STT · State Street Corporation

State Street Corporation delivered a strong start to 2026, reporting record quarterly fee revenue, net interest income, and total revenue. Total revenue of $3.8 billion represented a 16% year-over-year increase, driven by a 15% rise in fee revenue to $3.0 billion and a 17% increase in net interest income to $835 million. The revenue growth was broad-based, with servicing fees up 11%, management fees up 23%, and FX trading services up 29% year-over-year. Management attributed the performance to higher market levels, net new business wins, and improved net interest margin, which expanded 16 basis points to 1.16%.

Operating performance reflected positive leverage, with total operating leverage of 86 basis points on a GAAP basis and 616 basis points excluding notable items. Pre-tax margin expanded to 25.5% (GAAP) and 29.0% (adjusted). Notable items in the quarter included $89 million in repositioning charges and $41 million in client rescoping costs, totaling $130 million pre-tax. Excluding these items, total expenses increased 9%, driven by revenue-related costs and continued investments in technology and infrastructure.

Asset gathering strength was evident, with record Assets Under Custody/Administration of $54.5 trillion, up 17% year-over-year. Investment Management AUM reached $5.6 trillion, supported by record quarterly SPDR ETF inflows, positioning State Street as the #1 asset gathering ETF globally. The firm maintained robust capital return, distributing $633 million to common shareholders through dividends and buybacks. The CET1 ratio of 10.6% remained well above regulatory minimums, though it decreased 1.0 percentage point from the prior quarter due to a normalization in risk-weighted assets and continued capital return. Management expressed confidence in the firm's momentum while acknowledging uncertainty in the macro and geopolitical environment.