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Madge M. MeyerExecutive Vice President
IT Global Infrastructure ServicesState Street Corporation
IT Infrastructure Transformation 360
A Competitive Advantage
2
A Snapshot of State Street Corporation
Global AdvisorsGlobal Advisors
Approximately $2 trillion in Lendable assets
More than $425 billion in assets on loan
Lending across multiple asset classes in 45+ markets
More than 450 customers and 150 approved borrowers worldwide
$1.6 trillion* in assets under management
Worlds Largest Institutional Money Manager**
Investment solutions across the risk/return spectrum
Fiduciary heritage since 1792Fiduciary heritage since 1792 26,950 employees in 27 countries26,950 employees in 27 countries Core business: managing & servicing financial assetsCore business: managing & servicing financial assets
$12 trillion* inassets under custody
Largest provider of investment manager operations outsourcing
Premiere hedge fund service provider
Global MarketsGlobal MarketsSecuritiesSecuritiesFinanceFinanceInvestor ServicesInvestor Services
Asset Asset ServicingServicing
Asset Asset ManagementManagement
* As of June 30, 2009** Pension & Investments, May, 2009
Investment Research and TradingInvestment Research and Trading
Over $14 trillion in volume traded across asset classes in 2008
Completed over 1,000 transitions in 2008, representing more than $433 billion in value
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This is State StreetOur Company Today — Industry Leadership
No. 1 Overall in Fund Accounting and Administration
No. 1 (Globally) in Mutual Fund Administration
Most Recognized ETF Brand (SPDR) and Most Informative ETF Website (spdrs.com)
No. 1 Financial Services Company and No. 2 Overall
Global Securities Lender and Private Equity Administratorof the Year
Best Securities Lending House
European Transfer Agent and European Hedge Fund Administrator of the Year
R & M
Global Custodian
Exchangetradedfunds.com Global ETF Awards
The Globe 100
ICFA Global Awards
Computerworld
Asia Asset Management
July 2009
July 2009
May 2009
May 2009
May 2009
April 2009
January 2009
European Mutual Fund Provider of the Year ICFA European Awards December 2008
No. 1 Overall (Unweighted) and Weighted by Importance to Counterparty
ISF Equity Lending Survey September 2008
No. 1 in Securities Lending Among Institutional Investors with $1-10 Billion and More Than $10 billion
Global Custodian July 2008
44
This is State StreetOur Company Today — Technology Leadership
Global CIO 50 Annual Listing
Global Infrastructure Services named Computerworld Honors Program Laureate second consecutive year
No. 2 in Computerworld’s Top Green IT Survey
State Street Names to Global Green 100 List
Best Infrastructure Category for Zero Footprint, Maximum Impact™
Special Commendation in European Technology & Trading Provider of the Year (Back Office) Category
FX Connect® and Currenex shared top honors as Best Online FX Trading Systems
No. 62 out of 500 in InformationWeek 500
Global Infrastructure Services honored with 21st Century Achievement Award
InformationWeek
Computerworld
Computerworld
Uptime Institute
American Financial Technology Awards
Funds Europe Magazine
Global Finance
InformationWeek
Computerworld
June 2009
June 2009
April 2009
April 2009
December 2008
December 2008
November 2008
September 2008
June 2008
5
Our mission is to sustain State Street's industry leadership through world-class, reliable, flexible, cost-effective, business-focused, and
risk-managed computing services.
Our regional service delivery managers and global competency functions deliver data center, hardware and software management,
networking communications, and end-user computing support.
An Overview of Global Infrastructure Services
Global Competency
Functions
GIS GovernanceGIS Finance
GIS HR
EMEAService Delivery
ManagersAmericasServiceDelivery
Managers
Asia PacificService Delivery
Managers
6
Plan Build
Storage
Systems Software
Software/Release MgmtSecurity Software Mgt
Middleware/Transaction Services
NetworkNetwork Engineering
Network Installation & MgtNetwork Security
Systems/Servers
Technology Planning & BlueprintCapacity / Performance MgmtGlobal Data Center Strategy
New Business Integration
Service Level Mgt
Client Services
IT Initiatives
Availability Performance Capacity Security Efficiency Scalability Flexibility Manageability Speed to Market
ContinuityManagement
BusinessDrivers &
Requirements
Service Delivery
Managers
Business Office Business Communications and Metrics ReportingProcess / Quality / Risk & Compliance Mgmt
CrossPlatform
Systems/Servers ManagementConfiguration Management
Hardware Engineering
Storage Area NetworkStorage Management
GIS Service Delivery ModelDeliver
Service Desk
End User C
omputing
Change Mgmt
Problem Mgmt
Availability Mgmt
Asset Mgmt O
perations
Incident Mgmt
End to End
Applications Server Network Desktop Email Internet
7
AMER
APAC
EMEA
Network Systems / Server / Storage Operations End User
ComputingSystemsSoftware
GIS Service Delivery Model - Global Integration
Strategic
Operational
Prior
ities
GIS Exec Mgt
Sr Regional Managers
Sr Functional Managers
Service Delivery Mgrs
Regional TechMgrs
Regional Teams
NewRole
Service Delivery Mgr:• Customer Satisfaction• Business Service Level Mgt• BAU Operations• Demand Management• Financial Mgt & Communication• Project Oversight• Compliance Oversight
Regional Technology Mgr:• Technology Strategy &
Processes• Infra Service Level Mgt• Financial Management• Resource Management• Project Execution• Compliance Management
WhatWhen
HowWho
Service Level Requirements
Best Practice Solutions
New Mgt Structure
NewProcesses
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Sustained focus on IT
Infrastructure Optimization is allowing us to
cost-effectively meet increasing
demand and address landmark
business & regulatory changes
The Optimization Challenge: Grow & Globalize while Reducing Costs
2004 2005 2006 2007 2008
% of Operating Expenses% of Operating Revenue% of IT Spend
Infrastructure Spend Comparison
2004 2005
OperatingRevenue
% of Operating Expenses% of Operating Expenses% of % of IT Spend% of IT Spend
Infrastructure Spend Comparison
2003 2004 2005 2006 2007 2008 2009 Full Year Projection
Mainframe -- $/MIPS (Base installed) (-9% CAGR)Mainframe -- $/MIPS Value (Capacity on Demand Cost) (-11% CAGR)Open Systems -- $/Core Open Systems (-13% CAGR)Storage -- $/SAN Storage GB (-38% CAGR)Network -- $/Port (0% CAGR)
Cost Per Call by the Service Desk (-14% CAGR)Cost per Ticket by the Service Desk (-23% CAGR)Total Cost of Service per PC (-4% CAGR)
Indexed on base of 100
2003 2004 2005 2006 2007 2008 2009 Full Year Projection
Storage Admin Productivity: SAN GB per Storage AdminBackup Admin Productivity: All Open Systems Storage (GB) per Backup AdminServer Management Productivity: # Server Images per Admin
Network Productivity: Bandwidth per FTE (Mbps)GEUC Service Desk Productivity: Tickets per FTE (monthly)
Indexed on base of 100
9
The Innovation Challenge
Globalization
Increasing Sophistication
Technological Innovation
Product Innovation
Industry consolidation
Regulatory requirements Cost
pressures
RequirementsEnable State Street’s Global Operating Model Assure Security, Control, Business ContinuityProvide Global Reach with Local Performance
Zero Defect Expectation
Rapid ChangeMinimal Time to Market Expense Management
Market Demand & Opportunity
10
The Transformation Challenge
ManagementStrategies &
Practices
Technology
Busin
ess People
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Listen!
Ting!
"It is not the strongest that survive, nor the most intelligent, but the ones most responsive to change.” - Charles Darwin
Customer / Quality Focused Organization• Global Model with Virtual Teams• Industry Best Practices (COBIT, ITIL, etc,)• Tiered Services with Service Level Management
enabled by
Financial Management Disciplines• Governance & Best Practices
– e.g., Asset Mgt, Technology Planning, Business Office, etc.• End-to-End TCO Business Case / ROI
Current Year Impact (self-funding)• Cost Transparency
TransformationalBusiness Management Practices
聽
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緊急
TransformationalTechnology Management Practices
Urgency!“There is only one time that is important - NOW! It is the most important time
because it is the only time we have any power over.”Leo Tolstoy
Global 3-5 Year Strategy • Technology Blueprint
– e.g., Capacity on Demand, Grid, ILM, Cloud, etc.• Global Data Center Strategy• Green Initiatives
realized through
Local Business-driven Execution• Life Cycle Mgt / New Technology Adoption• Consolidation & Virtualization• End User Experience Focus
Jin Ji
13
Transformational People Management Practices
Those who admire you, can make you confidentThose who criticize you, can make you betterThose who hurt you, can make you strongerThose who rely on you, make you capable
From “Sharing” by Xi Mu Rong
Relationship
Guanxi
關係O
N
E
T
W
O
Ownership
Navigation
Escalation
Team Approach
World-Class Quality
One Global Process
IndividualAccountability
Global Commitment
partnered with
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A Few Recent Examples
改变Change
G i Biànǎ
Align
Anticipate Adapt
Architect
Adjust
Global Data Center Strategy
Capacity on Demand
MPLS Network
Virtualization
Regional & Global Support Model
Chargeback Models
Asset Management
Global Process Standards
Zero Footprint Office Build-outs
Market Volatility Response
Split Operations
Cost Transparency
Sustainability / Energy Efficiency Program
IBT Integration
Flexible Workplace Initiative
Cloud ComputingFollow-the-Sun Support
z/Linux
15
Enjoying the Moment (but only for a moment!)
"Change is the law of life. And those who look only to the past or present are
certain to miss the future.“ - John F. Kennedy
"Every act of creation is first of all an act of destruction.“ - Picasso
改变Change
G i Biànǎ
2008 21st Century Achievement Award
2008 American Financial Technology Award
2009 Top Green Achiever Award
EnterpriseData Center
Regional Data CenterLocal Data Center
DR Data CenterReciprocal DR
16
Key Principles for Success
> Leadership – vision and perseverance> Challenges drive innovation> Pave the way with transformation and optimization> Inspire with global, long-term strategy> Execute with local focus and short-term results> Remain fluid and flexible through each moment> Measure, communicate and celebrate your achievements> Reinvent through Schumpeter’s “creative destruction”
“If we wait for the business to tell us what’s required, we’re already too late.”
成功 Chéng Gōng
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Thank you!
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ReminderThis presentation contains forward-looking statements as defined by United States securities laws, including statements about State Street’s goals and expectations regarding its business, financial condition, results of operations and strategies, the financial and market outlook, governmental and regulatory initiatives and developments and the business environment. These statements are not guarantees of future performance, are inherently uncertain, are based on 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 State Street's expectations or beliefs as of any date subsequent to the date of this presentation. Important factors that may affect future results and outcomes include, but are not limited to: global financial market disruptions and the current worldwide economic recession, and monetary and other governmental actions designed to address such disruptions and recession in the U.S. and internationally; increases in the potential volatility of our net interest revenue, changes in the composition of the assets on our consolidated balance sheet and the possibility that we may be required to change the manner in which we fund those assets, all as a result of the May 15, 2009 consolidation for financial reporting purposes of the asset-backed commercial paper conduits that we administer; the financial strength and continuing viability of the counterparties with which we or our clients do business and with which we have investment, credit or financial exposure; the liquidity of the U.S. and international securities markets, particularly the markets for fixed income securities, and the liquidity requirements of our customers; the credit quality and credit agency ratings of the securities in our investment securities portfolio, a deterioration or downgrade of which could lead to other-than-temporary impairment of the respective securities and the recognition of an impairment loss; the maintenance of credit agency ratings for our debt obligations as well as the level of credibility of credit agency ratings; the possibility of our customers incurring substantial losses in investment pools where we act as agent, and the possibility of further general reductions in the valuation of assets; our ability to attract deposits and other low-cost, short-term funding; potential changes to the competitive environment, including changes due to the effects of consolidation, extensive and changing government regulation and perceptions of State Street as a suitable service provider or counterparty; the level and volatility of interest rates and the performance and volatility of securities, credit, currency and other markets in the U.S. and internationally; our ability to measure the fair value of the investment securities on our consolidated balance sheet; the results of litigation, government investigations and similar disputes and, in particular, the effect of current or potential proceedings concerning State Street Global Advisors’, or SSgA’s, active fixed-income strategies and other investment products, in particular, the potential for monetary damages and negative consequences for our business arising from the previously announced “Wells” notice we received from the SEC;and the enactment of legislation and changes in regulation and enforcement that impact us and our customers; adverse publicity or other reputational harm; our ability to pursue acquisitions, strategic alliances and divestures, finance future business acquisitions and obtain regulatory approvals and consents for acquisitions; the performance and demand for the products and services we offer, including the level and timing of withdrawals from our collective investment products; our ability to continue to grow revenue, attract highly skilled people, control expenses and attract the capital necessary to achieve our business goals and comply with regulatory requirements; our ability to control operating risks, information technology systems risks and outsourcing risks, the possibility of errors in the quantitative models we use to manage our business and the possibility that our controls will fail or be circumvented; the potential for new products and services to impose additional costs on us and expose us to increased operational risk, and our ability to protect our intellectual property rights; changes in government regulation or new legislation, which may increase our costs, expose us to risk related to compliance or impact our customers; changes in accounting standards and practices; and changes in tax legislation and in the interpretation of existing tax laws by U.S. and non-U.S. tax authorities that impact the amount of taxes due. Other important factors that could cause actual results to differ materially from those indicated by any forward-looking statements are set forth in State Street's 2008 Annual Report on Form 10-K and its subsequent SEC filings, including, in particular, its Current Report on Form 8-K dated May 18, 2009. State Street encourages investors to read these filings, particularly the sections on Risk Factors, and its subsequent SEC filings for additional information with respect to any forward-looking statements and prior to making any investment decision. The forward-looking statements contained in this presentation speak only as of August 24, 2009, and State Street does not undertake efforts to revise those forward-looking statements to reflect events after that date.