State Street Navigates Geopolitical Headwinds, AI Integration Amidst $51.66T AUC/A

TL;DR

**State Street is a behemoth in institutional finance, but watch out for geopolitical shocks and tech integration costs that could ding its steady revenue streams.**

AI Summary

STATE STREET CORP reported consolidated total assets of $371.07 billion, consolidated total deposits of $280.00 billion, and consolidated total shareholders' equity of $27.64 billion as of September 30, 2025. The company manages $51.66 trillion in Assets Under Custody/Administration (AUC/A) and $5.45 trillion in Assets Under Management (AUM) as of the same date. Operations are segmented into two lines of business: Investment Servicing and Investment Management. The company employs approximately 52,000 individuals globally. Key risks highlighted include intense competition, significant pricing pressure, and variability in AUC/A and AUM. The filing also notes potential adverse effects from political, geopolitical, economic, and market conditions, including the ongoing conflicts in Ukraine and the Middle East, and the U.S. federal government shutdown that began on October 1, 2025. Changes in interest rates or market conditions could decrease Net Interest Income (NII) or reduce capital/liquidity ratios. The company also faces extensive and changing government regulation, operational and technology risks, including cyber-attacks, and the challenges of integrating new technologies like artificial intelligence.

Why It Matters

For investors, State Street's substantial $51.66 trillion AUC/A and $5.45 trillion AUM underscore its systemic importance in the financial ecosystem, making its performance a bellwether for institutional investor sentiment. Employees face potential shifts due to strategic initiatives like AI adoption and operational model changes, which could impact job roles and locations. Customers benefit from State Street's broad range of financial products and services, but also face risks related to the company's operational resilience and cybersecurity. The broader market watches State Street for insights into global financial stability, given its extensive international operations and exposure to geopolitical and economic risks, including the U.S. federal government shutdown and conflicts in Ukraine and the Middle East, which could affect competitive dynamics in the investment servicing and management sectors.

Risk Assessment

Risk Level: high — The risk level is high due to significant exposure to geopolitical and economic volatility, including the U.S. federal government shutdown starting October 1, 2025, and ongoing conflicts in Ukraine and the Middle East. The filing explicitly states that these conditions could adversely affect the company's investment securities portfolio, financial condition, and results of operations. Additionally, the company faces substantial operational and technology risks, including cyber-attacks and the complexities of integrating new technologies like artificial intelligence, which could result in significant costs and reputational damage.

Analyst Insight

Investors should closely monitor State Street's Net Interest Income (NII) trends and capital ratios, as changes in interest rates and market conditions could lead to decreases. Evaluate the company's progress in mitigating operational and cybersecurity risks, especially given its reliance on technology and global footprint. Consider the potential impact of ongoing geopolitical events and regulatory changes on its fee revenue and overall profitability.

Financial Highlights

debt To Equity

N/A

revenue

N/A

operating Margin

N/A

total Assets

$371.07B

total Debt

N/A

net Income

N/A

eps

N/A

gross Margin

N/A

cash Position

N/A

revenue Growth

N/A

Revenue Breakdown

Key Numbers

• $371.07B — Consolidated Total Assets (As of September 30, 2025, indicating the company's overall scale.)
• $280.00B — Consolidated Total Deposits (As of September 30, 2025, a key metric for liquidity and funding.)
• $27.64B — Consolidated Total Shareholders' Equity (As of September 30, 2025, representing the company's book value.)
• $51.66T — Assets Under Custody/Administration (AUC/A) (As of September 30, 2025, demonstrating significant market presence in investment servicing.)
• $5.45T — Assets Under Management (AUM) (As of September 30, 2025, highlighting its scale in investment management.)
• 279,312,436 — Common Stock Outstanding (As of October 28, 2025, relevant for per-share metrics.)
• 52,000 — Employees (Approximate number of employees, indicating operational scale.)

Key Players & Entities

• STATE STREET CORPORATION (company) — Registrant and Parent Company
• State Street Bank and Trust Company (company) — Principal banking subsidiary
• SEC (regulator) — Securities and Exchange Commission
• New York Stock Exchange (regulator) — Exchange where STT and STT.PRG are registered
• $371.07 billion (dollar_amount) — Consolidated total assets as of September 30, 2025
• $280.00 billion (dollar_amount) — Consolidated total deposits as of September 30, 2025
• $27.64 billion (dollar_amount) — Consolidated total shareholders' equity as of September 30, 2025
• $51.66 trillion (dollar_amount) — Assets Under Custody/Administration (AUC/A) as of September 30, 2025
• $5.45 trillion (dollar_amount) — Assets Under Management (AUM) as of September 30, 2025
• 52,000 (person) — Approximate number of employees

FAQ

Risk Factors

• Geopolitical and Economic Volatility [high — market]: Ongoing conflicts in Ukraine and the Middle East, potential U.S. federal government shutdown (began Oct 1, 2025), and actions by central banks create significant market uncertainty. These factors can adversely impact operations and clients globally, potentially affecting financial markets, governmental actions, and monetary policy.
• Interest Rate and Market Condition Sensitivity [high — financial]: Changes in prevailing interest rates or market conditions can decrease Net Interest Income (NII) or lead to reductions in capital or liquidity ratios. The company's investment securities portfolio is also subject to these risks.
• Credit and Counterparty Risk [medium — financial]: State Street assumes significant credit risk from counterparties, many of whom have substantial financial dependencies on other institutions. These concentrated credit exposures could lead to substantial financial losses.
• Fee Revenue Volatility [medium — financial]: Fee revenue, a significant portion of total revenue, is subject to declines based on market and currency fluctuations, investment activity, client preferences, and onboarding timelines. This makes revenue streams susceptible to external market forces.
• Cybersecurity and Technology Risks [high — operational]: Attacks on IT systems, including cyber-attacks, can cause significant costs, reputational damage, and business disruptions. The adoption of new technologies like AI also introduces integration and operational risks.
• Operational Model and Third-Party Risks [medium — operational]: Shifting operations to non-U.S. jurisdictions, outsourcing, or insourcing to third parties increases operational and geopolitical risks. Failures in risk management frameworks, models, or processes, including errors in operational or transaction processing, can adversely affect financial condition and reputation.
• Extensive and Changing Regulation [high — regulatory]: The company faces extensive and evolving government regulation. Compliance with new requirements, such as those related to climate risks and sustainability standards, could adversely affect the business.
• Capital and Liquidity Management [high — financial]: Failure to effectively manage capital and liquidity can adversely affect financial condition, capital ratios, results of operations, and business prospects. The company may also need to raise additional capital or debt on potentially unfavorable terms.

Industry Context

State Street operates as a leading global provider of financial services to institutional investors, managing substantial assets in custody and management. The industry is characterized by intense competition and significant pricing pressure. Key trends include the increasing adoption of new technologies like AI, evolving regulatory landscapes, and the growing importance of ESG factors, all of which impact operational strategies and risk management.

Regulatory Implications

State Street faces extensive and evolving government regulation across its global operations. Compliance with these regulations, including those related to capital adequacy (e.g., LCR, NSFR, RWA) and emerging areas like climate risk and sustainability, is critical. Non-compliance or changes in regulatory requirements can significantly impact financial condition, operations, and business prospects.

What Investors Should Do

1. Monitor geopolitical and macroeconomic developments closely.
2. Assess the company's sensitivity to interest rate changes.
3. Evaluate the effectiveness of risk management frameworks, particularly for cyber and operational risks.
4. Review disclosures related to capital ratios and liquidity metrics.

Key Dates

• 2025-10-01: U.S. federal government shutdown began — Contributes to economic and political uncertainty, posing a risk to State Street's operations and clients.
• 2025-09-30: Quarter end for 10-Q filing — Provides the snapshot of the company's financial condition, including assets, deposits, equity, AUC/A, and AUM.
• 2024-12-31: Year end for 2024 Annual Report — This 10-Q updates the information presented in the 2024 Form 10-K, providing context for year-over-year comparisons.

Glossary

AUC/A

Assets Under Custody/Administration (A key metric indicating the scale of State Street's investment servicing business, totaling $51.66 trillion as of September 30, 2025.)

AUM

Assets Under Management (Represents the scale of State Street's investment management business, amounting to $5.45 trillion as of September 30, 2025.)

NII

Net Interest Income (A key component of revenue for financial institutions, sensitive to interest rate changes and market conditions.)

RWA

Risk-Weighted Assets (A measure used in regulatory capital calculations, indicating the level of risk associated with a bank's assets. Calculations depend on data, models, and assumptions.)

LCR

Liquidity Coverage Ratio (A regulatory requirement designed to ensure banks hold sufficient high-quality liquid assets to withstand a significant stress scenario.)

NSFR

Net Stable Funding Ratio (A regulatory requirement aimed at promoting resilience over a longer time horizon by requiring banks to fund their activities with sufficiently stable sources of funding.)

U.S. GAAP

United States Generally Accepted Accounting Principles (The accounting standards State Street follows for preparing its consolidated financial statements, requiring management to make estimates and assumptions.)

Year-Over-Year Comparison

The provided text is from a 10-Q filing and references the 2024 Form 10-K. Specific year-over-year comparisons for metrics like revenue growth, margin changes, or new risks are not detailed within this excerpt. However, the filing indicates that the current report updates the previous year's discussion and that certain amounts may have been reclassified for presentation consistency.

Key Financial Figures

• $1 — ange on which registered Common Stock, $1 par value per share STT New York Stoc
• $51.66 — institutional investors worldwide, with $51.66 trillion of AUC/A and $5.45 trillion of
• $5.45 — wide, with $51.66 trillion of AUC/A and $5.45 trillion of AUM as of September 30, 202
• $371.07 b — 25, we had consolidated total assets of $371.07 billion, consolidated total deposits of $
• $280.00 b — billion, consolidated total deposits of $280.00 billion, consolidated total shareholders'
• $27.64 billion — solidated total shareholders' equity of $27.64 billion and approximately 52,000 employees. Ou
• $2.78 — erformance Earnings per share (EPS) of $2.78 in the third quarter of 2025 increased
• $637 million — , respectively. We returned a total of $637 million to our shareholders in the form of comm
• $81 million — investment securities of approximately $81 million relating to an investment State Stree

Filing Documents

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• exhibit101vf.htm (EX-10.1) — 42KB
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• exhibit15-acknowledgmentle.htm (EX-15) — 14KB
• exhibit311-september302025.htm (EX-31.1) — 10KB
• exhibit312-september302025.htm (EX-31.2) — 10KB
• exhibit32-september302025.htm (EX-32) — 8KB
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• 0000093751-25-000575.txt ( ) — 33641KB
• stt-20250930.xsd (EX-101.SCH) — 101KB
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• stt-20250930_def.xml (EX-101.DEF) — 605KB
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• stt-20250930_pre.xml (EX-101.PRE) — 865KB
• stt-20250930_htm.xml (XML) — 7463KB

FINANCIAL INFORMATION

PART I FINANCIAL INFORMATION

Management's Discussion and Analysis of Financial Condition and Results of Operations 4

Management's Discussion and Analysis of Financial Condition and Results of Operations 4 General 4 Overview of Financial Results 8 Consolidated Results of Operations 10 Total Revenue 10 Net Interest Income 16 Provision for Credit Losses 19 Expenses 19 Repositioning Charges 20 Income Tax Expense 21 Line of Business Information 21 Investment Servicing 21 Investment Management 22 Financial Condition 22 Investment Securities 23 Loans 26 Risk Management 27 Credit and Counterparty Risk Management 27 Liquidity Risk Management 28 Operational Risk Management 31 Information Technology Risk Management 31 Market Risk Management 31 Model Risk Management 35 Strategic Risk Management 35 Capital 36 Off-Balance Sheet Arrangements 44 Recent Accounting Developments 44

Quantitative and Qualitative Disclosures About Market Risk 45

Quantitative and Qualitative Disclosures About Market Risk 45

Controls and Procedures 45

Controls and Procedures 45 Consolidated Financial Statements 46 Consolidated Statement of Income (unaudited) 46 Consolidated Statement of Comprehensive Income (unaudited) 47 Consolidated Statement of Condition 48 Consolidated Statement of Changes in Shareholders' Equity (unaudited) 49 Consolidated Statement of Cash Flows (unaudited) 50 Note 1. Summary of Significant Accounting Policies 51 Note 2. Fair Value 52 Note 3. Investment Securities 54 Note 4. Loans and Allowance for Credit Losses 58 Note 5. Goodwill and Other Intangible Assets 63 Note 6. Other Assets 64 Note 7. Derivative Financial Instruments 65 Note 8. Offsetting Arrangements 68 Note 9. Commitments and Guarantees 71 Note 10. Contingencies 71 Note 11. Variable Interest Entities 73 Note 12. Shareholders' Equity 74 Note 13. Regulatory Capital 77 Note 14. Net Interest Income 78 Note 15. Expenses 79 Note 16. Earnings Per Common Share 80 Note 17. Line of Business Information 80 Note 18. Revenue from Contracts with Customers 82 Note 19. Non-U.S. Activities 84 Note 20. Subsequent Events 85 Review Report of Independent Registered Public Accounting Firm 86

OTHER INFORMATION

PART II OTHER INFORMATION

Unregistered Sales of Equity Securities and Use of Proceeds 89

Item 2 Unregistered Sales of Equity Securities and Use of Proceeds 89

Other Information 89

Item 5 Other Information 89

Exhibits 91

Item 6 Exhibits 91 Signatures 92 We use acronyms and other defined terms for certain business terms and abbreviations, as defined in the acronyms list and glossary following the consolidated financial statements in this Form 10-Q.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION GENERAL As of September 30, 2025, we had consolidated total assets of $371.07 billion, consolidated total deposits of $280.00 billion, consolidated total shareholders' equity of $27.64 billion and approximately 52,000 employees. Our operations are organized into two lines of business, Investment Servicing and Investment Management, which are defined based on products and services provided. Additio nal information about our lines of business is provided in "Line of Business Information" in this Management's Discussion and Analysis and Note 17 to the consolidated financial statements in this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 (Form 10-Q). Our corporate headquarters is located at One Congress Street, Boston, Massachusetts 02114 (telephone (617) 786-3000). For purpose

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS directly comparable currently applicable regulatory ratio or U.S. GAAP-basis measure. As part of our non-GAAP-basis measures, we present a fully taxable-equivalent NII that reports non-taxable revenue, such as interest income associated with tax-exempt investment securities, on a fully taxable-equivalent basis, which we believe facilitates an investor's understanding and analysis of our underlying financial performance and trends. We provide additional disclosures required by applicable bank regulatory standards, including supplemental qualitative and quantitative information with respect to regulatory capital (including market risk associated with our trading activities), the LCR and NSFR, summary results of annual State Street-run stress tests which we conduct under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), and recovery and resolution plan disclosures. These additional disclosures are accessible on the "Filings & reports" tab of our website at investors.statestreet.com . We have included the website address of State Street (including investors.statestreet.com) and the SEC in this report as an inactive textual reference only. Information on those websites (or any other) is not incorporated by reference into this Form 10-Q. We use acronyms and other defined terms for certain business terms and abbreviations, as defined in the acronyms list and glossary following the consolidated financial statements in this Form 10-Q.

Forward-Looking Statements

Forward-Looking Statements This Form 10-Q, as well as other reports and proxy materials submitted by us under the Securities Exchange Act of 1934, registration statements filed by us under the Securities Act of 1933, our annual report to shareholders and other public statements we may make, may contain statements (including statements in our Management's Discussion and Analysis included in such reports, as applicable) that are considered "forward-looking statements" within the meaning of U.S. securities laws, including statements about our goals and expectations regarding our business, financial and capital condition, results of operations, strategies, cost savings and transformation initiatives, investment portfolio performance, dividend and stock purchase programs, acquisitions, outcomes of legal proceedings, market growth, joint ventures and divestitures, client growth, new technologies, services and opportunities, sustainability and impact, human capital and climate, as well as industry, governmental, regulatory, economic and market trends, initiatives and developments, the business environment and other matters that do not relate strictly to historical facts. Terminology such as "expect," "outlook," "will," "goal," "target," "strategy," "may," "estimate," "plan," "intend," "objective," "forecast," "believe," "priority," "anticipate," "seek," and "trend," or similar statements or variations of such terms, are intended to identify forward-looking statements, although not all forward-looking statements contain such terms. Forward-looking statements are subject to various risks and uncertainties, which change over time, are based on management's expectations and assumptions at the time the statements are made and are not guarantees of future results. Management's expectations and assumptions, and the continued validity of the forward-looking statements, are subject to change due to a broad range of factors affecting the U.S. and global economies, regulatory en

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS of other nations, the ongoing conflicts in Ukraine and in the Middle East, major political shifts domestically or internationally (including the potential for retaliatory actions by governments, market participants or clients based on diverging perspectives or otherwise and, separately, the shutdown of the U.S. federal government that began on October 1, 2025), actions taken by central banks in an attempt to address prevailing economic conditions, changes in monetary policy or periods of significant volatility in the markets for equity, fixed income and other asset classes globally or within specific markets; We have significant operations and clients in many markets and jurisdictions globally that can be adversely impacted, locally or more broadly, by disruptions in those or other markets or economies, including local, regional and geopolitical developments affecting those markets or economies; Our investment securities portfolio, consolidated financial condition and consolidated results of operations could be adversely affected by changes in the financial markets, governmental action or monetary policy. For example, among other risks, changes in prevailing interest rates or market conditions have led, and were they to persist or occur in the future could further lead, to decreases in our NII or to portfolio management decisions resulting in reductions in our capital or liquidity ratios; Our business activities expose us to interest rate risk; We assume significant credit risk of counterparties, who may also have substantial financial dependencies on other financial institutions, and these credit exposures and concentrations could expose us to financial loss; Our fee revenue represents a significant portion of our revenue and is subject to and may decline based on, among other factors, market and currency declines, investment activities and preferences of our clients and t

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Operational and Technology Risks Attacks or unauthorized access to our or our business partners' or clients' information technology systems or facilities, such as cyber-attacks or other disruptions to our or their operations, could result in significant costs, reputational damage and impacts on our business activities; Our business may be negatively affected by risks associated with strategic initiatives we are undertaking to enhance the effectiveness, including the adoption or integration of new technologies such as artificial intelligence, and efficiency of our operations and of our cybersecurity and technology infrastructure or by our failure to meet the related, resiliency or other expectations of our clients and regulators, or as a result of a cyber-attack or similar vulnerability in our or business partners' infrastructure; Our risk management framework, models and processes may not be effective in identifying or mitigating risk and reducing the potential for related losses, and a failure or circumvention of our controls and procedures, or errors or delays in our operational and transaction processing, or those of third parties, could have an adverse effect on our business, financial condition, operating results and reputation; Shifting and maintaining operational activities to non-U.S. jurisdictions, changing our operating model, and outsourcing to, or insourcing from, third parties expose us to increased operational risk, geopolitical risk and reputational harm and may not result in expected cost savings or operational improvements; Long-term contracts and customizing service delivery for clients expose us to increased operational risk, pricing and performance risk; The quantitative models we use to manage our business may contain errors that could adversely impact our business, financial condition, operating results and regulatory compliance, and lapses in disclos

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OVERVIEW OF FINANCIAL RESULTS TABLE 1: OVERVIEW OF FINANCIAL RESULTS Three Months Ended September 30, % Change (Dollars in millions, except per share amounts) 2025 2024 Total fee revenue $ 2,829 $ 2,616 8 % Net interest income 715 723 (1) Total other income 1 (80) nm Total revenue 3,545 3,259 9 Provision for credit losses 9 26 nm Total expenses 2,434 2,308 5 Income before income tax expense 1,102 925 19 Income tax expense 241 195 24 Net income $ 861 $ 730 18 Adjustments to net income: Dividends on preferred stock (1) $ (58) $ (48) (21) Earnings allocated to participating securities (2) (1) — nm Net income available to common shareholders $ 802 $ 682 18 Earnings per common share: Basic $ 2.83 $ 2.29 24 Diluted 2.78 2.26 23 Average common shares outstanding (in thousands): Basic 283,434 297,365 (5) Diluted 288,163 301,847 (5) Cash dividends declared per common share $ 0.84 $ 0.76 11 Return on average common equity 13.4 % 12.0 % 140 bps Pre-tax margin 31.1 28.4 270 Nine Months Ended September 30, % Change (Dollars in millions, except per share amounts) 2025 2024 Total fee revenue $ 8,118 $ 7,494 8 % Net interest income 2,158 2,174 (1) Total other income 1 (80) nm Total revenue 10,277 9,588 7 Provision for credit losses 51 63 (19) Total expenses 7,413 7,090 5 Income before income tax expense 2,813 2,435 16 Income tax expense 615 531 16 Net income $ 2,198 $ 1,904 15 Adjustments to net income: Dividends on preferred stock (1) $ (167) $ (148) (13) Earnings allocated to participating securities (2) (2) (1) nm Net income available to common shareholders $ 2,029 $ 1,755 16 Earnings per common share: Basic $ 7.09 $ 5.85 21 Diluted 6.98 5.77 21 Average common shares outstanding (in thousands): Basic 286,074 299,964 (5) Diluted 290,439 304,176 (5) Cash dividends declared per common share $ 2.36 $ 2.14 10 Return on average common equity

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS portfolio repositioning, reflected in other income; Gain on sale of an equity investme

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