STATE STREET CORP Quarterly Report for Q2 Ended Jun 30, 2019

Summary

State Street Corporation's Q2 2019 filing indicates a decline in overall revenue and net income compared to the prior year period. Total revenue decreased by 6% driven by lower fee revenue and net interest income, while total expenses remained relatively stable. This resulted in a 20% decrease in net income and a 24% drop in diluted earnings per share. The company repurchased $300 million of its common stock and declared a dividend of $0.47 per share, an increase of 12% year-over-year. Despite revenue headwinds in key segments like Servicing Fees and Foreign Exchange Trading Services, the company is actively managing expenses through a savings program targeting $400 million in gross savings for 2019. The acquisition of CRD is contributing to revenue, particularly in processing fees and other revenue, but also increasing expenses and amortization. State Street's capital ratios remain strong, with its Common Equity Tier 1 capital ratio at 11.5% as of June 30, 2019, demonstrating a solid capital position despite the challenging operating environment.

Key Highlights

• 1Total revenue decreased by 6% to $2.87 billion in Q2 2019 compared to Q2 2018, primarily due to lower fee revenue and net interest income.
• 2Diluted earnings per share (EPS) fell by 24% to $1.42 in Q2 2019 compared to $1.88 in Q2 2018.
• 3Total expenses remained relatively flat, decreasing by 1% to $2.15 billion in Q2 2019.
• 4The company continues its expense savings program, expecting $400 million in gross savings for 2019.
• 5State Street repurchased $300 million of common stock in Q2 2019 and increased its quarterly common stock dividend by 12% to $0.47 per share.
• 6Assets under Custody and/or Administration (AUC/A) decreased by 3% to $32.75 trillion, while Assets Under Management (AUM) increased by 7% to $2.92 trillion.

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