The bank booked repositioning charges of $226 million in the quarter primarily from workforce rationalization occupancy costs associated with real estate footprint optimization.
- Repositioning charge consists of $111 million charge reflected in compensation and employee benefits.
- State Street reported adjusted earnings per share of $2.97 for the quarter, surpassing analyst estimates of $2.78 per share.
- The company’s total expenses in the quarter increased by 6%, excluding notable items.
Shares of custodian bank State Street (STT) dived on Friday after it disclosed that it took a repositioning charge during the fourth quarter that weighed on its profit.
The bank said repositioning charges (net) of $226 million in the quarter represents a $111 million charge reflected in compensation and employee benefits primarily from workforce rationalization and a $69 million charge reflected in occupancy costs associated with real estate footprint optimization.
The company also saw its total expenses in the quarter increase by 12%, primarily driven by investments in its business and technology capabilities and revenue-related costs.
Strong Q4 Results
State Street reported adjusted earnings per share of $2.97 for the quarter, surpassing analyst estimates of $2.78 per share. Its revenue totaled $3.67 billion, beating consensus estimate of $3.57 billion and representing a 7% increase year-over-year, as per data from fiscal.ai.
"2025 marked another year of strong performance and strategic progress for State Street. We delivered robust financial results, achieving positive operating leverage, expanding pre-tax margin, and generating higher returns,” said Ron O’Hanley, Chairman and CEO at State Street.
Push Into Digital Assets
State Street earlier in the week announced the launch of its Digital Asset Platform, an infrastructure for tokenized assets. The platform strategically positions State Street to be the bridge between traditional and digital finance and the connection point between digital asset platforms for its clients.
The launch enables State Street's digital ambitions to develop core products for its clients, including tokenized Money Market Funds, ETFs, tokenized assets, and cash products including tokenized deposits and stablecoins.
The platform includes wallet management, custodial, and cash capabilities, designed to support tokenized product development across jurisdictions covering both private and public permissioned blockchain networks, it said.
Other Firms Into Digital Push
Earlier this week, BNY, a global financial services company, took its first step in its strategy to tokenize deposits by enabling the on‑chain mirrored representation of client deposit balances on its Digital Assets platform.
Global financial markets are shifting towards an always-on operating model, due to which institutions are seeking faster and more efficient ways to move assets with greater settlement certainty, transparency. Tokenized deposits can help to reduce settlement friction, improve liquidity efficiency across collateral and margin workflows, and enable programmable payments and settlements.
How Did Stocktwits Users React?
Retail sentiment around STT trended in ‘extremely bullish’ territory amid ‘high’ message volume.
Shares of State Street have risen 31% over the past 12 months.
