Mon, 21/01/2013 - 10:11
State Street had earnings per common share (EPS) of USD1.00 for the fourth quarter of 2012, a decrease from USD1.36 in the third quarter of 2012 but an increase from USD0.76 in the fourth quarter of 2011.
Net income available to common shareholders of USD468m decreased from USD654m in the third quarter of 2012 and increased from USD371m in the fourth quarter of 2011.
Revenue of USD2.45bn increased four per cent from the third quarter of 2012 and increased six per cent from the fourth quarter of 2011.
Net interest revenue of USD622m increased slightly from USD619m in the third quarter of 2012 and increased three per cent from the fourth quarter of 2011.
Expenses of USD1.86bn increased from USD1.42bn in the third quarter of 2012, primarily the result of a non-recurring benefit in the third quarter, and increased four per cent from the fourth quarter of 2011.
Return on average common shareholders' equity (ROE) of 9.3 per cent decreased from 13.3 per cent in the third quarter of 2012 and increased from 7.8 per cent in the fourth quarter of 2011.
Recorded pre-tax acquisition and restructuring costs of USD139m, primarily related to severance and benefits costs for targeted staff reductions expected to be substantially completed during 2013. This additional expense control measure was taken to better align the company's expenses to its business outlook for 2013 and will involve the reduction of approximately 630 positions worldwide.
Full year 2012 EPS increased 5.9 per cent to USD3.95 from USD3.73 in 2011. Revenue of USD9.73bn increased 1.74 per cent from USD9.56bn in 2011, and expenses of USD6.91bn increased 1.71 per cent from USD6.79bn in 2011. ROE decreased to 9.7 per cent in 2012 from 9.9 per cent in 2011.
Joseph L Hooley (pictured), State Street's chairman, president and chief executive officer, says: “The fourth-quarter and full-year 2012 results reflect continued resilience across our asset servicing and asset management businesses. We achieved these results in a constrained revenue environment, generating positive operating leverage and continuing to invest in key markets that position us for further growth.
“While equity markets improved in the fourth quarter, our clients remained cautious for most of the quarter given the uncertainty surrounding the global economic environment and the US fiscal cliff. We experienced strong demand for our solutions as evidenced by USD649bn in asset servicing wins and a continued strong pipeline.
“We remain focused on executing our business operations and information technology transformation programme. Additionally, to capture further efficiencies and cost savings, today we announced a separate reduction in force to align our expenses with our business outlook for 2013.
“We purchased approximately 11 million shares this quarter for USD480m under our USD1.8bn common stock purchase plan and declared a USD0.24 per share common stock dividend. Earlier this month, we submitted our 2013 capital plan to the Federal Reserve Bank. We continue to prioritise the return of capital to our shareholders.
"As we look ahead, we are encouraged by the recent market strength and early signs of client re-risking. We remain confident in the long-term growth prospects of our business and are focused on servicing clients, growing revenues organically, managing expenses prudently, and returning capital to shareholders.”
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