XML 334 R34.htm IDEA: XBRL DOCUMENT v3.24.0.1
Line of Business Information
 12 Months Ended
Dec. 31, 2023
Segment Reporting [Abstract]  
Line of Business Information Line of Business Information
Our operations are organized into two lines of business: Investment Servicing and Investment Management, which are defined based on products and services provided. The results of operations for these lines of business are not necessarily comparable with those of other companies, including companies in the financial services industry.
Investment Servicing, through State Street Investment Services, State Street Global Markets®, State Street Alpha®, and State Street Digital®, we provide investment services for 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. Products include: back office products such as custody, accounting, regulatory reporting, investor services, performance and analytics; middle office products such as investment book of record, transaction management, loans, cash, derivatives and collateral services, record keeping, client reporting and investment analytics; investment manager and alternative investment manager
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.
Included within our Investment Servicing line of business is the Charles River Investment Management Solution, a technology offering which is designed to automate and simplify 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. With the acquisition of CRD in 2018, we took the first step in building our front-to-back platform, State Street Alpha. In 2021, we further expanded State Street Alpha's technology offering with the acquisition of Mercatus, Inc., enabling the launch of Alpha for Private Markets. In 2023, we enhanced State Street Alpha with the release of two notable upgrades to its fixed income management module. Today our 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.
In 2021, we established State Street Digital to focus on the development of services related to digital assets and related technologies, such as blockchain, tokenization, cryptocurrency, and central bank digital currency, including the evolution of a new integrated business and digital operating model designed to support primarily our institutional clients' digital investment cycle.
Investment Management provides a broad range of investment management strategies and products for our clients through State Street Global Advisors. Our investment management strategies and products for equity, fixed income and cash assets, including core and enhanced indexing, multi-asset strategies, active quantitative and fundamental active capabilities and alternative investment strategies, span the risk/reward spectrum of these investment products. Our AUM is currently primarily weighted to indexed strategies. In addition, we provide a breadth of services and solutions, including ESG investing, defined benefit and defined contribution products, and Global Fiduciary Solutions. State Street Global
Advisors is also a provider of ETFs, including the SPDR® ETF brand.
Our investment servicing strategy is to focus on total client relationships and the full integration of our products and services across our client base through cross-selling opportunities. In general, our clients will use a combination of services, depending on their needs, rather than one product or service. For instance, a custody client may purchase securities finance and cash management services from different business units. Products and services that we provide to our clients are parts of an integrated offering to these clients. We price our products and services on the basis of overall client relationships and other factors; as a result, revenue may not necessarily reflect the stand-alone market price of these products and services within the business lines in the same way it would for separate business entities.
Our servicing and management fee revenue from the Investment Servicing and Investment Management business lines, including foreign exchange trading services and securities finance activities, represents approximately 70% to 80% of our consolidated total revenue. The remaining 20% to 30% is composed of software and processing fees, including front office software and data and lending related and other fees, as well as NII, which is largely generated by our investment of client deposits, short-term borrowings and long-term debt in a variety of assets, and net gains (losses) related to investment securities. These other revenue types are generally fully allocated to, or reside in, Investment Servicing and Investment Management.
Revenue and expenses are directly charged or allocated to our lines of business through management information systems. Assets and liabilities are allocated according to policies that support management’s strategic and tactical goals. Capital is allocated based on the relative risks and capital requirements inherent in each business line, along with management judgment. Capital allocations may not be representative of the capital that might be required if these lines of business were separate business entities.

The following is a summary of our line of business results “Other” column for the periods indicated.
Years Ended December 31,
Other
(Dollars in millions)202320222021
Fee revenue$— $23 $— 
Other Income(294)— 111 
FDIC special assessment(387)— — 
Net repositioning charges(203)(70)3 
Net acquisition and restructuring costs
15 (65)(65)
Legal and related expenses— — (18)
Deferred incentive compensation expense acceleration— — (147)
Other expenses(55)(10)(35)
Total$(924)$(122)$(151)
The “Other” columns represent amounts that are not allocated to our two lines of business. In 2023, we recognized a pre-tax expense within other expenses of approximately $387 million related to the FDIC special assessment to recover estimated losses to the Deposit Insurance Fund arising from the protection of uninsured depositors following the closure of SVB and Signature Bank. In 2023, we also recognized a pre-tax loss on sale of AFS securities of $294 million, related to an investment portfolio repositioning and net repositioning charges of $203 million. In addition, the acceleration of deferred compensation of $147 million in 2021 was not allocated to our two lines of business.

The following is a summary of our line of business results for the periods indicated.
Years Ended December 31,
Investment
Servicing		Investment
Management		OtherTotal
(Dollars in millions)202320222021202320222021202320222021202320222021
Servicing fees$4,922 $5,087 $5,531 $— $— $— $— $— $— $4,922 $5,087 $5,531 
Management fees— — — 1,876 1,939 2,053 — — — 1,876 1,939 2,053 
Foreign exchange trading services1,140 1,271 1,149 125 82 62 — 23 — 1,265 1,376 1,211 
Securities finance402 397 402 24 19 14 — — — 426 416 416 
Software and processing fees811 789 738 — — — — — — 811 789 738 
Other fee revenue(1)
145 46 59 35 (47)4 — — 180 (1)63 
Total fee revenue7,420 7,590 7,879 2,060 1,993 2,133 — 23 — 9,480 9,606 10,012 
Net interest income2,740 2,551 1,919 19 (7)(14)— — 2,759 2,544 1,905 
Total other income— (2)(1)— — — (294)— 111 (294)(2)110 
Total revenue10,160 10,139 9,797 2,079 1,986 2,119 (294)23 111 11,945 12,148 12,027 
Provision for credit losses46 20 (33)— — — — — — 46 20 (33)
Total expenses7,413 7,260 7,182 1,540 1,396 1,445 630 145 262 9,583 8,801 8,889 
Income before income tax expense$2,701 $2,859 $2,648 $539 $590 $674 $(924)$(122)$(151)$2,316 $3,327 $3,171 
Pre-tax margin27 %28 %27 %26 %30 %32 %19 %27 %26 %
Average assets (in billions)$271.5 $283.2 $296.5 $3.2 $3.2 $3.2 $274.7 $286.4 $299.7 
(1) Investment Management includes other revenue items that are primarily driven by equity market movements.