State Street Corporation · NYSE:STT
State Street — Goldman Sachs US Financial Services Conference 2018
19 slides from State Street's conference presentation, Dec 5, 2018
Slide 1: State Street at Goldman Sachs US Financial Services Conference
State Street at Goldman Sachs US Financial Services Conference Ronald P. O’Hanley President and Chief Operating Officer Wednesday, December 5, 2018
Slide 2: Preface and forward-looking statements
Preface and forward-looking statements This presentation (and the discussion accompanying it) contains forward-looking statements as defined by United States securities laws. These statements are not guarantees of future performance, are inherently uncertain, are based on assumptions that are diffic
Slide 3: Uniquely positioned in secularly attractive and high-growth markets
Uniquely positioned in secularly attractive and high-growth markets 3Q18YTD Total Revenue Mix3 • 2nd largest global custody • 3rd largest global asset bank with ~$34T AUCA manager with $2.8T AUM NII 22% Investment • 3rd largest ETF provider • Trusted with more than 10% of Management globally with AU
Slide 4: Environment creates challenges and opportunities
Environment creates challenges and opportunities • Technology innovation and rising scale economics • Regulatory evolution and complexity Industry • Growing wealth in emerging markets trends • Intensifying competition from traditional and non-traditional players • Fee compression and rising costs •
Slide 5: Our vision
Our vision To be the leading asset servicer, asset manager and data insight provider to the owners and managers of the world’s capital Essential Leading platform Technology-driven High-performing partner with a broad scale provider organization revenue mix • Help solve growth, • Leverage core client
Slide 6: Executing on our vision: Strategic priorities
Executing on our vision: Strategic priorities Essential partner 1 Reignite servicing fee growth 2 Innovate to grow diversified revenue streams Leading platform with a broad revenue mix Delivering results through 3 Deploy the leading front-to-back office platform focused Technology-driven execution s
Slide 7: Actions to support our strategic priorities
Actions to support our strategic priorities Strategic Priorities Near-term actionsA Medium-term actions and measuresB 1 • Upgrade our client executives to • Gain AUCA and revenue market share: Reignite servicing better partner with our top clients ‒ Increase revenue market share by 1–2% for priority
Slide 8: Reignite servicing fee growth: Our client base
Strategic Priorities 1 Reignite servicing fee growth: Our client base Well positioned market leader with more room to grow A B Segments Subsegments Market Share (~%) Actions Global asset managers 35% • Strengthen client coverage model; dedicated client executives aligned Global Large, sophisticated
Slide 9: Reignite servicing fee growth: International expansion opportunities
Strategic Priorities 1 Reignite servicing fee growth: International expansion opportunities Targeting high-growth geographies International market opportunities Servicing fee geographic mix ($M) US Major asset managers and asset owners continue International to grow globally: 4% • Expand servicing p
Slide 10: Grow diversified revenue streams through product innovations and deepened client relationship management
Strategic Priorities Grow diversified revenue streams through product 2 innovations and deepened client relationship management FX Trading: Global Real Money Leadership12 Global Advisors: Drive organic AUM growth 700 $654 $641 12.00% FX revenue ($M) AUM CAGR 11.00% Ranking12 ($B, at period-end) 7% $
Slide 11: Deploy the leading front-to-back office platform
Strategic Priorities Deploy the leading front-to-back office platform 3 CRD accelerates State Street Front-to-Back Platform Charles River offerings Front office Middle office Back-office • Portfolio modeling & construction • Performance & attribution • Custody • Investment risk & compliance • Invest
Slide 12: Generate structural expense saves of 2-3% annually; foster a high performing organization
Strategic Priorities Generate structural expense saves of 2-3% annually; foster a high performing organization 4 5 Generate structural expense saves annuallyA Further digitization efforts transforming operations Expenses ($B) • Maximize global hubs to drive efficiencies $8.3 • Raise straight-through
Slide 13: Financial targets
Financial targets A Our strategic priorities will deliver growth, drive innovation and enhance shareholder value Revenue growth 4–5% with CRD Pre-tax margin Further improve by an additional 2%pts EPS growth 10–15% ROE 12–15% Capital return Targeting total payout greater than or equal to 80%B A Finan
Slide 14: Questions and Answers
State Street at Goldman Sachs US Financial Services Conference Questions Ronald P. O’Hanley, President and Chief Operating Officer and Eric W. Aboaf, Chief Financial Officer Answers Wednesday, December 5, 2018 14
Slide 15: Appendix
Appendix Endnotes 16 Forward-looking statements 17 Non-GAAP measures 18 Definitions 19 15
Slide 16: Slide endnotes
Slide endnotes 1 Sources: a. “Trusted with more than 10% of world’s assets”: State Street and McKinsey Global Institute, Global Capital Markets, December 31, 2016. This represents State Street’s AUCA ($29T) as a proportion of total global financial assets ($270T). *Updated in January 2018 per bespok
Slide 17: Forward-looking statements
Forward-looking statements This presentation (and the discussion accompanying it) contains forward-looking statements within the meaning of United States securities laws, including statements about our goals and expectations regarding our business, financial and capital condition, results of operati
Slide 18: Non-GAAP Measures
Non-GAAP Measures In addition to presenting State Street's financial results in conformity with U.S. generally accepted accounting principles, or GAAP, management also presents certain financial information on a non-GAAP basis. In general, our non-GAAP financial results adjust selected GAAP-basis fi
Slide 19: Definitions
Definitions AUCA Assets under custody and administration AUM Assets under management Bps Basis points, with one basis point representing one hundredth of one percent CCAR Comprehensive Capital Analysis and Review CRD Charles River Development Diluted earnings per share (EPS) Net income available to
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