Loan Growth, Rise in Fee Income to Aid State Street's Q4 Earnings

Core Viewpoint - State Street (STT) is expected to report fourth-quarter and 2025 results on January 16, with anticipated year-over-year growth in revenues and earnings [1][9]. Financial Performance Expectations - The Zacks Consensus Estimate for fourth-quarter earnings is $2.82 per share, reflecting an 8.5% increase from the previous year [2]. - Quarterly sales are estimated at $3.59 billion, indicating a 5.3% year-over-year growth, while full-year sales are projected at $13.88 billion, representing a 6.1% increase [3]. Key Developments - In November, State Street entered a strategic partnership with Albilad Capital to enhance securities services in Saudi Arabia [4]. - The company acquired PriceStats, a provider of global inflation data, and also acquired global custody businesses from Mizuho Financial Group [5][6]. Earnings Drivers - Net Interest Income (NII) is expected to rise to $770 million, a 2.8% year-over-year increase, despite recent interest rate cuts [10][11]. - Fee revenues are projected to grow by 6.8% year-over-year, with FX trading services income estimated at $393 million, a 9.2% increase [12][14]. Expense Management - Total expenses are anticipated to rise due to increased information systems costs and strategic investments, with adjusted expenses expected to grow by 4.5% in 2025 [16][17]. Earnings Surprise History - State Street has a strong earnings surprise history, with an average surprise of 6% over the last four quarters [2][18].