State Street Tuesday announced a second-quarter loss of $23 million due to a $196 million restructuring charge it took to cover the voluntary buyout of 3,100 employees, Reuters reports. This amounted to a loss of 7 cents a diluted share. A year ago, State Street earned $178 million, or 54 cents a share. The firms earnings were down 46% in the first quarter.
BlackRock, meanwhile, buoyed by its concentration in fixed income, reported an 11% increase in earnings, or a profit of $38.7 million, for the quarter. This amounted to 59 cents a diluted share. The firm also announced that its assets year to date through June had risen 15% to $286.3 billion.
Nuveen Investments, which specializes in municipal bonds, also reported a strong quarter, with earnings up 12% to $34 million, or 36 cents a diluted share. Nuveens assets also rose significantly, increasing 29% from $68.5 billion to $88.3 billion as of the end of June.
Earnings for most asset management firms, particularly those that focus on equities, are likely to be down sharply in the second quarter, as the bear market and redemptions have reduced assets at most companies, The Wall Street Journal reported Monday (see MME, 7/15/03).