State Street marks rise in FX trading services revenues in Q1 2022
State Street Corporation (NYSE:STT) reported its first-quarter 2022 financial results today.
Foreign exchange trading services increased 4% compared to 1Q21, primarily driven by higher FX volatility, partially offset by lower client FX volumes. Forex trading services increased 20% compared to 4Q21, primarily reflecting higher FX volatility and client FX volumes.
Net interest income (NII) increased 9% compared to 1Q21, primarily driven by growth in investment portfolio and loan balances, as well as higher market interest rates. Compared to 4Q21, NII increased 5%, mainly due to higher market interest rates and growth in the investment portfolio.
Other income decreased compared to 4Q21, reflecting the absence of a gain on sale of investment securities in 4Q21.
Total revenues were adversely impacted by currency translation by $27 million and $5 million when compared to 1Q21 and 4Q21, respectively.
Standardized Common Equity Tier 1 (CET1) of 11.9% increased 1.1% points compared to 1Q21.
In the first three months of 2022, State Street returned a total of $209 million of capital to shareholders through declared common dividends of $0.57 per share.
Ron O’Hanley, Chairman and Chief Executive Officer:
“Our first-quarter results demonstrate the strength, diversity and durability of our business model. Year-over-year revenue growth was driven by continued momentum in front office solutions and asset management, as well as a strong quarter in FX trading, while the higher interest rate environment began to benefit net interest income. These revenue results combined with disciplined expense management generated positive operating leverage and year-over-year pre-tax margin expansion and earnings growth.”
O’Hanley added: “Our distinctive product innovation and solutions continue to make contributions across the franchise as evidenced by another quarter of solid new business wins in our Investment Services business and strong inflows at Global Advisors. We remain committed to being an essential partner to our clients, which creates a strong foundation for future growth.”