.40 | 1,236 | 6.44 | 553 | 5.17 | 39,782 | 5.79 | |||||||
| Total other interest-earning assets(2) | 7.33 | 242 | 2.89 | 205 | 4.66 | 2,594 | 3.63 | 35,476 | 7.01 | |||||||
| Total interest-earning assets | 5.06 | 3.70 | 4.89 | $ | 29,309 | 2.31 | $ | 269,506 | 4.55 | |||||||
| Total interest-bearing deposits(3)(4) | 4.41 | 2.17 | 1.84 | $ | 21,412 | (0.52) | $ | 201,264 | 3.35 | |||||||
| Central Bank Rate(5) | 5.43 | 3.70 | 5.08 | |||||||||||||
| Other | Total | |||||||||||||||
| (Dollars in millions, except where otherwise noted) | Average Rates | Average Balance | Average Rates | Average Balance | Average Rates | Average Balance | Average Rates | Average Balance | Average Rates | |||||||
| Interest-bearing deposits with banks | 5.56 | % | 3.85 | % | 5.15 | % | $ | 16,053 | 1.41 | % | $ | 87,894 | 4.25 | % | ||
| Total investment securities | 3.63 | 8,891 | 2.68 | 4,701 | 4.35 | 6,297 | 4.25 | 105,098 | 3.62 | |||||||
| Loans | 5.82 | 5,614 | 5.88 | 1,239 | 6.85 | 694 | 5.34 | 38,703 | 5.85 | |||||||
| Total other interest-earning assets(2) | 7.77 | 135 | 3.25 | 51 | 6.59 | 2,289 | 3.87 | 30,045 | 7.45 | |||||||
| Total interest-earning assets | 5.05 | 3.87 | 5.04 | $ | 25,333 | 2.45 | $ | 261,740 | 4.61 | |||||||
| Total interest-bearing deposits(3)(4) | 4.45 | 2.16 | 1.70 | $ | 21,328 | (0.32) | $ | 195,929 | 3.36 | |||||||
| Central Bank Rate(5) | 5.50 | 3.93 | 5.25 | |||||||||||||
| Other | Total | |||||||||||||||
| (Dollars in millions, except where otherwise noted) | Average Rates | Average Balance | Average Rates | Average Balance | Average Rates | Average Balance | Average Rates | Average Balance | Average Rates | |||||||
| Interest-bearing deposits with banks | 5.34 | % | 3.79 | % | 5.14 | % | $ | 10,312 | 2.41 | % | $ | 62,514 | 4.40 | % | ||
| Total investment securities | 3.10 | 8,815 | 1.81 | 4,773 | 2.80 | 6,901 | 2.90 | 104,995 | 2.97 | |||||||
| Loans | 5.67 | 5,139 | 5.28 | 1,061 | 7.00 | 555 | 5.86 | 34,525 | 5.65 | |||||||
| Total other interest-earning assets(2) | 7.57 | 162 | 3.47 | 56 | 5.69 | 2,012 | 3.14 | 20,456 | 7.10 | |||||||
| Total interest-earning assets | 4.45 | 3.48 | 4.35 | $ | 19,780 | 2.75 | $ | 222,490 | 4.16 | |||||||
| Total interest-bearing deposits(3)(4) | 4.07 | 1.67 | 1.29 | $ | 20,552 | 1.22 | $ | 169,151 | 3.13 | |||||||
| Central Bank Rate(5) | 5.43 | 3.73 | 5.16 | |||||||||||||
| (1) Average rates earned and paid on interest-earning assets and interest-bearing liabilities include the impact of hedge activities associated with our asset and liability management activities where applicable. | ||||||||||||||||
| (2) Average total other interest-earning assets include securities purchased under resale agreements, trading account assets and other interest-earning assets. Refer to average statement of condition - rates earned and paid - full taxable-equivalent basis for details. | ||||||||||||||||
| (3) Average rates for interest-bearing deposit balances denominated in U.S. dollars include both client and wholesale deposits. | ||||||||||||||||
| (4) FX swap costs for interest-bearing deposits are included in other currencies. | ||||||||||||||||
| (5) Central Bank Rate represents the quarterly average Federal Funds Target Rate for , European Central Bank Deposit Facility Rate for , and the Bank of England's Bank Rate for . |
All values are in US Dollars.
| STATE STREET CORPORATION | ||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||||||||||||
| INVESTMENT PORTFOLIO HOLDINGS BY ASSET CLASS | ||||||||||||||||||||||||||||
| Quarters | ||||||||||||||||||||||||||||
| 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | ||||||||||||||||||||||
| (Dollars in billions, except where otherwise noted) | Average Balance | Average Rate | Average Balance | Average Rate | Average Balance | Average Rate | Average Balance | Average Rate | Average Balance | Average Rate | Average Balance | Average Rate | Average Balance | Average Rate | ||||||||||||||
| Available-for-sale investment securities: | ||||||||||||||||||||||||||||
| Government & agency securities | $ | 23.1 | 2.74 | % | $ | 24.0 | 3.20 | % | $ | 23.2 | 3.82 | % | $ | 23.1 | 4.25 | % | $ | 25.1 | 4.44 | % | $ | 31.4 | 4.73 | % | $ | 35.0 | 4.89 | % |
| Asset-backed securities | 5.9 | 4.43 | 5.8 | 5.06 | 5.9 | 5.63 | 6.6 | 5.67 | 6.9 | 5.61 | 7.2 | 5.68 | 7.6 | 5.53 | ||||||||||||||
| Student loans | 0.1 | 7.04 | 0.1 | 6.46 | 0.1 | 6.82 | 0.1 | 6.87 | 0.1 | 7.42 | 0.1 | 7.02 | 0.1 | 7.10 | ||||||||||||||
| Credit cards | 0.1 | 5.40 | 0.1 | 5.78 | 0.1 | 6.26 | 0.1 | 6.35 | 0.1 | 6.24 | 0.1 | 6.21 | 0.1 | 6.25 | ||||||||||||||
| Auto & equipment | 0.6 | 2.74 | 0.4 | 3.41 | 0.6 | 4.06 | 0.8 | 4.22 | 0.9 | 4.51 | 1.0 | 4.63 | 1.0 | 4.71 | ||||||||||||||
| Non-U.S. residential mortgage backed securities | 1.6 | 4.00 | 1.6 | 4.45 | 1.5 | 5.10 | 1.7 | 5.07 | 2.0 | 5.24 | 2.2 | 5.61 | 2.5 | 5.26 | ||||||||||||||
| Collateralized loan obligation | 3.2 | 4.91 | 3.3 | 5.60 | 3.4 | 6.18 | 3.6 | 6.30 | 3.6 | 6.08 | 3.6 | 6.04 | 3.7 | 5.94 | ||||||||||||||
| Other | 0.3 | 3.36 | 0.4 | 4.12 | 0.2 | 3.91 | 0.3 | 4.78 | 0.2 | 4.72 | 0.2 | 4.63 | 0.2 | 4.46 | ||||||||||||||
| Mortgage-backed securities | 2.2 | 3.72 | 2.9 | 4.53 | 3.7 | 4.88 | 4.7 | 5.52 | 5.6 | 5.44 | 5.9 | 5.48 | 6.2 | 5.36 | ||||||||||||||
| Agency MBS | 2.2 | 3.72 | 2.9 | 4.53 | 3.7 | 4.88 | 4.7 | 5.52 | 5.6 | 5.44 | 5.9 | 5.48 | 6.2 | 5.36 | ||||||||||||||
| CMBS | 6.9 | 4.60 | 6.6 | 5.26 | 6.1 | 5.73 | 5.9 | 5.88 | 5.6 | 5.81 | 5.4 | 5.75 | 5.1 | 5.81 | ||||||||||||||
| Corporate bonds | 2.3 | 2.39 | 2.4 | 2.65 | 2.2 | 3.05 | 2.5 | 4.18 | 2.7 | 4.34 | 2.6 | 4.53 | 2.6 | 4.75 | ||||||||||||||
| Covered bonds | — | 0.65 | — | 0.69 | — | 0.66 | — | 0.65 | — | 3.63 | 0.1 | 4.84 | 0.3 | 5.42 | ||||||||||||||
| Municipal bonds | 0.5 | 2.91 | 0.6 | 0.89 | 0.5 | 3.29 | 0.4 | 3.41 | 0.2 | 2.78 | 0.2 | 2.80 | 0.2 | 2.80 | ||||||||||||||
| Clipper tax-exempt bonds | 0.3 | 4.40 | 0.2 | 4.67 | 0.2 | 4.45 | 0.1 | 4.45 | 0.1 | 4.41 | 0.1 | 4.52 | 0.1 | 4.38 | ||||||||||||||
| Other | 0.9 | 2.83 | 0.9 | 1.79 | 0.5 | 3.93 | 0.2 | 10.19 | 0.3 | 8.51 | 0.3 | 9.44 | 0.2 | 11.28 | ||||||||||||||
| Total available-for-sale portfolio | $ | 42.1 | 3.31 | $ | 43.4 | 3.76 | $ | 42.3 | 4.39 | $ | 43.5 | 4.84 | $ | 46.5 | 4.93 | $ | 53.2 | 5.06 | $ | 57.3 | 5.13 | |||||||
| 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | ||||||||||||||||||||||
| (Dollars in billions, except where otherwise noted) | Average Balance | Average Rate | Average Balance | Average Rate | Average Balance | Average Rate | Average Balance | Average Rate | Average Balance | Average Rate | Average Balance | Average Rate | Average Balance | Average Rate | ||||||||||||||
| Held-to-maturity investment securities: | ||||||||||||||||||||||||||||
| Government & agency securities | $ | 18.8 | 0.88 | % | $ | 18.9 | 0.88 | % | $ | 18.5 | 0.87 | % | $ | 16.9 | 0.92 | % | $ | 12.7 | 0.96 | % | $ | 10.8 | 0.88 | % | $ | 10.1 | 0.82 | % |
| Asset-backed securities | 3.8 | 5.37 | 3.7 | 5.73 | 3.5 | 6.02 | 3.4 | 6.19 | 3.1 | 6.15 | 3.0 | 6.15 | 2.7 | 6.21 | ||||||||||||||
| Student loans | 3.8 | 5.37 | 3.7 | 5.73 | 3.5 | 6.02 | 3.4 | 6.19 | 3.1 | 6.15 | 3.0 | 6.15 | 2.7 | 6.21 | ||||||||||||||
| Mortgage-backed securities | 37.1 | 2.23 | 36.3 | 2.22 | 35.4 | 2.21 | 34.4 | 2.22 | 33.8 | 2.25 | 32.9 | 2.23 | 32.1 | 2.22 | ||||||||||||||
| Agency MBS | 37.1 | 2.23 | 36.3 | 2.21 | 35.4 | 2.20 | 34.4 | 2.22 | 33.8 | 2.24 | 32.9 | 2.22 | 32.1 | 2.21 | ||||||||||||||
| CMBS | 5.3 | 1.93 | 5.2 | 1.94 | 5.3 | 1.94 | 5.2 | 1.93 | 5.2 | 1.93 | 5.2 | 1.91 | 5.2 | 1.91 | ||||||||||||||
| Total held-for-maturity portfolio | $ | 65.0 | 1.97 | $ | 64.1 | 1.99 | $ | 62.7 | 2.00 | $ | 59.9 | 2.05 | $ | 54.8 | 2.14 | $ | 51.9 | 2.14 | $ | 50.1 | 2.12 | |||||||
| Total investment securities | $ | 107.1 | 2.50 | $ | 107.5 | 2.71 | $ | 105.0 | 2.97 | $ | 103.4 | 3.23 | $ | 101.3 | 3.42 | $ | 105.1 | 3.62 | $ | 107.4 | 3.73 | |||||||
| STATE STREET CORPORATION | ||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||||||||||||
| INVESTMENT PORTFOLIO HOLDINGS BY ASSET CLASS (continued) | ||||||||||||||||||||||||||||
| (Dollars in billions, or where otherwise noted) | AAA | AA | A | BBB | <BBB | Fair Value | % Total | Net Unrealized Pre-tax MTM Gain/(Loss)<br><br>(In millions)(1) | Fixed Rate/<br><br>Floating Rate(2) | |||||||||||||||||||
| Available-for-sale investment securities: | ||||||||||||||||||||||||||||
| Government & agency securities | % | 27 | % | 15 | % | — | % | 1 | % | 1 | % | $ | 34.4 | 60.6 | % | $ | 42 | 92% / 8% | ||||||||||
| Asset-backed securities | 94 | 6 | — | — | — | 8.0 | 14.1 | 11 | 0% / 100% | |||||||||||||||||||
| Student loans | 13 | 87 | — | — | — | 0.1 | 1.3 | 1 | ||||||||||||||||||||
| Credit cards | 100 | — | — | — | — | 0.1 | 1.3 | 1 | ||||||||||||||||||||
| Auto & equipment | 81 | 19 | — | — | — | 1.1 | 13.8 | 1 | ||||||||||||||||||||
| Non-U.S. residential mortgage backed securities | 97 | 3 | — | — | — | 2.5 | 31.2 | 1 | ||||||||||||||||||||
| Collateralized loan obligation | 100 | — | — | — | — | 3.9 | 48.7 | 7 | ||||||||||||||||||||
| Other | 58 | 42 | — | — | — | 0.3 | 3.7 | — | ||||||||||||||||||||
| Mortgage-backed securities | — | — | — | — | — | 6.4 | 11.3 | 27 | 100% / 0% | |||||||||||||||||||
| Agency MBS | — | — | — | — | — | 6.4 | 100.0 | 23 | ||||||||||||||||||||
| Non-agency MBS | 3 | — | 97 | — | — | — | — | 4 | ||||||||||||||||||||
| CMBS | — | — | — | — | — | 4.8 | 8.5 | (33) | 4% / 96% | |||||||||||||||||||
| Corporate bonds | — | 22 | 65 | 13 | — | 2.7 | 4.7 | 53 | 79% / 21% | |||||||||||||||||||
| Covered bonds | 100 | — | — | — | — | 0.3 | 0.5 | — | 10% / 90% | |||||||||||||||||||
| Municipal bonds | 57 | 43 | — | — | — | 0.1 | 0.2 | — | 100% / 0% | |||||||||||||||||||
| Other | — | 100 | — | — | — | 0.1 | 0.1 | — | 0% / 100% | |||||||||||||||||||
| Total available-for-sale portfolio | % | 31 | % | 11 | % | 3 | % | 1 | % | 1 | % | $ | 56.8 | 100.0 | % | $ | 100 | 71% / 29% | ||||||||||
| Fair Value | 30.4 | $ | 17.4 | $ | 6.3 | $ | 1.8 | $ | 0.7 | $ | 0.2 | |||||||||||||||||
| AAA | AA | A | BBB | <BBB | Amortized Cost | % Total | Net Unrealized Pre-tax MTM Gain/(Loss)<br><br>(In millions)(1) | Fixed Rate/<br><br>Floating Rate(2) | ||||||||||||||||||||
| Held-to-maturity investment securities: | ||||||||||||||||||||||||||||
| Government & agency securities | % | 22 | % | 18 | % | — | % | 4 | % | — | % | $ | 9.9 | 20.0 | % | $ | (132) | 100% / 0% | ||||||||||
| Asset-backed securities | 23 | 71 | 4 | — | 2 | 2.6 | 5.3 | (22) | 5% / 95% | |||||||||||||||||||
| Student loans | 23 | 71 | 4 | — | 2 | 2.6 | 100.0 | (22) | ||||||||||||||||||||
| Mortgage-backed securities | — | — | — | — | — | 31.8 | 64.2 | (3,859) | 100% / 0% | |||||||||||||||||||
| Agency MBS | — | — | — | — | — | 31.8 | 100.0 | (3,859) | ||||||||||||||||||||
| CMBS | — | — | — | — | — | 5.2 | 10.5 | (539) | 97% / 3% | |||||||||||||||||||
| Total held-for-maturity portfolio | % | 6 | % | 7 | % | — | % | 1 | % | — | % | $ | 49.5 | 100.0 | % | $ | (4,552) | 95% / 5% | ||||||||||
| Amortized Cost | 42.5 | $ | 2.8 | $ | 3.6 | $ | 0.1 | $ | 0.4 | $ | 0.1 | |||||||||||||||||
| Total Investment Securities(3) | $ | 106.3 | 82% / 18% | |||||||||||||||||||||||||
| (1) At September 30, 2024, the after-tax unrealized MTM gain/(loss) includes after-tax unrealized loss on securities available-for-sale of 73 million, after-tax unrealized loss on securities held-to-maturity of 3,330 million and after-tax unrealized loss primarily related to securities previously transferred from available-for-sale to held-to-maturity of 411 million. | ||||||||||||||||||||||||||||
| (2) At September 30, 2024, fixed-to-floating rate securities, which excludes the impact of hedges, had a book value of approximately 25 million or 0.02% of the total portfolio. | ||||||||||||||||||||||||||||
| (3) State Street has a highly liquid balance sheet, with more than half of total assets deemed HQLA. Based upon fair value as of September 30, 2024, approximately 86% of our investment portfolio was held in HQLA. |
All values are in US Dollars.
| STATE STREET CORPORATION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ALLOWANCE FOR CREDIT LOSSES | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Quarters | % Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Allowance for credit losses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Beginning balance | $ | 121 | $ | 162 | $ | 136 | $ | 134 | $ | 150 | $ | 146 | $ | 145 | 6.6 | % | (0.7) | % | ||||||||||||||||||||||||||||||||||||||||||
| Provision for credit losses (funded commitments) | 21 | 12 | 1 | 20 | 31 | 12 | 26 | nm | nm | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Provision for credit losses (unfunded commitments) | (7) | (1) | (1) | — | (4) | (2) | — | nm | nm | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Provision for credit losses (investment securities and all other) | 30 | (29) | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total provision | 44 | (18) | — | 20 | 27 | 10 | 26 | nm | nm | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Charge-offs | (3) | (8) | (2) | (4) | (31) | (11) | — | nm | nm | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Ending balance(1) | $ | 162 | $ | 136 | $ | 134 | $ | 150 | $ | 146 | $ | 145 | $ | 171 | 27.6 | 17.9 | ||||||||||||||||||||||||||||||||||||||||||||
| Allowance for credit losses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Loans | $ | 115 | $ | 120 | $ | 119 | $ | 135 | $ | 135 | $ | 136 | $ | 162 | 36.1 | 19.1 | ||||||||||||||||||||||||||||||||||||||||||||
| Investment securities | 2 | — | 1 | 1 | 1 | 1 | 1 | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Unfunded (off-balance sheet) commitments | 16 | 15 | 14 | 14 | 10 | 8 | 8 | (42.9) | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| All other | 29 | 1 | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Ending balance(1) | $ | 162 | $ | 136 | $ | 134 | $ | 150 | $ | 146 | $ | 145 | $ | 171 | 27.6 | 17.9 | ||||||||||||||||||||||||||||||||||||||||||||
| (1) The allowance for credit losses on unfunded commitments is included within Other liabilities in the Consolidated Statement of Condition. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| nm Denotes not meaningful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| STATE STREET CORPORATION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||||||||||||||||||||||||||||||||||||||||||
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ASSETS UNDER CUSTODY AND/OR ADMINISTRATION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Quarters | % Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in billions) | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Assets Under Custody and/or Administration(1) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| By Product Classification: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Collective funds, including ETFs | $ | 12,748 | $ | 13,210 | $ | 13,145 | $ | 14,070 | $ | 14,694 | $ | 14,573 | $ | 15,253 | 16.0 | % | 4.7 | % | ||||||||||||||||||||||||||||||||||||||||||
| Mutual funds | 10,077 | 10,438 | 10,313 | 11,009 | 11,552 | 11,645 | 12,223 | 18.5 | 5.0 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Pension products | 7,871 | 8,037 | 8,255 | 8,352 | 8,800 | 8,916 | 9,339 | 13.1 | 4.7 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Insurance and other products | 6,939 | 7,904 | 8,304 | 8,379 | 8,866 | 9,178 | 9,944 | 19.7 | 8.3 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Assets Under Custody and/or Administration | $ | 37,635 | $ | 39,589 | $ | 40,017 | $ | 41,810 | $ | 43,912 | $ | 44,312 | $ | 46,759 | 16.8 | 5.5 | ||||||||||||||||||||||||||||||||||||||||||||
| By Asset Class: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Equities | $ | 20,966 | $ | 22,454 | $ | 22,971 | $ | 24,317 | $ | 25,909 | $ | 26,291 | $ | 27,715 | 20.7 | 5.4 | ||||||||||||||||||||||||||||||||||||||||||||
| Fixed-Income | 10,645 | 10,812 | 10,688 | 11,043 | 11,368 | 11,303 | 12,027 | 12.5 | 6.4 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Short-term and other investments(2) | 6,024 | 6,323 | 6,358 | 6,450 | 6,635 | 6,718 | 7,017 | 10.4 | 4.5 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Assets Under Custody and/or Administration | $ | 37,635 | $ | 39,589 | $ | 40,017 | $ | 41,810 | $ | 43,912 | $ | 44,312 | $ | 46,759 | 16.8 | 5.5 | ||||||||||||||||||||||||||||||||||||||||||||
| By Geographic Location(3): | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Americas | $ | 27,599 | $ | 28,220 | $ | 28,237 | $ | 29,951 | $ | 31,610 | $ | 31,763 | $ | 33,460 | 18.5 | 5.3 | ||||||||||||||||||||||||||||||||||||||||||||
| Europe/Middle East/Africa | 7,396 | 8,658 | 8,987 | 8,913 | 9,207 | 9,406 | 10,214 | 13.7 | 8.6 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Asia/Pacific | 2,640 | 2,711 | 2,793 | 2,946 | 3,095 | 3,143 | 3,085 | 10.5 | (1.8) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Assets Under Custody and/or Administration | $ | 37,635 | $ | 39,589 | $ | 40,017 | $ | 41,810 | $ | 43,912 | $ | 44,312 | $ | 46,759 | 16.8 | 5.5 | ||||||||||||||||||||||||||||||||||||||||||||
| Assets Under Custody(4) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| By Product Classification: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Collective funds, including ETFs | $ | 10,935 | $ | 11,331 | $ | 11,250 | $ | 12,101 | $ | 12,717 | $ | 12,570 | $ | 13,122 | 16.6 | 4.4 | ||||||||||||||||||||||||||||||||||||||||||||
| Mutual funds | 8,157 | 8,447 | 8,364 | 8,905 | 9,309 | 9,360 | 9,806 | 17.2 | 4.8 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Pension products | 6,355 | 6,485 | 6,679 | 6,825 | 7,235 | 7,333 | 7,693 | 15.2 | 4.9 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Insurance and other products | 2,706 | 2,778 | 2,820 | 2,784 | 2,898 | 2,898 | 3,046 | 8.0 | 5.1 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Assets Under Custody | $ | 28,153 | $ | 29,041 | $ | 29,113 | $ | 30,615 | $ | 32,159 | $ | 32,161 | $ | 33,667 | 15.6 | 4.7 | ||||||||||||||||||||||||||||||||||||||||||||
| By Geographic Location(3): | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Americas | $ | 21,019 | $ | 21,708 | $ | 21,578 | $ | 22,904 | $ | 24,241 | $ | 24,211 | $ | 25,386 | 17.6 | 4.9 | ||||||||||||||||||||||||||||||||||||||||||||
| Europe/Middle East/Africa | 5,039 | 5,153 | 5,273 | 5,302 | 5,380 | 5,361 | 5,715 | 8.4 | 6.6 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Asia-Pacific | 2,095 | 2,180 | 2,262 | 2,409 | 2,538 | 2,589 | 2,566 | 13.4 | (0.9) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Assets Under Custody | $ | 28,153 | $ | 29,041 | $ | 29,113 | $ | 30,615 | $ | 32,159 | $ | 32,161 | $ | 33,667 | 15.6 | 4.7 | ||||||||||||||||||||||||||||||||||||||||||||
| (1) Consistent with past practice, AUC/A values for certain asset classes are based on a lag, typically one-month. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (2) Short-term and other investments includes derivatives, cash and cash equivalents and other instruments. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (3) Geographic mix is generally based on the domicile of the entity servicing the funds and is not necessarily representative of the underlying asset mix. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (4) Assets under custody are a component of assets under custody and/or administration presented above. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| STATE STREET CORPORATION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||||||||||||||||||||||||||||||||||||||
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ASSETS UNDER MANAGEMENT | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Quarters | % Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in billions) | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Assets Under Management | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| By Asset Class and Investment Approach: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Active | $ | 60 | $ | 59 | $ | 53 | $ | 47 | $ | 51 | $ | 51 | $ | 54 | 1.9 | % | 5.9 | % | ||||||||||||||||||||||||||||||||||||||||||
| Passive | 2,152 | 2,287 | 2,161 | 2,466 | 2,661 | 2,708 | 2,923 | 35.3 | 7.9 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Equity | 2,212 | 2,346 | 2,214 | 2,513 | 2,712 | 2,759 | 2,977 | 34.5 | 7.9 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Fixed-Income: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Active | 85 | 84 | 80 | 71 | 27 | 28 | 30 | (62.5) | 7.1 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Passive | 490 | 505 | 506 | 538 | 551 | 555 | 593 | 17.2 | 6.8 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Fixed-Income | 575 | 589 | 586 | 609 | 578 | 583 | 623 | 6.3 | 6.9 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Cash(1) | 375 | 390 | 434 | 467 | 481 | 483 | 543 | 25.1 | 12.4 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Multi-Asset-Class Solutions: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Active | 28 | 25 | 20 | 21 | 23 | 22 | 23 | 15.0 | 4.5 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Passive | 203 | 220 | 222 | 289 | 312 | 327 | 352 | 58.6 | 7.6 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Multi-Asset-Class Solutions | 231 | 245 | 242 | 310 | 335 | 349 | 375 | 55.0 | 7.4 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Alternative Investments(2): | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Active | 35 | 36 | 21 | 11 | 11 | 10 | 10 | (52.4) | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Passive(3) | 185 | 181 | 175 | 192 | 182 | 185 | 204 | 16.6 | 10.3 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Alternative Investments | 220 | 217 | 196 | 203 | 193 | 195 | 214 | 9.2 | 9.7 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Assets Under Management | $ | 3,613 | $ | 3,787 | $ | 3,672 | $ | 4,102 | $ | 4,299 | $ | 4,369 | $ | 4,732 | 28.9 | 8.3 | ||||||||||||||||||||||||||||||||||||||||||||
| By Geographic Location(4): | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Americas | $ | 2,648 | $ | 2,784 | $ | 2,702 | $ | 3,028 | $ | 3,154 | $ | 3,195 | $ | 3,448 | 27.6 | 7.9 | ||||||||||||||||||||||||||||||||||||||||||||
| Europe/Middle East/Africa | 516 | 544 | 519 | 577 | 635 | 665 | 728 | 40.3 | 9.5 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Asia-Pacific | 449 | 459 | 451 | 497 | 510 | 509 | 556 | 23.3 | 9.2 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Assets Under Management | $ | 3,613 | $ | 3,787 | $ | 3,672 | $ | 4,102 | $ | 4,299 | $ | 4,369 | $ | 4,732 | 28.9 | 8.3 | ||||||||||||||||||||||||||||||||||||||||||||
| (1) Includes both floating- and constant-net-asset-value portfolios held in commingled structures or separate accounts. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (2) Includes real estate investment trusts, currency and commodities, including SPDR® Gold Shares and SPDR® Gold MiniSharesSM Trust. We are not the investment manager for the SPDR® Gold Shares and SPDR®Gold MiniSharesSM Trust, but act as the marketing agent. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (3) AUM for passive alternative investments has been revised from prior presentations. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (4) Geographic mix is based on client location or fund management location. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Exchange-Traded Funds(1) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| By Asset Class: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Alternative Investments(2) | $ | 73 | $ | 70 | $ | 66 | $ | 73 | $ | 74 | $ | 77 | $ | 91 | 37.9 | % | 18.2 | % | ||||||||||||||||||||||||||||||||||||||||||
| Equity | 841 | 919 | 886 | 1,038 | 1,131 | 1,157 | 1,253 | 41.4 | 8.3 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Fixed-Income | 141 | 142 | 142 | 156 | 155 | 159 | 171 | 20.4 | 7.5 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Multi-Asset | 1 | 1 | 1 | 1 | 1 | 1 | 1 | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Exchange-Traded Funds | $ | 1,056 | $ | 1,132 | $ | 1,095 | $ | 1,268 | $ | 1,361 | $ | 1,394 | $ | 1,516 | 38.4 | 8.8 | ||||||||||||||||||||||||||||||||||||||||||||
| (1) Exchange-traded funds are a component of assets under management presented above. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (2) Includes real estate investment trusts, currency and commodities, including SPDR® Gold Shares and SPDR® Gold MiniSharesSM Trust. We are not the investment manager for the SPDR® Gold Shares and SPDR®Gold MiniSharesSM Trust, but act as the marketing agent. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| STATE STREET CORPORATION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| LINE OF BUSINESS INFORMATION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Three Months Ended, | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Investment Servicing | % Change | Investment Management | % Change | Other(1) | % Change | Total | % Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 3Q23 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | 3Q23 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | 3Q23 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | 3Q23 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | ||||||||||||||||||||||||||||||||||||||||
| Servicing fees | $ | 1,234 | $ | 1,239 | $ | 1,266 | 2.6 | % | 2.2 | % | $ | — | $ | — | $ | — | — | % | — | % | $ | — | $ | — | $ | — | — | % | — | % | $ | 1,234 | $ | 1,239 | $ | 1,266 | 2.6 | % | 2.2 | % | ||||||||||||||||||||
| Management fees | — | — | — | — | — | 479 | 511 | 527 | 10.0 | 3.1 | — | — | — | — | — | 479 | 511 | 527 | 10.0 | 3.1 | ||||||||||||||||||||||||||||||||||||||||
| Foreign exchange trading services | 278 | 304 | 312 | 12.2 | 2.6 | 35 | 32 | 47 | 34.3 | 46.9 | — | — | 15 | nm | nm | 313 | 336 | 374 | 19.5 | 11.3 | ||||||||||||||||||||||||||||||||||||||||
| Securities finance | 98 | 101 | 111 | 13.3 | 9.9 | 5 | 7 | 5 | — | (28.6) | — | — | — | — | — | 103 | 108 | 116 | 12.6 | 7.4 | ||||||||||||||||||||||||||||||||||||||||
| Software and processing fees | 188 | 214 | 208 | 10.6 | (2.8) | — | — | — | — | — | — | — | — | — | — | 188 | 214 | 208 | 10.6 | (2.8) | ||||||||||||||||||||||||||||||||||||||||
| Other fee revenue | 41 | 36 | 48 | 17.1 | 33.3 | 3 | 12 | 11 | nm | (8.3) | — | — | 66 | nm | nm | 44 | 48 | 125 | nm | nm | ||||||||||||||||||||||||||||||||||||||||
| Total fee revenue | 1,839 | 1,894 | 1,945 | 5.8 | 2.7 | 522 | 562 | 590 | 13.0 | 5.0 | — | — | 81 | nm | nm | 2,361 | 2,456 | 2,616 | 10.8 | 6.5 | ||||||||||||||||||||||||||||||||||||||||
| Net interest income | 620 | 730 | 716 | 15.5 | (1.9) | 4 | 5 | 7 | 75.0 | 40.0 | — | — | — | — | — | 624 | 735 | 723 | 15.9 | (1.6) | ||||||||||||||||||||||||||||||||||||||||
| Total other income | — | — | 1 | nm | nm | — | — | — | — | — | (294) | — | (81) | 72.4 | nm | (294) | — | (80) | 72.8 | nm | ||||||||||||||||||||||||||||||||||||||||
| Total revenue | 2,459 | 2,624 | 2,662 | 8.3 | 1.4 | 526 | 567 | 597 | 13.5 | 5.3 | (294) | — | — | nm | nm | 2,691 | 3,191 | 3,259 | 21.1 | 2.1 | ||||||||||||||||||||||||||||||||||||||||
| Provision for credit losses | — | 10 | 26 | — | nm | — | — | — | — | — | — | — | — | — | — | — | 10 | 26 | — | nm | ||||||||||||||||||||||||||||||||||||||||
| Total expenses | 1,798 | 1,880 | 1,891 | 5.2 | 0.6 | 379 | 388 | 417 | 10.0 | 7.5 | 3 | 1 | — | nm | nm | 2,180 | 2,269 | 2,308 | 5.9 | 1.7 | ||||||||||||||||||||||||||||||||||||||||
| Income before income tax expense | $ | 661 | $ | 734 | $ | 745 | 12.7 | 1.5 | $ | 147 | $ | 179 | $ | 180 | 22.4 | 0.6 | $ | (297) | $ | (1) | $ | — | nm | nm | $ | 511 | $ | 912 | $ | 925 | 81.0 | 1.4 | ||||||||||||||||||||||||||||
| Pre-tax margin | 26.9 | % | 28.0 | % | 28.0 | % | 1.1 | % | — | % | pts | 27.9 | % | 31.6 | % | 30.2 | % | 2.3 | % | (1.4) | % | pts | 19.0 | % | 28.6 | % | 28.4 | % | 9.4 | % | (0.2) | % | pts | |||||||||||||||||||||||||||
| Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Investment Servicing | % Change | Investment Management | % Change | Other(1) | % Change | Total | % Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 2023 | 2024 | YTD2024<br>vs.<br>YTD2023 | 2023 | 2024 | YTD2024<br>vs.<br>YTD2023 | 2023 | 2024 | YTD2024<br>vs.<br>YTD2023 | 2023 | 2024 | YTD2024<br>vs.<br>YTD2023 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Servicing fees | $ | 3,710 | $ | 3,733 | 0.6 | % | $ | — | $ | — | —% | $ | — | $ | — | — | % | $ | 3,710 | $ | 3,733 | 0.6 | % | |||||||||||||||||||||||||||||||||||||
| Management fees | — | — | — | 1,397 | 1,548 | 10.8 | — | — | — | 1,397 | 1,548 | 10.8 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign exchange trading services | 875 | 924 | 5.6 | 83 | 102 | 22.9 | — | 15 | nm | 958 | 1,041 | 8.7 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Securities finance | 310 | 302 | (2.6) | 19 | 18 | (5.3) | — | — | — | 329 | 320 | (2.7) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Software and processing fees | 574 | 629 | 9.6 | — | — | — | — | — | — | 574 | 629 | 9.6 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Other fee revenue | 124 | 127 | 2.4 | 23 | 30 | 30.4 | — | 66 | nm | 147 | 223 | 51.7 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Total fee revenue | 5,593 | 5,715 | 2.2 | 1,522 | 1,698 | 11.6 | — | 81 | nm | 7,115 | 7,494 | 5.3 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Net interest income | 2,069 | 2,157 | 4.3 | 12 | 17 | 41.7 | — | — | — | 2,081 | 2,174 | 4.5 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Total other income | — | 1 | nm | — | — | — | (294) | (81) | 72.4 | (294) | (80) | 72.8 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Total revenue | 7,662 | 7,873 | 2.8 | 1,534 | 1,715 | 11.8 | (294) | — | nm | 8,902 | 9,588 | 7.7 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Provision for loan losses | 26 | 63 | nm | — | — | — | — | — | — | 26 | 63 | nm | ||||||||||||||||||||||||||||||||||||||||||||||||
| Total expenses | 5,626 | 5,734 | 1.9 | 1,126 | 1,225 | 8.8 | 9 | 131 | nm | 6,761 | 7,090 | 4.9 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Income before income tax expense | $ | 2,010 | $ | 2,076 | 3.3 | $ | 408 | $ | 490 | 20.1 | $ | (303) | $ | (131) | nm | $ | 2,115 | $ | 2,435 | 15.1 | ||||||||||||||||||||||||||||||||||||||||
| Pre-tax margin | 26.2 | % | 26.4 | % | 0.2 | % | pts | 26.6 | % | 28.6 | % | 2.0 | % | pts | 23.8 | % | 25.4 | % | 1.6 | % | pts | |||||||||||||||||||||||||||||||||||||||
| (1) Represents amounts that are not allocated to a specific line of business, including repositioning charges, employee costs, acquisition costs, revenue-related recoveries and certain legal accruals. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| nm Denotes not meaningful | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| STATE STREET CORPORATION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||||||||||||||||||
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| REGULATORY CAPITAL | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Basel III Advanced Approaches(1) | Basel III Standardized Approach(2) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | ||||||||||||||||||||||||||||||||||||||||||||||
| Ratios and Supporting Calculations: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common equity tier 1 capital | $ | 14,029 | $ | 13,496 | $ | 13,004 | $ | 12,971 | $ | 13,167 | $ | 13,346 | $ | 14,071 | $ | 14,029 | $ | 13,496 | $ | 13,004 | $ | 12,971 | $ | 13,167 | $ | 13,346 | $ | 14,071 | ||||||||||||||||||||||||||||||||
| Total risk-weighted assets | 108,296 | 106,521 | 106,846 | 107,453 | 112,161 | 111,224 | 112,795 | 115,582 | 114,022 | 118,008 | 111,703 | 118,613 | 119,244 | 121,137 | ||||||||||||||||||||||||||||||||||||||||||||||
| Common equity tier 1 risk-based capital ratio | 13.0 | % | 12.7 | % | 12.2 | % | 12.1 | % | 11.7 | % | 12.0 | % | 12.5 | % | 12.1 | % | 11.8 | % | 11.0 | % | 11.6 | % | 11.1 | % | 11.2 | % | 11.6 | % | ||||||||||||||||||||||||||||||||
| Tier 1 capital | $ | 16,005 | $ | 15,472 | $ | 14,980 | $ | 14,947 | $ | 15,635 | $ | 15,814 | $ | 16,887 | $ | 16,005 | $ | 15,472 | $ | 14,980 | $ | 14,947 | $ | 15,635 | $ | 15,814 | $ | 16,887 | ||||||||||||||||||||||||||||||||
| Tier 1 risk-based capital ratio | 14.8 | % | 14.5 | % | 14.0 | % | 13.9 | % | 13.9 | % | 14.2 | % | 15.0 | % | 13.8 | % | 13.6 | % | 12.7 | % | 13.4 | % | 13.2 | % | 13.3 | % | 13.9 | % | ||||||||||||||||||||||||||||||||
| Total capital | $ | 17,374 | $ | 16,854 | $ | 16,357 | $ | 16,817 | $ | 17,504 | $ | 17,682 | $ | 18,754 | $ | 17,535 | $ | 16,982 | $ | 16,488 | $ | 16,967 | $ | 17,650 | $ | 17,827 | $ | 18,925 | ||||||||||||||||||||||||||||||||
| Total risk-based capital ratio | 16.0 | % | 15.8 | % | 15.3 | % | 15.7 | % | 15.6 | % | 15.9 | % | 16.6 | % | 15.2 | % | 14.9 | % | 14.0 | % | 15.2 | % | 14.9 | % | 15.0 | % | 15.6 | % | ||||||||||||||||||||||||||||||||
| Tier 1 capital | $ | 16,005 | $ | 15,472 | $ | 14,980 | $ | 14,947 | $ | 15,635 | $ | 15,814 | $ | 16,887 | $ | 16,005 | $ | 15,472 | $ | 14,980 | $ | 14,947 | $ | 15,635 | $ | 15,814 | $ | 16,887 | ||||||||||||||||||||||||||||||||
| Leverage exposure(3) | 268,747 | 266,240 | 259,086 | 269,807 | 289,772 | 297,350 | 305,699 | 268,747 | 266,240 | 259,086 | 269,807 | 289,772 | 297,350 | 305,699 | ||||||||||||||||||||||||||||||||||||||||||||||
| Tier 1 leverage ratio | 6.0 | % | 5.8 | % | 5.8 | % | 5.5 | % | 5.4 | % | 5.3 | % | 5.5 | % | 6.0 | % | 5.8 | % | 5.8 | % | 5.5 | % | 5.4 | % | 5.3 | % | 5.5 | % | ||||||||||||||||||||||||||||||||
| On-and off-balance sheet leverage exposure | $ | 244,049 | $ | 249,353 | $ | 246,948 | $ | 248,371 | $ | 249,668 | $ | 261,135 | $ | 273,809 | $ | 244,049 | $ | 249,353 | $ | 246,948 | $ | 248,371 | $ | 249,668 | $ | 261,135 | $ | 273,809 | ||||||||||||||||||||||||||||||||
| Less: regulatory deductions | (8,745) | (8,732) | (8,641) | (8,852) | (8,798) | (8,948) | (8,941) | (8,745) | (8,732) | (8,641) | (8,852) | (8,798) | (8,948) | (8,941) | ||||||||||||||||||||||||||||||||||||||||||||||
| Total leverage exposure for SLR | 235,304 | 240,621 | 238,307 | 239,519 | 240,870 | 252,187 | 264,868 | 235,304 | 240,621 | 238,307 | 239,519 | 240,870 | 252,187 | 264,868 | ||||||||||||||||||||||||||||||||||||||||||||||
| Supplementary leverage ratio(4) | 6.8 | % | 6.4 | % | 6.3 | % | 6.2 | % | 6.5 | % | 6.3 | % | 6.4 | % | 6.8 | % | 6.4 | % | 6.3 | % | 6.2 | % | 6.5 | % | 6.3 | % | 6.4 | % | ||||||||||||||||||||||||||||||||
| (1) CET1, tier 1 capital, total capital and tier 1 leverage ratios for each period above were calculated in conformity with the advanced approaches provisions of the Basel III final rule. Capital ratios as of September 30, 2024 are estimates. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (2) CET1, tier 1 capital, total capital and tier 1 leverage ratios for each period above were calculated in conformity with the standardized approach provisions of the Basel III final rule. Capital ratios as of September 30, 2024 are estimates. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (3) Leverage exposure is equal to average consolidated total assets less applicable Tier 1 capital deductions. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (4) We are subject to a minimum Supplementary Leverage Ratio or SLR of 3%, and as a U.S. G-SIB, we must maintain a 2% SLR buffer in order to avoid any limitations on distributions to shareholders and discretionary bonus payments to certain executives. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| STATE STREET CORPORATION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||||||||||||||||||||||||||||
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| RECONCILIATIONS OF TANGIBLE BOOK VALUE PER SHARE AND RETURN ON TANGIBLE COMMON EQUITY | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| The tangible book value per common share (TBVPS) and return on average tangible common equity (ROTCE) are ratios that management believes provides context about State Street's use of equity. The TBVPS ratio is calculated by dividing the period end tangible common equity by total common shares outstanding. The ROTCE ratio is calculated by dividing annualized net income available to common shareholders for the relevant period by average tangible common equity. Period end and average tangible common equity reflected in the TBVPS and ROTCE ratios, are both non-GAAP measures which reduce period end and average common shareholders' equity, by period end and average goodwill and other intangible assets, net of related deferred taxes. Since there is no authoritative requirement to calculate the TBVPS and ROTCE ratios, our TBVPS and ROTCE ratios are not necessarily comparable to similar measures disclosed or used by other companies in the financial services industry. TBVPS and ROTCE are non-GAAP financial measures and should be considered in addition to, not as a substitute for or superior to, financial measures determined in accordance with GAAP or other applicable requirements. Reconciliations with respect to the calculation of these ratios are presented below. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Quarters | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions, except per share amounts, or where otherwise noted) | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Tangible common equity - period end: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total shareholders' equity | $ | 24,750 | $ | 24,204 | $ | 23,621 | $ | 23,799 | $ | 24,433 | $ | 24,762 | $ | 25,828 | ||||||||||||||||||||||||||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Preferred stock | 1,976 | 1,976 | 1,976 | 1,976 | 2,468 | 2,468 | 2,816 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common shareholders' equity | 22,774 | 22,228 | 21,645 | 21,823 | 21,965 | 22,294 | 23,012 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Goodwill | 7,530 | 7,544 | 7,487 | 7,611 | 7,582 | 7,751 | 7,833 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Other intangible assets | 1,493 | 1,435 | 1,363 | 1,320 | 1,258 | 1,209 | 1,166 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Plus related deferred tax liabilities | 496 | 499 | 497 | 461 | 460 | 461 | 467 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Tangible common shareholders' equity - Non-GAAP | $ | 14,247 | $ | 13,748 | $ | 13,292 | $ | 13,353 | $ | 13,585 | $ | 13,795 | $ | 14,480 | ||||||||||||||||||||||||||||||||||||||||||||||
| Total common shares outstanding - period end (in thousands) | 336,461 | 322,101 | 308,584 | 301,944 | 301,504 | 299,231 | 294,191 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Book value per common share | $ | 67.69 | $ | 69.01 | $ | 70.14 | $ | 72.27 | $ | 72.85 | $ | 74.50 | $ | 78.22 | ||||||||||||||||||||||||||||||||||||||||||||||
| Tangible book value per common share - Non-GAAP | 42.34 | 42.68 | 43.07 | 44.22 | 45.06 | 46.10 | 49.22 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Quarters | Year-to-Date | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions, except where otherwise noted) | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | 2023 | 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Tangible common equity - average: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Average common shareholders' equity | $ | 22,875 | $ | 22,409 | $ | 21,750 | $ | 21,783 | $ | 21,850 | $ | 22,061 | $ | 22,691 | $ | 22,341 | $ | 22,203 | ||||||||||||||||||||||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Average goodwill | 7,505 | 7,536 | 7,540 | 7,561 | 7,589 | 7,750 | 7,798 | 7,527 | 7,712 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Average other intangible assets | 1,516 | 1,462 | 1,402 | 1,336 | 1,287 | 1,230 | 1,187 | 1,460 | 1,235 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Plus related deferred tax liabilities | 495 | 497 | 498 | 479 | 460 | 460 | 464 | 497 | 462 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Average tangible common shareholders' equity - Non-GAAP | $ | 14,349 | $ | 13,908 | $ | 13,306 | $ | 13,365 | $ | 13,434 | $ | 13,541 | $ | 14,170 | $ | 13,851 | $ | 13,718 | ||||||||||||||||||||||||||||||||||||||||||
| Net income available to common shareholders | $ | 525 | $ | 726 | $ | 398 | $ | 172 | $ | 418 | $ | 655 | $ | 682 | $ | 1,649 | $ | 1,755 | ||||||||||||||||||||||||||||||||||||||||||
| Net income available to common shareholders, excluding notable items(1) | 525 | 726 | 613 | 636 | 517 | 655 | 682 | 1,864 | 1,854 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Return on average tangible common equity - Non-GAAP(2) | 14.6 | % | 20.9 | % | 12.0 | % | 5.1 | % | 12.4 | % | 19.3 | % | 19.3 | % | 15.9 | % | 17.1 | % | ||||||||||||||||||||||||||||||||||||||||||
| Return on average tangible common equity, excluding notable items - Non-GAAP(2)(3) | 14.6 | 20.9 | 18.4 | 19.0 | 15.4 | 19.3 | 19.3 | 17.9 | 18.0 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| (1) Refer to Reconciliations of non-GAAP Financial Information pages for a reconciliation of net income available to common shareholders, excluding notable items. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (2) Beginning in the third quarter of 2024, quarterly annualized net income available to common shareholders is utilized in the quarterly ROTCE calculation as compared to year-to-date annualized net income available to common shareholders utilized in prior quarters. Prior quarterly periods have been revised to conform to the current presentation. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (3) Return on average tangible common equity, excluding notable items - non-GAAP is calculated by dividing annualized net income available to common shareholders, excluding notable items for the relevant period by average tangible common equity. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| STATE STREET CORPORATION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |||||||||||||||||||||||||||||
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| RECONCILIATIONS OF NON-GAAP FINANCIAL INFORMATION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| In addition to presenting State Street's financial results in conformity with U.S. generally accepted accounting principles, or GAAP, management also presents certain financial information on a basis that excludes or adjusts one or more items from GAAP. This latter basis is a non-GAAP presentation. In general, our non-GAAP financial results adjust selected GAAP-basis financial results to exclude the impact of revenue and expenses outside of State Street’s normal course of business or other notable items, such as acquisition and restructuring charges, repositioning charges, gains/losses on sales, as well as, for selected comparisons, seasonal items. For example, we sometimes present expenses on a basis we may refer to as "expenses ex-notable items", which exclude notable items and, to provide additional perspective on both prior year quarter and sequential quarter comparisons, also exclude seasonal items. Management believes that this presentation of financial information facilitates an investor's further understanding and analysis of State Street's financial performance and trends with respect to State Street’s business operations from period-to-period, including providing additional insight into our underlying margin and profitability. In addition, Management may also provide additional non-GAAP measures. For example, we present capital ratios, calculated under regulatory standards scheduled to be effective in the future or other standards, that management uses in evaluating State Street’s business and activities and believes may similarly be useful to investors. Additionally, we may present revenue and expense measures on a constant currency basis to identify the significance of changes in foreign currency exchange rates (which often are variable) in period-to-period comparisons. This presentation represents the effects of applying prior period weighted average foreign currency exchange rates to current period results. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Non-GAAP financial measures should be considered in addition to, not as a substitute for or superior to, financial measures determined in conformity with GAAP. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Quarters | % Change | Year-to-Date | % Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions) | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | 2023 | 2024 | YTD2024<br> vs. <br>YTD2023 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Fee Revenue: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total fee revenue, GAAP-basis | $ | 2,335 | $ | 2,419 | $ | 2,361 | $ | 2,365 | $ | 2,422 | $ | 2,456 | $ | 2,616 | 10.8 | % | 6.5 | % | $ | 7,115 | $ | 7,494 | 5.3 | % | ||||||||||||||||||||||||||||||||||||
| Less: Notable items: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign exchange trading services(1) | — | — | — | — | — | — | (15) | nm | nm | — | (15) | nm | ||||||||||||||||||||||||||||||||||||||||||||||||
| Other fee revenue(2) | — | — | — | — | — | — | (66) | nm | nm | — | (66) | nm | ||||||||||||||||||||||||||||||||||||||||||||||||
| Total fee revenue, excluding notable items | $ | 2,335 | $ | 2,419 | $ | 2,361 | $ | 2,365 | $ | 2,422 | $ | 2,456 | $ | 2,535 | 7.4 | 3.2 | $ | 7,115 | $ | 7,413 | 4.2 | |||||||||||||||||||||||||||||||||||||||
| Total Revenue: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total revenue, GAAP-basis | $ | 3,101 | $ | 3,110 | $ | 2,691 | $ | 3,043 | $ | 3,138 | $ | 3,191 | $ | 3,259 | 21.1 | % | 2.1 | % | $ | 8,902 | $ | 9,588 | 7.7 | % | ||||||||||||||||||||||||||||||||||||
| Less: Notable items: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign exchange trading services(1) | — | — | — | — | — | — | (15) | nm | nm | — | (15) | nm | ||||||||||||||||||||||||||||||||||||||||||||||||
| Other fee revenue(2) | — | — | — | — | — | — | (66) | nm | nm | — | (66) | nm | ||||||||||||||||||||||||||||||||||||||||||||||||
| (Gains) losses related to investment securities, net(3) | — | — | 294 | — | — | — | 81 | (72.4) | — | 294 | 81 | (72.4) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Total revenue, excluding notable items | $ | 3,101 | $ | 3,110 | $ | 2,985 | $ | 3,043 | $ | 3,138 | $ | 3,191 | $ | 3,259 | 9.2 | 2.1 | $ | 9,196 | $ | 9,588 | 4.3 | |||||||||||||||||||||||||||||||||||||||
| Expenses: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total expenses, GAAP-basis | $ | 2,369 | $ | 2,212 | $ | 2,180 | $ | 2,822 | $ | 2,513 | $ | 2,269 | $ | 2,308 | 5.9 | % | 1.7 | % | $ | 6,761 | $ | 7,090 | 4.9 | % | ||||||||||||||||||||||||||||||||||||
| Less: Notable items: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Acquisition and restructuring costs(4) | — | — | — | 15 | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
| Repositioning charges(5) | — | — | — | (203) | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
| FDIC special assessment(6) | — | — | — | (387) | (130) | — | — | — | — | — | (130) | nm | ||||||||||||||||||||||||||||||||||||||||||||||||
| Other notable items(7) | — | — | — | (45) | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
| Total expenses, excluding notable items | 2,369 | 2,212 | 2,180 | 2,202 | 2,383 | 2,269 | 2,308 | 5.9 | 1.7 | 6,761 | 6,960 | 2.9 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Seasonal expenses | (181) | — | — | — | (162) | — | — | — | nm | (181) | (162) | (10.5) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Total expenses, excluding notable items and seasonal expenses | $ | 2,188 | $ | 2,212 | $ | 2,180 | $ | 2,202 | $ | 2,221 | $ | 2,269 | $ | 2,308 | 5.9 | 1.7 | $ | 6,580 | $ | 6,798 | 3.3 | |||||||||||||||||||||||||||||||||||||||
| Fee Operating Leverage, GAAP-Basis: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total fee revenue, GAAP-basis | $ | 2,335 | $ | 2,419 | $ | 2,361 | $ | 2,365 | $ | 2,422 | $ | 2,456 | $ | 2,616 | 10.8 | % | 6.5 | % | $ | 7,115 | $ | 7,494 | 5.3 | % | ||||||||||||||||||||||||||||||||||||
| Total expenses, GAAP-basis | 2,369 | 2,212 | 2,180 | 2,822 | 2,513 | 2,269 | 2,308 | 5.9 | 1.7 | 6,761 | 7,090 | 4.9 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Fee operating leverage, GAAP-basis(8) | 4.9 | % | pts | 4.8 | % | pts | 0.4 | % | pts | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Fee Operating Leverage, excluding notable items: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total fee revenue, excluding notable items (as reconciled above) | $ | 2,335 | $ | 2,419 | $ | 2,361 | $ | 2,365 | $ | 2,422 | $ | 2,456 | $ | 2,535 | 7.4 | % | 3.2 | % | $ | 7,115 | $ | 7,413 | 4.2 | % | ||||||||||||||||||||||||||||||||||||
| Total expenses, excluding notable items (as reconciled above) | 2,369 | 2,212 | 2,180 | 2,202 | 2,383 | 2,269 | 2,308 | 5.9 | 1.7 | 6,761 | 6,960 | 2.9 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Fee operating leverage, excluding notable items(9) | 1.5 | % | pts | 1.5 | % | pts | 1.3 | % | pts | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Operating Leverage, GAAP-Basis: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total revenue, GAAP-basis | $ | 3,101 | $ | 3,110 | $ | 2,691 | $ | 3,043 | $ | 3,138 | $ | 3,191 | $ | 3,259 | 21.1 | % | 2.1 | % | $ | 8,902 | $ | 9,588 | 7.7 | % | ||||||||||||||||||||||||||||||||||||
| Total expenses, GAAP-basis | 2,369 | 2,212 | 2,180 | 2,822 | 2,513 | 2,269 | 2,308 | 5.9 | 1.7 | 6,761 | 7,090 | 4.9 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Operating leverage, GAAP-basis(10) | 15.2 | % | pts | 0.4 | % | pts | 2.8 | % | pts | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Operating Leverage, excluding notable items: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total revenue, excluding notable items (as reconciled above) | $ | 3,101 | $ | 3,110 | $ | 2,985 | $ | 3,043 | $ | 3,138 | $ | 3,191 | $ | 3,259 | 9.2 | % | 2.1 | % | $ | 9,196 | $ | 9,588 | 4.3 | % | ||||||||||||||||||||||||||||||||||||
| Total expenses, excluding notable items (as reconciled above) | 2,369 | 2,212 | 2,180 | 2,202 | 2,383 | 2,269 | 2,308 | 5.9 | 1.7 | 6,761 | 6,960 | 2.9 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Operating leverage, excluding notable items(11) | 3.3 | % | pts | 0.4 | % | pts | 1.4 | % | pts | |||||||||||||||||||||||||||||||||||||||||||||||||||
| STATE STREET CORPORATION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||||||||||||||||||||||||||||||
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| RECONCILIATIONS OF NON-GAAP FINANCIAL INFORMATION (Continued) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Quarters | % Change | Year-to-Date | % Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions, except earnings per share, or where otherwise noted) | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | 2023 | 2024 | YTD2024<br> vs. <br>YTD2023 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Income before income tax expense: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Income before income tax expense GAAP-basis | A | $ | 688 | $ | 916 | $ | 511 | $ | 201 | $ | 598 | $ | 912 | $ | 925 | 81.0 | % | 1.4% | $ | 2,115 | $ | 2,435 | 15.1 | % | ||||||||||||||||||||||||||||||||||||
| Less: Notable items | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign exchange trading services(1) | — | — | — | — | — | — | (15) | — | (15) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other fee revenue(2) | — | — | — | — | — | — | (66) | — | (66) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| (Gains) losses related to investment securities, net(3) | — | — | 294 | — | — | — | 81 | 294 | 81 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Acquisition and restructuring costs(4) | — | — | — | (15) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Repositioning charges(5) | — | — | — | 203 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| FDIC special assessment(6) | — | — | — | 387 | 130 | — | — | — | 130 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other notable items(7) | — | — | — | 45 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Income before income tax expense, excluding notable items | B | $ | 688 | $ | 916 | $ | 805 | $ | 821 | $ | 728 | $ | 912 | $ | 925 | 14.9 | % | 1.4 | % | $ | 2,409 | $ | 2,565 | 6.5 | ||||||||||||||||||||||||||||||||||||
| Net Income: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net Income GAAP-basis | $ | 549 | $ | 763 | $ | 422 | $ | 210 | $ | 463 | $ | 711 | $ | 730 | 73.0 | % | 2.7% | $ | 1,734 | $ | 1,904 | 9.8 | % | |||||||||||||||||||||||||||||||||||||
| Less: Notable items | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign exchange trading services(1) | — | — | — | — | — | — | (15) | — | (15) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other fee revenue(2) | — | — | — | — | — | — | (66) | — | (66) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| (Gains) losses related to investment securities, net(3) | — | — | 294 | — | — | — | 81 | 294 | 81 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Acquisition and restructuring costs(4) | — | — | — | (15) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Repositioning charges(5) | — | — | — | 203 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| FDIC special assessment(6) | — | — | — | 387 | 130 | — | — | — | 130 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other notable items(7) | — | — | — | 45 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Tax impact of notable items | — | — | (79) | (156) | (31) | — | — | (79) | (31) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Net Income, excluding notable items | $ | 549 | $ | 763 | $ | 637 | $ | 674 | $ | 562 | $ | 711 | $ | 730 | 14.6 | % | 2.7 | % | $ | 1,949 | $ | 2,003 | 2.8 | |||||||||||||||||||||||||||||||||||||
| Net Income Available to Common Shareholders: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net Income Available to Common Shareholders, GAAP-basis | $ | 525 | $ | 726 | $ | 398 | $ | 172 | $ | 418 | $ | 655 | $ | 682 | 71.4 | % | 4.1% | $ | 1,649 | $ | 1,755 | 6.4 | % | |||||||||||||||||||||||||||||||||||||
| Less: Notable items | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign exchange trading services(1) | — | — | — | — | — | — | (15) | — | (15) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other fee revenue(2) | — | — | — | — | — | — | (66) | — | (66) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| (Gains) losses related to investment securities, net(3) | — | — | 294 | — | — | — | 81 | 294 | 81 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Acquisition and restructuring costs(4) | — | — | — | (15) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Repositioning charges(5) | — | — | — | 203 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| FDIC special assessment(6) | — | — | — | 387 | 130 | — | — | — | 130 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other notable items(7) | — | — | — | 45 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Tax impact of notable items | — | — | (79) | (156) | (31) | — | — | (79) | (31) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Net Income Available to Common Shareholders, excluding notable items | $ | 525 | $ | 726 | $ | 613 | $ | 636 | $ | 517 | $ | 655 | $ | 682 | 11.3 | % | 4.1 | % | $ | 1,864 | $ | 1,854 | (0.5) | |||||||||||||||||||||||||||||||||||||
| Diluted Earnings per Share: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Diluted earnings per share, GAAP-basis | $ | 1.52 | $ | 2.17 | $ | 1.25 | $ | 0.55 | $ | 1.37 | $ | 2.15 | $ | 2.26 | 80.8 | % | 5.1% | $ | 4.97 | $ | 5.77 | 16.1 | % | |||||||||||||||||||||||||||||||||||||
| Less: Notable items | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign exchange trading services(1) | — | — | — | — | — | — | (0.04) | — | (0.04) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other fee revenue(2) | — | — | — | — | — | — | (0.16) | — | (0.16) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| (Gains) losses related to investment securities, net(3) | — | — | 0.68 | — | — | — | 0.20 | 0.64 | 0.20 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Acquisition and restructuring costs(4) | — | — | — | (0.04) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Repositioning charges(5) | — | — | — | 0.50 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| FDIC special assessment(6) | — | — | — | 0.94 | 0.32 | — | — | — | 0.32 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other notable items(7) | — | — | — | 0.09 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Diluted earnings per share, excluding notable items | $ | 1.52 | $ | 2.17 | $ | 1.93 | $ | 2.04 | $ | 1.69 | $ | 2.15 | $ | 2.26 | 17.1 | % | 5.1 | % | $ | 5.61 | $ | 6.09 | 8.6 | |||||||||||||||||||||||||||||||||||||
| STATE STREET CORPORATION | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||||||||||||||||||||||||||||
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| RECONCILIATIONS OF NON-GAAP FINANCIAL INFORMATION (Continued) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| % Change | Year-to-Date | % Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (Dollars in millions, except earnings per share, or where otherwise noted) | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | 2Q24 | 3Q24 | 3Q24<br> vs. <br>3Q23 | 3Q24<br> vs. <br>2Q24 | 2023 | 2024 | YTD2024<br> vs. <br>YTD2023 | ||||||||||||||||||||||||||||||||||||||||||||||||
| Pre-tax Margin: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Pre-tax margin, GAAP-basis | 22.2 | % | 29.5 | % | 19.0 | % | 6.6 | % | 19.1 | % | 28.6 | % | 28.4 | % | 9.4 | % | pts | (0.2) | % | pts | 23.8 | % | 25.4 | % | 1.6 | % | pts | |||||||||||||||||||||||||||||||||
| Less: Notable items | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign exchange trading services(1) | — | — | — | — | — | — | (0.3) | — | (0.2) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other fee revenue(2) | — | — | — | — | — | — | (1.1) | — | (0.7) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| (Gains) losses related to investment securities, net(3) | — | — | 8.0 | — | — | — | 1.4 | 2.4 | 0.9 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Acquisition and restructuring costs(4) | — | — | — | (0.5) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Repositioning charges(5) | — | — | — | 6.7 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| FDIC special assessment(6) | — | — | — | 12.7 | 4.1 | — | — | — | 1.4 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other notable items(7) | — | — | — | 1.5 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Pre-tax margin, excluding notable items | 22.2 | % | 29.5 | % | 27.0 | % | 27.0 | % | 23.2 | % | 28.6 | % | 28.4 | % | 1.4 | (0.2) | 26.2 | % | 26.8 | % | 0.6 | |||||||||||||||||||||||||||||||||||||||
| Return on Average Common Equity: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Return on average common equity, GAAP-basis | 9.3 | % | 13.0 | % | 7.3 | % | 3.1 | % | 7.7 | % | 11.9 | % | 12.0 | % | 4.7 | % | pts | 0.1 | % | pts | 9.9 | % | 10.6 | % | 0.7 | % | pts | |||||||||||||||||||||||||||||||||
| Less: Notable items | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign exchange trading services(1) | — | — | — | — | — | — | (0.3) | — | (0.1) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other fee revenue(2) | — | — | — | — | — | — | (1.1) | — | (0.4) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| (Gains) losses related to investment securities, net(3) | — | — | 5.4 | — | — | — | 1.4 | 1.8 | 0.5 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Acquisition and restructuring costs(4) | — | — | — | (0.3) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Repositioning charges(5) | — | — | — | 3.7 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| FDIC special assessment(6) | — | — | — | 7.0 | 2.4 | — | — | — | 0.8 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other notable items(7) | — | — | — | 0.9 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Tax impact of notable items | — | — | (1.5) | (2.8) | (0.6) | — | — | (0.5) | (0.2) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Return on average common equity, excluding notable items | 9.3 | % | 13.0 | % | 11.2 | % | 11.6 | % | 9.5 | % | 11.9 | % | 12.0 | % | 0.8 | 0.1 | 11.2 | % | 11.2 | % | — | |||||||||||||||||||||||||||||||||||||||
| Effective Tax Rate: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Effective tax rate, GAAP-basis | 20.2 | % | 16.7 | % | 17.4 | % | (4.4) | % | 22.5 | % | 22.1 | % | 21.1 | % | 3.7 | % | pts | (1.0) | % | pts | 18.0 | % | 21.8 | % | 3.8 | % | pts | |||||||||||||||||||||||||||||||||
| Less: Notable items | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Foreign exchange trading services(1) | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other fee revenue(2) | — | — | — | — | — | — | (0.1) | — | (0.1) | |||||||||||||||||||||||||||||||||||||||||||||||||||
| (Gains) losses related to investment securities, net(3) | — | — | 3.5 | — | — | — | 0.1 | 1.1 | 0.1 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Acquisition and restructuring costs(4) | — | — | — | (0.5) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Repositioning charges(5) | — | — | — | 7.3 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| FDIC special assessment(6) | — | — | — | 13.9 | 0.3 | — | — | — | 0.1 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Other notable items(7) | — | — | — | 1.6 | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Effective tax rate, excluding notable items | 20.2 | % | 16.7 | % | 20.9 | % | 17.9 | % | 22.8 | % | 22.1 | % | 21.1 | % | 0.2 | (1.0) | 19.1 | % | 21.9 | % | 2.8 | |||||||||||||||||||||||||||||||||||||||
| (1) Amount in 2024 consists of a 15 million revenue-related recovery associated with the proceeds from a 2018 foreign exchange benchmark litigation resolution, which is reflected in foreign exchange trading services revenue. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (2) Amount in 2024 consists of a 66 million gain on sale of equity investment, which is reflected in other fee revenue. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (3) In 2024 and 2023, loss on the sale of investment securities of 81 million and 294 million, respectively, related to the repositioning of the investment portfolio, which is reflected in other income. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (4) Acquisition and restructuring costs related to the BBH Investor Services acquisition transaction that State Street is no longer pursuing. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (5) Amount in 2023 includes 182 million of compensation and benefits expenses related to workforce rationalization, and 21 million of occupancy charges related to real estate footprint optimization. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (6) In 2024 and 2023, FDIC special assessment of 130 million and 387 million, respectively, reflected in other expenses. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (7) Charges of 41 million in information systems and communications and 4 million, net, in other expenses, primarily associated with operating model changes. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (8) Calculated as the period-over-period change in total fee revenue less the period-over-period change in total expenses. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (9) Calculated as the period-over-period change in total fee revenue, excluding notable items less the period-over-period change in total expenses, excluding notable items. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (10) Calculated as the period-over-period change in total revenue less the period-over-period change in total expenses. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (11) Calculated as the period-over-period change in total revenue, excluding notable items less the period-over-period change in total expenses, excluding notable items. |
All values are in US Dollars.
| STATE STREET CORPORATION | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||
| RECONCILIATION OF PRE-TAX MARGIN EXCLUDING NOTABLE ITEMS | ||||||||||||||||||
| (Dollars in millions) | 2020 | 2021 | 2022 | 2023 | ||||||||||||||
| Total revenue: | ||||||||||||||||||
| Total revenue, GAAP-basis | $ | 11,703 | $ | 12,027 | $ | 12,148 | $ | 11,945 | ||||||||||
| Less: Fees revenue | — | — | (23) | — | ||||||||||||||
| Less: Total other income | — | (111) | — | — | ||||||||||||||
| Add: (Gains) losses related to investment securities, net | — | — | — | 294 | ||||||||||||||
| Total revenue, excluding notable items | 11,703 | 11,916 | 12,125 | 12,239 | ||||||||||||||
| Provision for credit losses | 88 | (33) | 20 | 46 | ||||||||||||||
| Total expenses: | ||||||||||||||||||
| Total expenses, GAAP-basis | 8,716 | 8,889 | 8,801 | 9,583 | ||||||||||||||
| Less: Notable expense items: | ||||||||||||||||||
| Acquisition and restructuring costs | (50) | (65) | (65) | 15 | ||||||||||||||
| Deferred incentive compensation expense acceleration | — | (147) | — | — | ||||||||||||||
| Legal and other | 9 | (18) | — | — | ||||||||||||||
| Repositioning (charges) / release | (133) | 3 | (70) | (203) | ||||||||||||||
| FDIC special assessment | — | — | — | (387) | ||||||||||||||
| Other notable items | — | — | — | (45) | ||||||||||||||
| Total expenses, excluding notable items | 8,542 | 8,662 | 8,666 | 8,963 | ||||||||||||||
| Income before income tax expense, excluding notable items | $ | 3,073 | $ | 3,287 | $ | 3,439 | $ | 3,230 | ||||||||||
| Income before income tax expense, GAAP-basis | $ | 2,899 | $ | 3,171 | $ | 3,327 | $ | 2,316 | ||||||||||
| Pre-tax margin, excluding notable items | 26.3 | % | 27.6 | % | 28.4 | % | 26.4 | % | ||||||||||
| Pre-tax margin, GAAP-basis | 24.8 | 26.4 | 27.4 | 19.4 | ||||||||||||||
| STATE STREET CORPORATION | ||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| EARNINGS RELEASE ADDENDUM | ||||||||||||||||||
| RECONCILIATIONS OF CONSTANT CURRENCY FX IMPACTS | ||||||||||||||||||
| GAAP-Basis QTD Comparison | Currency Translation Impact | Excluding Currency Impact | % Change Constant Currency | |||||||||||||||
| (Dollars in millions) | 2Q24 | 3Q24 | 3Q24 vs. 3Q23 | 3Q24 vs. 2Q24 | 3Q24 vs. 3Q23 | 3Q24 vs. 2Q24 | 3Q24 vs. 3Q23 | 3Q24 vs. 2Q24 | ||||||||||
| GAAP-Basis Results: | ||||||||||||||||||
| Fee revenue: | ||||||||||||||||||
| Back office services | 1,138 | $ | 1,146 | $ | 1,167 | $ | 3 | $ | 7 | $ | 1,164 | $ | 1,160 | 2.3 | % | 1.2 | % | |
| Middle office services | 93 | 99 | 1 | 1 | 98 | 98 | 2.1 | 5.4 | ||||||||||
| Servicing fees | 1,239 | 1,266 | 4 | 8 | 1,262 | 1,258 | 2.3 | 1.5 | ||||||||||
| Management fees | 511 | 527 | — | 1 | 527 | 526 | 10.0 | 2.9 | ||||||||||
| Foreign exchange trading services | 336 | 374 | — | — | 374 | 374 | 19.5 | 11.3 | ||||||||||
| Securities finance | 108 | 116 | — | — | 116 | 116 | 12.6 | 7.4 | ||||||||||
| Front office software and data | 152 | 146 | — | 1 | 146 | 145 | 12.3 | (4.6) | ||||||||||
| Lending related and other fees | 62 | 62 | — | — | 62 | 62 | 6.9 | — | ||||||||||
| Software and processing fees | 214 | 208 | — | 1 | 208 | 207 | 10.6 | (3.3) | ||||||||||
| Other fee revenue | 48 | 125 | — | — | 125 | 125 | nm | nm | ||||||||||
| Total fee revenue | 2,456 | 2,616 | 4 | 10 | 2,612 | 2,606 | 10.6 | 6.1 | ||||||||||
| Net interest income | 735 | 723 | 2 | 7 | 721 | 716 | 15.5 | (2.6) | ||||||||||
| Total other income | — | (80) | — | — | (80) | (80) | nm | nm | ||||||||||
| Total revenue | 2,691 | $ | 3,191 | $ | 3,259 | $ | 6 | $ | 17 | $ | 3,253 | $ | 3,242 | 20.9 | 1.6 | |||
| Expenses: | ||||||||||||||||||
| Compensation and employee benefits | 1,082 | $ | 1,099 | $ | 1,134 | $ | 7 | $ | 9 | $ | 1,127 | $ | 1,125 | 4.2 | 2.4 | |||
| Information systems and communications | 454 | 463 | — | 1 | 463 | 462 | 12.7 | 1.8 | ||||||||||
| Transaction processing services | 250 | 255 | — | 1 | 255 | 254 | 5.8 | 1.6 | ||||||||||
| Occupancy | 106 | 105 | — | 1 | 105 | 104 | 4.0 | (1.9) | ||||||||||
| Amortization of other intangible assets | 60 | 56 | — | — | 56 | 56 | (6.7) | (6.7) | ||||||||||
| Other | 300 | 295 | 2 | 2 | 293 | 293 | 2.8 | (2.3) | ||||||||||
| Total expenses | 2,180 | $ | 2,269 | $ | 2,308 | $ | 9 | $ | 14 | $ | 2,299 | $ | 2,294 | 5.5 | 1.1 | |||
| Total expenses, excluding notable items - Non-GAAP | 2,180 | $ | 2,269 | $ | 2,308 | $ | 9 | $ | 14 | $ | 2,299 | $ | 2,294 | 5.5 | 1.1 | |||
| Total non-compensation expenses, excluding notable items - Non-GAAP(1) | 1,170 | 1,174 | 2 | 5 | 1,172 | 1,169 | 6.7 | (0.1) | ||||||||||
| GAAP-Basis YTD Comparison | Currency Translation Impact | Excluding Currency Impact | % Change Constant Currency | |||||||||||||||
| (Dollars in millions) | 2024 | YTD2024 vs.YTD2023 | 2024 | YTD2024 vs. YTD2023 | ||||||||||||||
| GAAP-Basis Results: | ||||||||||||||||||
| Fee revenue: | ||||||||||||||||||
| Back office services | 3,433 | $ | 3,449 | $ | 1 | $ | 3,448 | 0.4 | % | |||||||||
| Middle office services | 284 | 1 | 283 | 2.2 | ||||||||||||||
| Servicing fees | 3,733 | 2 | 3,731 | 0.6 | ||||||||||||||
| Management fees | 1,548 | (2) | 1,550 | 11.0 | ||||||||||||||
| Foreign exchange trading services | 1,041 | — | 1,041 | 8.7 | ||||||||||||||
| Securities finance | 320 | — | 320 | (2.7) | ||||||||||||||
| Front office software and data | 442 | 1 | 441 | 10.0 | ||||||||||||||
| Lending related and other fees | 187 | — | 187 | 8.1 | ||||||||||||||
| Software and processing fees | 629 | 1 | 628 | 9.4 | ||||||||||||||
| Other fee revenue | 223 | — | 223 | 51.7 | ||||||||||||||
| Total fee revenue | 7,494 | 1 | 7,493 | 5.3 | ||||||||||||||
| Net interest income | 2,174 | 2 | 2,172 | 4.4 | ||||||||||||||
| Total other income | (80) | — | (80) | nm | ||||||||||||||
| Total revenue | 8,902 | $ | 9,588 | $ | 3 | $ | 9,585 | 7.7 | ||||||||||
| Expenses: | ||||||||||||||||||
| Compensation and employee benefits | 3,497 | $ | 3,485 | $ | 9 | $ | 3,476 | (0.6) | ||||||||||
| Information systems and communications | 1,349 | — | 1,349 | 9.7 | ||||||||||||||
| Transaction processing services | 753 | 1 | 752 | 5.2 | ||||||||||||||
| Occupancy | 314 | 1 | 313 | 5.0 | ||||||||||||||
| Amortization of other intangible assets | 176 | — | 176 | (2.2) | ||||||||||||||
| Other | 1,013 | (1) | 1,014 | 20.6 | ||||||||||||||
| Total expenses | 6,761 | $ | 7,090 | $ | 10 | $ | 7,080 | 4.7 | ||||||||||
| Total expenses, excluding notable items - Non-GAAP | 6,761 | $ | 6,960 | $ | 10 | $ | 6,950 | 2.8 | ||||||||||
| Total non-compensation expenses, excluding notable items - Non-GAAP(1) | 3,475 | 1 | 3,474 | 6.4 | ||||||||||||||
| (1) Total non-compensation expenses, excluding notable items is comprised of total expenses, excluding notable items - Non-GAAP, less compensation and employee benefits, excluding notable items. Compensation and benefits, excluding notable items were 1,134 million in the third quarter of 2024, 1,099 million in the second quarter of 2024 and 1,082 million in the third quarter of 2023. |
All values are in US Dollars.
21
stt3q24earningspresentat
1 NYSE: STT October 15, 2024 Exhibit 99.3
2 All comparisons are to corresponding prior year period unless otherwise noted Financial performance • EPS of $2.26, up 81%; up 17% ex-notable itemsA • Total revenue of $3.3B, up 21%; up 9% ex-notable itemsA – Fee revenue up 11%; up 7% ex-notable items, reflecting broad-based strength across the franchiseA – NII up 16%, largely due to higher investment securities yields and loan growth, partially offset by deposit mix shift • Total expenses of $2.3B, up 6%, with business investments and revenue-related costs partially offset by productivity savings • Pre-tax margin of 28.4%; ROE of 12.0%; ROTCE of 19.3%A • Operating leverage of 15.2%pts; 3.3%pts ex-notable items; Fee operating leverage of 4.9%pts; 1.5%pts ex-notable itemsA Business momentum Investment Servicing • Record AUC/A of $46.8T at quarter-end; AUC/A wins of $466B and AUC/A yet to be installed of $2.4T1 • New servicing fee revenue wins of $84M primarily related to Back office wins2 • Reported 2 new State Street Alpha® mandates, resulting in 5 YTD Alpha wins1 Investment Management • Record AUM of $4.7T at quarter-end • Record $100B of total net inflows, driven by record Cash inflows and strength across the ETF and Institutional businesses1 Markets & Financing Awards • Named Best FX Bank for Client Service, Best FX Bank for Research, Best FX Trading Technology Solution and Best Technology Provider for FX Data Management in the Euromoney 2024 FX Awards3 Balance sheet and capital • CET1 ratio of 11.6% and State Street Bank and Trust LCR of 129% at quarter end4,5 • Returned $674M to common shareholders, including $450M of share repurchases and $224M of declared dividends – ~100% total payout ratio6 A These are non-GAAP presentations; refer to the Appendix for a reconciliation of ex-notable items and further explanations of non-GAAP measures. Refer to the Appendix included with this presentation for endnotes 1 to 27.
3 A These are non-GAAP presentations; refer to the Appendix for further explanations of non-GAAP measures and for endnotes 1 to 27. Financial results Notable items ($M, except EPS data) 3Q23 2Q24 3Q24 Investment portfolio repositioningB ($294) - ($81) Gain on sale of equity investmentC - - 66 Revenue-related recoveryD - - 15 Total notable items (pre-tax) ($294) - - Income tax impact from notable items (79) - - EPS impact ($0.68) - - QuartersA B Loss on sale related to a repositioning of the investment portfolio reflected in Other income in both 3Q23 and 3Q24. C Gain on sale of equity investment reflected in Other fee revenue. D Revenue-related recovery associated with the proceeds from a 2018 FX benchmark litigation resolution reflected in FX trading services revenue. (GAAP; $M, except EPS data, or where otherwise noted) 3Q23 2Q24 3Q24 2Q24 3Q23 Revenue: Servicing fees 1,234 1,239 1,266 2 3 Management fees 479 511 527 3 10 Foreign exchange trading services 313 336 374 11 19 Securities finance 103 108 116 7 13 Software and processing fees 188 214 208 (3) 11 Other fee revenue 44 48 125 nm nm Total fee revenue 2,361 2,456 2,616 7 11 Net interest income 624 735 723 (2) 16 Other income (294) - (80) nm 73 Total revenue $2,691 $3,191 $3,259 2% 21% Provision for credit losses - 10 26 nm nm Total expenses $2,180 $2,269 $2,308 2% 6% Net income before income taxes $511 $912 $925 1% 81% Net income $422 $711 $730 3% 73% Diluted earnings per share $1.25 $2.15 $2.26 5% 81% Return on average common equity 7.3% 11.9% 12.0% 0.1%pts 4.7%pts Return on average tangible common equityA 12.0% 19.3% 19.3% - 7.3%pts Pre-tax margin 19.0% 28.6% 28.4% (0.2)%pts 9.4%pts Tax rate 17.4% 22.1% 21.1% (1.0)%pts 3.7%pts Ex-notable items, non-GAAP A: Total revenue $2,985 $3,191 $3,259 2% 9% Total expenses $2,180 $2,269 $2,308 2% 6% EPS $1.93 $2.15 $2.26 5% 17% Return on average common equity 11.2% 11.9% 12.0% 0.1%pts 0.8%pts Return on average tangible common equity 18.4% 19.3% 19.3% - 0.9%pts Pre-tax margin 27.0% 28.6% 28.4% (0.2)%pts 1.4%pts Tax Rate 20.9% 22.1% 21.1% (1.0)%pts 0.2%pts Quarters %∆
4 AUC/A ($T, as of period-end) 1 Market indices7 • Up 17% YoY and 6% QoQ primarily driven by higher quarter-end market levels, net new business and client flows • Up 29% YoY and 8% QoQ reflecting higher quarter-end market levels and record quarterly net inflows in 3Q24 AUM ($B, as of period-end) 1 +8% +6% $40.0 $44.3 $46.8 3Q23 2Q24 3Q24 3Q23 2Q24 3Q24 $3,672 $4,369 $4,732 +17% +29% A Line items may not sum to total due to rounding. Refer to the Appendix included with this presentation for endnotes 1 to 27. Select industry flows8 2Q24 3Q23 Equity & Bond Indices: EOP 6% 34% Daily Avg 6 24 EOP 7 22 Daily Avg 2 13 EOP 8 23 Daily Avg 3 10 EOP 6 30 Daily Avg 4 20 EOP 7 12 Daily Avg 4 6 Volatility Indices: VIX Daily Avg 22% 14% JPM G7 FX Daily Avg 11 (2) JPM EM FX Daily Avg 16 (5) Specials Volumes: S&P Global Industry Specials Avg Volume (1)% (14)% S&P U.S. Industry Specials Avg Volume 15 (12) (% change) 3Q24 vs S&P 500 MSCI EAFE MSCI EM MSCI ACWI Bloomberg Global Agg 3Q23 2Q24 3Q24 Long Term Funds $(111) $(111) $(121) Money Market 132 62 278 ETF 110 206 288 North America Total 131 157 444 EMEA Total 38 148 266 Total flowsA ($B)
5 Servicing fees of $1,266M Up 3% YoY and 2% QoQA • Up 3% YoY as higher average market levels and net new business, excluding a previously disclosed client transition, were partially offset by pricing headwinds, a previously disclosed client transition and lower client activity, including asset mix shift • Up 2% QoQ mainly due to higher average market levels and net new business Servicing fees ($M) 3Q24 performance 1,138 1,128 1,136 1,146 1,167 96 3Q23 84 4Q23 92 1Q24 93 2Q24 99 3Q24 $1,234 $1,212 $1,228 $1,239 $1,266 Investment Services business momentum • New 3Q24 servicing fee revenue wins of $84M, with the majority driven by Back office wins2 – Trailing 12-month servicing fee revenue wins of $326M • $288M of servicing fee revenue to be installed as of quarter-end, up $33M YoY and $12M QoQ2 • $466B in new servicing AUC/A wins, with the majority from Asset Managers1 – ~$380B of new servicing AUC/A wins driven by Alpha A Servicing fees were positively impacted by currency translation both YoY and QoQ by $4M and $8M, respectively. Refer to the Appendix included with this presentation for endnotes 1 to 27. +3% Back office services Middle office services 3% 3% YoY % $149 $501 $474 $291 $466 2,255 2,302 2,576 2,390 2,354 91 103 67 72 84 Performance indicators AUC/A wins1 ($B) AUC/A to be installed1 ($B) Servicing fee rev. wins2 ($M) +2%
6 • ETF: Strong net inflows of $37B contributed to ETF franchise record AUM of $1.5T; market share gains across U.S. Low Cost, Commodities and in EMEA • Institutional: Net inflows of $9B led by multi-asset solutions, including U.S. Defined Contribution, and Index Equity • Cash: Record quarterly net inflows of $54B primarily into Money Market funds, which contributed to Institutional Money Market Funds market share gains9 Management fees ($M) 3Q24 performance Management fees of $527M up 10% YoY and 3% QoQA • Up 10% YoY and 3% QoQ primarily due to higher average market levels • Record $100B of total net inflows, driven by record Cash inflows as well as strength across the ETF and Institutional businesses • Investment Management business 3Q24 pre-tax margin of 30% Performance indicators ($B) 1 3Q23 4Q23 1Q24 2Q24 3Q24 $479 $479 $510 $511 $527 Investment Management business momentum1 AUM $3,672 $4,102 $4,299 $4,369 $4,732 Net flows (QoQ) 10 95 (14) (5) 100 A Management fees were positively impacted by currency translation QoQ by $1M. Refer to the Appendix included with this presentation for endnotes 1 to 27. +3% +10%
7 44 33 50 48 59 188 237 207 214 208 103 97 96 108 116 313 307 331 336 359 3Q23 4Q23 1Q24 2Q24 3Q24 $648 $674 $684 $706 $742 FX trading10 Securities finance Software & processing 15% 13% 11% YoY % Other fees11,12 34% • FX trading services of $359M 10 – Up 15% YoY primarily due to higher client volumes, partially offset by lower spreads associated with lower average FX volatility – Up 7% QoQ supported by higher client volumes • Securities finance of $116M – Up 13% YoY and 7% QoQ mainly due to higher client lending balances, partially offset by lower spreads primarily resulting from muted industry specials activity • Software and processing fees of $208M – Up 11% YoY primarily due to higher Front office software and data revenue associated with CRD – Down (3)% QoQ mainly driven by lower Front office software and data revenue associated with CRD • Other fee revenue of $59M 11,12 3Q24 performance (Ex-notable items, non-GAAP, $M)A Markets, Software & processing, and Other fees (Ex-notable items, non-GAAP, $M)A A These are non-GAAP presentations; refer to the Appendix for a reconciliation of ex-notable items and further explanations of non-GAAP measures. Refer to the Appendix included with this presentation for endnotes 1 to 27.
8 • 3Q24 annual recurring revenue (ARR) increased 19% YoY, driven by 20+ SaaS client implementations and conversions since 3Q23 • Reported 2 new Alpha mandates in 3Q24 and 5 mandates YTD1 85 89 94 101 106 27 33 31 29 29 52 15 18 14 3Q23 4Q23 1Q24 2Q24 8 3Q24 $130 $179 $144 $152 $146 Refer to the Appendix included with this presentation for endnotes 1 to 27. • Up 12% YoY primarily due to continued strong Software-enabled revenue growth, partially offset by lower On-premises renewals • Down (4)% QoQ primarily driven by lower On-premises renewals, partially offset by continued strong Software-enabled revenue growth ($M) 3Q23 2Q24 3Q24 Front office metrics New bookings15 $10 $3 $10 ARR16 299 345 356 Uninstalled revenue backlog17 88 99 100 Middle office metric Uninstalled revenue backlog18 83 109 114 Alpha metrics # of mandate wins1 2 1 2 Live mandates to-date 15 23 23 Professional services Software- enabled (incl. SaaS)14 On-premises14 21% YoY Growth Business momentum Front office software and data ($M) 13 Future growth driven by Front, Middle and Alpha 3Q24 performance -4% +12%
9 NII and NIM ($M) 19 Average balance sheet highlights ($B) A A Line items are rounded. B Net interest income was positively impacted by currency translation both YoY and QoQ by $2M and $7M, respectively. Refer to the Appendix included with this presentation for endnotes 1 to 27. 3Q23 4Q23 1Q24 2Q24 3Q24 Total assets $268 $279 $299 $306 $315 Cash20 66 75 95 91 90 Investment portfolio 105 103 101 105 107 HTM % (EOP) 60% 56% 52% 47% 47% Duration (EOP) 21 2.7 2.7 2.7 2.5 2.5 Loans 35 37 38 39 40 Total deposits $198 $207 $219 $221 $225 % Operational 22 75% 74% 73% 75% 75% NIM19 (FTE, %) 1.12% 1.16% 1.13% 1.13% 1.07% 3Q23 4Q23 1Q24 2Q24 3Q24 $624 $678 $716 $735 $723 • Assets increased 18% YoY and 3% QoQ primarily due to an increase in total deposits and balance sheet funding • Deposits increased 14% YoY mainly driven by growth in interest-bearing balances, partially offset by a reduction in non-interest-bearing deposits • Loan growth of 15% YoY and 3% QoQ • Up 16% YoY largely due to higher investment securities yields and loan growth, partially offset by deposit mix shift • Down (2)% QoQ primarily driven by deposit mix shift and lower market rates, partially offset by higher investment securities yields Average assets and liabilities3Q24 performance B -2% +16%
10 $2,180 $2,269 $2,308 42,352 54,926 52,568 52,566 Expenses of $2,308M up 6% YoY and up 2% QoQA • Compensation and employee benefits of $1,134M – Up 5% YoY mainly due to higher performance-based incentive compensation and employee benefits, partially offset by ongoing organizational process improvements and initiatives as well as net benefits from the JV consolidations in India – Up 3% QoQ primarily driven by higher salaries, performance-based incentive compensation and employee benefits • Information systems and communications of $463M – Up 13% YoY and 2% QoQ largely from higher technology and infrastructure investments • Transaction processing services of $255M – Up 6% YoY primarily reflecting higher revenue-related costs associated with sub-custody, broker fees and market data – Up 2% QoQ mainly from higher revenue-related sub-custody costs • Occupancy of $105M – Up 4% YoY primarily driven by footprint expansion related to JV consolidations in India, partially offset by footprint optimization and one-time vendor credits • Other of $351M23 – Up 2% YoY mainly due to higher professional services and travel costs – Down (3)% QoQ primarily reflecting lower professional services GAAP Expenses Headcount 345 360 351 241 250 255 411 454 463 1,082 1,099 1,134 3Q23 2Q24 3Q24 $2,180 $2,269 $2,308 A These are non-GAAP presentations; refer to the Appendix for a reconciliation of ex-notable items and further explanations of non-GAAP measures. Total expenses on both a GAAP and ex-notables basis were negatively impacted by currency translation of $9M and $14M on a YoY and QoQ basis, respectively. Refer to the Appendix included with this presentation for endnotes 1 to 27. Comp. & benefits Info. sys. Tran. processing Other23 Occupancy 105106101 YoY +6% QoQ +2% +6% YoY +24% QoQ flat Headcount reflects the consolidation of two operations JVs in India (one in 4Q23 and one in 2Q24), which increased headcount by ~12,000. The associated headcount costs were previously reflected in the Compensation and employee benefits line. Pro-forma24 YoY -4% Expenses (Ex-notable items, non-GAAP, $M)A 3Q24 performance (Ex-notable items, non-GAAP, $M)A +2%
11 • 3Q24 standardized CET1 ratio at quarter-end of 11.6% increased 0.4%pts QoQ primarily due to capital generated from earnings and improved AOCI, partially offset by continued capital return and higher RWA • 3Q24 Tier 1 leverage ratio of 5.5% increased 0.2%pts QoQ mainly driven by capital generated from earnings and higher preferred equity, partially offset by higher average balance sheet levels • Returned $674M to common shareholders, including $450M of share repurchases and $224M of declared dividends – ~100% total payout ratio6 Capital and liquidity highlights Capital ($B unless otherwise noted, capital metrics as of period-end) 3Q23 2Q24 3Q24 Standardized CET1 CET1 capital $13.0 $13.3 $14.0 Risk weighted assets 118 119 121 Tier 1 leverage Tier 1 capital 15.0 15.8 16.8 Leverage exposure26 259 297 306 OCI impact of investment portfolio on regulatory capital27 0.3 0.0 0.4 Tier 1 leverage 5.8% 5.5% 5.4% 5.3% 5.5% 3Q23 4Q23 1Q24 2Q24 3Q24 Minimum ratio4.0% STT Target Range5.25-5.75% Refer to the Appendix included with this presentation for endnotes 1 to 27. CET1 (Standardized) 11.0% 11.6% 11.1% 11.2% 11.6% 4.5% 2.5% 3Q23 4Q23 1Q24 2Q24 3Q24 SCB25 Minimum ratio8 .0 % 10-11% G-SIB surcharge1.0% Ratios (%, as of period-end) 4 State Street Bank and Trust LCR 5 Requirement Requirement Requirement 120% 122% 130% 134% 129% 100% 3Q23 4Q23 1Q24 2Q24 3Q24 STT Target Range
12
13 3Q24 line of business performance 14 Reconciliation of notable items 15 Reconciliation of constant currency impacts 16 Endnotes & other information 17 Forward-looking statements 19 Non-GAAP measures 20 Definitions 21
14 1,945 State StreetAInvestment Servicing Total revenueB 620 716 1,839 1,945 3Q23 3Q24 $2,459M $2,662M Pre-tax income Fee revenue NII Pre-tax margin 26.9% 28.0% +1.1%pts YoY % ∆ +6% +16% +8% +13% Investment Management Total revenueC 3Q23 3Q24 $526M $597M Pre-tax income Pre-tax margin 27.9% 30.2% +2.3%pts 3Q23 3Q24 $147M $180M YoY % ∆ +14% +22% Total revenue ex-notable itemsB,D 624 723 2,361 2,535 3Q23 3Q24 $2,985M $3,259M Pre-tax income ex-notable itemsD Fee revenue NII Pre-tax margin 27.0% 28.4% +1.4%pts YoY % ∆ +7% +16% +9% +15% A State Street includes line of business results from Investment Servicing, Investment Management, and Other. Refer to the Addendum for further line of business information. B Total revenue also includes Other income of $1M in 3Q24. C 3Q23 and 3Q24 Total revenue includes $4M and $7M in NII, respectively. D These are non-GAAP presentations; refer to the Appendix for a reconciliation of ex-notable items and further explanations of non-GAAP measures. 3Q23 3Q24 $661M $745M 3Q23 3Q24 $805M $925M
15 A Calculated as the period-over-period change in total fee revenue less the period-over-period change in total expenses. B Calculated as the period-over-period change in total fee revenue, excluding notable items less the period-over-period change in total expenses, excluding notable items. C Calculated as the period-over-period change in total revenue less the period-over-period change in total expenses. D Calculated as the period-over- period change in total revenue, excluding notable items less the period-over-period change in total expenses, excluding notable items. Quarterly reconciliation % Change (Dollars in millions, unless noted otherwise) 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 3Q24 vs. 3Q23 3Q24 vs. 2Q24 2023 2024 YTD 2024 vs. YTD 2023 Total fee revenue, GAAP-basis 2,335$ 2,419$ 2,361$ 2,365$ 2,422$ 2,456$ 2,616$ 10.8% 6.5% 7,115$ 7,494$ 5.3% Less: Notable items: Foreign exchange trading services (15) (15) Other fee revenue (66) (66) Total fee revenue, excluding notable items 2,335 2,419 2,361 2,365 2,422 2,456 2,535 7.4% 3.2% 7,115 7,413 4.2% Total revenue, GAAP-basis 3,101 3,110 2,691 3,043 3,138 3,191 3,259 21.1% 2.1% 8,902 9,588 7.7% Less: Notable items: Foreign exchange trading services (15) (15) Other fee revenue (66) (66) (Gains) losses related to investment securities, net 294 81 294 81 Total revenue, excluding notable items 3,101 3,110 2,985 3,043 3,138 3,191 3,259 9.2% 2.1% 9,196 9,588 4.3% Total expenses, GAAP basis 2,369 2,212 2,180 2,822 2,513 2,269 2,308 5.9% 1.7% 6,761 7,090 4.9% Less: Notable items: Acquisition and restructuring costs 15 Repositioning charges (203) FDIC special assessment (387) (130) (130) Impairments and other (45) Total expenses, excluding notable items 2,369 2,212 2,180 2,202 2,383 2,269 2,308 5.9% 1.7% 6,761 6,960 2.9% Seasonal expenses (181) (162) (181) (162) Total expenses, excluding notable items and seasonal expense items 2,188$ 2,212$ 2,180$ 2,202$ 2,221$ 2,269$ 2,308$ 5.9% 1.7% 6,580$ 6,798$ 3.3% Fee operating leverage, GAAP-basis (%pts)A 4.9% pts 4.8% pts 0.4% pts Fee operating leverage, excluding notable items (%pts)B 1.5% pts 1.5% pts 1.3% pts Operating leverage, GAAP-basis (%pts)C 15.2% pts 0.4% pts 2.8% pts Operating leverage, excluding notable items (%pts)D 3.3% pts 0.4% pts 1.4% pts Pre-tax margin, GAAP-basis (%) 22.2% 29.5% 19.0% 6.6% 19.1% 28.6% 28.4% 9.4% pts -0.2% pts 23.8% 25.4% 1.6% pts Notable items as reconciled above (%) 8.0% 20.4% 4.1% 2.4% 1.4% Pre-tax margin, excluding notable items (%) 22.2% 29.5% 27.0% 27.0% 23.2% 28.6% 28.4% 1.4% pts -0.2% pts 26.2% 26.8% 0.6% pts Net income available to common shareholders, GAAP-basis 525$ 726$ 398$ 172$ 418$ 655$ 682$ 71.4% 4.1% 1,649$ 1,755$ 6.4% Notable items as reconciled above: pre-tax 294 620 130 294 130 Tax impact on notable items as reconciled above (79) (156) (31) (79) (31) Net income available to common shareholders, excluding notable items 525$ 726$ 613$ 636$ 517$ 655$ 682$ 11.3% 4.1% 1,864$ 1,854$ (0.5)% Diluted EPS, GAAP-basis 1.52$ 2.17$ 1.25$ 0.55$ 1.37$ 2.15$ 2.26$ 80.8% 5.1% 4.97$ 5.77$ 16.1% Notable items as reconciled above 0.68 1.49 0.32 0.64 0.32 Diluted EPS, excluding notable items 1.52$ 2.17$ 1.93$ 2.04$ 1.69$ 2.15$ 2.26$ 17.1% 5.1% 5.61$ 6.09$ 8.6% % Change Year-to-Date
16A Other includes Other expenses and Amortization of intangible assets. Reconciliation of Constant Currency FX Impacts (Dollars in millions) 3Q23 2Q24 3Q24 3Q24 vs. 3Q23 3Q24 vs. 2Q24 3Q24 vs. 3Q23 3Q24 vs. 2Q24 3Q24 vs. 3Q23 3Q24 vs. 2Q24 Non-GAAP basis Total revenue, excluding notable items $ 2,985 $ 3,191 $ 3,259 $ 6 $ 17 $ 3,253 $ 3,242 9.0% 1.6% Compensation and employee benefits, excluding notable items $ 1,082 $ 1,099 $ 1,134 $ 7 $ 9 $ 1,127 $ 1,125 4.2% 2.4% Information systems and communications, excluding notable items 411 454 463 - 1 463 462 12.7% 1.8% Transaction processing services, excluding notable items 241 250 255 - 1 255 254 5.8% 1.6% Occupancy, excluding notable items 101 106 105 - 1 105 104 4.0% (1.9)% Other expenses, excluding notable items 345 360 351 2 2 349 349 1.2% (3.1)% Total expenses, excluding notable items $ 2,180 $ 2,269 $ 2,308 $ 9 $ 14 $ 2,299 $ 2,294 5.5% 1.1% Reported Currency Translation Impact Excluding Currency Impact % Change Constant Currency
17 This presentation (and the conference call accompanying it) includes certain highlights of, and also material supplemental to, State Street Corporation’s news release announcing its third quarter 2024 financial results. That news release contains a more detailed discussion of many of the matters described in this presentation and is accompanied by an Addendum with detailed financial tables. This presentation (and the conference call accompanying it) is designed to be reviewed together with that news release and that Addendum, which are available on State Street’s website, at http://investors.statestreet.com, and are incorporated herein by reference. No other information on our website is incorporated herein by reference. 1. New asset servicing mandates, including announced Alpha front-to-back investment servicing clients, may be subject to completion of definitive agreements, consents or assignments, approval of applicable boards and shareholders and customary regulatory approvals, the failure to complete any of which will prevent the relevant mandate from being installed and serviced. New asset servicing mandates and servicing assets remaining to be installed in future periods exclude new business which has been contracted, but for which the client has not yet provided permission to publicly disclose and is not yet installed. These excluded assets, which from time to time may be significant, will be included in new asset servicing mandates and reflected in servicing assets remaining to be installed in the period in which the client provides its permission. Servicing mandates, servicing assets remaining to be installed in future periods and servicing fee revenues remaining to be installed in future periods are presented on a gross basis based on factors present on or about the time we determine the business to be won by us and are not updated based on subsequent developments, including changes in assets, market valuations, scope and, potentially termination. Such assets therefore also do not include the impact of clients who have notified us during the period of their intent to terminate or reduce their relationship with State Street, which from time to time may be significant. New business in assets to be serviced is reflected in our AUC/A after we begin servicing the assets, and new business in assets to be managed is reflected in our AUM after we begin managing the assets. As such, only a portion of any new asset servicing and asset management mandates may be reflected in our AUC/A and AUM as of any particular date specified. Consistent with past practice, AUC/A values for certain asset classes are based on a lag, typically one-month. Generally, our servicing fee revenues are affected by several factors, and we provide varied services from our full suite of offerings to different clients. The basis for fees will also differ across regions and clients and can reflect pricing pressures traditionally experienced in our industry. Consequently, no assumption should be drawn as to future revenue run rate from announced servicing wins or new servicing business yet to be installed, as the amount of revenue associated with AUC/A can vary materially. Management fees also are generally affected by various factors, including investment product type and strategy and relationship pricing for clients, and are more sensitive to market valuations than are servicing fees. Therefore, no assumption should be drawn from management fees associated with changes in AUM levels. Levels of AUC/A, AUC/A to be installed, Servicing fee wins to be installed and AUM are always presented as of the end of the relevant period, unless otherwise specifically noted. AUM for passive alternative investments has been revised from prior presentations. 2. Servicing fee revenue wins/backlog represents estimates of future annual revenue associated with new servicing engagements State Street determines to be won during the current reporting period, which may include anticipated servicing-related revenues associated with acquisitions or structured transactions, based upon factors assessed at the time the engagement is determined by State Street to be won, including asset volumes, number of transactions, accounts and holdings, terms and expected strategy. These and other relevant factors influencing projected servicing fees upon asset implementation/onboarding will change from time to time prior to, upon and following asset implementation/onboarding, among other reasons, due to varying market levels and factors and client and investor activity and preferences. Servicing fee/backlog estimates are not updated to reflect those changes, regardless of the magnitude or direction of, or reason for, any change. Servicing fee revenue wins in any period are highly variable and include estimated fees attributable to both (1) services to be provided for new estimated AUC/A reflected in new asset servicing wins for the period (with AUC/A to be onboarded in the future) and (2) additional services to be provided for AUC/A already included in our end-of period AUC/A (i.e., for which other services are currently provided); and the magnitude of one source of servicing fee revenue wins relative to the other (i.e., (1) relative to (2)) will vary from period to period. Therefore, for these and other reasons, comparisons of estimated servicing fee revenue wins to estimated new asset servicing AUC/A wins for any period will not produce reliable fee per AUC/A estimates. No servicing fees are recognized until the point in the future when we begin performing the associated services with respect to the relevant AUC/A. See also endnote 1 above in reference to considerations applicable to pending servicing engagements, which similarly apply to engagements for which reported servicing fee revenue wins/backlog are attributable. 3. State Street was recognized in Euromoney Magazine’s 2024 FX Awards across four categories: Best FX Bank for Client Service, Best FX Bank for Research, Best FX Trading Technology Solution and Best Technology Provider for FX Data Management. 4. Unless otherwise noted, all capital ratios referenced on this slide and elsewhere in this presentation refer to State Street Corporation, or State Street, and not State Street Bank and Trust Company. All capital ratios are as of quarter end. The lower of capital ratios calculated under the Basel III advanced approaches and under the Basel III standardized approach are applied in the assessment of our capital adequacy for regulatory purposes. Standardized approach ratios were binding for 3Q23 to 3Q24. Refer to the Addendum for descriptions of these ratios. September 30, 2024 capital ratios are presented as of quarter-end and are preliminary estimates. 5. State Street Corporation LCR in 3Q24 increased 1%pt QoQ to ~107%; State Street Bank and Trust's (SSBT) LCR is significantly higher than State Street Corporation's (SSC) LCR, primarily due to application of the transferability restriction in the U.S. LCR Final Rule to the calculation of SSC’s LCR. This restriction limits the amount of HQLA held at SSC’s principal banking subsidiary, SSBT, and available for the calculation of SSC’s LCR to the amount of net cash outflows of SSBT. This transferability restriction does not apply in the calculation of SSBT’s LCR, and therefore SSBT’s LCR reflects the full benefit of all of its HQLA holdings. Leverage exposure is equal to average consolidated assets less applicable Tier 1 leverage capital reductions under regulatory standards. 6. Capital returned represents the common stock dividends declared during 3Q24 and common share repurchases made in 3Q24.Total payout represents capital returned divided by net income available to common shareholders over the period of 3Q24. The total payout ratio was 99% in 3Q24.
18 7. The index names listed are service marks of their respective owners. S&P Global Specials and S&P U.S. Specials Volumes sourced from S&P Global Market Intelligence. 8. Data presented for indicative purposes. Morningstar data includes long-term mutual funds, ETFs and Money Market funds. Mutual fund data represents estimates of net new cash flow, which is new sales minus redemptions combined with net exchanges, while ETF data represents net issuance, which is gross issuance less gross redemptions. Data for Fund of Funds, Feeder funds and Obsolete funds were excluded from the series to prevent double counting. Data is from the Morningstar Direct Asset Flows database. The long-term fund flows reported by Morningstar in North America are composed of U.S. domiciled Market flows mainly in Equities, Allocation and Fixed Income asset classes. 3Q24 data for North America (U.S. domiciled) includes Morningstar actuals for July and August 2024 and Morningstar estimates for September 2024. 3Q24 data for EMEA is on a rolling three month basis for June 2024 through August 2024. 9. Quartile performance data provided by iMoneyNet. Market share based on Global Institutional Money Market Funds and sourced from Money Fund Analyzer, a service provided by iMoneyNet as of the end of September 2024. 10. GAAP-basis FX trading services in 3Q24 of $374M included a notable item related to a revenue-related recovery of $15M. Excluding the notable item, 3Q24 FX trading services of $359M was up 15% compared to 3Q23 FX trading services of $313M and up 7% compared to 2Q24 FX trading services of $336M. 11. Other fee revenue primarily consists of income from equity method investments, certain tax-advantaged investments and market-related adjustments. 12. GAAP-basis Other fee revenue in 3Q24 of $125M included a notable item related to a gain on sale of equity investment of $66M. Excluding the notable item, 3Q24 Other fee revenue of $59M was up 34% compared to 3Q23 Other fee revenue of $44M and up 23% compared to 2Q24 Other fee revenue of $48M. 13. Front office software and data revenue primarily includes revenue from CRD, Alpha Data Platform and Alpha Data Services. Includes Other revenue of $4M in 3Q23, $5M in 4Q23, $4M in 1Q24 and 2Q24, and $3M in 3Q24. Revenue line items may not sum to total due to rounding. 14. On-premises revenue is revenue derived from locally installed software. Software-enabled revenue includes SaaS, maintenance and support revenue, FIX, brokerage, and value-add services. The revenue recognition pattern for On-premises installations differs from software-enabled revenue. 15. Front office bookings represent signed ARR contract values for CRD, CRD for Private Markets, Alpha Data Platform, and Alpha Data Services excluding bookings with affiliates, including SSGA. Front office revenue derived from affiliate agreements is eliminated in consolidation for financial reporting purposes. 16. Front office software and data annual recurring revenue (ARR), an operating metric, is calculated by annualizing current quarter revenue for CRD and CRD for Private Markets and includes the annualized amount of most software-enabled revenue, including revenue generated from SaaS, maintenance and support revenue, FIX, and value-added services, which are all expected to be recognized ratably over the term of client contracts. Front office software and data ARR does not include software-enabled brokerage revenue, revenue from affiliates and licensing fees (excluding the portion allocated to maintenance and support) from On-premises software. 17. Represents expected ARR from signed client contracts that are scheduled to be largely installed over the next 24 months for CRD, CRD for Private Markets and Alpha Data Services. It includes SaaS revenue, as well as maintenance and support revenue, and excludes the one-time impact of On-premises license revenue, revenue generated from FIX, brokerage, value-add services, and professional services as well as revenue from affiliates. 18. Represents expected annual revenue from signed client contracts that are scheduled to be largely installed over the next 24 months. This amount of expected revenue is estimated based on factors present on or about the time the contract was signed (and is not updated based on subsequent developments, including changes in assets, market valuations and scope). It does not include professional services revenue or revenue from affiliates. 19. NII is presented on a GAAP-basis. NIM is presented on a fully taxable-equivalent (FTE) basis, and is calculated by dividing FTE NII by average total interest-earning assets. Refer to the Addendum for reconciliations of NII FTE-basis to NII GAAP-basis on the Average Statement of Condition. 20. Includes Cash and due from banks and Interest-bearing deposits with banks. 21. Duration as of period end and based on the total investment portfolio. 22. Calculated as Operational deposits divided by Total deposits, in the respective periods. 23. Other, excluding notable items, includes Other expenses and Amortization of intangible assets. 24. Pro-forma headcount reflects estimated total headcount for 3Q23 as if the headcount of the India JVs that were consolidated in 4Q23 and 2Q24 had been included in the prior period and is based on headcount in each JV at the end of the period. 25. The SCB of 2.5% effective on October 1, 2024 is calculated based upon the results of the CCAR 2024 exam. 26. Leverage exposure is equal to average consolidated assets less applicable Tier 1 leverage capital reductions under regulatory standards. 27. OCI impact of investment portfolio on regulatory capital is a sub-component within GAAP AOCI.
19 This Presentation contains forward-looking statements within the meaning of United States securities laws, including statements about our goals and expectations regarding our strategy, growth and sales prospects, capital management, business, financial and capital condition, results of operations, the financial and market outlook and the business environment. Forward-looking statements are often, but not always, identified by such forward- looking terminology as “outlook,” “priority,” “will,” “expect,” “intend,” “aim,” “outcome,” “future,” “strategy,” “pipeline,” “trajectory,” “target," “guidance,” “objective,” “plan,” “forecast,” “believe,” “anticipate,” “estimate,” “seek,” “may,” “trend,” and “goal,” or similar statements or variations of such terms. These statements are not guarantees of future performance, are inherently uncertain, are based on current assumptions that are difficult to predict and involve a number of risks and uncertainties. Therefore, actual outcomes and results may differ materially from what is expressed in those statements, and those statements should not be relied upon as representing our expectations or beliefs as of any time subsequent to the time this Presentation is first issued. We are subject to intense competition, which could negatively affect our profitability; We are subject to significant pricing pressure and variability in our financial results and our AUC/A and AUM; We could be adversely affected by political, geopolitical, economic and market conditions, including, for example, as a result of liquidity or capital deficiencies (actual or perceived) by other financial institutions and related market and government actions, the ongoing wars in Ukraine and in the Middle East, major political elections globally, actions taken by central banks to address inflationary and growth pressures, monetary policy tightening, periods of significant volatility in valuations and liquidity or other disruptions in the markets for equity, fixed income and other assets classes globally or within specific markets; Our development and completion of new products and services, including State Street Alpha® and those related to digital assets and artificial intelligence, may impose costs on us, involve dependencies on third parties and may expose us to increased operational, model and other risks; Our business may be negatively affected by our failure to update and maintain our technology infrastructure, or otherwise meet the increasing resiliency expectations of our clients and regulators, or as a result of a cyber-attack or similar vulnerability in our or business partners' infrastructure; Our risk management framework, models and processes may not be effective in identifying or mitigating risk and reducing the potential for related losses, and a failure or circumvention of our controls and procedures, or errors or delays in our operational and transaction processing, or those of third parties, could have an adverse effect on our business, financial condition, operating results and reputation; Acquisitions, strategic alliances, joint ventures and divestitures, and the integration, retention and development of the benefits of these transactions, including the consolidation of our operations joint ventures in India, pose risks for our business; Competition for qualified members of our workforce is intense, and we may not be able to attract and retain the highly skilled people we need to support our business; We have significant global operations and clients that can be adversely impacted by disruptions in key global economies, including local, regional and geopolitical developments affecting those economies; Our investment securities portfolio, consolidated financial condition and consolidated results of operations could be adversely affected by changes in the financial markets, governmental action or monetary policy. For example, among other risks, increases in prevailing interest rates or market conditions have led, and were they to occur in the future could further lead, to reduced levels of client deposits and resulting decreases in our NII or to portfolio management decisions resulting in reductions in our capital or liquidity ratios; Our business activities expose us to interest rate risk; We assume significant credit risk of counterparties, who may also have substantial financial dependencies on other financial institutions, and these credit exposures and concentrations could expose us to financial loss; Our fee revenue represents a significant portion of our revenue and is subject to decline based on, among other factors, market and currency declines, investment activities and preferences of our clients and their business mix; If we are unable to effectively manage our capital and liquidity, our financial condition, capital ratios, results of operations and business prospects could be adversely affected; We may need to raise additional capital or debt in the future, which may not be available to us or may only be available on unfavorable terms; If we experience a downgrade in our credit ratings, or an actual or perceived reduction in our financial strength, our borrowing and capital costs, liquidity and reputation could be adversely affected; Our business and capital-related activities, including common share repurchases, may be adversely affected by regulatory requirements and considerations, including capital, credit and liquidity; We face extensive and changing government regulation and supervision in the jurisdictions in which we operate, which may increase our costs and compliance risks and may affect our business activities and strategies; Our businesses may be adversely affected by government enforcement and litigation; Our businesses may be adversely affected by increased and conflicting political and regulatory scrutiny of asset management stewardship and corporate sustainability or Environmental, Social and Governance (ESG) practices; Any misappropriation of the confidential information we possess could have an adverse impact on our business and could subject us to regulatory actions, litigation and other adverse effects; Our calculations of risk exposures, total RWA and capital ratios depend on data inputs, formulae, models, correlations and assumptions that are subject to change, which could materially impact our risk exposures, our total RWA and our capital ratios from period to period; Changes in accounting standards may adversely affect our consolidated results of operations and financial condition; Changes in tax laws, rules or regulations, challenges to our tax positions and changes in the composition of our pre-tax earnings may increase our effective tax rate; We could face liabilities for withholding and other non-income taxes, including in connection with our services to clients, as a result of tax authority examinations; Our businesses may be negatively affected by adverse publicity or other reputational harm; Shifting and maintaining operational activities to non-U.S. jurisdictions, changing our operating model, including by consolidating our operations joint ventures in India, and outsourcing to, or insourcing from, third parties expose us to increased operational risk, geopolitical risk and reputational harm and may not result in expected cost savings or operational improvements; Attacks or unauthorized access to our or our business partners' or clients' information technology systems or facilities, such as cyber-attacks or other disruptions to our or their operations, could result in significant costs, reputational damage and impacts on our business activities; Long-term contracts and customizing service delivery for clients expose us to increased operational risk, pricing and performance risk; We may not be able to protect our intellectual property or may infringe upon the rights of third parties; The quantitative models we use to manage our business may contain errors that could adversely impact our business, financial condition, operating results and regulatory compliance; Our reputation and business prospects may be damaged if investors in the collective investment pools we sponsor or manage incur substantial losses in these investment pools or are restricted in redeeming their interests in these investment pools; The impacts of climate change, and regulatory responses, and disclosure requirements related to such risks, could adversely affect us; and We may incur losses or face negative impacts on our business as a result of unforeseen events, including terrorist attacks, natural disasters, climate change, pandemics, global conflicts, an abrupt banking crisis and other geopolitical events, which may have a negative impact on our business and operations. Other important factors that could cause actual results to differ materially from those indicated by any forward-looking statements are set forth in our 2023 Annual Report on Form 10-K and our subsequent SEC filings. We encourage investors to read these filings, particularly the sections on risk factors, for additional information with respect to any forward-looking statements and prior to making any investment decision. The forward-looking statements contained in this Presentation should not by relied on as representing our expectations or beliefs as of any time subsequent to the time this Presentation is first issued, and we do not undertake efforts to revise those forward-looking statements to reflect events after that time.
20 In addition to presenting State Street's financial results in conformity with U.S. generally accepted accounting principles, or GAAP, management also presents certain financial information on a basis that excludes or adjusts one or more items from GAAP. This latter basis is a non-GAAP presentation. In general, our non-GAAP financial results adjust selected GAAP-basis financial results to exclude the impact of revenue and expenses outside of State Street’s normal course of business or other notable items, such as acquisition and restructuring charges, repositioning charges, gains/losses on sales, as well as, for selected comparisons, seasonal items. For example, we sometimes present expenses on a basis we may refer to as “expenses ex-notable items", which exclude notable items and, to provide additional perspective on both prior year quarter and sequential quarter comparisons, may also exclude seasonal items. Management believes that this presentation of financial information facilitates an investor's further understanding and analysis of State Street's financial performance and trends with respect to State Street’s business operations from period-to-period, including providing additional insight into our underlying margin and profitability. In addition, Management may also provide additional non-GAAP measures. For example, we may present revenue and expense measures on a constant currency basis to identify the significance of changes in foreign currency exchange rates (which often are variable) in period-to-period comparisons. This presentation represents the effects of applying prior period weighted average foreign currency exchange rates to current period results. Non-GAAP financial measures should be considered in addition to, not as a substitute for or superior to, financial measures determined in conformity with GAAP. Refer to the Addendum for reconciliations of our non-GAAP financial information. To access the Addendum go to http://investors.statestreet.com and click on “Filings & Reports – Quarterly Results”.
21 ACWI All Country World Index AOCI Accumulated other comprehensive income ARR Annual recurring revenue AUC/A Assets under custody and/or administration AUM Assets under management Bloomberg Global Aggregate Bloomberg Global Aggregate represents Bloomberg Global Aggregate Bond Index CCAR Comprehensive Capital Analysis and Review CET1 ratio Common equity tier 1 ratio CRD Charles River Development EAFE Europe, Australia, and Far East EM Emerging markets EMEA Europe, Middle East and Africa EOP End of period EPS Earnings per share ETF Exchange-traded fund FDIC Federal Deposit Insurance Corporation FIX The Charles River Network's FIX Network Service (CRN) is an end-to-end trade execution and support service facilitating electronic trading between Charles River's asset management and broker clients Front office uninstalled revenue backlog Represents the annualized recurring revenue from signed client contracts that are scheduled to be fully installed over the next 24 months for CRD, Charles River for Private Markets and Alpha Data Services. It includes SaaS revenue as well as maintenance and support revenue and excludes the one-time impact of on-premises license revenue, revenue generated from FIX, brokerage, value-add services, and professional services as well as revenue from affiliates FTE Fully taxable-equivalent FX Foreign exchange GAAP Generally accepted accounting principles in the United States G-SIB Global systemically important bank HQLA High Quality Liquid Assets HTM Held-to-maturity JPM G7 JP Morgan G7 Volatility Index JPM EM JP Morgan Emerging Market Bond Index JV Joint venture LCR Liquidity Coverage Ratio Middle office uninstalled revenue backlog Represents the annualized recurring revenue from signed client contracts that are scheduled to be fully installed over the next 24 months. It does not include professional services revenue or revenue from affiliates MSCI Morgan Stanley Capital International Net interest income (NII) Income earned on interest bearing assets less interest paid on interest bearing liabilities Net interest margin (NIM) (FTE) Fully taxable-equivalent (FTE) Net interest income divided by average total interest-earning assets nm Not meaningful NYSE New York Stock Exchange OCI Other comprehensive income On-premises On-premises revenue as recognized in Front office software and data Pre-tax margin Income before income tax expense divided by total revenue Operational deposits Client cash deposits that are required for or related to the underlying transaction activity of their accounts, and accordingly, are historically more stable than other transient cash deposits %Pts Percentage points is the difference from one percentage value subtracted from another Quarter-over-Quarter (QoQ) Sequential quarter comparison Return on equity (ROE) Net income available to common shareholders less dividends on preferred stock divided by average common equity Return on tangible common equity (ROTCE) Net income available to common shareholders excluding notable items divided by average tangible common equity RWA Risk weighted assets SaaS Software as a service SCB Stress capital buffer Seasonal expenses Seasonal deferred incentive compensation expenses for retirement-eligible employees and payroll taxes SEC Securities Exchange Commission SSGA State Street Global Advisors VIX Chicago Board Options Exchange's CBOE Volatility Index Year-over-Year (YoY) Current period compared to the same period a year ago YTD Year-to-date