Shareholders' Equity

12 Months Ended

Dec. 31, 2012

Stockholders' Equity Note [Abstract]

Shareholders' Equity

Shareholders’ Equity

In August 2012, we issued and sold 20 million depositary shares, each representing a 1/4,000th ownership interest in a share of State Street’s non-cumulative perpetual preferred stock, Series C, without par value, with a liquidation preference of $100,000 per share (equivalent to $25 per depositary share), in a public offering. We issued 5,000 shares of Series C preferred stock in connection with the depositary share offering. The aggregate proceeds from the offering, net of underwriting discounts, commissions and other issuance costs, were approximately $488 million.

Dividends on shares of the Series C preferred stock are not mandatory and are non-cumulative. If declared, dividends will be payable on the liquidation preference of $100,000 per share quarterly in arrears on March 15, June 15, September 15 or December 15 of each year at an annual rate of 5.25%. If we issue additional shares of Series C preferred stock after the original issue date, dividend rights with respect to such shares will commence from the original issue date of such additional shares. Dividends on the Series C preferred stock will not be declared to the extent that such declaration would cause us to fail to comply with applicable laws and regulations, including federal regulatory capital guidelines. In 2012, we declared and paid dividends of approximately $8 million on the Series C preferred stock.

On September 15, 2017, or any dividend payment date thereafter, the Series C preferred stock and corresponding depositary shares may be redeemed by us, in whole or in part, at a redemption price equal to $100,000 per share (equivalent to $25 per depositary share) plus any declared and unpaid dividends, without accumulation of any undeclared dividends. The Series C preferred stock and corresponding depositary shares may be redeemed at our option, in whole or in part, prior to September 15, 2017, upon the occurrence of a regulatory capital treatment event, as defined in the certificate of designation with respect to the Series C preferred stock, at a redemption price equal to $100,000 per share (equivalent to $25 per depositary share) plus any declared and unpaid dividends, without accumulation of any undeclared dividends.

In October 2012, using the proceeds from the issuance of the Series C preferred stock described above together with cash on hand, we redeemed all 5,001 outstanding shares of our non-cumulative perpetual preferred stock, Series A, liquidation preference of $100,000 per share, for a redemption payment equal to $100,000 per share, or approximately $500 million. At the time of redemption, we also paid declared but unpaid dividends on the Series A preferred stock. The Series A preferred stock, issued in March 2011, was held by State Street Capital Trust III, and constituted the principal asset of the trust. Total dividends paid on the Series A preferred stock in 2012 were $21 million.

In March 2012, our Board of Directors approved a new program authorizing the purchase by us of up to $1.80 billion of our common stock through March 31, 2013. During the period from April 1, 2012 through December 31, 2012, we purchased approximately 33.4 million shares of our common stock under this program at an average cost of $43.11 and an aggregate cost of approximately $1.44 billion. As of December 31, 2012, approximately $360 million remained available for purchase under this program. Shares acquired in connection with the program which remained unissued as of year-end were recorded as treasury stock in our consolidated statement of condition as of December 31, 2012.

In 2011, under a previous Board-authorized program, we purchased approximately 16.3 million shares of our common stock at an average cost per share of approximately $41.38 and an aggregate cost of approximately $675 million. Shares acquired in connection with these purchases which remained unissued as of year-end were recorded as treasury stock in our consolidated statement of condition as of December 31, 2011. No shares of our common stock were purchased by us in 2010. We may employ third-party broker/dealers to acquire shares on the open market in connection with our common stock purchase programs.

Our common shares may be acquired for other deferred compensation plans, held by an external trustee, that are not part of our common stock purchase program. As of December 31, 2012 and 2011, approximately 387,000 shares and 406,000 shares, respectively, had been purchased and were held in trust. These shares are recorded as treasury stock in our consolidated statement of condition.

The following table presents the after-tax components of accumulated other comprehensive gain (loss) as of December 31:

(In millions)	2012			2011			2010
Foreign currency translation	$	134		$	—		$	216
Net unrealized losses on hedges of net investments in non-U.S. subsidiaries	(14		)	(14		)	(14		)
Net unrealized gains (losses) on available-for-sale securities portfolio	815			110			(90		)
Net unrealized losses related to reclassified available-for-sale securities	(110		)	(189		)	(317		)
Net unrealized gains (losses) on available-for-sale securities	705			(79		)	(407		)
Net unrealized losses on available-for-sale securities designated in fair value hedges	(183		)	(210		)	(135		)
Other-than-temporary impairment on available-for-sale securities related to factors other than credit	(3		)	(17		)	(17		)
Other-than-temporary impairment on held-to-maturity securities related to factors other than credit	(65		)	(86		)	(111		)
Net unrealized gains (losses) on cash flow hedges	69			(5		)	(11		)
Unrealized losses on retirement plans	(283		)	(248		)	(210		)
Total	$	360		$	(659	)	$	(689	)

For the year ended December 31, 2012, we realized net gains of $55 million from sales of available-for-sale securities. Unrealized pre-tax gains of $67 million were included in other comprehensive income as of December 31, 2011, net of deferred taxes of $27 million, related to these sales. For the year ended December 31, 2011, we realized net gains of $140 million from sales of available-for-sale securities. Unrealized pre-tax gains of $76 million were included in other comprehensive income as of December 31, 2010, net of deferred taxes of $30 million, related to these sales. For the year ended December 31, 2010, we realized net losses of $55 million from sales of available-for-sale securities. Unrealized pre-tax losses of $728 million were included in other comprehensive income as of December 31, 2009, net of deferred taxes of $291 million, related to these sales.