State Street Corporation provides financial services to institutional investors, including investment services, markets and financing solutions, and investment management.
The company’s clients - asset managers and owners, insurance companies, wealth managers, official institutions, and central banks - rely on it to deliver solutions that support their business objectives across the investment life cycle. Through its subsidiaries, including its principal banking subsidiary, State Street Bank an...
State Street Corporation provides financial services to institutional investors, including investment services, markets and financing solutions, and investment management.
The company’s clients - asset managers and owners, insurance companies, wealth managers, official institutions, and central banks - rely on it to deliver solutions that support their business objectives across the investment life cycle. Through its subsidiaries, including its principal banking subsidiary, State Street Bank and Trust Company, referred to as State Street Bank, the company operates in more than 100 geographic markets worldwide, including the United States, Canada, Latin America, Europe, the Middle East, and Asia. The company provides a broad range of financial products and services to institutional investors worldwide.
The company conducts its business primarily through State Street Bank. State Street Bank's current charter was authorized by a special Act of the Massachusetts Legislature in 1891. State Street Bank operates as a specialized bank, referred to as a trust or custody bank, that services and manages assets on behalf of its institutional clients.
The company provides additional disclosures required by applicable bank regulatory standards, including supplemental qualitative and quantitative information with respect to regulatory capital (including market risk associated with its trading activities), the LCR and the NSFR, summary results of annual State Street-run stress tests that it conducts under the Dodd-Frank Act, and resolution plan disclosures required under the Dodd-Frank Act.
Lines of Business
The company’s operations are organized into two lines of business: Investment Servicing and Investment Management, which are defined based on products and services provided.
Investment Servicing
Investment Servicing line of business provides a broad range of services and market and financing solutions to institutional clients, including mutual funds, collective investment funds and other investment pools, corporate and public retirement plans, insurance companies, investment managers, foundations, and endowments worldwide.
Through State Street Investment Services, State Street Global Markets, and State Street Alpha, the company offers a full range of back- and middle-office solutions, including custody, accounting and fund administration services for traditional and alternative assets, as well as multi-asset class investments; recordkeeping, client reporting and investment book of record, transaction management, loans, cash, derivatives and collateral services; investor services operations outsourcing; performance, risk and compliance analytics; financial data management to support institutional investors; foreign exchange, brokerage and other trading services; securities finance, including prime services products; and deposit and short-term investment facilities.
Together with the company’s middle- and back-office services, CRD’s front- and middle-office technology offerings form the foundation of State Street Alpha. The company’s State Street Alpha platform combines portfolio management, trading and execution, analytics and compliance tools, and advanced data aggregation and integration with other industry platforms and providers. Included in CRD’s technology offerings are Charles River Investment Management Solution, a front-office technology offering that automates and simplifies the institutional investment process across asset classes, from portfolio management and risk analytics through trading and post-trade settlement, with integrated compliance and managed data throughout; Charles River for Private Markets, an investment management solution for institutions investing in Private Credit, Private Equity, Real Estate, Infrastructure, and Funds; and Charles River Wealth Management Solution, which provides portfolio management, trading compliance and manager/sponsor communication capabilities to wealth managers, private banks, and financial advisors.
As the digital asset space continues to mature, the company is building solutions to service, tokenize, and safekeep digital assets.
The company provides some or all of its Investment Servicing products and services to clients in the United States and in many other markets, including, among others, Australia, Canada, China, Cayman Islands, France, Germany, Ireland, Italy, Japan, Luxembourg, South Korea, and the United Kingdom.
Investment Management
Investment Management line of business provides a comprehensive range of investment management solutions and products for the company’s clients through State Street Global Advisors. The company’s investment management solutions include strategies across equity, fixed income, cash, multi-asset, and alternatives; products, such as SPDR ETFs and index funds; and services, including defined benefit, defined contribution, and Outsourced Chief Investment Officer.
Supervision and Regulation
The company is registered with the Federal Reserve as a bank holding company pursuant to the Bank Holding Company Act of 1956. Some aspects of the company’s public disclosure, corporate governance principles and internal control systems are subject to the Sarbanes-Oxley Act of 2002 (SOX), the Dodd-Frank Act and regulations and rules of the SEC and the New York Stock Exchange.
The Federal Reserve has implemented rules on TLAC, LTD and clean holding company requirements for U.S. domiciled G-SIBs, such as the company. The company is subject to the Volcker Rule and implementing regulations. Under the Federal Reserve’s regulation, the company is required to comply with various liquidity-related risk management standards and maintain a liquidity buffer of unencumbered highly liquid assets based on the results of internal liquidity stress testing.
As a G-SIB, the company is subject to enhanced supervision and prudential standards.
Under Section 165(d) of the Dodd-Frank Act, the company is required to submit a resolution plan on a biennial basis jointly to the Federal Reserve and the FDIC (the ‘Agencies’).
State Street Bank has registered with the CFTC as a swap dealer. As a registered swap dealer, State Street Bank is subject to significant regulatory obligations regarding its swap activity and the supervision, examination and enforcement powers of the CFTC and other regulators. The CFTC has granted State Street Bank a limited-purpose swap dealer designation.
The Federal Reserve is the primary federal banking agency responsible for regulating the company and its subsidiaries, including State Street Bank, with respect to both its U.S. and non-U.S. operations.
State Street Bank is a member of the Federal Reserve System, its deposits are insured by the Federal Deposit Insurance Corporation (FDIC) and it is subject to applicable federal and state banking laws and to supervision and examination by the Federal Reserve, the Massachusetts Commissioner of Banks, as well as the FDIC and the regulatory authorities of those states and countries in which State Street Bank operates a branch.
Derivatives, securities borrowing and securities lending transactions between State Street Bank and its affiliates became subject to these restrictions pursuant to the Dodd-Frank Act.
The company’s other subsidiary trust companies are subject to supervision and examination by the OCC, the Federal Reserve or by the appropriate state banking regulatory authorities of the states in which they are organized and operate. The company’s continental European banking subsidiary, State Street Bank International GmbH is a significant entity in accordance with European banking regulations and accordingly is supervised directly by the European Central Bank. State Street Bank International GmbH operates in several countries, including Germany, Luxembourg, Italy, France, and Switzerland. In the United Kingdom, the branch of State Street Bank is dually regulated by the Prudential Regulatory Authority and the Financial Conduct Authority, in Ireland the company’s depositary and fund administration companies are regulated by the Central Bank of Ireland and in Canada its trust company is regulated by the Office of the Superintendent of Financial Institutions.
The company’s business related to investment management and trusteeship of collective trust funds and separate accounts offered to employee benefit plans is subject to the Employee Retirement Income Security Act (ERISA), and is regulated by the U.S. Department of Labor (DOL).
The majority of the company’s non-U.S. asset servicing operations are conducted pursuant to the Federal Reserve's Regulation K through State Street Bank’s Edge Act subsidiary or through international branches of State Street Bank.
In addition to the company’s non-U.S. operations conducted pursuant to Regulation K, the company also makes new investments abroad directly (through the company or through its non-banking subsidiaries) pursuant to the Federal Reserve's Regulation Y, or through international bank branch expansion, neither of which is subject to the investment limitations applicable to Edge Act subsidiaries.
Certain of the company’s subsidiaries are subject to the Bank Secrecy Act of 1970, as amended by the USA PATRIOT Act of 2001, and related regulations, which contain anti-money laundering (AML) and financial transparency provisions and which require implementation of an AML compliance program, including processes for verifying client identification and monitoring client transactions and detecting and reporting suspicious activities.
For larger institutions, such as State Street Bank, assessments are determined based on regulatory ratings and forward-looking financial measures to calculate the assessment rate, which is subject to adjustments by the FDIC, and the assessment base.
The FDIC Improvement Act of 1991 requires the appropriate federal banking regulator to take ‘prompt corrective action’ with respect to a depository institution if that institution does not meet certain capital adequacy standards, including minimum capital ratios. While these regulations apply only to banks, such as State Street Bank, the Federal Reserve is authorized to take appropriate action against a parent bank holding company, such as the company, based on the under-capitalized status of any banking subsidiary.
Under Federal Reserve regulations, a bank holding company, such as the company is required to act as a source of financial and managerial strength to its banking subsidiaries. This requirement was added to the Federal Deposit Insurance Act by the Dodd-Frank Act.
History
State Street Corporation was founded in 1792. The company was incorporated in 1969 under the laws of the Commonwealth of Massachusetts.