By Anna Prior
State Street Corp. said fourth-quarter earnings rose 16% on
higher servicing and management fees.
State Street, one of the country's largest trust banks, has
taken a hard line on expenses despite improving business trends.
The company's cost-control measures have included withdrawing from
its fixed-income-trading initiative and staff cuts, actions it has
said will better align expenses with its business outlook.
The company reported a profit of $545 million, or $1.22 a share,
up from $468 million, or $1 a share, a year earlier. The latest
quarter included an out-of-period income tax benefit of $71
million, or 16 cents a share, related to the completion of a
multiyear data-enhancement process in connection with the company's
deferred income-tax accounts. Per-share earnings also included
pretax provisions of $45 million, or six cents a share, related to
previously disclosed litigation and non-U.S. regulatory
matters.
Adjusted per-share earnings rose to $1.15 from $1.11.
Revenue edged up 0.4% to $2.46 billion, while operating revenue
rose 2.8% to $2.53 billion.
Analysts polled by Thomson Reuters forecast earnings of $1.19 a
share on revenue of $2.5 billion.
State Street shares recently fell 3.2% to $72.76 in premarket
trading.
Servicing fees rose 7.1% to $1.23 billion. Trading-services
revenue, which includes foreign-exchange trading revenue and
brokerage and other fees, fell 6.2% to $228 million. Management
fees added 12% to $290 million.
Assets under management at the end of the quarter rose 12% to
$2.35 trillion from a year earlier, while assets under custody and
administration climbed 13% to $27.43 trillion.
Write to Anna Prior at anna.prior@wsj.com
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