{"id":13728,"date":"2025-04-18T07:16:13","date_gmt":"2025-04-18T07:16:13","guid":{"rendered":"https:\/\/finderica.com\/?p=13728"},"modified":"2025-04-18T07:16:13","modified_gmt":"2025-04-18T07:16:13","slug":"state-street-keeps-full-year-guidance-despite-tariff-turmoil","status":"publish","type":"post","link":"https:\/\/finderica.com\/?p=13728","title":{"rendered":"State Street keeps full-year guidance despite tariff turmoil"},"content":{"rendered":"
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State Street brushed off uncertainty surrounding a potential global trade war spurred by President Donald Trump and affirmed its full-year guidance.\u00a0<\/p>\n

State Street maintained its goal of $350 million to $400 million in new servicing fee revenue in 2025 due to strong new-business volume, despite uncertainty prevailing in the global financial market, Chairman and CEO Ronald O’Hanley said on the company’s earnings call Thursday.\u00a0<\/p>\n

“While the current environment presents some uncertainty, our existing pipeline of investment services fees is robust, and I am confident in our platform and the improvements we have made to our sales effectiveness \u2026 while also being mindful of the potential for variability in the current environment,” O’Hanley said, citing taxes, geopolitics, deficits and changing regulation as other variables.\u00a0<\/p>\n

The investment and custody bank also maintained its outlook for net interest income, which it expects to be flat, with a range of up by low-single digits to down by low-single digits, interim Chief Financial Officer Mark Keating said on the call.\u00a0<\/p>\n

“In 2024, we grew [net interest income] by 6% year over year, so it’s a pretty high stepping off point,” Keating said.\u00a0<\/p>\n

State Street sees loan growth and investment portfolio rollover as potential tailwinds for NII but counts the interest rate environment and changes to the bank’s deposit mix as potential tailwinds.\u00a0<\/p>\n

“I use ‘potential’ because some of those can become tailwinds as well, depending on macroeconomic developments,” Keating said.\u00a0<\/p>\n

State Street joined KeyBank in reaffirming full-year guidance today. Truist<\/u><\/ps-link> and Regions Financial<\/u><\/ps-link> trimmed their outlooks.<\/p>\n

For the first quarter ended March 31, State Street lived up to analysts’ expectations on profits but missed on revenue expectations.\u00a0<\/p>\n

Net income for the Boston-based investment and custody bank landed at $644 million, a 39% year-over-year increase, beating analysts’ estimates of $583.58 million. Earnings per share amounted to $2.09, ahead of analysts’ $2.01 target.\u00a0<\/p>\n

Revenue, on the other hand, tallied $2.83 billion, below analysts’ expectations of $3.32 billion.\u00a0<\/p>\n

A 6% year-over-year increase in fee revenue helped offset flat net interest income in the first quarter, reflecting “broad based strength across the franchise,” according to State Street.\u00a0<\/p>\n

Net interest income landed at $714 million, reflecting higher investment security yields and continued loan growth, which grew almost 16% to $44 billion. Those gains were partially offset by lower average short-end rates and a deposit mix shift. Deposits grew 11% to $243 billion.\u00a0<\/p>\n

“We had talked about overall client deposits in the $230 to $240 billion range when we gave our original guide,” Keating said. “I think the high end of that range right now is probably a better estimate.We still expect there to be some decrease in non-interest bearing [deposits], but right now, we’re seeing it hold up pretty well.”<\/p>\n

Fee revenue breakdown was as follows:\u00a0<\/p>\n