Aided by a surge in assets under management, State Street Corp. reported strong growth in profits in the fourth quarter, but executives remained conservative for 2011.

Edward J. Resch, the company’s chief financial officer, said during its fourth quarterly earnings conference call that it doesn’t expect to grow its balance sheet “much” this year and remains relatively conservative.

“Our view is to be cautious,” he said.

Joseph L. Hooley, State Street’s chief operating officer who will become its chief executive officer on March 1, said the company will “redouble its efforts” to reduce risk. Structurally, he said, it is developing “internal controls,” including risk management, audit, legal and compliance, to avoid some of the issues the company and the industry faced regarding its investments in subprime mortgages.

“We all learned something in the past couple of years,” he said. “We are in transition where risk management is becoming a broader part of the culture as we look at opportunities going forward. There is much more attention to managing risk in a prudent way. That doesn’t mean we are not going to take risks, but we are going to take a harder look at it.”

State Street posted a profit of $498 million, or $1 a share, from $234 million, or 54 cents a share a year earlier. The company beat the average analyst estimate by three cents, according to Thomson Reuters. Revenue declined 13% to $2.31 billion.

Assets under management increased 32% to $1.91 billion from a year earlier and 10% from the previous quarter.

Hooley said that the company continues to see strong growth in its exchange traded fund business. State Street trails only BlackRock Inc., which bought Barclays’ ETF business last year, as the largest provider of ETFs nationally. Global ETF assets hit the $1 trillion mark at the end of December, a milestone long expected by industry insiders.

Hooley said as confidence returning to actively-managed investments this year he expects assets will increase on that side of the business.

Early this year, State Street expects to complete two acquisitions that it announced in the fourth quarter. In December, the company announced reached an agreement with Intesa Sanpaolo, a Milan banking company, to buy its securities services business for $1.87 billion in cash.

Earlier last month, it announced that it agreed to acquire a European fund administrator, Mourant International Finance Administration that is based in Jersey in the Channel Islands to expand its alternative servicing capabilities. That deal, which is expected to close in the first quarter, will add $170 billion in assets under administration to State Street and approximately 650 employees in Dublin, Singapore and New York.

Ronald E. Logue, State Street’s chairman and chief executive officer, said the company will continue to look for more acquisitions overseas. “This company has proven it can integrate multiple acquisitions at the same time.”

Logue said 2010 will be a “year of transition” for State Street and the industry “when core business will grow, but sources of market revenue will face headwinds.”

In terms of an economic recovery, Logue said that “we are at or near the trough. … Now we are ready to begin growing again.”