Slide 1: 2Q 2022 Financial Highlights
July 15, 2022 2Q 2022 Financial Highlights (NYSE: STT)
Slide 2: Preface and forward-looking statements
Preface and forward-looking statements This presentation includes certain highlights of, and also material supplemental to, State Street Corporation’s news release announcing its second quarter 2022 financial results. That news release contains a more detailed discussion of many of the matters descr
Slide 3: 2Q22 highlights
2Q22 highlights All comparisons are to corresponding prior year period unless noted otherwise • EPS of $1.91, down (8)%; $1.94 ex-notable items, down (2)%A • Total revenue of ~$3.0B, down (3)%; down (1)% ex-notablesA ‒ Fee revenue down (6)% largely due to lower equity and fixed income market levels,
Slide 4: Summary of 2Q22 financial results
Summary of 2Q22 financial results Quarters %∆ 2Q21 %∆ (GAAP, $M, except EPS data, or where otherwise noted) ex-currency 2Q21 1Q22 2Q22 1Q22 2Q21 translation A Revenue: Back office servicing fees $1,290 $1,268 $1,205 (5)% (7)% (4)% Middle office services 104 100 92 (8) (12) (9) Servicing fees 1,394 1
Slide 5: AUC/A and AUM levels, markets and flows performance
AUC/A and AUM levels, markets and flows performance A AUC/A and AUM Market indices4 AUC/A ($T, as of period-end) 1 (% change) 2Q22 vs -10% • (10)% decrease from 2Q21 largely 1Q22 2Q21 driven by: EOP (16)% (12)% -8% – Lower equity and fixed income market S&P 500 Daily Avg (8) (2) levels, partially of
Slide 6: Revenue: Servicing fees
Revenue: Servicing fees Servicing fees ($M) 2Q22 performance Total YoY -3% Servicing fees of $1,297M down (7)% YoY and (5)% QoQ; $3,034 $2,990 $3,053 $3,081 $2,953 QoQ -4% revenue down (4)% YoY and QoQ ex-FXA • Down (7)% YoY primarily driven by lower average equity and fixed income -7% market levels
Slide 7: Revenue: Management fees
Revenue: Management fees Management fees ($M) 2Q22 performance Total YoY -3% Management fees of $490M down (3)% YoY and (6)% QoQ; $3,034 $2,990 $3,053 $3,081 $2,953 QoQ -4% down (1)% YoY and (5)% QoQ ex-FXA revenue • Down (3)% YoY mainly due to lower average equity and fixed income -3% -1% ex-FX A m
Slide 8: Revenue: Markets, Software and processing, and Other fee revenue
Revenue: Markets, Software and processing, and Other fee revenue Markets, Software & processing, and Other fees ($M) 2Q22 performance • FX trading services of $331M Total YoY -3% revenue $3,034 $2,990 $3,053 $3,081 $2,953 QoQ -4% – Up 16% YoY primarily reflecting higher FX spreads, partially offset
Slide 9: Enterprise solutions enabled by State Street Alpha
Enterprise solutions enabled by State Street Alpha Future growth driven by Front office, Middle Front office software and data ($M) A office, and Alpha Total ($M) 2Q21 1Q22 2Q22 YoY -3% revenue $3,034 $2,990 $3,053 $3,081 $2,953 QoQ -4% Front office metrics -15% New bookings 8 $20 $5 $11 -9% $148 AR
Slide 10: Revenue: Net interest income
Revenue: Net interest income NII and NIM ($M) 12 Average balance sheet highlights ($B) A Total YoY -3% 2Q21 3Q21 4Q21 1Q22 2Q22 $3,034 $2,990 $3,053 $3,081 $2,953 QoQ -4% revenue Total assets $308 $291 $303 $295 $291 +25% +15% Interest-earning assets 266 255 265 258 251 $584 Loans 29 32 34 34 36 $50
Slide 11: Expenses
Expenses Expenses 2Q22 performance A (Ex-notable items, non-GAAP, $M) (Ex-notable items, non-GAAP)A -1% A Expenses of $2,096M down (1)% YoY and (10)% QoQ; up +2% ex-FX -10% 2% YoY and down (8)% QoQ ex-FXA • Compensation and employee benefits of $1,046M A -8% ex-FX $2,318 – Down (3)% YoY mainly due t
Slide 12: Capital ratios
Capital ratios 3 Capital ratios Capital highlights (%, as of period-end) CET1 (Standardized) • 2Q22 quarter end standardized CET1 ratio of 12.9% increased 1.0%pt QoQ primarily reflecting planned RWA reductions and management 14.3% 13.5% 12.9% actions to reduce AOCI impact of the investment portfolio
Slide 13: Summary
Summary All comparisons are to corresponding prior year period unless noted otherwise 2Q22 financial review • EPS of $1.91; pre-tax margin of 28.3%; ROE of 12.1% • EPS ex-notable items of $1.94, down (2)%A – Total revenue of ~$3.0B, down (1)% (up 1% ex-currency translation), with Fee revenue down (6
Slide 14: Appendix
2Q22 line of business performance 15 Reconciliation of notable items 16 Reconciliation of constant currency impacts 17 Appendix Endnotes 18 Forward-looking statements 19 Non-GAAP measures 20 Definitions 21 14
Slide 15: 2Q22 line of business performance
2Q22 line of business performance Investment Servicing Investment Management State StreetB Total revenueA YoY % ∆ Total revenue YoY % ∆ Total revenue ex-notable itemsA, C YoY % ∆ $2,452M $2,475M +1% $2,981M $2,953M -1% Fee 1,888 -5% $529M Fee 1,984 1,888 $478M -10% 2,514 2,370 -6% revenue revenue NI
Slide 16: Reconciliation of notable items
Reconciliation of notable items Quarterly reconciliation % Change Year-to-Date % Change 2Q22 2Q22 YTD2022 vs. vs. vs. (Dollars in millions, unless noted otherwise) 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 2Q21 1Q22 2021 2022 YTD2021 Total revenue, GAAP-basis $2,950 $3,034 $2,990 $3,053 $3,081 $2,953 (2.7)% (4.
Slide 17: Reconciliation of constant currency impacts
Reconciliation of constant currency impacts Currency Translation Excluding Currency % Change Constant Reconciliation of Constant Currency FX Impacts Reported Impact Impact Currency 2Q22 2Q22 2Q22 2Q22 2Q22 2Q22 vs. vs. vs. vs. vs. vs. (Dollars in millions) 2Q21 1Q22 2Q22 2Q21 1Q22 2Q21 1Q22 2Q21 1Q2
Slide 18: Endnotes
Endnotes 1. New asset servicing mandates, including announced front-to-back investment servicing clients, may be subject to completion of definitive agreements, approval of applicable boards and shareholders and customary regulatory approvals. New asset servicing mandates and servicing assets remain
Slide 19: Forward-looking statements
Forward-looking statements This presentation (and the conference call referenced herein) 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
Slide 20: 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 basis that excludes or adjusts one or more items from GAAP. This latter basis is a non-G
Slide 21: Definitions
Definitions AOCI Accumulated other comprehensive income ARR Annual recurring revenue AUC/A Assets under custody and/or administration AUM Assets under management Barclays Global Agg Barclays Global Agg represents Barclays Global Aggregate Bond Index BBH Brown Brothers Harriman Bps Basis points, with