What happened
It wasn't a happy Friday for shareholders of storied bank and financial services company State Street (STT 0.14%). The company released its latest set of quarterly metrics and figures, and to say the market was displeased is an understatement. They traded the stock down by more than 12%, which was quite a big move, considering that the benchmark S&P 500 index closed essentially flat on the day.
So what
For its second quarter, State Street managed to increase its total revenue by 5% to $3.11 billion, due in no small part to net interest income that grew 18% (to $691 million). This made up for the sluggish 2% growth in total fees reaped by the bank.
Similar to that figure for fee revenue, the company's net income crept only 2% higher. It landed at $763 million, or $2.17 per share.
This meant a mixed quarter for State Street. On average, analysts tracking the stock were anticipating total revenue of $3.13 billion, and a per-share net income figure of $2.11.
In the earnings release, State Street quoted CEO Ron O'Hanley as saying that the company's "results reflect the strength of our business model year over year as strong net interest income growth, a significant expansion in front-office solutions, and higher securities finance revenue contributed to improved EPS and ROE."
Now what
However, market players likely weren't impressed when they started digging through State Street's figures for the quarter. One pundit who got notably more bearish on the company post-earnings was Evercore ISI's Glenn Schorr, who described the net interest income number as "weaker than expected" and pointed out that total deposits were down notably in the period.
