2023-04-17 22:37:00
riceState Street shares fell for the first time in three years on Thursday. It reported the withdrawal of client money from investment products, pointing out that the outflow of money was probably not over.
The stock closed 9.2% lower at $72.68. At one point it was down 18%.According to the announcement on this day, there was a net outflow of $ 26 billion (about 3.5 trillion yen) from investment products in the first quarter (first quarter), and analysts expected an inflow of $ 8 billion.I’m out. The year-ago quarter saw net inflows of $51 billion.
Fee income fell 9% year-on-year and assets under management fell 10% to $3.6 trillion. The company cited relatively low market prices at the end of the first quarter and net outflows of funds. But he added on a conference call with analysts that the company’s money market funds (MMFs) have seen some inflows due to a “flight to quality.”
State Street shares have largely escaped the turmoil involving regional banks and were up 3% through last week. Analysts were optimistic about the company, partly because of the limited credit risk of financial institutions in custody.
Adjusted earnings per share were $1.52 in the first quarter, up 1% from a year earlier. Earnings per share fell short of analyst expectations of $1.64. The stock has fallen, but the company still expects to buy back up to $4.5 billion of its stock in 2023.
On the conference call, the company expects net interest income to fall by 5% to 10% in the second quarter as clients seek higher returns, but revenue growth is expected to remain steady. Chief Financial Officer Eric Abouf said deposits would likely fall by billions of dollars more.
Original title:State Street Slides as Custody Bank Results Miss Estimates (3)(excerpt)
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