Business Irish

Saturday 17 February 2018

State Street's profits jump 5pc

Thomas Molloy

STATE Street, the US financial services company that employs 2,000 people here, said operating profit rose 5pc in the second quarter, fuelled by strong growth in its investment management and servicing business.

The Boston-based asset management and custody firm with operations in Dublin, Kilkenny, Naas and Drogheda said earnings on an operating basis climbed to $464m (€360m) from $441m a year earlier, as earnings per share rose to 93c from 89c.

Custody banks such as State Street keep records, track performance and lend securities to institutional investors including pension funds.

State Street opened a new headquarters in Dublin's docklands in March, a decision chief executive Jay Hooley said signalled the company's commitment to Ireland.

The firm said yesterday that servicing fees climbed 20pc to $957m, while management fees rose 12pc to $217m. On an operating basis, total sales increased 6pc to $2.16bn.

State Street previewed earnings earlier this month and said it took a one-time charge of $251m, or 50c a share, for an injection of money to support trust funds that its money management arm offers.

At June 30, the after-tax, unrealised mark-to-market losses in the investment portfolio, which has worried investors, were $994m, down 31pc from the previous quarter and a decline of 79pc on a year ago.

The money that State Street invests for clients rose almost 15pc to $1.78 trillion in the quarter, while expenses rose 43pc to $1.94bn, primarily because of the $251m after-tax charge.

Irish Independent

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