State Street to Further Consolidate Operating Model in India
04 Diciembre 2023 - 5:00AM
Business Wire
- Advances Next Phase of State Street’s Transformation and
Productivity Plan
State Street Corporation (NYSE: STT) and HCLTech announced today
they are finalizing plans for State Street to assume full ownership
of the Joint Venture operations (JV) Statestreet HCL Services,
formed in 2012 to provide business operations services. This
consolidation, which is based on the arrangements aligned with the
existing JV agreement and expected to be completed in the second
calendar quarter of 2024, will further streamline State Street’s
operating model in India and continue State Street’s ongoing
transformation and productivity plan and strategy of simplifying
its global operating model.
State Street has partnered with HCLTech for more than a decade,
and this collaboration has grown into a valuable servicing and
operational center for the firm and its clients. State Street has a
longstanding presence in India, and in October 2023 it acquired
full ownership of a separate joint venture with another partner.
Bringing the State Street HCL Services capabilities and expertise
in-house will create a more simplified model to facilitate faster
decision making and a more effective and efficient experience for
its clients.
“This integration is a natural evolution of our successful
relationship with HCLTech, which remains a strategic technology
partner,” said Mostapha Tahiri, executive vice president and
incoming Chief Operating Officer of State Street Corporation. “By
creating additional scale, we remain committed to further advancing
our operational model with client needs at the center.”
“State Street continues to be one of our strategic and top 15
clients in IT. We are proud of the collaboration over the past
eleven years and look forward to our continued partnership across
key priority areas of State Street,” said Srinivasan Seshadri,
chief growth officer and global head, Financial Services,
HCLTech.
State Street conducts operations through a global operating
model with multiple locations across the Americas, Europe, and
Asia. The company delivers high-quality investment services,
expertise and full-service coverage with complementary and
overlapping operational hours globally.
About State Street Corporation
State Street Corporation (NYSE: STT) is one of the world's
leading providers of financial services to institutional investors
including investment servicing, investment management and
investment research and trading. With $40.0 trillion in assets
under custody and/or administration and $3.7 trillion* in assets
under management as of September 30, 2023, State Street operates
globally in more than 100 geographic markets and employs
approximately 42,000 worldwide. For more information, visit State
Street's website at www.statestreet.com.
*Assets under management as of September 30, 2023 includes
approximately $58 billion of assets with respect to SPDR® products
for which State Street Global Advisors Funds Distributors, LLC
(SSGA FD) acts solely as the marketing agent. SSGA FD and State
Street Global Advisors are affiliated.
About HCLTech
HCLTech is a global technology company, home to more than
221,000 people across 60 countries, delivering industry-leading
capabilities centered around digital, engineering, cloud and AI,
powered by a broad portfolio of technology services and products.
We work with clients across all major verticals, providing industry
solutions for Financial Services, Manufacturing, Life Sciences and
Healthcare, Technology and Services, Telecom and Media, Retail and
CPG, and Public Services. Consolidated revenues as of 12 months
ending September 2023 totaled $12.9 billion. To learn how we can
supercharge progress for you, visit hcltech.com.
FORWARD LOOKING STATEMENTS
This News Release contains forward-looking statements within the
meaning of United States securities laws, including statements
about State Street’s (“we” or “our”) goals and expectations
regarding plans to assume full ownership of the State Street HCL
Services joint venture and related financial, operational and other
benefits, as well as regarding our transformation and productivity
initiatives more generally and other topics, including our
strategy, growth and sales prospects, capabilities, business
results of operations, the market outlook and the business
environment. Forward looking statements are often, but not always,
identified by such forward-looking terminology as “plan,” “will,”
“expect,” "intend," "aim," "outcome," "future," “strategy,”
"pipeline," “trajectory,” "target," “outlook,” “priority,”
“guidance,” “objective,” “forecast,” “believe,” “anticipate,”
“estimate,” “seek,” “may,” “trend,” and “goal,” or similar
statements or variations of such terms. These statements are not
guarantees of future performance, are inherently uncertain, are
based on current assumptions that are difficult to predict and
involve a number of risks and uncertainties. Therefore, actual
outcomes and results may differ materially from what is expressed
in those statements, and those statements should not be relied upon
as representing our expectations or beliefs as of any time
subsequent to the time this News Release is first issued.
Important factors that may affect future results and outcomes
include, but are not limited to:
- Acquisitions, strategic alliances, joint ventures and
divestitures, including our planned assumption of full ownership of
the State Street HCL Services joint venture, are subject to
contractual provisions and may not be completed following
announcement, and the integration, retention and development of the
benefits of these transactions, including the consolidation of our
operations joint ventures in India, pose risks for our
business;
- Shifting operational activities to non-U.S. jurisdictions,
changing our operating model and outsourcing to, or insourcing
from, third parties portions of our operations may expose us to
increased operational risk, geopolitical risk and reputational harm
and may not result in expected cost savings or operational
improvements;
- Our internal control environment may be inadequate, fail or be
circumvented, and operational risks could adversely affect our
business and consolidated results of operations;
- We are subject to intense competition, which could negatively
affect our profitability;
- We are subject to significant pricing pressure and variability
in our financial results and our AUC/A and AUM;
- We could be adversely affected by geopolitical, economic and
market conditions, including, for example, as a result of liquidity
or capital deficiencies (actual or perceived) by other financial
institutions and related market and government actions, the
Israel-Hamas War, ongoing war in Ukraine, actions taken by central
banks to address inflationary pressures, challenging conditions in
global equity markets, periods of significant volatility in
valuations and liquidity or other disruptions in the markets for
equity, fixed income and other asset classes globally or within
specific markets such as those that impacted the UK gilts in the
fourth quarter of 2022;
- Our development and completion of new products and services,
including State Street Alpha® or State Street Digital®, and the
enhancement of our infrastructure required to meet increased
regulatory and client expectations for resiliency and the systems
and process re-engineering necessary to achieve improved
productivity and reduced operating risk, involve costs, risks and
dependencies on third parties;
- Our business may be negatively affected by our failure to
update and maintain our technology infrastructure or as a result of
a cyber-attack or similar vulnerability in our or business
partners' infrastructure;
- Competition for qualified members of our workforce is intense,
and we may not be able to attract and retain the highly skilled
people we need to support our business;
- We have significant international operations and clients that
can be adversely impacted by developments in European and Asian
economies, including local, regional and geopolitical developments
affecting those economies;
- Our investment securities portfolio, consolidated financial
condition and consolidated results of operations could be adversely
affected by changes in the financial markets, governmental action
or monetary policy. For example, among other risks, increases in
prevailing interest rates could lead to reduced levels of client
deposits and resulting decreases in our NII;
- Our business activities expose us to interest rate risk;
- We assume significant credit risk of counterparties, who may
also have substantial financial dependencies on other financial
institutions, and these credit exposures and concentrations could
expose us to financial loss;
- Our fee revenue represents a significant portion of our revenue
and is subject to decline based on, among other factors, market and
currency declines, investment activities and preferences of our
clients and their business mix;
- If we are unable to effectively manage our capital and
liquidity, our financial condition, capital ratios, results of
operations and business prospects could be adversely affected;
- We may need to raise additional capital or debt in the future,
which may not be available to us or may only be available on
unfavorable terms;
- If we experience a downgrade in our credit ratings, or an
actual or perceived reduction in our financial strength, our
borrowing and capital costs, liquidity and reputation could be
adversely affected;
- Our business and capital-related activities, including common
share repurchases, may be adversely affected by regulatory capital,
credit (counterparty and otherwise) and liquidity standards and
considerations;
- We face extensive and changing governmental regulation in the
jurisdictions in which we operate, which may increase our costs and
compliance risks and may affect our business activities and
strategies;
- We are subject to enhanced external oversight as a result of
the resolution of prior regulatory or governmental matters;
- Our businesses may be adversely affected by government
enforcement and litigation;
- Our businesses may be adversely affected by increased political
and regulatory scrutiny of asset management stewardship and
corporate ESG practices;
- Our efforts to improve our billing processes and practices are
ongoing and may result in the identification of additional billing
errors;
- Any misappropriation of the confidential information we possess
could have an adverse impact on our business and could subject us
to regulatory actions, litigation and other adverse effects;
- Our calculations of risk exposures, total RWA and capital
ratios depend on data inputs, formulae, models, correlations and
assumptions that are subject to change, which could materially
impact our risk exposures, our total RWA and our capital ratios
from period to period;
- Changes in accounting standards may adversely affect our
consolidated results of operations and financial condition;
- Changes in tax laws, rules or regulations, challenges to our
tax positions and changes in the composition of our pre-tax
earnings may increase our effective tax rate;
- We could face liabilities for withholding and other non-income
taxes, including in connection with our services to clients, as a
result of tax authority examinations;
- Attacks or unauthorized access to our or our business partners'
information technology systems or facilities, or disruptions to our
or their operations, could result in significant costs,
reputational damage and impacts on our business activities;
- Long-term contracts and customizing service delivery for
clients expose us to pricing and performance risk;
- Our businesses may be negatively affected by adverse publicity
or other reputational harm;
- We may not be able to protect our intellectual property or may
infringe upon the rights of third parties;
- The quantitative models we use to manage our business may
contain errors that could adversely impact our business and
regulatory compliance;
- Our reputation and business prospects may be damaged if our
clients incur substantial losses or are restricted in redeeming
their interests in investment pools that we sponsor or manage;
- The impacts of climate change, and regulatory responses to such
risks, could adversely affect us;
- We may incur losses as a result of unforeseen events including
terrorist attacks, natural disasters, the emergence of a new
pandemic or acts of embezzlement; and
- The transition away from LIBOR may result in additional costs
and increased risk exposure.
- Other important factors that could cause actual results to
differ materially from those indicated by any forward-looking
statements are set forth in our 2022 Annual Report on Form 10-K and
our subsequent SEC filings. We encourage investors to read these
filings, particularly the sections on risk factors, for additional
information with respect to any forward-looking statements and
prior to making any investment decision. The forward-looking
statements contained in this News Release should not by relied on
as representing our expectations or beliefs as of any time
subsequent to the time this News Release is first issued, and we do
not undertake efforts to revise those forward-looking statements to
reflect events after that time.
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Media: Ed Patterson Mobile: +1 404 213 3106
epatterson@statestreet.com
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