In a welcome sign for Wall Street firms amidst the Covid-19 pandemic, State Street has reported a 25% jump in Q1 2020 net income.
The asset manager registered a net income of $634m in the three-month period ended 31 March 2020, versus $508m in the prior year.
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Total revenue increased 5% to $3.06bn from $2.93bn.
However, the impact of lower market rates decreased net interest income by 1% to $664m on a year-on-year basis.
Total expenses dipped 2% to $2.25bn from $2.29bn. The firm attributed the decrease to automation, resource discipline as well as process re-engineering.
The firm’s assets under management as of 31 March 2020 were $2.7trn, down 4% from $2.8trn a year ago.
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By GlobalDataAssets under custody and/or administration dropped 2% to $31.86trn from $32.64trn over the period.
State Street chairman and CEO Ron O’Hanley said: “While our first quarter results were somewhat impacted by the COVID-19 pandemic, our overall strong year-over-year performance reflects the strength, diversity and durability of our business model.
“Compared to 4Q19, market valuations and client flows impacted servicing and management fees, offset by significant client activity, with heightened volatility levels driving strong fee revenue growth in our foreign exchange trading services business.
“Similarly, while lower rates were a headwind for net interest income during the quarter, we also saw significant deposit inflows and greater client usage of our strong balance sheet.”
Financial majors like Morgan Stanley, Goldman Sachs, BlackRock reported profit drop this quarter due to the pandemic.
