State Street chalks up 3.2% gain in AUM for quarter to $2.81 trillion

State Street Global Advisors had $2.81 trillion in assets under management as of Sept. 30, up 3.2% from the end of the previous quarter and 5.1% higher than a year earlier, according to parent company State Street Corp.'s earnings release Friday.

In a conference call Friday, Jay Hooley, State Street president and CEO, said quarterly AUM rose on the strength of equity markets and exchange-traded fund inflows resulting from the introduction of low-cost investment products in late 2017.

SSGA experienced total net inflows of $8 billion in the third quarter, compared to net outflows of $14 billion the previous quarter and net outflows of $25 billion quarter in the quarter ended Sept. 30, 2017. By asset class, equity net inflows were $41 billion, while net outflows were reported in cash, at $19 billion; fixed income, $8 billion; alternative investments, $5 billion; and multiasset strategies, $1 billion.

Long-term institutional net inflows in equity were $29 billion, vs. net outflows of $11 billion in fixed income, $2 billion in alternatives and $1 billion in multiasset strategies.

Market appreciation for the latest quarter was $86 billion.

Equities had $1.789 trillion in AUM as of Sept. 30, up 7.3% from the end of the prior quarter and up 9.1% from a year earlier, while fixed income accounted for $423 billion, down 3.2% from three months earlier but up 6.3% from the previous year.

Multiasset strategies accounted for $145 billion in assets at the end of the latest quarter, up 0.7% from the end of June and up 7.4% from the third quarter 2017; alternative investments, $136 billion, down 4.2% from three months earlier and down 11.1% from 12 months earlier; and cash, $317 billion, down 4.8% and 8.6%, respectively.

Assets under custody and administration were $33.996 trillion, up 0.4% from the second quarter and 5.9% higher than the third quarter 2017.

SSGA's investment management fees totaled $474 million in the third quarter, up 1.9% from the previous quarter and up 13.1% from the year-earlier quarter.

Revenue for the parent company was $2.951 billion for the quarter, down 2.5% from the prior quarter but up 3.7% from the year-earlier quarter. State Street's net income was $709 million, up 1.6% from the second quarter and up 12.7% from the quarter ended Sept. 30, 2017.

The third quarter financials do not include the impact of State Street's $2.6 billion acquisition of front-office servicing provider Charles River Development, which closed Oct. 1.