Letter from Chairman and CEO Ronald P. O’Hanley
A year of strong momentum and growth
State Street’s principal banking entity bears the name “State Street Bank and Trust.” The word “Trust” is more than a name — it embodies our business and serves as the foundation of every State Street relationship. Trust is not taken nor assumed; it is earned through making and keeping promises, consistent execution, unwavering integrity, and a steadfast commitment to our clients and their desired outcomes, which in turn, fosters long-term growth and lasting value to our shareholders.
Our clients rely on us as an essential partner, confident in our service quality and operational excellence — enabled by top-tier talent, scale, and technology. By delivering on this promise, we create enduring value for our clients and grow alongside them.
Without trust, partnership does not exist — and partnerships have never been more critical than today. Whether in times of stability or periods of disruption, strong and reliable partners help minimize vulnerabilities, marshal resources and expertise, and drive resilience. This principle is true across industries, and our clients are no exception as they navigate an ever-evolving market and operating landscape.
The global economy is different from just a few years ago. Macro forces — from geopolitical reordering, surging debt levels, shifting demographics, rapid technology change, and evolving trade and immigration policies — are reshaping the investment landscape. These trends have the potential to significantly impact global growth, inflation, and market stability.
“Trust is not taken nor assumed; it is earned through making and keeping promises, consistent execution, unwavering integrity, and a steadfast commitment to our clients and their desired outcomes, which in turn, fosters long-term growth and lasting value to our shareholders.”
As our clients refine their investment strategies accordingly, the increasing complexity of their portfolios makes operational efficiency and innovation critical priorities. In this environment, state-of-the-art investment and servicing capabilities are a decisive advantage.
At the same time, institutional investors face mounting fee pressures, new technology requirements, and rising costs, which are driving increased demand for new operating models. Clients seek end-to-end solutions that provide critical infrastructure and technology, new capabilities, efficiency, and better data management to drive smarter, more informed investment decisions. These services not only improve operational effectiveness and reduce costs, they also provide access to advanced solutions and specialized expertise — capabilities that are difficult and costly to replicate without scale.
Our role extends far beyond providing services or products — it requires strategic alignment, acting as an extension of our clients’ teams, proactively anticipating their needs, and developing or codeveloping solutions to address them effectively.
Our people truly excel in this space. Time and time again, our teams bring deep expertise, creativity, and forward-thinking innovation to every challenge — pushing boundaries and redefining the status quo. We embrace a holistic approach to innovation, leveraging technology and data while also rethinking operating models and pioneering new ways of working. This focus positions our clients — and consequently State Street — for sustained, long-term success.
Innovation is fundamental to how we create value. It may take the form of continuous refinements, or bold, transformational changes that reshape the industry. In 2024, the investment world celebrated the centennial anniversary of the mutual fund. State Street played a pivotal role in what turned out to be a stunning innovation, serving as the custodian for the first U.S. open-ended mutual fund, established in 1924. Today, we service 38 percent* of the U.S., 23 percent* of the global, and 16 percent* of the Europe, the Middle East and Africa (EMEA) mutual fund and undertakings for collective investment in transferable securities (UCITS) markets. This breakthrough laid the groundwork for further innovation, including exchange-traded funds (ETFs), where today we are also the market leader serving over 40 percent* of the global ETF market.
Over 30 years ago, State Street Global Advisors launched SPY — the first U.S.-listed ETF. It has since become the world’s most liquid and heavily traded ETF. As the ETF marketplace has surged to $14.7 trillion,* State Street has become the world’s largest ETF servicer and the third-largest sponsor/manager of ETFs.
These advancements have deepened financial markets, increased access, expanded participation, and fueled long-term wealth creation. I take great pride in State Street’s role in the global financial system — helping our clients create value while contributing to a stronger, more impactful investment ecosystem. In all that we do, we remain guided by our purpose: to help create better outcomes for the world’s investors and the people they serve.
To fulfill our purpose, we operate through two primary lines of business: Investment Servicing, which includes our Investment Services and Global Markets businesses, and Investment Management through State Street Global Advisors. In Investment Servicing, our clients depend on us to provide mission-critical services that enable them to focus on investing well on behalf of their clients. Meanwhile, State Street Global Advisors — the fourth-largest investment manager in the world, efficiently allocates capital on behalf of clients, manages risk, and facilitates long-term wealth creation for millions of investors worldwide.
At the heart of our organization is a singular vision: to be the leading partner and provider to asset managers, asset owners, and wealth managers globally with high-quality servicing, analytics, financing, liquidity, and investment solutions. This vision reflects our distinct value proposition — one that unites our shared purpose, aspirations, and expertise into a cohesive approach that deepens partnerships and unlocks new opportunities both inside and outside of State Street.
“Our role extends far beyond providing services or products — it requires strategic alignment, acting as an extension of our clients’ teams, proactively anticipating their needs, and developing or co-developing solutions to address them effectively.”
Our strategic foundation
The operating environment in 2024 was broadly constructive for State Street, allowing us to build on our strong strategic foundation, reinforced by years of investment. Ours is a business in which a multi-year strategy and associated investments — in service excellence, client relationships, technology, and product and people capabilities — compound over time, positioning us for sustained success.
In 2024, we further strengthened our business through key strategic actions, optimizing performance via growth initiatives across each of our businesses, deeper client engagement, prudent deposit pricing, investment portfolio repositioning, accelerated innovation, and advancing our multi-year transformation and productivity initiatives.
In last year’s annual report, I outlined key strategic priorities for 2024; we executed well against each:
- Delivering sustained fee revenue growth
- Extending market leadership in our Global Markets and Investment Management businesses
- Enhancing productivity while providing our clients service and operational excellence
- Building out even more technological capabilities to support growth, manage risk, and improve resilience
- Fostering a workplace culture that accelerates business performance; sharpens accountability; and attracts, retains, and inspires top talent
“2024 was an outstanding year for State Street financial performance, underscoring the strength of our franchise and the effectiveness of our strategy.”
Through this disciplined execution coupled with service excellence, we delivered strong financial performance, deepened client relationships, and sustained business momentum, reinforcing the long-term value of investing in State Street.
2024 financial performance1
2024 was an outstanding year for State Street financial performance, underscoring the strength of our franchise and the effectiveness of our strategy.
Full-year earnings per share (EPS) rose to $8.21 in 2024, up from $5.58 in 2023. Excluding notable items, EPS grew 13 percent year-over-year to $8.67, while pre-tax margin expanded by more than a full percentage point to 28 percent. Full-year return on average tangible common equity reached 18 percent, or 19 percent, excluding notable items.
Our strong performance and balance sheet allowed us to return $2.2 billion of capital to shareholders, through common share re-purchases and dividends, including a 10 percent increase in our declared quarterly common dividend per share beginning in the third quarter.
I am particularly pleased with our broad-based revenue growth. Full-year fee revenue increased 7 percent compared to 2023, while total revenue grew 9 percent and net interest income (NII) grew 6 percent. Excluding notable items, fee revenue and total revenue each increased by 6 percent year-over-year. Every revenue line contributed positively, including double-digit growth in management fees, foreign exchange (FX) trading services, and front-office software and data revenue. Additionally, we delivered a second consecutive year of record NII.
Pre-tax margin, excluding notables
Of capital returned to shareholders
We carefully managed our expense base to support revenue growth, achieving positive fee and total operating leverage2 in 2024. Excluding notable items, we realized 205 basis points of positive fee and 200 basis points of total operating leverage, even as expenses increased by 4 percent year-over-year, driven in part by higher revenue-related costs. As we continue positioning our business for sustainable growth, expense discipline remains a top priority.
Our assets under custody and/or administration (AUC/A) reached $46.6 trillion at year-end, reflecting an 11 percent increase year-over-year, primarily driven by higher period-end market levels and client flows.
At State Street Global Advisors, total 2024 year-end assets under management3 (AUM) grew to $4.7 trillion, up 15 percent year-over-year, primarily due to higher period-end market levels and net inflows of $146 billion. Notably, we achieved record full year ETF net inflows of $109 billion, and grew market share in our strategically important U.S. Low-Cost ETF suite and the EMEA region.
Strong business momentum
Our Investment Services business remains State Street’s largest revenue generator. In 2024, we again advanced and executed against our strategy to drive sustainable revenue growth and strengthen our market position.
“Service quality is key to our value proposition, and it is what unites us as an organization. 2024 marked our second consecutive year of increased client satisfaction and loyalty, a testament to our continued service momentum.”
Service quality is key to our value proposition, and it is what unites us as an organization. 2024 marked our second consecutive year of increased client satisfaction and loyalty, a testament to our continued service momentum. Service excellence leads to better client retention, reduces fee pressure, broadens relationships, and earns us the right to win new business. Further underscoring service quality, we achieved our servicing fee revenue retention target of 97 percent.
Our enhanced client service is also reflected in our servicing sales performance. In 2024, we delivered on our ambitious fee revenue sales goals, with the vast majority in back-office revenues, aligning with our goal of prioritizing faster time-to-revenue products. Additionally, our AUC/A pipeline continued to grow, reflecting continued market demand and reinforcing confidence in our long-term servicing fee performance.
Front-office software and data revenue grew 10 percent year-over-year, and we achieved record new bookings in the fourth quarter. Charles River Development delivered important new enhancements to its core software, expanded its wealth capabilities, and explored new partnership opportunities in wealth distribution for Global Advisors products. Front-office software and data revenue was $639 million in 2024, representing over 6 percent of our total fee revenue, and we are well along in our strategy to build a $1 billion business.
In 2024, we celebrated the five-year anniversary of State Street Alpha® — a key example of how we successfully incubate, scale, and integrate innovative solutions into our core business. State Street Alpha has matured into a critical element of our value proposition, offering a configurable, open-architecture platform that enhances data integration and streamlines investment activities. It provides a clear competitive advantage, helping to retain business, win new long-term relationships, and deepen existing client relationships.
Servicing fee revenue retention
Total number of State Street Alpha clients
Products launched by Global Advisors
This was evident in 2024, with a significant new mandate that began as a front-office Charles River Development client, but has now expanded our relationship to include middle-and back-office services, including custody, all underpinned by our Alpha data platform and data services. State Street Alpha contributed to half of our AUC/A wins in 2024, with seven new mandates, bringing our total number of Alpha clients to 35 — 25 of which were live on our platform at year-end.
Our Global Markets business continued to innovate while remaining focused on supporting clients and expanding wallet share. We strengthened our leadership position in FX, digital platforms, differentiated research, and our top-ranked agency lending program, which leverages the scale of our custody business. We also advanced targeted strategic initiatives including closing the acquisition of CF Global Trading, enhancing our ability to enable agency-based trading across multiple asset classes and geographies.
Through focused execution and strong market demand, we achieved notable business growth, including an 11 percent increase in FX trading services revenue. These results reflect our commitment to strategic decision-making and client-driven innovation.
Global Advisors also had an exceptional year in 2024, with management fees reaching an all-time high for State Street. We generated $146 billion in net new assets, delivering more than 3 percent organic AUM growth for the second consecutive year, supported by achieving heightened client loyalty levels.
We implemented our strategy to accelerate innovation, expand capabilities, and enhance client solutions, positioning the business for continued growth. We are already realizing early benefits from these initiatives. In 2024, Global Advisors launched more than 90 products worldwide — more than in the past three years combined.
We also leveraged our “ETF as a Service” model, where Global Advisors manages partner ETFs on its platform while Investment Services provides administrative services — unlocking the broader value of One State Street for our clients. We continued our long history of democratizing investing and broadening our market base by innovating in new target date structures that provide longevity protection to retirement investors as well as exploring mechanisms to broaden access to high-quality alternatives strategies.
Client experience and operations
Our commitment to clients is at the core of our identity, deeply embedded in our culture, and is fundamental to our success. Every day, I witness our employees’ dedication firsthand — putting clients at the center of every decision, delivering exceptional service quality execution, and exceeding expectations in even the smallest interactions. The client experience is woven into every aspect of our organization, from the insights we share and the technology we advance to the efficiencies we drive and the risk management strategies we implement. Trust is built and strengthened through this holistic approach — where trusted human expertise and operational excellence combine to create lasting value.
As a global financial services company, we are in the knowledge business. Helping clients achieve better outcomes requires more than just execution — it requires actionable insight. We provide industry-leading thought leadership that enhances our clients’ understanding of market trends and key industry developments to enable them to invest better.
This commitment to knowledge-sharing fosters meaningful dialogue, equipping our clients with the intelligence and strategic foresight they need to navigate complexity and gain a competitive edge.
One of the most significant industry milestones of 2024 was the transition to T+1 settlement, a fundamental shift that reshaped operational processes for global investors. This change provided State Street with an opportunity to reaffirm our role as an essential partner to our clients. Our proactive approach and operational expertise enabled clients to navigate this change seamlessly, reinforcing our value and demonstrating the strength of our firm-wide capabilities. It was a powerful demonstration of effective client engagement and industry leadership.
Our license to operate relies on our unwavering commitment to risk excellence and upholding the trust of clients and regulators. This responsibility is even more critical given our designation as a Global Systemically Important Financial Institution. Risk management is embedded in our culture and reflected in our continued investment in maintaining a robust risk and control environment. We consistently enhance our infrastructure, technology, operating standards, and governance to fortify and strengthen an already strong control framework — reinforcing confidence in our ability to operate with prudence and stability.
In 2024, we advanced our technology modernization and rationalization efforts, consolidating our physical technology landscape while investing in more agile and efficient applications.
“Every day, I witness our employees’ dedication firsthand — putting clients at the center of every decision, delivering exceptional service quality execution, and exceeding expectations in even the smallest interactions.”
Resiliency remains a priority, and we continue to drive improvements that enhance the stability and performance of our platforms. We also utilized artificial intelligence and machine learning to optimize workflows, accelerate technology development, free up resource capacity, and enable employees to focus on more strategic, meaningful, and high-value work. With a strong foundation of talent and cutting-edge technology, we are primed to sustain and extend our industry leadership.
Our operation is our product, and in 2024, we made significant progress in our end-to-end transformation and simplification of our global operating model. By streamlining and optimizing our operating model, we delivered better service, and improved client outcomes, while achieving productivity savings. In 2024, we realized approximately $500 million in recurring savings through our productivity initiatives, which funded significant investments in our business.
Our strategic investments included enhancing State Street Alpha, expanding servicing capabilities for private markets, and strengthening our digital and custody capabilities to drive future growth. Beyond business growth, we also continued to fortify cybersecurity and resiliency, as well as enhance product offerings in payments, cash, and custody services.
In 2024, we further optimized our India operations by assuming control of a second operations joint venture, building on our successful consolidation of a separate operations joint venture in 2023. These actions provide expanded scale and streamline our operating model, enabling faster decision-making and delivering a smoother, more efficient experience for clients. Furthermore, we expect the consolidation of our India operations joint ventures to unlock additional efficiencies and productivity savings in the years ahead.
“Businesses thrive when the communities in which they operate are strong.”
Hours of volunteer time by our employees
Our people and communities
Our people are the driving force behind our success. I want to express my sincerest gratitude to each of them for their unwavering commitment to delivering on State Street’s purpose, vision, and strategic priorities. Each of our approximately 53,000 employees play a vital part in earning our clients’ trust, shaping their experience, and thus driving our business forward. Our culture is the foundation that enables our strategy, reinforcing accountability; strengthening business performance; and allowing us to attract, develop, motivate, and retain world-class talent.
Businesses thrive when the communities in which they operate are strong. To support our communities, State Street Foundation invested nearly $22 million in 2024 to create brighter futures, with a primary focus on education and workforce readiness initiatives around the globe.
Our employees further amplified this impact through their own philanthropic giving, matched by State Street Foundation. Even more impactful is the over 100,000 hours of volunteer time by our employees in 2024 — not only their time but also their expertise and skills to drive meaningful, positive change in the communities where they live and work.
Helping to build capabilities within the financial services industry extends opportunity, fuels innovation, strengthens economic resilience, and drives long-term growth. In 2024, we deployed $100 million in deposits with community-based depository institutions, providing critical capital directly to underbanked communities to stimulate local economic development.
We also continued our program to access a broad investor base by partnering with a diverse syndicate of underwriters for our corporate-issued securities, reinforcing our commitment to accessing additional talent within the financial services industry.
Attracting and retaining high-quality talent is critical to State Street’s business success. State Street has an unwavering commitment to creating a workplace in which talented people feel valued, respected, and engaged. An inclusive workplace where everyone feels a sense of belonging drives value for our clients, employees, shareholders, and communities.
A future built on strength
I will conclude where I began — by reaffirming that trust is the foundation of our business and the driving force behind sustainable growth and long-term business success. Our strong performance in 2024 exemplifies our ability to earn, deepen, and uphold that trust through consistent high-quality execution. Thanks to our extraordinary employees, we not only served our clients well but also achieved key strategic milestones, fortifying our foundation for even greater success in 2025 and beyond.
As we look ahead, we remain focused on three strategic priorities:
- Delivering sustained revenue growth
- Achieving operational excellence
- Fostering a high-performing culture
Being an essential partner carries a dual mandate: to deliver exceptional service to our clients — so they, in turn, can better serve their clients — while also driving sustainable growth and value for you, our shareholders. Over our nearly 233-year history, we have grown and evolved alongside the global economy, pioneering innovations that have transformed modern investing. As we continue shaping the future, we do so with an understanding that our potential is even greater than our accomplishments.
With a compelling growth strategy fortified by a distinctive value proposition, and an unwavering commitment to our clients, employees, and shareholders, we are effectively positioning our firm for long-term sustainable growth.
Thank you for your continued partnership and trust.
Ronald P. O’Hanley
Chairman and CEO
This annual report, including, without limitation, the letters to shareholders, contains forward-looking statements as defined by U.S. securities laws. These statements are not guarantees for future performance, are inherently uncertain, are based on assumptions that are difficult to predict, and have a number of risks and uncertainties.
Further, the forward-looking statements speak only as of the time of this annual report is first published, and State Street does not undertake efforts to revise forward looking statements. Refer to Item 1A of the Form 10-K included with this annual report for details.