State Street Corp., the world’s
largest custodian of assets, said third-quarter earnings rose 11
percent, as higher stock markets boosted management fees.
Net income increased to $202 million, or 60 cents a share,
from $182 million, or 56 cents, in the year-earlier period, the
Boston-based company said in a statement. Analysts were expecting
profit of 57 cents a share. Third-quarter revenue gained 17
percent to $1.13 billion.
State Street rebounded from a second-quarter loss, its first
in 26 years, that was caused by an expense to shed 3,100 jobs.
Chief Executive Officer David Spina has focused on reducing costs
and trying to keep customers obtained in the January acquisition
of Deutsche Bank AG’s record-keeping and securities-lending unit.
“We are making operations cost efficient,” Spina said in
the statement. State Street expects to retain about 90 percent of
the client fees from Deutsche Bank. The acquired business is
operating at about “break even,” with about $628 million of
annualized revenue and about $520 million of annualized costs, the
company said.
The takeover of the Deutsche Bank business put State Street
ahead of Bank of New York Co. and J.P. Morgan Chase & Co. as the
world’s largest custodian of assets. State Street had $8.8
trillion of assets under custody at the end of September.
Bloomberg News
