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$STT 1Q15 10-Q: In March 2015, Board approved a new common stock purchase program authorizing purchase of up to $1.8Bil of STT’s common stock through June 30, 2016, following Federal Reserve's Comprehensive Capital Analysis and Review, 2015 process. 2015 capital plan includes a proposed increase in 2Q15 common stock dividend to $0.34 per share.
With higher market interest rates lifting the net interest income by 12.3% to $603MM and total revenue by 8.6% to $2.85Bil in 3Q17, $STT saw net income jump 24% to $629MM or $1.66 per diluted share. Adjusted diluted EPS soared 27% to $1.71.
$STT has declared a dividend of $1,312.50 per share on its series-C preferred stock, and $1,475 per share on series-D stock. The company also announced a $1,500/share dividend on its series-E preferred stock and $1,337.50 per share on series-G stock. The dividends are payable on December 15, 2017, to the holders of record on November 30, 2017.
$STT appointed Ilene Fiszel Bieler as SVP of Investor Relations (IR) with responsibility for managing relationships with its shareholders and analysts. Ilene replaces Anthony Ostler who is moving to a client leadership position within $STT's Global Services division. Bieler most recently was MD and head of IR and Strategy for Americas at Barclays.
$STT received no objection from the Federal Reserve for its capital plan. The plan include an increase in quarterly dividend from $0.38 to $0.42 per share, starting in 3Q17, and repurchase of up to $1.4Bil of common stock, effective July 1, 2017 through June 30, 2018.
$STT's asset management business, State Street Global Advisors (SSGA), announced that Dave Ireland will return to SSGA as the new global head of Defined Contribution. Based in Boston, Mr. Ireland will report to Barry F.X. Smith, head of the Americas Institutional Client Group.
$STT's net interest income for 1Q17 increased 2.6% from 1Q16. The increase was primarily due to higher market interest rates in the U.S. and disciplined liability pricing, partially offset by lower interest earning assets and lower non-U.S. investment portfolio yields. Net interest margin rose to 117 basis points from 112 basis points in 1Q16.
$STT reported a jump in 1Q17 earnings driven by 12% increase in fee revenue, continued expense control and further progress across its strategic priorities. Net income rose to $446MM or $1.15 per share from $319MM or $0.79 per share last year. Revenue grew 7.4% to $2.67Bil. Operating EPS increased to $1.21 from $0.98.
$DST unit will acquire $STT's ownership interest in BFDS by delivery of 2.0MM State Street shares for about $157.6MM. DST expects the transaction to be accretive to diluted EPS by $0.15 to $0.19 in the next twelve months, before costs and charges. The BFDS acquisition is expected to close within the next several days.
$DST entered definitive agreements to buy State Street's ownership interest in the Boston Financial Data Services, Inc. JV (BFDS) and International Financial Data Services Ltd JV (IFDS) in the UK from $STT. Following completion of these acquisitions, DST will own 100% of the equity interests in both BFDS and IFDS U.K.
During 4Q16, $STT’s foreign exchange trading revenue increased from 4Q15 and 3Q16 reflecting higher volatility and client-related volumes. Securities finance revenue increased from 4Q15, primarily reflecting growth and enhanced custody, partially offset by lower agency revenue.
$STT recorded net asset servicing wins of approx. $1.4 trillion in 2016, including $180Bil in 4Q16, reflecting strong growth with significant participation from Europe. In the SSgA asset management business, $STT experienced net inflows of $16Bil during 4Q16. SSgA also finished 2016 with approx. $46Bil in assets under management.