State Street Corp. (STT) on Tuesday reported third-quarter 2010 earnings per common share of $1.08, an increase of 64% compared to $0.66 in the third quarter of 2009. Revenue in Q3 2010 was $2.31 billion, up 3% from $2.24 billion at this time last year.
The company, whose Q3 2010 results beat analysts' expectations for earnings per share of $0.83, made its profits primarily by reducing expenses and increasing service fee revenues.
Expenses of $1.527 billion in the third quarter declined 12% from $1.733 billion in the third quarter of 2009. Servicing fees were up 19% to $989 million from $833 million in the third quarter of 2009.
STT stock after the earnings release was trading in a range of $39.58 to $41.31 per share versus the prior day's close of $41.21.
State Street President and CEO Joseph L. Hooley credited the company's servicing fees in the company's overall results, noting that STT won $477 billion in assets to be serviced in the third quarter. He also acknowledged that management fees were off and that trading remains a challenge.
"Our overall results were driven by strength in our servicing fee revenue and our ability to maintain our focus on cost control," Hooley said in a statement. "State Street Global Advisors continues to perform well although management fees
were down slightly, due primarily to the change in business mix as shown in assets under management."
