State Street Corporation · NYSE:STT
State Street — Shareholder Meeting (May 2014)
25 slides from State Street's shareholder meeting presentation, May 14, 2014
Slide 1: The Way Ahead: Creating Long-Term Shareholder Value
The Way Ahead: Creating Long-Term Shareholder Value 2014 Annual Meeting of Shareholders May 14, 2014
Slide 2: Forward-looking Statements
2 Forward-looking Statements This presentation contains forward-looking statements as defined by United States securities laws, including statements relating to our goals and expectations regarding our business, financial and capital condition, results of operations, investment portfolio performance
Slide 3: The Way Ahead Agenda
3 The Way Ahead Agenda ● 2013 Performance ● 2014 First Quarter Results ● Focused Strategy ● Summary
Slide 4: 2013 Performance
2013 Performance Et) STATE STREET.
Slide 5: Full-year 2013 Accomplishments
5 Full-year 2013 Accomplishments1 ● Increased operating-basis EPS2 by nearly 15% ● Grew total operating-basis2 revenue 3.3% to more than $10 billion ● Grew core servicing and management fees approximately 10% ● Achieved record levels of $27.4 trillion in assets under custody and administration and $
Slide 6: Peer data and non-GAAP presentation notes
6 1 (i) Data for each of State Street Corporation (STT), The Bank of New York Mellon Corporation (BK) and Northern Trust Corporation (NTRS) is derived from the relevant company’s public filings, earnings announcements or related materials (individually or collectively, “publicly disclosed informatio
Slide 7: Delivering Shareholder Value: Total Shareholder Return
7 Source: Factset market data. Delivering Shareholder Value TOTAL SHAREHOLDER RETURN 1/1/2011– 12/31/2013 1/11 4/11 7/11 10/11 1/12 4/12 7/12 10/12 1/13 4/13 7/13 10/13 -60% -40% -20% 0% 20% 40% 60% 80% 67% State Street Corp 23% Bank of New York Mellon Corp. 20% Northern Trust Corp 45% S&P 500 Finan
Slide 8: 2014 First-Quarter Results
8 2014 First-Quarter Results
Slide 9: Continuing to Perform in a Challenging Environment
9 First-Quarter 2014 Results Compared to the First Quarter of 2013 ● First-quarter 2014 operating-basis1 EPS of $0.99, increased 3.1% ● Total operating-basis1 revenue of $2.56 billion, up 3.6% ● Core total asset servicing and asset management fees increased 6.4% ● Market-driven revenue remained unde
Slide 10: 2014 CCAR stress test capital ratios
10 12.7% 11.4% 10.0% 6.5% 6.1% 6.1% 5.9% 5.5% 5.3% 7.7% 0% 2% 4% 6% 8% 10% 12% 14% BNY Mellon State Street Northern Trust Citigroup Wells Fargo Goldman Sachs Morgan Stanley JP Morgan Chase Bank of America Average*** 1 Source: Board of Governors of the Federal Reserve System, “Comprehensive Capital A
Slide 11: Return of Capital to Shareholders Remains a Priority
11 Return of Capital to Shareholders Remains a Priority Dividend Payout ● Plan to increase quarterly common stock dividend to $0.30 per share in Q2 ’14, subject to consideration and approval by the Board of Directors Common Stock Repurchase Program ● Completed final phase of $2.1 billion common stoc
Slide 12: Focused Strategy
Focused Strategy fs) STATE STREET.
Slide 13: Focused Strategy: Long-Term Shareholder Value
13 1 Goals presented on an operating basis, a non-GAAP presentation. See Appendix for explanations of our non-GAAP financial measures and for reconciliations of our operating-basis financial information. The Appendix is available on State Street’s website (www.statestreet.com/stockholder) and in Sta
Slide 14: Building on Our Strong Core
14 Data as of, or for the year ended December 31, 2013, as appropriate. Building on Our Strong Core ● Transitioning to a more integrated sales approach by sector ● Capturing full value of client relationships ● Developing innovative new products and services ● Leveraging technology leadership for sp
Slide 15: Achieving a Digital Enterprise
15 Achieving a Digital Enterprise Digital Enterprise Process Automation and Standardization Workforce Optimization: Centers of Excellence Leveraging Lower-Cost Locations Integrating Private Cloud Infrastructure ● Speed and Agility ● Data Services ● Increased Efficiency Balanced Focus on Efficiency a
Slide 16: Investing in Opportunities for Growth
16 Investing in Opportunities for Growth Global Services ● Expanding presence in servicing alternative asset managers; acquisition of business purchased from Goldman Sachs completed ● Strong new business growth driven by continued focus on servicing alternative assets Global Advisors ● Expanding mul
Slide 17: Optimizing Capital
17 1 Goals presented on an operating basis, a non-GAAP presentation. See Appendix for explanations of our non-GAAP financial measures and for reconciliations of our operating-basis financial information. The Appendix is available on State Street’s website (www.statestreet.com/stockholder) and in Sta
Slide 18: Talent, Culture and Innovation: Citizenship and Local Commitment
18 Talent, Culture and Innovation Citizenship and Local Commitment1 ● $19.6 million in Foundation investments focused on communities – Foundation investments in Massachusetts totaled $10.8 million • Investment in the Boston Private Industry Council supported the placement of 3,000 youth in summer in
Slide 19: Talent, Culture and Innovation
19 Best of the Best Top Employer Best of the Best Top Employer Innovation Excellence for Flex Program A 100 Top Company Providing Opportunities for Latinos Financial Services Diversity Leadership Awards Program of the Year Most Admired Companies, CEO's, and Brands Talent, Culture and Innovation EMPL
Slide 20: Summary
Summary EES rox ga) STATE STREET.
Slide 21: Focused Strategy: Long-Term Shareholder Value
21 1 Goals presented on an operating basis, a non-GAAP presentation. See Appendix for explanations of our non-GAAP financial measures and for reconciliations of our operating-basis financial information. The Appendix is available on State Street’s website (www.statestreet.com/stockholder) and in Sta
Slide 22: Appendix
22 Appendix The foregoing presentation includes financial information presented on a GAAP basis as well as on a non-GAAP, or “operating basis.” Management measures and compares certain financial information on an operating basis, as it believes that this presentation supports meaningful comparisons
Slide 23: 2013 vs. 2012 operating-basis reconciliation
23 2013 vs. (Dollars in millions) 2012 Total Revenue: Total revenue, GAAP basis $ 9,884 $ 9,649 2.4 % Tax-equivalent adjustment associated with tax-exempt investment securities 142 124 Tax-equivalent adjustment associated with tax-advantaged investments 158 126 Loss on sale of Greek investment secur
Slide 24: Pre-tax income and net interest revenue reconciliation
24 (Dollars in millions, except per share amounts) Income Before Income Tax Expense: Income before income tax expense, GAAP basis $ 2,686 $ 2,766 $ 2,536 Net pre-tax effect of non-operating adjustments to revenue and expenses 343 62 239 Income before income tax expense, operating basis $ 3,029 $ 2,8
Slide 25: Q1 2014 vs. Q1 2013 reconciliation
25 Q1 2014 vs. (Dollars in millions) Q1 2013 Total Revenue: Total revenue, GAAP basis $ 2,485 $ 2,435 2.1 % Tax-equivalent adjustment associated with tax-advantaged investments 57 34 Tax-equivalent adjustment associated with tax-exempt investment securities 44 32 Discount accretion associated with f