Investment Services

INVESTMENT SERVICES

SHAPING THE FUTURE OF INVESTMENT SERVICING

Investment Services

SHAPING THE FUTURE OF INVESTMENT SERVICING

Lou Maiuri Lou Maiuri President, Chief Operating Officer, and Head of Investment Services
quotations

Our unwavering client focus and capacity to deliver innovative solutions globally and at scale position us as the industry's partner of choice.

Lou Maiuri President, Chief Operating Officer, and Head of Investment Services
quotations

Our unwavering client focus and capacity to deliver innovative solutions globally and at scale position us as the industry's partner of choice.

Lou Maiuri President, Chief Operating Officer, and Head of Investment Services

State Street's Investment Services business is focused on delivering the best possible solutions, services, and insights to institutional clients, and helping drive growth and operational efficiency — across our clients' investment operations and our own.

Our vision is to be the world's leading investment servicer, shaping the future of the industry and achieving new levels of technology-led innovation, resiliency, efficiency, and growth for investors and the people they serve.

We help clients — asset managers, insurance companies, pension funds, official institutions and central banks, and wealth managers — streamline their operating models, remain focused on identifying and capitalizing on growth opportunities, and harness their data to develop deeper insights and make better-informed investment decisions. Through enduring partnerships with these clients, we co-design, co-invest, and innovate together, so they can succeed in today's environment, and thrive in tomorrow's.

2022 BUSINESS MOMENTUM

Our distinctive value proposition and diversified offerings drove our continued business momentum, with servicing wins of $1.9 trillion in 2022 and $3.6 trillion of new business to be installed at year-end. Within our servicing business, our assets under custody and/or administration (AUC/A) wins in the Alternatives segment more than doubled in 2022.

In addition to achieving organic servicing wins through deepening existing client relationships, we gained new business across client segments and geographies. We grew our Latin America presence, opening a new office in Chile to support institutional clients, with a focus on custody, fund administration, and securities lending.

We also enhanced our products and capabilities in Mexico with the launch of an integrated fund trading solution. In the Asia-Pacific (APAC) region, where we have been doing business for four decades, our business unit achieved its best performance ever, driven by large mandates in Australia and Japan.

The unit closed the year by winning Australia's largest-ever custodial mandate for the newly formed Australian Retirement Trust (the combination of superannuation funds Sunsuper and QSuper), among other important wins. In recognition of our continued strength and success in APAC, we won a number of regional awards, including being named Best Custodian for Asset Owners in the Asianlnvestor Asset Management Awards, and Best Global Custodian in APAC (25 Years) and Best Middle- and Back-Office Provider in the Asia Asset Management Best of the Best Awards.

2022 Industry Awards

Recognizing Our Alpha, Outsourcing and Multi-Bank Technology
  • Best Front-Office Platform and Best Managed Data Service Provider WatersTechnology Asia 2022

  • #1 Multi-Dealer Platform, Real Money Euromoney FX Survey 2022, 5th straight year (GlobalLink)

  • Best Hedge Funds Administrator - Over $30B Single Manager HFM Asia Services Award 2022

  • Best Outsourcing Provider to the Buy Side WatersTechnology Buy Side Technology Awards 2022

  • Best Global Custodian in APAC Asia Asset Management Best of the Best Awards 2022 (25 Years)

  • Outstanding FX Settlement Bank Bond Connect Awards 2022

  • No. 1 Multi-Dealer Platform Euromoney FX Survey 2022 2nd straight year (FX Connect®, Currenex®)

  • Best Middle- and Back- Office Provider Asia Asset Management best of the Best Awards 2022

  • Best Multibank Platform Global Finance 2022 (FX Connect)

  • Best Service Euromoney FX Survey 2022, 2nd straight year (GlobalLink)

  • Best Custodian for Asset Owner AsianInvestor Asset Management Awards 2022

  • Best in Securities Lending The Asset Triple A Sustainable Investing Awards 2022 (8th consecutive year)

Donna Milrod quotations

We continue to see strong interest in digital technology and infrastructure from both institutional and alternatives clients as a means to solve current operational challenges, increase liquidity, or find new distribution channels.

Donna Milrod Chief Product Officer
Brian Franz quotations

Our goal is to continually enhance our client experience and technology solutions through innovation, while driving efficiency and productivity across our organization.

Brian Franz Chief Information Officer and Head of Enterprise Resiliency

Driving growth through innovation

Donna Milrod quotations

We continue to see strong interest in digital technology and infrastructure from both institutional and alternatives clients as a means to solve current operational challenges, increase liquidity, or find new distribution channels.

Donna Milrod Chief Product Officer

As an organization, we are always striving to create new and better ways of serving our clients. At State Street, innovation is not a product, a strategy, a goal, or a one-and-done initiative. Rather, it is an ethos and attitude ingrained across our enterprise.

We are committed to leading the industry, facilitating systemic change and transformation to better serve clients and deliver value to investors. Through our in-depth knowledge of global financial markets and our clients' needs, we not only see the future; we are helping to shape it.

Among the most tangible benefits of State Street's innovation mindset are the sophisticated products and data platforms we have created by teaming with the best minds in the business, both internally and externally.

With the evolution of fund structures and growing investor demand for exchange-traded funds (ETFs), we developed and implemented State Street Total ETF, which provides clients with a full suite of capabilities, from pre-launch planning and project management, to a host of servicing and global markets capabilities and portfolio management tools.

We also announced that GlobalLink, our award-winning suite of digital multi-asset trading solutions, has introduced a new, open client platform. The platform enables customized workflows and a seamless user experience across the full suite of GlobalLink-branded solutions and other strategic third-party partners.

GlobalLink's new platform functionality has been purposefully designed to better enhance services, solutions, and automation, allowing institutions and applications to speak to each other through an integrated dashboard, helping to yield cost savings and maximize trading and workflow efficiency.

STATE STREET DIGITAL®: BUILDING THE FINANCIAL INFRASTRUCTURE OF THE FUTURE

Digital assets are a transformational force in our industry, and will be for years to come. As such, they represent a sizable opportunity to create new market settlement solutions based on transfer of value rather than information. Opportunities also exist to gain operational efficiencies from smart contracts and assets programmability, as well as enhanced liquidity and ease of distribution. Firms are increasingly recognizing the benefits of tokenization and utilization of distributed ledger technology (DLT).

We currently support the administration of crypto assets under management for multiple funds. As decentralized finance continues to gain traction in global markets, we have developed a series of in-house, permanent, private DLT networks with robust security that are flexible and scalable.

This DLT ecosystem is the foundation for State Street Digital, and supports each aspect of our strategy, including asset tokenization. The ecosystem integrates with our current fund administration and accounting service offering for funds, including those that hold cryptocurrencies, and we will continue to integrate new services as we advance our front-to-back digital strategy.

We also continue to attract strong interest in digital technology and infrastructure from both institutional and alternatives clients seeking ways to achieve operational efficiency and open new distribution channels. To help clients stay ahead of developments and regulatory shifts around digital finance, we launched a quarterly thought leadership compendium, Digital Digest. Featuring timely, topical insights from our digital markets experts, the Digital Digest has been well-received by clients and was recognized at the 2022 Crypto AM Awards.

In 2023, we will continue to focus on commercializing digital wallets, DLT, tokenization, and smart contract capabilities. As regulatory agencies begin to clarify rules governing cryptocurrencies, digital assets, and infrastructure, we expect client demand to further intensify and new opportunities to emerge. We will continue to work closely with regulators as the crypto investment landscape evolves.

Brian Franz quotations

Our goal is to continually enhance our client experience and technology solutions through innovation, while driving efficiency and productivity across our organization.

Brian Franz Chief Information Officer and Head of Enterprise Resiliency
Technology Transformation

Across the enterprise, our technology transformation efforts are focused on optimizing efficiency and resiliency, and driving innovation and growth. In 2022, we continued to advance our multi-year technology strategy, with a focus on modernizing our platform, streamlining our business, unlocking efficiencies, and increasing productivity.

We drove meaningful gross operations and technology savings, which were redeployed to fuel other growth-enhancing capabilities.

We also continued to operate an advanced technology network to accelerate innovation and meet client expectations. To this end, we are creating a simplified infrastructure that leverages artificial intelligence and machine learning automation, underpinned by a hybrid multi-cloud architecture.

In addition to building out a formidable IT ecosystem underpinned by our own in-house capabilities, we also continued to partner with leading technology firms — a strategy that helps us innovate with agility and give clients access to a broader selection of best-in-class solutions, efficiently and at scale. We are applying this technology-led approach to enhancing and digitizing our core products and services — from custody and accounting to fund administration and transfer agency — future-proofing our capabilities to help solve our clients' problems today and meet their future needs.

For example, we partnered with the industry's top provider of a scalable, cloud-native investment accounting, fund accounting, and contingency net asset value solution that enables straight-through processing, from portfolio management and trading, to custody and administration. By embedding these capabilities into our State Street Alpha platform, we strengthened our ability to offer clients the critical data they need to transact and better understand their investment performance.

Further, by partnering with the industry's leading public and private cloud service providers, we were able to accelerate our migration to the cloud, reduce our facilities footprint, and improve our risk posture.

Our technology transformation aims to accelerate business innovation and the delivery of new products and services, while enhancing client outcomes and automating processes to help deliver cost savings.

looking ahead

In 2023, we will continue to execute against our strategic priorities of delivering growth, fostering innovation, and enhancing shareholder value. Key focus areas include driving core growth in traditional investment services globally, further building out Alpha as an industry-leading platform, enhancing our private markets enterprise outsourcing offering, pursuing new growth opportunities in digital assets and wealth services, and continuously optimizing and fortifying our operating model.

We will maintain an unwavering focus on serving our clients as the industry's best partner, operator, innovator, and employer of choice.

John Plansky quotations

The Alpha Data Platform empowers investment and operations teams with trusted, accurate data that helps unlock new insights and efficiency.

John Plansky Head of State Street Alpha

State street alpha

Enabling Growth And Efficiencies For Investors Worldwide

In 2019, we launched the industry's first front-to-back asset servicing platform from a single provider — State Street Alpha — to help our clients manage their investment products and business lines in one place.

The platform's value proposition is clear: to enable our clients' end-to-end investment strategy, provide the right capabilities, software, services, and data, and help our clients grow efficiently.

Today, Alpha is at the center of our technology strategy, instrumental in driving the firm's enterprise-wide growth and revenue. Speeding time-to-decision by providing a centralized, single source of truth across the enterprise, Alpha is a compelling example of how we continue to shape the future of the financial services industry through tech-led innovation. In 2022, Alpha continued to gain broad-based marketplace adoption, as we added significant new capabilities and partnerships.

State Street Alpha is cloud-native by design, leveraging the advanced security, performance, and scale of a globally leading cloud computing platform. Its open architecture offers seamless integration with leading third-party providers, making it easy for us to tap into the capabilities and strengths of our own stable of tech partners, while also forging powerful connectivity with other industry-leading firms.

As an example, our Alpha Data Platform — built on the Snowflake® data cloud — provides a foundation that lets clients use both internally generated and externally acquired data to drive faster, clearer investment insights. By streamlining client data flows across the front, middle, and back office, our Alpha Data Platform provides a seamless, highly functional client experience for equity, fixed income and multi-asset strategies.

During 2022, we announced three new Alpha client wins, while expanding services to 17 existing Alpha clients. We have a robust pipeline of prospects in advance negotiations for sign-on in 2023.

John Plansky quotations

The Alpha Data Platform empowers investment and operations teams with trusted, accurate data that helps unlock new insights and efficiency.

John Plansky Head of State Street Alpha
Seizing The Private Markets Opportunity

In private markets, the industry revenue pool is growing faster than the core servicing revenue market. We have been providing back- and middle-office services for our clients' alternative investments for more than 20 years.

In response to client demand for added exposure to private equity and real estate, we continue to invest in this space to offer the right servicing tools to meet our clients' needs. We further expanded State Street Alpha's technology offering with the 2021 acquisition of Mercatus, enabling the launch of Alpha for Private Markets.

Alpha for Private Markets facilitates differentiated servicing, enabling holistic portfolio management across private and public assets for private markets clients and new investors diversifying into this asset class. Institutional investors can manage their entire investment life cycle for private equity, real estate, infrastructure, private debt, and fund of funds on a single, integrated platform.

In sum, the Alpha proposition, which is a clear differentiator for State Street, continues to resonate with clients and fuel new business.

Details 04/24/2022