State Street Corp. on Tuesday, July 20, reported second-quarter 2010 earnings of 87 cents, down 12 cents from 99 cents in the first quarter of 2010, due primarily to a securities lending charge. However, profits stood at $432 million compared with a loss of $3.31 billion, or $7.12 a share, last year.
The second-quarter earnings report also showed an increase of 10% compared to $0.79 in the second quarter of 2009 before the conduit-related extraordinary loss. Revenue in the second quarter of 2010 was $2.304 billion, up 9% from $2.122 billion in the second quarter of 2009.
Expenses of $1.944 billion in the second quarter increased from $1.364 billion in the second quarter of 2009 due primarily to the securities lending charge. Return on shareholders’ equity was 11.0%, down from 13.0%, before the extraordinary loss, in the second quarter of 2009.
The Boston-based custodial bank reported in a release that second-quarter 2010 GAAP-basis results included a pre-tax charge of $414 million, or $251 million after tax, separately announced on July 7, related to certain common and collective trust funds managed by State Street Global Advisors that engage in securities lending, and the agency lending program.