UPDATE 2-State Street posts higher-than-expected profit

* State Street operating EPS at 86 cents

* Higher servicing fees boost earnings

* Unrealized losses on investment portfolio shrink
(Adds details on earnings)

BOSTON, Oct 19 (BestGrowthStock) – State Street Corp (STT.N: ), one
of the world’s largest institutional investors, reported
higher-than-expected quarterly profit on Tuesday after recent
acquisitions helped the company earn more in fees.

State Street, which also earns fees for offering services
like record-keeping to mutual and hedge funds, said earnings
per common share climbed to $1.08 from 66 cents a year ago.

On an operating basis, earnings per share climbed to 86
cents a share from 71 cents, beating analysts’ expectations for
earnings of 83 cents a share, according to Thomson Reuters
I/B/E/S.

The company said it earned 19 percent more in servicing
fees during the third quarter, pushing the total to $989
million. Part of the increase was fueled by new business, State
Street said, noting that it won $477 billion in new assets to
be serviced.

The numbers prompted CEO Joseph Hooley to sound a
cautiously optimistic note for the full year.

“With the support of the two acquisitions, as well as
strong year-to-date wins in servicing and growth in passive
strategies and ETFs in asset management, we continue to expect
that our operating-basis earnings per share, which exclude
discount accretion, will be slightly above the adjusted
operating-basis $3.32 per share recorded last year,” he said in
a statement.

Assets under custody and administration jumped to $20.2
trillion from $17.9 trillion a year ago, while assets under
management rose to $1.9 trillion from $1.7 trillion a year
earlier.

At June 30, the after-tax, unrealized mark-to-market losses
in the investment portfolio, which had worried investors in the
past years, had shrunk to $281 million, decreasing by 72
percent from the second quarter.
(Reporting by Svea Herbst-Bayliss. Editing by Robert
MacMillan)

UPDATE 2-State Street posts higher-than-expected profit