By Michael Calia And Angela Chen
State Street Corp. said strength in its trading-services and
foreign-exchange trading segments spurred strong earnings growth in
the fourth quarter, despite unfavorable currency effects.
The results beat expectations.
"Despite the low interest-rate environment in 2014, our revenue
experienced solid growth compared with 2013 from both asset
servicing and asset management," said Chief Executive Joseph L.
Hooley. State Street added some $400 billion of new asset-servicing
mandates last quarter and net new assets to be managed were $7
billion.
Overall, State Street reported earnings of $525 million, down
from $545 million, a year ago. On a per-share basis, however,
earnings rose $1.24 from $1.22 a year earlier.
On an operating basis, profit rose to $1.37 a share versus $1.15
a share a year earlier.
Operating revenue improved 7.8% to $2.72 billion.
Analysts polled by Thomson Reuters estimated an operating profit
of $1.26 a share and revenue of $2.67 billion.
The firm said it had $2.74 trillion in assets under management
as of Dec. 31, about 0.2% less than it had during the same period a
year ago. Assets under custody and administration rose to $28.19
trillion from $27.43 trillion.
Servicing fees grew 5.6% to $1.3 billion due to new business and
stronger U.S. equity markets, though partially offset by the
stronger dollar. Management fees grew 3.1% to $299 million, largely
due to the same reasons.
In its trading-services business, revenue jumped 24%. Revenue
climbed 34% in foreign-exchange trading due to higher volatility
and volumes.
Rival Northern Trust Corp. earlier this week reported earnings
that beat expectations, while Bank of New York Mellon Corp. on
Friday posted disappointing results amid weakness in its
fixed-income segment.
Shares of State Street, which were inactive premarket, have
risen about 6% in the past 12 months through Thursday's close.
Write to Michael Calia at michael.calia@wsj.com and Angela Chen
at angela.chen@dowjones.com
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