8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): December 22, 2009

State Street Corporation

(Exact name of registrant as specified in its charter)

Massachusetts	001-07511	04-2456637
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

One Lincoln Street, Boston, Massachusetts	02111
(Address of principal executive offices)	(Zip Code)

617-786-3000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01. Regulation FD Disclosure

State Street Corporation announced today that it has signed an acquisition agreement with Intesa Sanpaolo (“ISP”). Under this agreement, State Street is expected to acquire ISP’s Securities Services (“ISPSS”) business, with operations in Italy and Luxembourg, including ISPSS’ global custody, depository banking, correspondent banking (banca corrispondente), and fund administration portions of the ISPSS business. As consideration for the transaction, State Street will pay ISP an amount equal to the sum of €1.28 billion, subject to certain adjustments. State Street expects to support the acquired ISPSS balance sheet with approximately €560 million ($800 million) of additional capital. Completion of the transaction is subject to regulatory approvals and other closing conditions.

Attached hereto as Exhibit 99.1 are slides being presented to investors in connection with the execution of an acquisition agreement with ISP.

The information in this Item 7.01, and the slide presentation in Exhibit 99.1 attached to this Form 8-K, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall this Item 7.01, such Exhibit 99.1, or any of the information contained therein be deemed incorporated by reference in any filing under the Securities Exchange Act of 1934 or the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

Exhibit No.	Description
99.1	Slide presentation (such Exhibit 99.1 is furnished and not filed).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

STATE STREET CORPORATION
By:	/s/    DAVID C. PHELAN
Name: Title:	David C. Phelan Executive Vice President and General Counsel

Date: December 22, 2009

Exhibit Index

Exhibit No.	Description
99.1	Slide presentation (such Exhibit 99.1 is furnished and not filed).

EX-99.1

1

State Street’s Acquisition of Intesa Sanpaolo’s

Securities Services Business

December 22, 2009

Exhibit 99.1

2

Reminder

This presentation contains forward-looking statements as defined by United States securities laws, including statements about our agreement to acquire the

securities services business of Intesa Sanpaolo, the results and impact of that acquisition, including the estimated impact of the acquisition on specified capital

ratios and our financial results, and related rationales, as well as our overall goals and expectations regarding our 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 current assumptions that are difficult to predict, as well as

representations in the acquisition agreement, 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 date subsequent to

the date of this release.

Important factors that may affect future results and outcomes include, but are not limited to: the ability to obtain regulatory approvals for the transaction in

multiple jurisdictions and the satisfaction of other closing conditions; the risk that businesses will not be integrated successfully, or will take longer than anticipated,

that expected synergies will not be achieved or unexpected disynergies will be experienced, that customer  and deposit retention goals will not be met, and that

disruptions from the transaction will harm relationships with customers, employees and regulators; financial market disruptions and the economic recession,

whether in the U.S. or internationally, and monetary and other governmental actions designed to address such disruptions and recession, including actions taken

in the U.S. and internationally to address the financial and economic disruptions that began in 2007; increases in the potential volatility of, or declines in the levels

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; the financial strength and continuing viability of the counterparties with which we or our customers do business and to

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, credit agency ratings, and fair values 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 income statement recognition

of an impairment loss; the maintenance of credit agency ratings for our debt and depository 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 investmen

products; 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 grow revenue, attract and retain 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 our 2008

Annual Report on Form 10-K, our Current Report on Form 8-K dated May 18, 2009, 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 presentation speak only as of the date hereof, December 22, 2009, and we do not undertake efforts to revise

those forward-looking statements to reflect events after this date.

3

State Street’s Acquisition of Intesa Sanpaolo’s

Securities Services Business

Agenda

Intesa Sanpaolo’s Securities Services Business

Strategic Rationale and Financial Impact

Transaction Summary

Capital Impact

Expected Timetable

1

Transaction Summary

Purchase Price

Description

Financing

Earnings Impact

Capital Impact

Transaction IRR

Timing

•

Purchase of the Securities Services Business based in Italy and Luxembourg

from Intesa Sanpaolo S.p.A. with long-term contract to service all of Intesa’s

investment management affiliates including Eurizon Capital

•

€1.28bn in cash

•

Available resources: no external financing required

•

Anticipated to be modestly accretive to 2010 earnings on an operating basis

•

Expect to maintain strong capital ratios

•

Anticipated to exceed State Street’s hurdle rate

•

Closing expected in second quarter of 2010, subject to regulatory approvals

and closing conditions

5

Intesa Sanpaolo’s Securities Services Business

€173bn

NAV calculation / fund accounting,  back office outsourcing,

transfer agent activities and performance analysis

Fund Administration

€343bn

Safekeeping, settlement, corporate actions, tax services and

proxy voting

Custody

€22bn

€141bn

1H ’09 Avg.

Customer Assets

Business

Line

Key

Activities

Depository Bank

NAV Control, fund participants register and control, pricing

verification and fund limits control

Banca Corrispondente

Intermediation in Italy of shares of funds managed by foreign

asset managers and tax management according to Italian law

•

A leading provider in the Italian market

•

Customers include mutual funds, pension funds, real estate funds, hedge funds, banks and

insurers

•

Approximately 80% of customer revenues in Italy with remainder in Luxembourg

•

Business comprised of four major business lines

6

Strategic Rationale

Enhanced Global Platform

Market

Penetration /

Geographic

Expansion

•

Italian market leadership with immediate visibility and credibility

•

Increased scale and enhanced presence in Luxembourg

•

Attractive margins in both markets

•

In line with objective of sourcing 50% of revenues outside US

Financially

Attractive

•

Strategic deployment of available capital results in 2010 operating-basis

EPS accretion and strong financial returns

•

Cost synergies with existing European business and global custody

infrastructure

•

Opportunity to cross sell additional State Street value-added services

Track Record of

Successful

Acquisitions

Leveraging Market Opportunity and Acquisition Expertise to Strengthen

Position

as

a

Global

Custodian

while

Generating

Strong

Financial

Returns

•

Proven ability to integrate significant acquisitions

–

Investors Financial Services Corp. in 2007

–

Deutsche Bank GSS business in 2003

•

State Street’s operational expertise will enhance acquired business

7

Strategic Rationale

Expands International Market Position

•

Italy is one of State Street’s key strategic European markets

•

Expect to further expand on Intesa Sanpaolo relationship

•

Estimated increase in 2008 non-US revenue share from 35% to 38%, adjusted for the

acquisition

Offshore

(Ireland & Luxembourg)

Range of

Services

Country

Market

Presence

Italy

France

Germany

Netherlands

Switzerland

UK

Strengthens Position as a Leading Global Custodian

FULL

EVOLVING

8

Strategic Rationale

Further Enhances State Street’s Competitive Position

Source: Company filings and websites

Note: Figures based on most recently available public information.  ISPSS AUC as of 30-Jun-2009.

*BK

figure

represents

AUA

as

AUC

is

not

disclosed;

STT

AUA

as

of

30-Sep-09

was

$17.9tn.

**The orange portion of the chart represents the assets STT expects to acquire from Intesa Sanpaolo.

$22.1

$14.9

$13.8

$4.7

$4.5

$4.5

$3.6

$3.3

$11.8

$13.3

$0

$5

$10

$15

$20

$25

BK*

JPM

STT**

Citi

BNP

Soc Gen

HSBC

NTRS

CACEIS

Large Global Custodians by AUC*

Strengthens Position as a Leading Global Custodian

9

Strategic Rationale

Pro Forma Accretion / (Dilution)

•

State Street intends to use existing resources to finance the acquisition

•

Long-term cost synergies and revenue enhancement opportunities

–

2009 ISPSS revenues estimated at €293 million (~$427mm)

–

Expect to remove €60mm (~$90mm) in costs over 5 years

•

Merger & Integration costs estimated at ~€80mm (~$120mm) pre-tax:

–

€43mm (~$64mm) in 2010

–

€22mm (~$32mm) in 2011

•

Identifiable

intangibles

of

approximately

€800

-

€825mm

(~$1.17

-

$1.21bn)

to

be

amortized over approximately 16 years

•

IRR expected to be attractive

•

Modest operating EPS accretion anticipated in 2010

Transaction Generates Attractive Financial Returns

10

Strategic Rationale

Track Record of Successful Acquisitions

•

Transaction allows State Street to further leverage its proven integration expertise as

demonstrated in acquisitions of Deutsche Bank’s Global Securities Services and Investors

Financial businesses

–

Revenue retention rates of approximately 90%

–

Cost synergies delivered on or above original plan

–

Accretion exceeded original plan

–

Significant opportunities for additional cross sell

•

Integration plan to be executed substantially over 24 months with no business disruption

Strong Record of Successful, Accretive Acquisitions

11

Balance Sheet and Capital Impact

7.4%

8.0%

5.0%

a, b

Tier 1 Leverage

16.8%

16.5%

10.0%

a

Total capital

15.6%

15.3%

6.0%

a

Tier 1 capital

5.6%

Q3

2009A

Standalone

Estimated

State Street Corp

5.5%

4.25%

-

4.75%

Tangible Common Equity

“Well capitalized”

/Target

Q2

2010E

a

Minimum “Well Capitalized”

as defined by Federal regulators.

b

Minimum “Well Capitalized,”

as defined by Federal regulators, applies to State Street Bank and Trust only.

c

Target ratio as defined by State Street.

For a description of calculation of the capital ratios, including the estimated ratios, please see appendix to this slide presentation.

•

Expect to acquire €11bn (~$16bn) of cash deposits at closing

•

Expect to support balance sheet with approximately €560mm (~$800mm)

of additional capital

•

Expect to invest in Euro-denominated, short-term government debt

•

Capital ratios well in excess of long-term targets

•

Capital generation capabilities further strengthened by ISPSS transaction

Capital

Balance

Sheet

c

12

Expected Timetable

Key Dates

Substantially Complete in 24 Months

Integration

April –

May 2010

Targeted Closing

Timing / Estimated Timing

Milestone

Agreement Reached

December 21, 2009

Regulatory Approvals

January –

March 2010

13

13

14

14

Appendix

>The ratio of tangible common equity, or TCE ratio, as used by State Street in the foregoing

presentation,

is

calculated

by

dividing

total

consolidated

common

shareholders’

equity

by

consolidated total assets, after reducing both amounts by goodwill and other intangible assets net of

related deferred taxes.  Consolidated total assets reflected in the TCE ratio also exclude cash

balances on deposit at the Federal Reserve and other central banks in excess of required reserves. 

The TCE ratio is not required by GAAP or by bank regulators, but

is a metric used by management

to evaluate the adequacy of State Street capital levels   Since there is no authoritative requirement

to calculate the TCE ratio, State Street’s TCE ratio is not necessarily comparable to similar capital

measures disclosed or used by other companies in the financial services industry. 

>The total capital,  tier 1 capital, and tier 1 leverage ratios are calculated in accordance with

applicable bank regulatory requirements. 

>The estimates of the ratios provided in the foregoing presentation reflect the estimated effects of

the closing of the transaction and assumptions relating to, among other things, the size of cash

deposits acquired, amounts of incremental capital required to support the balance sheet,

investments in Euro-denominated, short-term government debt (each as noted elsewhere in the

presentation) and the continued financial positions of State Street and ISPSS.  Financial information

concerning ISPSS and related estimates are each based on representations made in the acquisition

agreement.

15

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