Institutional services

Institutional Services

Redefining the
client experience

Francisco

Institutional Services

Redefining the client experience

The difference between a provider and a partner is that a partner co-invests with you, understands you better, is more committed and goes to any length to deliver.

Francisco Aristeguieta Chief Executive Officer and Head of Institutional Services, Hong Kong

While 2020 was a year of extraordinary challenges, it was also a year of remarkable achievements in our asset servicing business, as our employees around the globe stepped up to serve clients with resilience, ingenuity, dedication, and fortitude — strengthening our client relationships and further solidifying our role as a trusted partner. The plans we had in motion prior to the pandemic kept us on track to deliver superior client service, deploy leading-edge solutions, and continue our strategic pivot from our traditional role as a fund service provider to an essential enterprise outsourced solutions partner.

With the launch of our Institutional Services1 group, we have further refined and intensified our focus on delivering a comprehensive, holistic approach to each client relationship — for asset managers and owners, insurance companies, and official institutions globally. By aligning all of our client-facing functions under one umbrella, we’re consistently bringing the very best solutions and services the firm has to offer — across all of our locations, products, and capabilities.

Partnership is about putting yourself in your clients’ shoes. It’s being proactive, anticipatory, and understanding what they are grappling with.

Donna milrod Head of Asset Managers Segment
and Global Clients Division, New York
Donna M

Strengthening Our Client-Centric Model

In 2020, we executed on plans to enhance our Institutional Services business model and further our goal of achieving sustainable revenue growth over time. Armed with lessons from the successful client coverage model we launched two years ago, we focused on expanding our client coverage organization to provide the highest quality service to an even broader range of clients.

Understanding that each client segment has its own unique challenges — sometimes differing by region — that require bespoke solutions to address them, we strengthened our client segment strategy during the year. We have already made significant progress here, availing our alternatives asset manager, asset manager, asset owner, and insurer clients with expanded offerings and technology solutions.

During the year, we also added new capabilities to our State Street AlphaSM front-to-back investment servicing platform through a number of industry partnerships. For example, we are now leveraging multi-asset class platform provider Solovis to help ensure that our asset owner clients can more accurately measure investment performance. Solovis delivers consolidated performance data — including alternative asset and third-party data — on a single platform, powered by our Alpha Data Services.

Our alliance with outsourced services provider Coremont allows us to offer fully integrated outsourcing services for hedge fund clients, covering front-, middle-, and back-office operations, with broader portfolio management analytics including derivatives modeling and processing.

This solution delivers a single, consolidated set of records between portfolio managers and administrators, enabling greater data transparency and risk reduction. Our partnership with SimCorp is helping meet the needs of insurance company clients in Europe, the Middle East, and Africa, with an investment outsourcing solution that delivers operational efficiency along with accurate, timely, and high-quality data for their operations.

Hafida Amara

Since joining State Street, I have had many career growth opportunities, from leading the State Street Global Advisors sales team in the Middle East and Africa to closing my largest deal ever, remotely! I have benefited from sponsorship along the way, and am pleased to be giving back by mentoring others.

Hafida Amara Head of Sales, Middle East and North Africa, Abu Dhabi

Voice of the client

pimco

Jonathan May, Head of Enterprise Risk

With the 2020 onset of the pandemic, State Street became not only a trusted service provider but a critical partner in ensuring the continuity of our operations and the safety of our employees. Whether it was affording us facilities access to accommodate a contingency trading site or maintaining constant connectivity during the devastating Southern California wildfires, we had confidence that State Street was taking all necessary actions to help protect our business, our employees and our clients’ trust.

Voice of the client

Ping An Overseas Holdings

Nicholas Ng, Managing Director

With State Street taking care of the day-to-day administrative operations of our funds, we are able to concentrate on our core competencies of offering compelling investment opportunities to our investing partners.

Voice of the client

union service-gesellschaft mbh

Oliver Reinki, Managing Director (Geschäftsführer) at Union Service-Gesellschaft mbH

State Street has been a highly reliable and trusted service partner. We are confident that extending this partnership will enhance our ability to service our clients, as we continue to benefit from State Street’s products and services and dedication to service excellence.

State Street’s servicing capabilities span more than 100 markets globally,2 and our clients look to us for support as they seek growth across geographic borders. To better service their global growth ambitions, we appointed regional and country heads in key Asian and Latin American markets, and expanded our footprint in the Middle East, opening a new office in Riyadh, Saudi Arabia.

Our new regional strategy focuses on developing country-level plans, applying regional expertise and leadership, and further optimizing our global operating model. By realigning our client-facing and service support groups to make it easier for clients to interact with us, we streamlined our business development and investment servicing operating models to drive better execution, deepen client relationships, and power future growth.

Building Relationships; Driving Performance

In our asset servicing business, we reported record assets under custody and/or administration of $38.8 trillion at December 31, 2020, a year-over-year increase of 13%. Business wins totaled $787 billion in 2020 — yet another reflection of our ability to serve as our clients’ essential partner during one of the most challenging years in recent memory.

The commitment, creativity, and expertise of our investment servicing teams — in the midst of a 90% remote work environment — helped us add new business and deliver expanded capabilities with existing clients, underpinning our success during the year in delivering a wide range of outsourced solutions to clients around the world.

Mostapha Tahiri

State Street has supported clients through different stages of growth. We want to bring that expertise to our Asian clients to help them accelerate their growth plans.

Mostapha Tahiri Head of Asia Pacific, Singapore

We focused our technology investment portfolio on enterprise-wide products and solutions rather than investment in specific areas with limited use.

Brenda Lyons Global Head of Asset Servicing Product, Boston
Brenda Lyons

In Asia Pacific, we grew our relationship with the subsidiary of a large insurance company located in China when we were named custodian and fund administrator for the subsidiary’s two new private equity funds. This business is in addition to the custody and fund administration services we currently provide for this client’s global infrastructure funds.

In EMEA, a German asset manager demonstrated its confidence in our ongoing partnership by renewing our agreement to provide collateral services. We were also reappointed by one of the largest pension providers in the U.K. to continue providing a variety of back-office servicing solutions.

Throughout the year, we extended multiple servicing agreements with major asset managers with products encompassing every asset class. We also kept abreast of new developments in the industry, helping clients identify growth opportunities. For example, we were the first ETF service provider to support the launch of semitransparent active ETFs, servicing 14 of the 19 funds launched in the industry in 2020. We continue to leverage our long-standing leadership in ETF servicing to help educate clients on the potential of these funds.

Partnering for the Future

Shockwaves from the global health, financial, and racial inequity crises of 2020 will be felt for years to come. Although the events of the year forced the entire industry to reassess the strength of its operating models, they also offered valuable lessons about resiliency, leadership, collaboration, and sustainability.

While some market participants may have anticipated a pause in the industry’s attention on environmental, social, and governance (ESG) considerations, there was an increased emphasis on the topic during the year, as investment risk and regulatory reporting requirements continued to gain momentum. Our focus on ESG remains deeply embedded across all aspects of our organization, and we are well positioned to provide best-practice guidance and support to investors adopting ESG investing into their long-term growth strategies.

Through our continuity plans, technology infrastructure, and incredible teams, we were prepared to not only help clients execute daily financial transactions through periods of great global disruption, but also to serve as their essential partner in ways we never anticipated. As we have with prior financial crises and economic downturns, we will apply these lessons to further accelerate the positive momentum we gained during the year, so that we can move forward together, building a more resilient future.

Marcia Rothschild

We see tremendous opportunities in the region to support our clients as they look to Latin America as part of their geographic growth plans. With our new Brazil office, we can now offer market-leading foreign exchange products and an award-winning3 research platform, along with global scale and local talent.

Marcia Rothschild Head of Latin America, New York

1 Our Investment Servicing business includes Institutional Services, Global Markets, State Street AlphaSM, and Charles River Development.
2 State Street Investment Manager Guide, February 5, 2021
3 Winner, Euromoney Magazine FX Survey, July 2020: No. 1 in Research for Real Money; No. 2 in Research overall (for the second consecutive year)

Details 01/23/2021