State Street's Q1 Revenues Up 1% As FX Trading Volumes Rise

The financial services company cited strength in equity markets, combined with higher volumes in foreign exchange trading, supported by fee revenues.

State Street reported revenues of $2.44 billion in the first quarter of 2013, a decline of one percent from Q4 of 2012, as well as a one percent increase from the first quarter of 2012.

The bank’s net income totaled $455 million, a drop from $468 million in the fourth quarter of 2012, and an increase from $417 million in the first quarter of last year.

The financial services company whose businesses include global custody, asset servicing, brokerage and asset management, said the results reflect “good performance and providing valued added solutions to clients across the asset servicing and asset management businesses,” according to comments by Joseph Holey, State Street’s chairman, CEO and president.

In a statement in today’s earnings release, Holey cited the strength in equity markets, combined with higher volumes and increased volatility in foreign exchange trading as supporting fee revenue. He also singled out expense controls and benefits from a transformation program.

“Overall the environment continues to show signs of gradual improvement as reflected by investors shifting into equities,” said Holey. “However, given the ongoing fragile state of the global wealth markets, we continue to remain cautious for 2013.”

State Street’s most profitable businesses were as follows: Trading services from foreign -exchange trading and brokerage and other fees, generated $281 million, rising 15.6 percent from Q4 of 2o12 due to strength in foreign exchange and electronic trading.

Foreign exchange revenue increased 23.7 percent form the fourth quarter of 2012 due to higher volumes and volatilities, the company fees. Brokerage and other fees increased 8 percent to $135 million from the fourth quarter of 2012 due to increased electronic trading. Management fees increased to $263 million in the first quarter of 2013, up slightly from $260 million in 2012’s Q4, due to stronger global equity markets offset by lower performance fees. Compared to the first quarter of 2012, management fees increased 11.4 percent, mainly due to stronger global equity markets and net new business.

Ivy is Editor-at-Large for Advanced Trading and Wall Street & Technology. Ivy is responsible for writing in-depth feature articles, daily blogs and news articles with a focus on automated trading in the capital markets. As an industry expert, Ivy has reported on a myriad ... View Full Bio