The earnings report of Boston headquartered bank State Street Corp. outlined better-than-expected results in the first quarter of 2015. The main driver behind the increase in business was rampant foreign exchange volatility.
The Chairman and Chief Executive Officer of State Street Corp. commented, “Our first-quarter 2015 results reflect strong fee revenue growth compared to the first quarter of 2014, continued momentum of our core business, and our focus on managing expenses.”
Fee revenue growth in the first quarter supported by strong foreign exchange trading
“Our fee revenue growth in the first quarter was supported by strong foreign exchange trading activity. The divergence in interest rate expectations for the United States relative to most other major economies and the actions taken by several central banks around the world to increase their quantitative easing has contributed to an increase in volatility and volumes of foreign exchange trading,” he elaborated.
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The overall hit the firm took due to the higher exchange rate of the U.S. dollar was offset by expense cutting.
The company reported revenues totaling $2.67 billion in the first quarter, which is higher by 4.6% when compared to last year, but lower than the final quarter of 2014, when the figure was 1.7% higher.
Operating earnings per share have increased by 18.2% when compared to last year, but declined from last quarter by 14.6% to $1.17 on a non-GAAP basis.
State Street joins BNY Mellon which reported larger than expected gains due to strong foreign exchange business. Banks which have been positioned well after the SNB induced turmoil are reporting substantial growth in their FX business.