Annual Report — Form 10-K
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-K State Street Boston Corp. Form 10-K 19 123K
2: EX-10 Material Contracts 6± 29K
3: EX-10 Material Contracts 2± 11K
4: EX-10 Material Contracts 1 8K
5: EX-10 Material Contracts 2± 11K
6: EX-10 Material Contracts 2± 10K
7: EX-10 Material Contracts 2± 9K
8: EX-10 Material Contracts 13± 60K
9: EX-11 Statement Re Computation of Per Share Earnings 1 10K
10: EX-12 Statement Re Computation of Ratios 2± 11K
11: EX-13 Annual Report to Stockholders 2± 12K
12: EX-13 Annual Report to Stockholders 24± 97K
13: EX-13 Annual Report to Stockholders 2± 13K
14: EX-13 Annual Report to Stockholders 20 106K
15: EX-21 Subsidiaries of the Registrant 2± 11K
16: EX-23 Consents of Experts and Counsel 1 8K
EX-13 — Annual Report to Stockholders
EXHIBIT 13.3
TO OUR
Stockholders:
For State Street, 1993 was a successful year of growth, evolution and
investment in our future. Revenue grew 18%. Earnings per share were up 13%.
Return on stockholders' equity was 17.4%. Financial assets in our custody
grew 21% to $1.6 trillion, and assets under management reached $142 billion,
up 28% over last year. At year-end, the dividend rate was 17% higher than
a year ago. We have increased our dividend every six months for the past
15 years. These results are strong evidence that our strategy of leveraging
information technology to develop a broad, integrated product line for
servicing financial assets is working well.
We surpassed $1 billion of revenue for the first time in 1993. We added
important new customers worldwide in all our businesses, strengthened
relationships with existing customers, and introduced new and innovative
services. We transferred capabilities we had established in the
United States to markets around the world and adapted them for local
requirements. We are seeing the benefits of focusing on cross-selling
products across our customer base. More and more, our customers are buying
multiple services from us. We are making increased use of our balance sheet
to accommodate customers' short-term cash needs in the form of repurchase
agreements and multicurrency deposits. Over one-third of the loan portfolio
supports the short-term borrowing requirements of our financial asset
services customers and securities brokers.
We are increasing efforts to continue our growth for the long term. We made a
strategic decision to increase investment spending to approximately 10% of
revenue for 1993 and 1994. We are investing in information technology, product
development and geographic expansion. This higher level of investment
spending will strengthen our leadership in the markets we serve and position us
for long-term growth.
Over the past years, we have chosen to look to the future, to take the long
view -- and this has been the foundation of State Street's success.
In the late 1970s, we transformed ourselves from a regional bank to
the leading U.S. securities custodian. Building on our strengths as the largest
mutual fund custodian in the United States, we became the largest U.S.
master trustee/master custodian. In the 1980s, we reexamined the marketplace
and decided to expand globally to support our customers' need for a
global custodian and to penetrate non-U.S. markets.
Achieving sustained growth depends on our continued transformation as a
provider of a full range of integrated financial asset services.
We are leveraging our strengths - customer focus, advanced information
technology and a highly professional global work force - to meet the demands of
an increasingly competitive marketplace.
Underpinning our customer focus is an obsession with quality service. Time
after time, we win in the marketplace on the basis of references from
satisfied customers, as well as the strength of our multi-currency
accounting system; the capacity to support investment management with
on-line systems; and an ability to deliver multiple products and services,
not just traditional custody and accounting, quickly and effectively.
We are making significant investments in our business. Two areas in which we
are concentrating investment are new technology and reengineering.
We are developing Global Horizon Interchanger to meet our customers'
sophisticated information needs. Interchange is an open architecture
that will enable customers and their investment managers to integrate the
transaction processing and accounting data we maintain for them with the
information they receive from their own systems, as well as from other
information providers. Interchange's underlying technology adapts to our
customers' systems, allowing them to download information from State Street
into their software applications, share data on their local area networks and
choose the speed at which information is delivered. In addition to its powerful
integration capabilities and increased speed of information delivery, the
importance of Global Horizon Interchange is its ability to enhance
productivity - for us and for our customers.
As part of our reengineering effort, we are conducting an end-to-end review of
core cash and securities processing workflows. The objectives are better
product delivery, higher service quality, and a significant reduction in the
unit costs of fundamental custody and accounting services. We expect to benefit
significantly from this effort to improve our operating processes.
We are taking action to stay ahead of the competition, and we will continue to
capitalize on opportunities that arise as investors implement increasingly
complex global investment strategies. As you will see in the following pages,
we are aligned with large and growing markets around the world. Combining
our advanced information technology with banking, trust, investment and
securities processing capabilities, we continue to win new business and expand
existing customer relationships.
Our financial objective remains sustainable real growth in earnings per share.
We believe this will create value for our stockholders over the long term.
It is also our goal to achieve superior long-term financial performance, which
we translate into a return on equity of 18%. We are pleased that, given the
increased level of investment spending, we achieved a 17.4% return on equity
for 1993. Given our current assessment of our company and the markets we serve,
our expectation is for continued double-digit earnings per share growth for
the next few years. We are committed to continuing our transformation as we
aim to be the leading global servicer of financial assets.
Our success in 1993 was the result of the hard work of the 10,000 State Street
employees around the world. We would like to take this opportunity to
acknowledge and thank them for their contributions. Their creativity and
dedication have driven our past success and will pave the way for our success
in the future.
Signature
Marshall N. Carter
Chairman and Chief Executive Officer
Signature
David A. Spina
Vice Chairman
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