State Street Overbilled $200 Million Over 18 Years
December 17 2015 - 8:00AM
Dow Jones News
State Street Corp. overbilled certain clients over an 18-year
period by roughly $200 million, the asset manager said Thursday,
funds it intends to reimburse at the completion of its review.
The Boston-based bank said it has conducted a preliminary
investigation of the period for which it has accessible records,
covering about $400 million in invoices for asset-servicing clients
primarily in the U.S.
Approximately $200 million or more of expenses may have been
incorrectly invoiced, the company said, adding that it "deeply
regrets this matter."
In State Street's most recent business year, the categories of
expenses under review represented about 0.7% of the bank's total
asset servicing fee revenue. Asset servicing fee revenue makes
roughly half of the company's top line.
State Street said it would fully compensate affected clients,
including interest, once its investigation is completed. The trust
bank also said it would make any required improvements to its
billing practices.
The bank said its December quarter's financial results are
likely to include expenses stemming from the review and that it
would provide additional information when it reports those results
on Jan. 27.
Write to Lisa Beilfuss at lisa.beilfuss@wsj.com
(END) Dow Jones Newswires
December 17, 2015 07:45 ET (12:45 GMT)
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